0:00:02 > 0:00:05Hello. More and more people are building a property portfolio
0:00:05 > 0:00:07and that doesn't have to be as grand as it sounds.
0:00:07 > 0:00:11Even if you can manage to raise a small sum, you can usually find something to buy.
0:00:11 > 0:00:14And that way, you get your foot on the property ladder.
0:00:14 > 0:00:17One good way to do that is to buy at auction.
0:00:42 > 0:00:47Buying at auction is a great way to get good value for money
0:00:47 > 0:00:50and that's essential, especially if you're starting a business.
0:00:50 > 0:00:55If you've done all your research and managed to get finances, you should make quite a success of it.
0:00:55 > 0:00:59So here's what people invested in on today's show.
0:01:00 > 0:01:04'This place is Derby looks quite foxy, so why the exceedingly low guide price?'
0:01:04 > 0:01:09Aha! Looking at the auction catalogue, I can see why.
0:01:10 > 0:01:15'This three-bed semi-detached in Kent gets me reflecting on its interior.'
0:01:15 > 0:01:19There's loads of mirrors everywhere! Good if you need to check the hair.
0:01:20 > 0:01:25'And I'm in Stratford in London where you'll need your property developer goggles for this one.'
0:01:25 > 0:01:30Now, this is a classic case of first looks can be a little deceptive.
0:01:32 > 0:01:37'All these properties are being sold at auction and we'll find out who bought them and what they paid
0:01:37 > 0:01:39- 'when they went under the hammer.' - Sold.
0:01:44 > 0:01:49'I'm in Derby, just a mile from the city centre and not far from the university.'
0:01:49 > 0:01:54So, close to the city centre, great area for letting to students
0:01:54 > 0:01:58and the guide price of the property I'm here to see was 50,000 quid
0:01:58 > 0:02:03which for a three-bed mid terrace sound extraordinary.
0:02:03 > 0:02:07Aha! Looking at the auction catalogue, I can see why
0:02:07 > 0:02:10it had that low guide price. More of that later.
0:02:11 > 0:02:15# Low, low, low, low
0:02:18 > 0:02:24'The reason for the low guide price is because this property is unmortgageable. But why?
0:02:24 > 0:02:26'Let's investigate.'
0:02:27 > 0:02:33So fairly standard layout, straight off the pavement into the front room.
0:02:33 > 0:02:38A few signs of damp but that's not the reason I know it's unmortgageable.
0:02:39 > 0:02:43# Tell me why
0:02:43 > 0:02:46# Tell me why
0:02:49 > 0:02:55Through to the rear sitting room. A solid stone floor which might be a potential problem with damp.
0:02:55 > 0:02:59That's not why it's not mortgageable. Some of the skirting boards are coming off
0:02:59 > 0:03:03and a few cracks here and there, but that's not why it's not mortgageable.
0:03:03 > 0:03:08Through to the rear of the property where you've got this extremely small and fairly sparse kitchen.
0:03:08 > 0:03:11So, is that the reason it's not mortgageable?
0:03:13 > 0:03:15Nope. It's outside.
0:03:15 > 0:03:18# So tell me, what's the answer?
0:03:19 > 0:03:23'The garden is a typical size for this sort of Victorian terrace
0:03:23 > 0:03:28'and, like the inside, could do with some serious attention.'
0:03:28 > 0:03:31Travel down the length of the garden
0:03:31 > 0:03:36and at the end there is... an outside loo.
0:03:37 > 0:03:40And it's the only one in the property.
0:03:40 > 0:03:43Oh! That's why it's not mortgageable.
0:03:45 > 0:03:49'To obtain a mortgage, a property has to be fit for habitation.
0:03:49 > 0:03:52'Having no indoor bathroom or toilet means no mortgage.
0:03:52 > 0:03:59'I certainly wouldn't fancy making a dash from my warm, cosy bed on a dark night to that outdoor loo.'
0:03:59 > 0:04:04# Cos I don't wanna leave
0:04:04 > 0:04:08# Ooh, girl, I gotta go right now
0:04:08 > 0:04:13# I'll be back before you know it so hold that thought
0:04:13 > 0:04:19Upstairs, I have to say, a real pleasant surprise. You've got two good size double bedrooms
0:04:19 > 0:04:24and this at the rear of the property and I guess, in terms of that whole issue with the bathroom,
0:04:24 > 0:04:27this is the obvious place to put it.
0:04:27 > 0:04:31You are going to lose one of the bedrooms, which will have financial implications,
0:04:31 > 0:04:36and to put it in here from scratch you'll have to think about soil pipes, water, electricity.
0:04:36 > 0:04:42So it's not going to be cheap but it's what this property needs and at least you have space to do it.
0:04:45 > 0:04:49'I reckon this rundown terrace will scrub up a treat.
0:04:49 > 0:04:55'Strip and sand the floors and doors, restore the lovely original Victorian fireplaces,
0:04:55 > 0:05:00'I even like this Bakelite light switches, while also renovating to ensure all modern comforts
0:05:00 > 0:05:02'and this place could be a lovely house.
0:05:02 > 0:05:08'If purchased for around the low guide price of 50 grand, this could earn the purchaser a pretty penny.'
0:05:11 > 0:05:16# Low, low, low, low, low
0:05:17 > 0:05:23'We invited the auctioneer who sold it to give us his opinion.'
0:05:23 > 0:05:27This is a fantastic property. I love these sort of places.
0:05:27 > 0:05:30Everything needs doing to it so it's a blank canvas.
0:05:30 > 0:05:34It needs rewiring, a damp-proof course, new flooring,
0:05:34 > 0:05:37it's got old-fashioned fireplaces.
0:05:37 > 0:05:42Having said that, there are the original cast-iron fireplaces upstairs which is quite exciting.
0:05:42 > 0:05:47It needs a bathroom. There's only one obvious place to put it so you have to sacrifice the back bedroom.
0:05:47 > 0:05:51But it becomes a two-bedroom house. Most of them are. It's not problem.
0:05:52 > 0:05:57'Once renovated, what could this achieve on the rental market?'
0:05:57 > 0:06:02There's quite a lot of rented accommodation round here. It's a good first-time buyer area, too.
0:06:02 > 0:06:06But it would rent out very readily once it was renovated
0:06:06 > 0:06:10and I guess you'd be looking at something around £500 per calendar month.
0:06:11 > 0:06:15'Not too bad at all. And sell-on value?'
0:06:15 > 0:06:20Its sale value, once renovated, would be about £95,000.
0:06:24 > 0:06:30So, a pretty solid little terrace in a good location but one big problem.
0:06:30 > 0:06:35It doesn't have a bathroom. Did that put people off? Let's find out when it went under the hammer.
0:06:36 > 0:06:40What am I saying for this one? 50,000? 48.
0:06:40 > 0:06:44Start me where you like. 48,000. 48 is bid here. Thank you.
0:06:44 > 0:06:47At 48. 49 I've got. 50, sir?
0:06:47 > 0:06:5050,000, a fresh bidder. At 50,000. 51.
0:06:50 > 0:06:5351. 52. 53.
0:06:53 > 0:06:5754. 55.
0:06:57 > 0:06:5855,000.
0:06:58 > 0:07:02£55,000 I have. 56 somewhere else?
0:07:02 > 0:07:0556 I've got here on the front row.
0:07:05 > 0:07:08500 he says. 56,500. 57.
0:07:08 > 0:07:1057.
0:07:10 > 0:07:1257,500.
0:07:12 > 0:07:1458. 58,000.
0:07:14 > 0:07:1758,500. 58,500. 59.
0:07:17 > 0:07:2159. At 59,000.
0:07:21 > 0:07:2459,500. 60,000.
0:07:24 > 0:07:27At £60,000 then for the first time.
0:07:27 > 0:07:30For the second time. Third and last opportunity.
0:07:30 > 0:07:33Any higher bid? 500.
0:07:33 > 0:07:3660 and a half. 61? 61.
