Episode 59 Homes Under the Hammer

-Like many, we're interested in property.

-That means every aspect.

I know I'm always on the look out for a bargain.

But how do you go about getting one?

Well, a very reliable way is to go to a property auction.

Now, there are property auctions all over the country

and throughout the year, so you really are spoilt for choice.

So let's see which properties made their buyers part with their cash on today's show.

This house in Gainsborough in Lincolnshire

turns out to be a bit of a challenge.

HE CLEARS HIS THROAT

Right. Well, we'll have to leave that till later.

In Balham, London, this property alerts my instincts

to a possible great find.

That feeling is a good feeling.

I like it.

And this flat in Folkestone, Kent, leaves me feeling very liberated.

If you can stare out on that,

you're never going to feel like you're closed in.

All these properties went to auction and we'll find out who bought them

and what they paid for them when they went under the hammer.

Thank you, sir.

This is Gainsborough, an attractive market town in Lincolnshire

and Britain's most inland port.

It's in easy reach of Lincoln, Doncaster and Scunthorpe

so let's hope it harbours some potential for development.

Well, the property I'm here to see is just a short stroll from the river,

which is literally just down there.

However, you do also have to walk past a cement factory on the way,

which means you get massive trucks trundling past your front door.

But the property itself doesn't look too bad from the outside.

It's this two bed Victorian semi.

It had a guide price of 50,000 quid.

Let's take a look inside.

Well, there might be a concrete plant just along the road

but how solid an investment was this house, guided at 50,000?

Well, the outside looks sturdy enough.

So through the double-glazed door, that's a good start.

You've got double glazing in the windows as well, which is good news.

It's a bit, you know, old fashioned when you first walk in for sure

but nice and light - that bay window really makes a big difference.

Through this little area here, you've got your stairs up to your bedrooms then through into the rear.

Living room.

Oh, dear.

What on earth is gong on with this wall?!

Look at the mould!

Look at this one. Unbelievable!

Have you ever seen a mould like that? Pink and furry?

This is like some natural history exhibit, not a house!

Where on earth is it coming from? It's interesting, it's an internal wall...

Actually no, it's partly an external wall,

so maybe it's coming from lead flashing, I don't know.

That is not brilliant. Let's see if we can see round the back.

There's this tiny little kitchen here which needs a bit of work doing to it

but I'm really not bothered about that, I want to sort out whatever's going on,

whatever's going...

HE CLEARS HIS THROAT

Right. Well, we'll have to leave that till later.

Hmm not great. Doors that don't open, damp on the units

and an interesting array of mould.

However, it may just be a leaking pipe or a gutter that's causing all this grief,

so, hopefully, it's not as bad as it looks.

So double bedroom on the front there and another double bedroom at the back

and oh, well, surprise, surprise, even more mould.

This really is a house for fungus fanatics isn't it? Blimey.

But you know, I don't think this is related to the one downstairs.

Looking out there, I think you've got issues with guttering,

amongst other things, which is creating that,

which leads me to think that the problems downstairs are created

probably by some leaky pipe work or other,

and that would tie in with the position of the bathroom,

which really isn't ideal.

It's off the second bedroom here, that's your bathroom and toilet.

You know, it's tired, it really needs replacing,

but more importantly, it's in the wrong place.

You really don't want to travel through the bedroom to get to it.

So what could you do?

Well, possibly put a corridor here

and then you'd have separate access to the loo from each bedroom.

You do lose quite a lot of space. You could move the stairs around perhaps.

That'll be an expensive job.

Other people in this street have built an extension,

put another bathroom and toilet downstairs

and kept this as an en suite.

That comes down to how much it's going to cost to do it

and how much it'll add value to the price of the property.

Think about it. Might be worth doing, might not.

# Let it grow

# Let it grow... #

So there might be some merit in growing the size of the property

by putting a bigger extension on the back.

That might then give scope for a much-needed layout rejig upstairs,

but one thing you do need to stop getting worse is the damp.

However, despite that, I think this house is really pretty good.