0:07:36 > 0:07:41500, sir? No? First and last bid, was it? Well tried.
0:07:41 > 0:07:47- £61,000 once. Twice. Third time. - HAMMER BANGS
0:07:47 > 0:07:52'It was Kerry and his husband Alan who made the final bid of £61,000.
0:07:52 > 0:07:54'They have been married for one year.
0:07:56 > 0:08:03'Kerry's a dog handler and Alan's a plasterer, so Kerry will be keeping a tight leash on the budget
0:08:03 > 0:08:07'while Alan gets busy turning this dog's dinner into a prize-winner.'
0:08:07 > 0:08:10# The dog days are over
0:08:10 > 0:08:13# The dog days are all gone
0:08:13 > 0:08:18- Kerry, Alan, good to meet you. Congratulations!- Thank you. - Why did you want to buy this place?
0:08:18 > 0:08:21THEY LAUGH
0:08:21 > 0:08:26- Why did we want to buy this place? - Initially, it was because I'm a plasterer and my work went slack
0:08:26 > 0:08:32so we thought we'd buy a house to use as a hospital job.
0:08:32 > 0:08:36- A hospital job? - Yeah. It's an emergency. When you've got no work, you can drop on it.
0:08:36 > 0:08:39THEY LAUGH
0:08:39 > 0:08:42We bought the house. My work's picked up again now
0:08:42 > 0:08:45so we're waiting for it to go slack again.
0:08:45 > 0:08:47Plastering - that is a great trade.
0:08:47 > 0:08:50Electrics, you're not allowed to. Gas, you're not allowed to.
0:08:50 > 0:08:56- Plastering, most people can't.- Yeah, I've seen some of the plastering that people have attempted to do
0:08:56 > 0:09:01and had to go and put it right. It is one of the finishing touches so it needs to look good.
0:09:01 > 0:09:05- What is it about plastering that's so difficult?- I'm not telling you. It's a trade secret.
0:09:05 > 0:09:08THEY LAUGH
0:09:08 > 0:09:12- What, you're really not?- No. THEY LAUGH
0:09:12 > 0:09:18- It's just practice, like anything else. It's not rocket science. - But it is a great skill to have.
0:09:18 > 0:09:21It's not being a TV presenter. THEY LAUGH
0:09:23 > 0:09:26'Well, Alan described this property as a hospital job.
0:09:26 > 0:09:29'It certainly does need major surgery
0:09:29 > 0:09:32'but the couple have a healthy budget of £15,000
0:09:32 > 0:09:37'and are allowing six months for Alan to play doctor and bring it back to life.'
0:09:37 > 0:09:43- Have you done anything like this before?- You've renovated your own properties, haven't you?- Yeah.
0:09:43 > 0:09:47Not as a business thing but just our own properties that we've lived in.
0:09:47 > 0:09:51But nothing like this, no. We've never been to the auction before.
0:09:51 > 0:09:54- How was it? - It didn't quite go to plan, did it?
0:09:54 > 0:09:57Somebody got auction fever. HE LAUGHS
0:09:57 > 0:10:04Yeah. We did our research and the plan was to go to auction and not to buy.
0:10:04 > 0:10:08We were just going for research purposes. But then this one came up
0:10:08 > 0:10:13and it was in the price bracket that we were looking, so I got a bit carried away...
0:10:13 > 0:10:15I hadn't actually seen inside the property.
0:10:15 > 0:10:18I'd seen outside. But I trust my wife, obviously.
0:10:18 > 0:10:23Went to see about 600 terraced houses and this is the one I hadn't seen.
0:10:23 > 0:10:26So what did you think when you walked in?
0:10:26 > 0:10:30Er, I think it's very good. I think it's a good property to start with.
0:10:30 > 0:10:35I'm a plasterer so nothing really too bad that we can't do. So hopefully it's a good buy.
0:10:35 > 0:10:38What was it that made you so excited about this particular house?
0:10:38 > 0:10:43I like the character of the place. It's got nice old Victorian fireplaces upstairs
0:10:43 > 0:10:45and it just had a nice feel about it.
0:10:45 > 0:10:50Prime student rental area, so it just looked an all-round good investment.
0:10:51 > 0:10:55'Alan will fit the renovation around his plastering job,
0:10:55 > 0:10:58'so no weekends off until the work is done.
0:10:58 > 0:11:02'If the couple can bring this project in on budget and within their six-month schedule,
0:11:02 > 0:11:05'then it certainly would be a good investment.'
0:11:07 > 0:11:11So what's the plan for the future if this goes well?
0:11:11 > 0:11:14Hopefully, not divorce. THEY LAUGH
0:11:14 > 0:11:18We might rent it out. We may see what it's like when it's ready
0:11:18 > 0:11:21and see what we can do, maybe buy some more.
0:11:21 > 0:11:26Yeah, if we can sell it for a reasonable profit, then we may buy another one and do it again,
0:11:26 > 0:11:29- but we'll see how we get on with this one first.- Yeah.
0:11:29 > 0:11:33- Congratulations. Good luck and we look forward to seeing how you get on.- Thank you.
0:11:35 > 0:11:39So, a bit of a surprise for Alan that they ended up with this place
0:11:39 > 0:11:43but he's certainly got the skills to sort the majority of it out.
0:11:43 > 0:11:45And with Kerry's help, I'm sure they'll be all right.
0:11:45 > 0:11:50However, he has only got weekends to do it so it could take a while.
0:11:50 > 0:11:53How are they going to get on? You can find out later in the show.
0:11:59 > 0:12:02'Ah, beautiful Ramsgate in Kent.
0:12:02 > 0:12:06'Bobbing boats on the water and a thriving and bustling community.
0:12:06 > 0:12:09'Perfect for tourists and locals alike.'
0:12:11 > 0:12:16How much do you think a three-bedroom semi-detached period property
0:12:16 > 0:12:19in a desirable part of town could be worth?
0:12:19 > 0:12:21£250,000 perhaps?
0:12:21 > 0:12:23200 grand maybe?
0:12:23 > 0:12:30Well, no. How does a guide of £120,000 to £130,000 sound? Ooh!
0:12:31 > 0:12:34'For a period property in such a prime location,
0:12:34 > 0:12:36'it's definitely worth a look.'
0:12:36 > 0:12:40Wow! You've got a really nicely decorated house.
0:12:40 > 0:12:45What I love about these 30s properties are the little bits of intricate detailing.
0:12:45 > 0:12:47You've got really high ceilings here.
0:12:47 > 0:12:53Could do with a little bit of work, but a really good size lounge, a nice period fireplace.
0:12:53 > 0:12:59There could possibly be enough room for an under-stairs loo here if you're really clever.
0:12:59 > 0:13:01Walking round here into the second reception room.
0:13:01 > 0:13:04This is a brilliant size.
0:13:04 > 0:13:08I would think about knocking through, but actually, when you've got a kitchen placed here,
0:13:08 > 0:13:12I think this space could make a fantastic kitchen/breakfast room.
0:13:12 > 0:13:17So if you were to sort this kitchen out, because it's a complete wreck,
0:13:17 > 0:13:22you could lead out here to the... I'd call it an open-air conservatory
0:13:22 > 0:13:25because right now there is no glass up there at all.
0:13:25 > 0:13:29But I actually think somebody has started work on an extension.
0:13:29 > 0:13:34You can see all the brickwork has been put in. That's probably been there for quite some time.
0:13:34 > 0:13:38You can see down here there's loads of old tiles stacked up.
0:13:38 > 0:13:43'It's certainly a job worth finishing because there's a fair old drop down there to the large garden.
0:13:43 > 0:13:48'Hm. The word railings springs to mind as an obvious solution.
0:13:48 > 0:13:52'But before you go ahead with the work, it would definitely be advisable
0:13:52 > 0:13:56'to make sure that the odd space under the conservatory was safe.'
0:13:56 > 0:14:00# Underneath the arches
0:14:01 > 0:14:05# I dream my dreams away
0:14:05 > 0:14:11'It's hard to imagine what you could use this area for. Handy for storing garden furniture, I suppose.
0:14:11 > 0:14:15'But there's a more pressing issue inside.'
0:14:15 > 0:14:17# Dee-dee-dah-dah-dah-dah
0:14:17 > 0:14:22The one thing I have noticed about this property is there's no central heating
0:14:22 > 0:14:27so you're going to have to factor that into your budget. Also, there's loads of mirrors everywhere!
0:14:27 > 0:14:31Good if you need to check the hair. But, of course, they do reflect loads of light,
0:14:31 > 0:14:33so that's always good to have in a property.
0:14:33 > 0:14:37You've got one, two, three bedrooms, two doubles and a single.
0:14:37 > 0:14:42And a really nice bathroom. Look at that. That's a really good size.
0:14:42 > 0:14:47You've got a roll top bath and an original sink and those beautiful old-fashioned tiles.
0:14:47 > 0:14:52I think you could restore those and it could look fantastic.
0:14:52 > 0:14:55It would take a bit of cash but I think it would be definitely worth doing.
0:14:57 > 0:15:03'The bare bones of this character property are all in place but there will be some hard graft ahead.
0:15:03 > 0:15:07'Stripping the Artex off before you can reveal its true beauty.
0:15:11 > 0:15:13'What does a local property expert think?
0:15:13 > 0:15:17'We've asked one along to have a look and give us his opinion.'
0:15:20 > 0:15:23I think this one's a bit of a doer-upper.
0:15:23 > 0:15:27Having looked round, quite a lot to do, but once the work's done,
0:15:27 > 0:15:31it's in a good location so should represent value for money.
0:15:31 > 0:15:36The garden's quite large. It looks as if it needs quite a lot of work doing.
0:15:36 > 0:15:40But I think, once it's done, it could look very pleasant indeed.
0:15:41 > 0:15:45'Once this place is done up, would this be a good rental opportunity?'
0:15:48 > 0:15:51I think this property would be ideal for letting
0:15:51 > 0:15:57and if you were going to rent this property, you're looking at around about £700 per calendar month.
0:15:59 > 0:16:03'How much could it be worth if the purchaser decided to sell it on?'
0:16:05 > 0:16:10Once this property's renovated, you're going to realistically, in the current market
0:16:10 > 0:16:13be looking at about £165,000.
0:16:14 > 0:16:19A solid period property not far from the sea with scope to add value.
0:16:19 > 0:16:25What's not to like? Somebody fancied it. Let's find out who that was as we go to auction.
0:16:25 > 0:16:28Where are you going to start me on that? £120,000?
0:16:28 > 0:16:31120 can I say? Should fly at 120.
0:16:31 > 0:16:35Give me 110, then. 110. 110, I'm on the way.
0:16:35 > 0:16:37115 now do I see?
0:16:37 > 0:16:40115, I'm obliged. 120. And 5.
0:16:40 > 0:16:42125. 5. And 30.
0:16:42 > 0:16:45130. And 5. 135 if you like.
0:16:45 > 0:16:47At £130,000 bid I've got.
0:16:47 > 0:16:502 I'll take if it will make the difference.
0:16:50 > 0:16:54If not, I've got £130,000 and I will be selling for the first time.
0:16:54 > 0:16:57£130,000 for lot 40 for the second time.
0:16:57 > 0:17:01- Third and final time, if we're all done at £130,000. - HAMMER BANGS
0:17:01 > 0:17:03Madam, you've bought it. A441.
0:17:03 > 0:17:06'Those happy faces belong to partners Colin and Steph
0:17:06 > 0:17:09'who bought the property for £130,000.
0:17:09 > 0:17:15'Just three days before the auction, they both gave up their jobs as comprehensive school art teachers
0:17:15 > 0:17:18'to pursue new ventures.
0:17:18 > 0:17:21'I met the couple back at their first investment property
0:17:21 > 0:17:26'to find out how they plan to turn this place into a masterpiece.'
0:17:27 > 0:17:34- Colin and Steph, congratulations. - Thank you.- What was it about this house that you liked so much?
0:17:34 > 0:17:36The price.
0:17:36 > 0:17:42It was within a budget that we could realistically afford, having just left work.
0:17:42 > 0:17:48And we thought it was a modest way to start into property development.
0:17:48 > 0:17:51Did you view this property prior to the auction?
0:17:51 > 0:17:53Thereby hangs a tale.
0:17:53 > 0:18:00We tried to view it twice and we looked at the outside but never saw the inside until yesterday.
0:18:00 > 0:18:04- Oh. So did you just peer through the letterbox?- Yes, literally.
0:18:04 > 0:18:07- So you bought it on the strength of that?- Yes.
0:18:07 > 0:18:11- At any point did you think, "Oh, what have we done?"- Yes.
0:18:11 > 0:18:14I was in a kind of world of disbelief, anyway.
0:18:14 > 0:18:20I'd just left school and the following Monday I'm there in an auction room.
0:18:20 > 0:18:28Steph did the bidding and the hammer came down and I was just sort of... "Is that it? Do we own a house now?"
0:18:29 > 0:18:33'You certainly do, Colin. And a very quick change of career,
0:18:33 > 0:18:39'not quite overnight but almost. Why did they both give up teaching in the first place?'
0:18:39 > 0:18:42The reason that we stopped teaching, although we loved it,
0:18:42 > 0:18:45we want to make more art of our own.
0:18:45 > 0:18:51But this is a project to make a bit of money to fund that luxury.
0:18:51 > 0:18:55- Tell me about your work.- I'm more of a landscape painter and photographer
0:18:55 > 0:19:01and Steph is a portraitist. We've currently got a little exhibition going on in the town
0:19:01 > 0:19:04and we're hoping things are going to take off.
0:19:04 > 0:19:08But, as I say, it's early days for all of these ventures.
0:19:08 > 0:19:13'On top of all of that, they also run classes back in their studio in Whitstable.'
0:19:13 > 0:19:17# That old master painter from the faraway hills
0:19:17 > 0:19:21# Painted the violets and the daffodils
0:19:21 > 0:19:25# He put the purple in the twilight haze
0:19:25 > 0:19:29# Then did a rainbow for the rainy days
0:19:29 > 0:19:32'So what plans have they drawn up for this property?'
0:19:34 > 0:19:37Well, in the brief time that we've had to look at it,
0:19:37 > 0:19:41we think, especially this room here, we want to extend this room out
0:19:41 > 0:19:45into this half-built conservatory that's here.
0:19:45 > 0:19:49Erm, do the kitchen. That obviously needs to be done.
0:19:49 > 0:19:53Improve the bathroom. And decorate the place.
0:19:53 > 0:19:56How long do you think it's going to take to do this place up?
0:19:56 > 0:20:00We've given ourselves six months but we're fairly new to this game
0:20:00 > 0:20:03and we could... We're going to put a lot of effort and work into it.
0:20:03 > 0:20:08We've always said if we put the same amount of effort into this as we did into the previous career,
0:20:08 > 0:20:11it will be done pretty quickly,
0:20:11 > 0:20:14but we think six months.
0:20:15 > 0:20:19'With a budget of £20,000, they should be able to do a great job.
0:20:19 > 0:20:22'Hopefully there will be no nasty surprises waiting for them.
0:20:22 > 0:20:28'But remember, they paid £130,000 at auction, so if they spend all that budget,
0:20:28 > 0:20:34'I'm a little worried they could hit the ceiling price for this kind of property in this area.
0:20:34 > 0:20:41'Remember, the estate agent's valuation for it, once renovated, was £165,000.'
0:20:42 > 0:20:44What do you think the top value on this will be?
0:20:44 > 0:20:51If we could make £10,000 to £20,000, we'd be happy.
0:20:51 > 0:20:54If we can get over 175 for it,
0:20:54 > 0:21:00then that's roughly what the market is at the moment. That's what we're hoping for.
0:21:00 > 0:21:05I think the way that we're looking at it, even if we don't make very much money on this one,
0:21:05 > 0:21:07it's the first step and it's just...
0:21:07 > 0:21:11As long as we don't lose money on it, that's fine I think.
0:21:11 > 0:21:15It's a shame you're going to be renovating this throughout the winter months.
0:21:15 > 0:21:18Cos this would be an amazing property to renovate throughout the summer
0:21:18 > 0:21:22- because Ramsgate's great in the summer.- Yes, that's right.
0:21:22 > 0:21:24The sea's just two minutes down the road there.
0:21:24 > 0:21:28You can see it from the bedroom. It's a lovely area.
0:21:28 > 0:21:33But maybe it'll be finished at the right time of the year to show it off at its best.
0:21:33 > 0:21:39You see, already she's looking at it through a developer's eyes. I like it, Steph! Way to go!
0:21:39 > 0:21:42It's been brilliant meeting you both. I can't wait to see what you do.
0:21:42 > 0:21:48- I'm sure it's going to be a huge success for you. Congratulations. Well done.- Thank you.- Thanks.
0:21:48 > 0:21:54Giving up a steady job on the Friday and purchasing an investment property on the Monday.
0:21:54 > 0:21:58Not a lot of us can say we've done that! Well, Colin and Steph can.
0:21:58 > 0:22:01The artists have definitely taken a risk.
0:22:01 > 0:22:04But will those teachers learn any lessons from this project?
0:22:04 > 0:22:07You can find out what happens later on in the programme.
0:22:08 > 0:22:12'Coming up, this rundown house in London isn't as bad as it looks.'
0:22:12 > 0:22:17Looks like it's in need of tender loving care, but apart from that...
0:22:18 > 0:22:21'This house on the Kent coast was covered in Artex.
0:22:21 > 0:22:25'How have Colin and Steph got on chipping it away?'
0:22:25 > 0:22:28Going round looking like snowmen.
0:22:29 > 0:22:33'But first, husband and wife team Kerry and Alan
0:22:33 > 0:22:38- 'reveal the secret behind their successful relationship.' - What the wife wants, she gets.
0:22:40 > 0:22:46'Let's return to the terraced streets of Derby
0:22:46 > 0:22:52'where I viewed this three-bedroom house with a low guide price of £50,000.
0:22:52 > 0:22:54'"Why was that?" I hear you ask.
0:22:54 > 0:22:59'Well, it wasn't just because of the dilapidated and damp interior.
0:22:59 > 0:23:04'But also because the only loo was at the back of this rubbish-strewn garden.
0:23:06 > 0:23:13'The property was bought at auction for £61,000 by plasterer Alan and dog handler Kerry
0:23:13 > 0:23:16'who, caught up in the excitement of the auction,
0:23:16 > 0:23:19'and much to Alan's surprise, started bidding for the house.'
0:23:22 > 0:23:26- Have you done this before?- No. We've never been to the auction before. - How was it?
0:23:26 > 0:23:29- Didn't quite go to plan, did it? - Somebody got auction fever.
0:23:29 > 0:23:35The plan was to go to auction and not to buy, we were just going for research purposes.
0:23:35 > 0:23:39But then this one came up and I got a bit carried away.
0:23:39 > 0:23:43'Well, their purchase price coupled with the amount of work needed
0:23:43 > 0:23:48'meant they would need to keep a close eye on their 15 grand budget to ensure a profit.
0:23:48 > 0:23:53'So, will Kerry's auction fever leave them in a sweat about their financial investment
0:23:53 > 0:23:57'or will it earn them red-hot returns?
0:24:00 > 0:24:04'Six months later, we've returned to find out.'
0:24:04 > 0:24:08# Fever sure has got me good
0:24:08 > 0:24:12# What do you do when fever takes hold?
0:24:12 > 0:24:17# Don't you feel the fever like I do?
0:24:20 > 0:24:24'The front reception room was rundown and damp-ridden.
0:24:25 > 0:24:28'Now it's clean and fresh.'
0:24:30 > 0:24:34Oh, the damp was a big issue in this house. The floors needed doing.
0:24:34 > 0:24:37The skirting had all got wet rot and everything.
0:24:37 > 0:24:40We just had to hack all the plaster off and redo it all.
0:24:40 > 0:24:44So it was a major issue. All the wallpaper was falling off.
0:24:44 > 0:24:48- Oh, it was terrible.- Yeah. Particularly in the dining room,
0:24:48 > 0:24:52the skirting boards were just hanging off, they were rotten,
0:24:52 > 0:24:58- falling to pieces. So it was a big job that needed to be sorted out. But it's all done now.- All good.
0:25:00 > 0:25:05'Alan's fine touch with the trowel has left the walls and ceilings as smooth as glass.
0:25:05 > 0:25:09'And in the kitchen, which had nothing but the kitchen sink,
0:25:09 > 0:25:13'they've made the best use of a tight space.'
0:25:16 > 0:25:21The kitchen was quite problematic because it's a very small space
0:25:21 > 0:25:24and so we were very restricted with how we could lay it out.
0:25:24 > 0:25:30The main solution we came up with was to knock the wall down between the kitchen and the dining room
0:25:30 > 0:25:35just to allow a better flow of light through and give you the illusion of more space if nothing else.
0:25:35 > 0:25:38I was very conscious of making sure there was enough cupboard space.
0:25:38 > 0:25:44Depending on how many people live in the house, we need to make sure it's a practical, workable kitchen.
0:25:44 > 0:25:50With the kitchen sink, we went for a smaller one so that we could just utilise the space a bit better.
0:25:50 > 0:25:54I think it worked out well, particularly with knocking the wall down.
0:25:54 > 0:25:58That was the main thing that just made it feel a bit more open.
0:25:59 > 0:26:01'Alongside their excellent work in the kitchen,
0:26:01 > 0:26:04'they've also installed a central heating system,
0:26:04 > 0:26:08'new electrics and replaced all the windows and exterior doors.
0:26:11 > 0:26:14'Out back, the wild garden has been tamed.
0:26:20 > 0:26:25'And I'm glad to see the fox knocker from the front door has been given a new home,
0:26:25 > 0:26:27'hanging on the door to the outside loo.'
0:26:28 > 0:26:32I spotted the fox on the front door when we first bought the house
0:26:32 > 0:26:37and I'm a bit of an animal lover and I thought it was a nice little feature.
0:26:37 > 0:26:41- We had the ritual last night, didn't we?- Yeah, when we finished the garden
0:26:41 > 0:26:45and finished everything, we went and put Mr Fox on the toilet door in the garden
0:26:45 > 0:26:50so he can remain... as just a little additional feature.
0:26:50 > 0:26:54Might not be to everybody's taste, but I liked him.
0:26:56 > 0:26:58'Now let's take a look upstairs.
0:26:58 > 0:27:03'There were three bedrooms but the smallest has been transformed into the bathroom.'
0:27:07 > 0:27:11Basically, this was the third bedroom. There was nothing in the room at all
0:27:11 > 0:27:16so we got the plumber to put all the hot and cold feeds and the waste pipes in
0:27:16 > 0:27:19and we managed to get the P-shaped bath in.
0:27:19 > 0:27:24We've incorporated the shower. Rather than have a separate shower, we thought we'd keep it all in one area.
0:27:24 > 0:27:30Tiled everything, all the floor and the walls, and we think it looks super. We're well happy with it.
0:27:34 > 0:27:39'In the two remaining bedrooms, the couple have managed to restore the original Victorian fireplaces,
0:27:39 > 0:27:43'and as they have with the rest of the house, stripped and varnished the doors.'
0:27:47 > 0:27:54I love the original features. I'm a big fan of that sort of thing. I love the fireplaces and the doors.
0:27:54 > 0:28:00I'm very pleased, cos we had the doors stripped. Rather than replace them with new, modern ones,
0:28:00 > 0:28:05we thought we'd make use of what was already here and they've come up really nice. I'm really pleased.
0:28:05 > 0:28:09'This renovation has been carried out on evenings and weekends
0:28:09 > 0:28:12'as both Kerry and Alan have full-time jobs.
0:28:12 > 0:28:17'However, they've managed to finish one month ahead of their six-month deadline.
0:28:17 > 0:28:22'But they've spent £17,000, £2,000 more than they'd budgeted.
0:28:22 > 0:28:26'That takes their total outlay to £78,000.
0:28:28 > 0:28:32'Let's find out what two local property experts think
0:28:32 > 0:28:35'of Kerry and Alan's handiwork.'
0:28:38 > 0:28:43I'm really impressed. It's got a very clean, tidy, neat look to it.
0:28:43 > 0:28:48I suppose if you paint everywhere white, you get that effect.
0:28:48 > 0:28:52It's a bit clinical but it does impress you, certainly.
0:28:53 > 0:28:56First impressions of the property are good.
0:28:56 > 0:28:58You walk in, it's immediately apparent
0:28:58 > 0:29:03that everything has been taken back to brick and rebuilt again.
0:29:04 > 0:29:06'The experts are impressed.
0:29:06 > 0:29:11'How much do they believe this place could achieve on the rental market?'
0:29:11 > 0:29:16I think if you got a prospective tenant through the door here, they'd be impressed,
0:29:16 > 0:29:21so I would say you'd probably achieve £500 per calendar month, but that might be optimistic.
0:29:21 > 0:29:27The rental value on the property, I would expect, with it being brand new throughout,
0:29:27 > 0:29:31to achieve around £475 per calendar month.
0:29:32 > 0:29:35'Those figures are in line with Kerry and Alan's expectations
0:29:35 > 0:29:39'and would earn them a rental yield of between 7% and 8%.
0:29:39 > 0:29:45'But they hope to sell this property on, so how much do the experts believe this terrace could go for?'
0:29:48 > 0:29:53Resale value of the property on today's market, which is not the best market we've had,
0:29:53 > 0:29:57I would say would be £95,000 to £100,000.
0:29:57 > 0:30:02Resale value, I would suggest between £95,000 and £100,000.
0:30:03 > 0:30:09'Those valuations could earn Kerry and Alan a pre-tax profit of between £17,000 and £22,000.
0:30:09 > 0:30:11'Not too bad at all.
0:30:14 > 0:30:20'So, looking back at the auction, does Alan wish Kerry had kept her cool after all?'
0:30:20 > 0:30:27I thought we were just going on a reconnaissance mission, but what the wife wants, the wife gets.
0:30:28 > 0:30:32- Yeah, I think we're both agreed that it's been a good purchase.- Yeah.
0:30:32 > 0:30:35And we're really glad that we did it.
0:30:35 > 0:30:37# Feel the fever
0:30:41 > 0:30:46'Welcome to Stratford in East London, home of the Olympic village.
0:30:46 > 0:30:50'There's a massive amount of development in both road and rail links here
0:30:50 > 0:30:53'and with those comes a resurgence for the whole area.'
0:30:53 > 0:30:55# I'm moving on up now
0:30:57 > 0:31:00# Getting out of the darkness
0:31:01 > 0:31:06Certainly this location in central Stratford, at first glance, doesn't look too bad.
0:31:06 > 0:31:08The University of East London is quite close by,
0:31:08 > 0:31:11so potential for student lets there.
0:31:11 > 0:31:17And of course, the 2012 games. That's got to high jump prices for sure.
0:31:17 > 0:31:20And this is what I'm here to see. Two-storey mid-terrace.
0:31:20 > 0:31:22Had a guide price of 160,000 quid.
0:31:22 > 0:31:26Doesn't look too bad from the outside. Let's take a look inside.
0:31:30 > 0:31:32Hm, OK.
0:31:32 > 0:31:35It's not a bad start. Nice high ceilings.
0:31:35 > 0:31:41Looks like it's in need of a bit of tender loving care, but apart from that...
0:31:43 > 0:31:45Right.
0:31:45 > 0:31:48Now, this is a case of first looks can be a little deceptive.
0:31:48 > 0:31:51As you can see, it is in a right old state.
0:31:51 > 0:31:55But this is one of those classic examples of where you have to look through the clutter
0:31:55 > 0:31:59to what this place could actually become. All in all, it's not a bad size room.
0:32:01 > 0:32:03Hm.
0:32:03 > 0:32:07'Most of this is just superficial, really.'
0:32:07 > 0:32:10# I'm in a really big mess
0:32:10 > 0:32:13'Nothing that a day's tidying up couldn't sort out.
0:32:13 > 0:32:16'The actual fabric of the building looks generally OK
0:32:16 > 0:32:19'and it's a pretty good size.'
0:32:19 > 0:32:22So through to the very rear of the property where the kitchen is located.
0:32:22 > 0:32:27It's actually not a bad size. Clearly you want to completely rip it out and start again.
0:32:27 > 0:32:33But I love that fact that it's looking onto the garden. You could put French doors in there
0:32:33 > 0:32:36to make this a really lovely, usable space. Oh.
0:32:36 > 0:32:41You know what? I don't see why I should suffer this kind of thing alone. Cup of coffee, anybody?
0:32:41 > 0:32:45'Urgh! No, thought you'd pass on that offer.
0:32:45 > 0:32:50'But look beyond the dirt and grime and you'll see the kitchen's well proportioned.
0:32:51 > 0:32:56'There's also a cellar and downstairs cloakroom, so plenty of food for thought here.
0:32:56 > 0:33:02'And there's a good size bathroom and bedroom on the first level of a split landing.
0:33:08 > 0:33:11'There are two further bedrooms at the top of the stairs.
0:33:11 > 0:33:17'I'm beginning to wonder if this house could be turned into student lets or maybe a couple of flats.
0:33:17 > 0:33:20'It's certainly not short of space here.'
0:33:25 > 0:33:28Well, at the rear of the property, there is a reasonable sized garden.
0:33:28 > 0:33:31Like the rest of the house, it is in a bit of a mess.
0:33:31 > 0:33:34But when you come out here, you can see that at some stage
0:33:34 > 0:33:38an extension has been built on the back. It mirrors the one next door.
0:33:38 > 0:33:41It gives you a lot of extra space. Could you extend it even further?
0:33:41 > 0:33:46I think you'd have to apply for planning permission, but maybe some kind of extra extension there,
0:33:46 > 0:33:50maybe a conservatory. Either way, it's a way of adding value.
0:33:50 > 0:33:53Just make sure you don't spend too much to get back what you put in.
0:33:53 > 0:33:57'This is an interesting one because there are options.
0:33:57 > 0:34:02'Clearly the easiest and cheapest approach would be to give it a thorough refurbishment
0:34:02 > 0:34:04'and let it out or sell on.
0:34:04 > 0:34:10'But I think either room-by-room lets or conversion into two flats might work.
0:34:10 > 0:34:14'But it really depends on the demands of the market in the area.
0:34:14 > 0:34:18'So we asked a local estate agent for his advice.'
0:34:18 > 0:34:22I would actually keep it as a single dwelling.
0:34:22 > 0:34:25There is possibility here to turn it into flats,
0:34:25 > 0:34:28but this area at the moment is being redeveloped heavily
0:34:28 > 0:34:34by large-scale developers who are building nothing other than one, two and three-bedroom flats.
0:34:34 > 0:34:40So my estimation is that the market for houses
0:34:40 > 0:34:43will be much stronger in the future.
0:34:43 > 0:34:47'So it does seem that keeping this as a house may be the way forward.
0:34:47 > 0:34:50'How would it fair on the rental market?'
0:34:51 > 0:34:58For rental purposes, in good order, a property like this will achieve around £1,500 per calendar month.
0:34:58 > 0:35:02'If a full refurbishment was done, how would this place,
0:35:02 > 0:35:07'that was guided at £160,000, do on the resale market?'
0:35:07 > 0:35:14In good order, I think you will be lucky to realise somewhere around about £375,000.
0:35:14 > 0:35:20'Wow! That's a massive increase from the guide price of £160,000,
0:35:20 > 0:35:22'even factoring in renovation costs.
0:35:22 > 0:35:26'So scratch the surface and you might not have to be an Olympic athlete
0:35:26 > 0:35:29'to strike gold in Stratford.'
0:35:31 > 0:35:36Well, this is a classic case of the property where you have to see through the superficial mess
0:35:36 > 0:35:41to what it could actually become, and I think a potentially lucrative venture.
0:35:41 > 0:35:45Do you convert this into flats or keep this as it is. You need to do research on that.
0:35:45 > 0:35:50But either way, I think there's money to be made. Let's see who bought it at the auction.
0:35:52 > 0:35:56Right, lot six is a three-bed mid-terraced house.
0:35:56 > 0:35:58Requires modernisation.
0:35:58 > 0:36:02I don't know, start low? 150? 150 in the front.
0:36:02 > 0:36:06155. 155. 160.
0:36:06 > 0:36:09165. 170.
0:36:09 > 0:36:11175. 180.
0:36:11 > 0:36:14185. 190.
0:36:14 > 0:36:18195. 200. I'll get there in the end.
0:36:18 > 0:36:20205. 210.
0:36:20 > 0:36:23210. 210 with you.
0:36:26 > 0:36:28That's what I like. 215. 220.
0:36:28 > 0:36:31225. 230, sir.
0:36:31 > 0:36:33235. 240.
0:36:33 > 0:36:36245. 250.
0:36:36 > 0:36:38255. 260.
0:36:38 > 0:36:42265. 270.
0:36:42 > 0:36:45271. 272.
0:36:49 > 0:36:51Have a think. 271 down here.
0:36:51 > 0:36:56272 elsewhere? Anyone else coming or coming back in? 272?
0:36:56 > 0:36:59If not, 271, first time.
0:36:59 > 0:37:01Second time.
0:37:01 > 0:37:05- Third and last time if you're all done. - HAMMER BANGS
0:37:05 > 0:37:07Sold 271 to you, sir.
0:37:07 > 0:37:15'So, for a whopping £111,000 over the guide price at £271,000,
0:37:15 > 0:37:20'the new owner of the three-bed property in Stratford is full-time developer Delawa.
0:37:20 > 0:37:25'He joined me, along with his builder Amrik, to outline the plans.'
0:37:25 > 0:37:28- Amrik, Delawa, lovely to meet you. Congratulations.- Thank you.
0:37:28 > 0:37:33- Tell me why you wanted to buy this place.- Well, it's mainly location.
0:37:33 > 0:37:37Stratford is a coming up area, so we thought...
0:37:37 > 0:37:43I bought over the odds, but I still like the area. I've got a few properties here.
0:37:43 > 0:37:46Tell me a bit more about you and your background.
0:37:46 > 0:37:51Well, I used to work for the railways at one time
0:37:51 > 0:37:54and at the same time I was buying properties.
0:37:54 > 0:37:59And then in 2000, we made a property company.
0:37:59 > 0:38:03- And how many properties do you now have?- A few.- A few?
0:38:03 > 0:38:09- More than ten, less than 100.- Maybe. THEY LAUGH
0:38:09 > 0:38:12So tell me about the relationship between you two.
0:38:12 > 0:38:16Well, we are friends and he's my project manager.
0:38:16 > 0:38:20We've been working for at least ten years, maybe more.
0:38:20 > 0:38:25'Over the years, this successful business arrangement has worked on a number of projects.
0:38:25 > 0:38:29'But I was intrigued to know what they had planned for this, their latest development.'
0:38:30 > 0:38:36- Tell me what you're planning to do with this house.- We're thinking of converting it into two flats.
0:38:36 > 0:38:42- OK. And your job is going to be doing that, it is?- Yeah. We'll be demolishing most of the walls.
0:38:42 > 0:38:48- Wow.- And on the first floor, hopefully, there will be a one-bedroom flat,
0:38:48 > 0:38:54self-contained, so kitchen, bathroom, living room and one bedroom.
0:38:54 > 0:38:58And downstairs, we're going to do an extension in the back for the kitchen
0:38:58 > 0:39:05and then two bedrooms in the front and the living room, bathroom and the kitchen downstairs.
0:39:05 > 0:39:08Why do flats over keeping it as a house?
0:39:08 > 0:39:13By making it two flats, it's better, you get better income.
0:39:13 > 0:39:21I know you have to spend. And also, if you want to sell it, there's two flats, you get more money for it.
0:39:21 > 0:39:26'I think Delawa and Amrik may have trouble getting their plans approved.
0:39:26 > 0:39:31'That's because, as we've already heard, a large number of flats are already being built in the area
0:39:31 > 0:39:34'due to the 2012 Olympics
0:39:34 > 0:39:36'and that could affect the planner's final decision.
0:39:36 > 0:39:40'So keeping it as a house may end up being a better option.
0:39:40 > 0:39:43'But they're determined to press ahead,
0:39:43 > 0:39:47'not only with the conversion but also with building an extension.
0:39:47 > 0:39:53'They paid £271,000 at auction, plus stamp duty of just over eight grand,
0:39:53 > 0:39:55'and the costs are rising.'
0:39:55 > 0:39:58What kind of budget have you got for doing the work?
0:39:59 > 0:40:03We're thinking about £50,000 to do it up.
0:40:03 > 0:40:08- So let's see if we can stick to it. - And what kind of timescale?
0:40:08 > 0:40:14It'll take us about five to six months because the planning permission...
0:40:14 > 0:40:18- The planning permission will take about three months. - It takes ten to 12 weeks.
0:40:18 > 0:40:23- Listen, congratulations, and we look forward to seeing how you get on. - Thank you very much.
0:40:24 > 0:40:29Well, with so many properties under their belts, this team can certainly make a success of this project.
0:40:29 > 0:40:32However, they did spend a lot of money over that guide price.
0:40:32 > 0:40:37And is converting to flats the right thing to do? You can find out later in the show.
0:40:40 > 0:40:47The big question is, have our buyers made the most of their investments or created a dream home?
0:40:47 > 0:40:49Have their efforts at improving them paid off?
0:40:49 > 0:40:53Well, time has passed. Let's go back and see what those properties look like now.
0:40:55 > 0:41:00'Let's head back to the blue skies and sunshine of Ramsgate on the Kent coast.
0:41:03 > 0:41:07'To this three-bedroom semi, a stone's throw from the harbour.
0:41:08 > 0:41:13'It was in dire need of modernisation from the floorboards up.
0:41:13 > 0:41:18'Also, the house was a horror show of every developer's nightmare - Artex!
0:41:21 > 0:41:24'It's enough to drive you mad.
0:41:30 > 0:41:34'Whoever purchased this dilapidated and dingy property
0:41:34 > 0:41:36'would need not only a flair for decoration
0:41:36 > 0:41:39'but a determination to get the job done.
0:41:39 > 0:41:42'And that's exactly what Colin and Steph had by the bucketful.
0:41:42 > 0:41:47'They'd packed in their jobs as art teachers at a local school,
0:41:47 > 0:41:51'opened their own artist studio and invested all their savings
0:41:51 > 0:41:54'into the £130,000 purchase of this semi.
0:41:54 > 0:41:57'It was to be their first development.'
0:41:57 > 0:42:00Guys, what is the grand plan now for you both?
0:42:00 > 0:42:03The reason that we stopped teaching, although we loved it,
0:42:03 > 0:42:06we want to make more art of our own.
0:42:06 > 0:42:12But this is a project to make a bit of money to fund that luxury.
0:42:12 > 0:42:16'We returned after six months to find out how they'd got on.
0:42:20 > 0:42:23'Well, it's more mess than masterpiece.
0:42:23 > 0:42:26'Let's see what Colin and Steph have been up to inside.'
0:42:27 > 0:42:33# Could you be the one to see the masterpiece in me?
0:42:35 > 0:42:39'Well, what a transformation from dank and dreary
0:42:39 > 0:42:43'to a simply stunning open-plan living and kitchen area.
0:42:45 > 0:42:49'That leads onto this wonderful conservatory with sliding patio doors.
0:42:53 > 0:42:58'It bathes the room in seaside sunshine. Really lovely!
0:42:58 > 0:43:02'So how did the couple enjoy doing the renovation?'
0:43:02 > 0:43:05Great! We've really enjoyed doing it.
0:43:05 > 0:43:11I mean, it's very satisfying, turning what was a bit of an old wreck into something quite nice.
0:43:11 > 0:43:14'The kitchen is sleek and stylish.
0:43:14 > 0:43:20'The couple's artistic eye is evident in the aquatic hues of the tiles and the bold splash back.
0:43:22 > 0:43:26'The living room, once drowned in a sea of Artex,
0:43:26 > 0:43:28'now has clean, crisp lines.'
0:43:33 > 0:43:37The Artex was a nightmare to get away,
0:43:37 > 0:43:40scraping and getting covered in dust.
0:43:40 > 0:43:43We were going round looking like snowmen.
0:43:45 > 0:43:49'Let's head on upstairs.
0:43:51 > 0:43:54'The bedrooms have been given a splash of colour
0:43:54 > 0:43:58'with the skirting and architrave painted in sea blues and greens.
0:43:59 > 0:44:04'The renovation has been hard work and far from plain sailing.
0:44:04 > 0:44:09'Colin broke his leg at their own home four months into the makeover.'
0:44:09 > 0:44:14I was going down into the studio before going to bed to have a look at some work,
0:44:14 > 0:44:20stepped with my left leg and the cat was on the next step down
0:44:20 > 0:44:27so I moved my left leg to avoid him and that went slipping on down the stairs
0:44:27 > 0:44:30and this broken one stayed behind on the top step.
0:44:30 > 0:44:34I didn't think it was broken at the time. I did scream a bit.
0:44:34 > 0:44:37# I slipped, I stumbled, I fell
0:44:37 > 0:44:42# I slipped, I stumbled, I fell
0:44:43 > 0:44:47'Colin's broken leg has slowed down their progress.
0:44:48 > 0:44:53'They've still to tackle the rear garden and have some finishing touches to do inside.
0:44:54 > 0:45:02'And I wonder, have they also broken the bank by overspending on their £20,000 budget?'
0:45:02 > 0:45:09It's 25ish. I haven't got a final figure, but it's around 25.
0:45:09 > 0:45:13We put good quality stuff in, so it's just edged up a little bit.
0:45:14 > 0:45:17'That quality is evident in the bathroom.
0:45:19 > 0:45:25'I'm sorry to see the roll top bath has gone, but the couple have chosen a clean and tidy contemporary look.'
0:45:28 > 0:45:31I'm actually standing where the bath was.
0:45:31 > 0:45:36The bath was going this way and we thought it would make the bathroom look bigger to turn it round.
0:45:36 > 0:45:41But we've just left it very simple.
0:45:41 > 0:45:43I mean, I love these seaside colours.
0:45:43 > 0:45:48Because we're so close to the sea here, we wanted to make it fairly seaside-y.
0:45:50 > 0:45:54'Steph and Colin have undergone a dramatic lifestyle change
0:45:54 > 0:45:59'from school teachers to property developers, working alongside each other day in, day out.'
0:45:59 > 0:46:03It's been lovely working on these things together.
0:46:03 > 0:46:07Colin leaves design stuff to me
0:46:07 > 0:46:10and I leave all the heavy work to him.
0:46:10 > 0:46:14We know what our strengths and weaknesses are.
0:46:14 > 0:46:22We've found a very...a very good place for us to work together.
0:46:22 > 0:46:26And more recently, when I've had a little mishap and broken my ankle,
0:46:26 > 0:46:32she's taken over and done all of the jobs just seamlessly.
0:46:32 > 0:46:36She's finished the tiling and things like that. So we work very well together.
0:46:36 > 0:46:41# Oh, you could say it was a work of art
0:46:41 > 0:46:43# Like someone took a brush
0:46:43 > 0:46:46# And painted their hearts
0:46:46 > 0:46:51# Together they've made such a beautiful thing
0:46:52 > 0:46:55'The couple have invested all their savings in this property
0:46:55 > 0:47:00'and so far they've spent a total of £155,000.'
0:47:01 > 0:47:05# Love is a masterpiece
0:47:07 > 0:47:10'We invited two local estate agents
0:47:10 > 0:47:12'to tell us whether Colin and Steph's investment
0:47:12 > 0:47:15'is a money-maker or a money pit.'
0:47:15 > 0:47:20They've really made a good job. It's really light, good colours.
0:47:20 > 0:47:22The conservatory on the back's fantastic.
0:47:22 > 0:47:26I think that's going to make a big difference to its saleability.
0:47:26 > 0:47:30Having has a look round, I think it's been done to a very good standard.
0:47:30 > 0:47:34Obviously, central heating's been put in, double glazing throughout.
0:47:34 > 0:47:37Very nice, neutral colours. I think they've done a very good job.
0:47:38 > 0:47:41'Colin and Steph plan to sell this property,
0:47:41 > 0:47:45'releasing the capital to fund their next renovation.
0:47:45 > 0:47:49'So what do the estate agents believe this property could achieve,
0:47:49 > 0:47:54'bearing in mind their total outlay of £155,000 so far?'
0:47:55 > 0:47:59I think this property's been done up to a really nice standard
0:47:59 > 0:48:03and you're going to be looking at around about £170,000.
0:48:03 > 0:48:08In the current climate, I would estimate putting this on at around £175,000.
0:48:08 > 0:48:12Erm... They're slightly lower than we had hoped.
0:48:12 > 0:48:16I think the house is worth what somebody's willing to pay for it
0:48:16 > 0:48:21and we've been looking at house prices around here
0:48:21 > 0:48:26and seen that houses like this have been selling for 185 or upwards.
0:48:26 > 0:48:30So we think we might stick out for a little bit more.
0:48:33 > 0:48:38'This has been the couple's first foray into property development. Are they keen to give it another crack?'
0:48:40 > 0:48:44It's been good fun. And it's very satisfying, isn't it,
0:48:44 > 0:48:48seeing it like this now and thinking what it was like.
0:48:48 > 0:48:51To be honest, at the beginning I had no confidence
0:48:51 > 0:48:57to do some of the things that now I'm quite proud of what we've achieved.
0:48:57 > 0:49:02And I feel really eager to take my skills forward into the next project.
0:49:02 > 0:49:05# Nothing but blue skies
0:49:05 > 0:49:08# From now on
0:49:15 > 0:49:22'With the Olympic Games right on its doorstep, Stratford in the East End of London is undergoing big changes
0:49:22 > 0:49:24'and property prices here are on the up.
0:49:24 > 0:49:29'So when a three-bed terraced house came up for auction at a guide price of £160,000,
0:49:29 > 0:49:33'it wasn't surprising that there was a lot of interest.
0:49:33 > 0:49:38'It exceeded that guide price by a whopping £111,000.'
0:49:40 > 0:49:42Sold, 271, to you, sir.
0:49:42 > 0:49:47'It was property developer Delawa who paid that £271,000.
0:49:47 > 0:49:51'Along with his builder Amrik, he saw it as a golden opportunity
0:49:51 > 0:49:54'to turn this house into a rent machine.'
0:49:54 > 0:49:57Tell me what you're planning to do with this house.
0:49:57 > 0:50:01- We're thinking of converting it into two flats.- On the first floor,
0:50:01 > 0:50:05hopefully there will be a one-bedroom flat
0:50:05 > 0:50:09and downstairs will be an extension in the back for the kitchen
0:50:09 > 0:50:11and then two bedrooms in the front.
0:50:11 > 0:50:14'With so many new flats being built in the area,
0:50:14 > 0:50:18'I thought keeping the building as a house might have been a better option.
0:50:18 > 0:50:22'But undeterred and armed with a £50,000 budget,
0:50:22 > 0:50:30'the pair decided to press ahead, submit their plans to the local authority and hope for the best.
0:50:30 > 0:50:35'Six months later, we return to see how they got on.
0:50:37 > 0:50:42'Well, the outside's certainly much improved. Gone is the boarded up door
0:50:42 > 0:50:44'and single-glazed sash windows
0:50:44 > 0:50:48'to be replaced by a UPVC door and double glazing.
0:50:48 > 0:50:51'And the exterior plaster work has been given a lick of paint.
0:50:51 > 0:50:56'Inside, how's it going converting this into two flats?'
0:50:57 > 0:51:00Unfortunately, we couldn't get the planning permission
0:51:00 > 0:51:05so we had to replan everything to convert it back into a house.
0:51:05 > 0:51:12We wasted two or three months, as well, plus the money.
0:51:12 > 0:51:15'It seems they fell at the first hurdle.
0:51:15 > 0:51:17'In the end, the planners rejected it
0:51:17 > 0:51:21'on the grounds that the building was too small for a two-flat conversion.
0:51:21 > 0:51:24'So it was out with plan A and in with plan B,
0:51:24 > 0:51:28'renovate the house for the rental market and make the most of the living space.
0:51:30 > 0:51:33'The front reception room is no longer open plan,
0:51:33 > 0:51:37'with the wall reinstated to make two separate reception rooms.
0:51:41 > 0:51:46'And the kitchen? Well, that's moved back a bit.'
0:51:46 > 0:51:50This is the single-storey extension to create a bigger kitchen.
0:51:50 > 0:51:56We have a couple more extra units and then the opening into the dining room
0:51:56 > 0:51:59to create a nice kitchen for a nice big family.
0:51:59 > 0:52:03'Because of the size of the extension, it didn't require planning permission.
0:52:03 > 0:52:09'So they avoided any further delays and have maximised the space as much as possible.
0:52:13 > 0:52:17'They put a shower in the downstairs toilet area.
0:52:18 > 0:52:22'And completely altered the dark, dingy cellar.'
0:52:22 > 0:52:27This was the old big cellar full of junk and rubbish and stuff.
0:52:27 > 0:52:32We plastered all the walls, put in a couple of windows for the light,
0:52:32 > 0:52:35air bricks for ventilation and put the new ceiling up
0:52:35 > 0:52:40and a partition to make two rooms for storage or whatever they're used for.
0:52:40 > 0:52:45'Although the two rooms in the cellar can't be used as bedrooms due to building regulations,
0:52:45 > 0:52:50'they do offer a fantastic bonus to an already decent-sized house.
0:52:50 > 0:52:58'Upstairs on the half landing, the bathroom and bedroom have been refurbished and redecorated.
0:52:59 > 0:53:04'Whilst at the top of the stairs, the two other bedrooms have been given a similar neutral finish.
0:53:05 > 0:53:08'New carpet has been laid and there are new curtains.
0:53:08 > 0:53:12'So the house is looking spick and span and ready to let.'
0:53:13 > 0:53:18Actually, it's been let already. I've got two offers. I have to decide.
0:53:19 > 0:53:22'It's great to hear there's competition for tenancy here.
0:53:22 > 0:53:28'But having spent £271,000 already on buying the property,
0:53:28 > 0:53:31'how much has it cost to get this three-bed house ready to rent out?'
0:53:33 > 0:53:39If there was two flats, we would've spent about £50,000.
0:53:39 > 0:53:43But as it is now, we've spent about £35,000.
0:53:44 > 0:53:50'£35,000 on top of that £271,000 purchase price,
0:53:50 > 0:53:52'plus stamp duty at three percent,
0:53:52 > 0:53:58'takes Delawa's total outlay to around £315,000, not including fees.
0:53:58 > 0:54:02'Has keeping this as a single dwelling paid off?
0:54:02 > 0:54:04'What do two local estate agents think?'
0:54:07 > 0:54:10First impressions are that the house is a very good size
0:54:10 > 0:54:12and the bedrooms are brilliant, three doubles.
0:54:12 > 0:54:16And the best thing about the house is having an upstairs bathroom.
0:54:16 > 0:54:20In this area, a lot of properties have downstairs bathrooms, which many families don't like.
0:54:20 > 0:54:24The property has undergone a vast transformation
0:54:24 > 0:54:27from what it was before previously.
0:54:27 > 0:54:32It looks as if the property has been done to a budget
0:54:32 > 0:54:34and has been done up for rental purposes.
0:54:35 > 0:54:39'At present, Delawa's only interested in renting this house out.
0:54:39 > 0:54:44'But how could his £315,000 investment fair if sold?'
0:54:46 > 0:54:50If I was to put this on the resale market today, I would market it for £350,000.
0:54:50 > 0:54:54I would place this property on the market at approximately £395,000.
0:54:54 > 0:54:58'So there's quite a large difference between the figures there,
0:54:58 > 0:55:03'with a potential pre-tax profit of between £35,000 and £80,000 to be made.
0:55:03 > 0:55:06'What do Delawa and Amrik think of that?'
0:55:06 > 0:55:09- Whoo! - THEY LAUGH
0:55:09 > 0:55:11We done well, I think!
0:55:11 > 0:55:17I think it will be between 350 and 395.
0:55:17 > 0:55:23- That's what we think about it, yeah. - Very nice.
0:55:23 > 0:55:27'So, happy with the resale values, then.
0:55:27 > 0:55:30'But what do the estate agents reckon the house could make on the rental market
0:55:30 > 0:55:33'and will that match what the pair have been offered?'
0:55:33 > 0:55:36If we were to rent this as a single dwelling,
0:55:36 > 0:55:40we'd place it onto the market for £1,700 per calendar month.
0:55:40 > 0:55:45As a single dwelling, you'd rent this for approximately £1,800 per calendar month.
0:55:46 > 0:55:49'So come on, then, what are the two offers they've had?'
0:55:49 > 0:55:53One was £2,100 a month.
0:55:53 > 0:55:56The other one is £2,000 a month.
0:55:56 > 0:56:02So we're going to check on the references, et cetera, and decide.
0:56:02 > 0:56:05'It looks as though they've struck gold with those offers
0:56:05 > 0:56:10'which could see them with a rental yield of between 7.5% and 8%.
0:56:10 > 0:56:14'So this partnership shows once again how well they operate as a team.'
0:56:14 > 0:56:16Well, we both depend on each other.
0:56:16 > 0:56:20I depend more on him than he depends on me, actually.
0:56:20 > 0:56:23- No, I depend on you more. - THEY LAUGH
0:56:23 > 0:56:25- He's the man with the chequebook! - THEY LAUGH
0:56:25 > 0:56:28- I'm the one with the wheelbarrow. - THEY LAUGH
0:56:28 > 0:56:30# Oh, yeah
0:56:31 > 0:56:34# In sweet harmony
0:56:34 > 0:56:36'They might not have got what they originally wanted
0:56:36 > 0:56:40'but with Amrik and Delawa's skills in perfect harmony,
0:56:40 > 0:56:43'they've managed to overcome all the hurdles with this property
0:56:43 > 0:56:46'and delivered yet another successful project.'
0:56:50 > 0:56:52Well, we hope you've enjoyed the programme
0:56:52 > 0:56:55and perhaps got a bit of inspiration from our buyers.
0:56:55 > 0:56:58Join us next time for more properties on Homes Under The Hammer.
0:56:58 > 0:56:59- See you then.- Goodbye.- Goodbye.
0:57:01 > 0:57:05Subtitles by Red Bee Media Ltd
0:57:05 > 0:57:09E-mail subtitling@bbc.co.uk
0:57:09 > 0:57:09.