A nice bonus - which you might not expect in this kind of property - a decent-size garden.

Bit of lawn, a few bushes and shrubs and heathers there.

The only downside though, THAT is a factory.

It makes exhausts for heavy goods vehicles.

You can't have everything I guess.

It might not be ideal but a bit of fencing and some decent planting would help.

For the most part, the presence of the factory wouldn't be noticed.

It might put some buyers off but it's unlikely to affect its rental appeal.

What does a local estate agent make of this two-bed semi?

My first impression is that it needs a general overhaul,

a complete refurbishment,

but I'd recommend an extension to the rear elevation of the property

to include a ground floor bathroom or WC, and an en-suite off the master bedroom.

Ah ha! That's not a bad idea.

What it would save is having to turn those stairs or corridor off the bedrooms.

But if that was done, what kind of returns could we see from this house that was guided at 50,000?

For two-bedroom properties such as this, with the right application

and extension, I believe the property could be worth in the region of £80,000 to £90,000.

And on the rental market?

Once fully renovated, I believe this property would rent

somewhere between £350 to £395 per calendar month.

Well, despite appearances in certain parts of the house,

I think this property has a lot going for it.

Yes, it needs a bit of money spending on it

but I think do that and it could show the right kind of growth.

Let's see who fancied it when it went under the hammer.

We move back now to Gainsborough for lot number 12,

which is a traditional semi-detached house.

What's it going to be? 40,000?

40,000. At £40,000 I'm bid.

At £40,000 I'm bid, thank you very much. 41, 42, are you? 42, 43, 44.

At £44,000 I'm bid. At £44,000 I'm bid. 45.

£45,000 I'm bid.

At £45,000 I'm bid. And 500.

45,500, 46, 500, 47, 500.

47,500. 48 for you. £48,000 I'm bid, the bid is here at 48,000. 500 now?

At £48,000.

At £48,000, sir, for the first time,

second, third and last time at £48,000. Are there any more bids?

Gentleman on the right there, sir. Thank you.

So for £48,000, the successful bidders were Shaun and Luke.

It was Luke who went to the auction with his dad, who he persuaded to do the bidding. Well, it worked.

They're now proud owners of this large, slightly mouldy two-bed house.

I met them there to find out more.

Shaun, Luke, lovely to meet you both. Congratulations.

Why did you want to buy this place?

I dunno. We looked at a few, didn't we?

And this one wasn't even one of our top ones.

It was further down the line that we wanted

but this one came up at the right price so we went for it.

-So it's mainly the price that sort of persuaded you.

-Pretty much, yeah.

Which is one of the reasons we come up north as well, cos they're cheaper.

-Where are you originally from?

-Essex.

So something like this down there is going to set you back how much?

-200 grand probably.

-Yeah.

So you almost get three for the price of one.

-Four.

-Four for the price of one.

-Yeah, pretty much.

-It's amazing.

But, of course, the key thing is not that sale prices are a quarter of

those in parts of the south but that the rental return is still strong.

That makes the yield on the rental market very attractive.

Tell how you know each other and what you do.

-Well, we've been best mates since we were four years old.

-Aw.

We're both 30 now, so it's been a long time.

We've got our building company that we're both directors in that we started six years ago

and it's going very successful at the moment, so we just thought we'd try our hand

in something else to make some money for the future, really.

-Right. So tell me exactly what you are going to do to the property.

-It's just a basic full refurb.

Kitchen out, bathroom out, strip all the wallpapering out, up with all the carpets, maybe the extension.

Tell me more about that. What would that be?

If we do the extension, we'll try and make the kitchen bigger,

so it's a bit bigger like you see next door -

they've got an extension, they made their kitchen bigger.

They've brought the bathroom down, turned it into a three-bed upstairs,

and that would basically be our plan.

We're thinking about moving the staircase over to there

so, turn it round so there's more room upstairs.

We can get a corridor in down to the third bedroom.

-Where would the third bedroom be?

-Where the bathroom is now.

-So you'd lose that bathroom.

-Yeah.

-Bring the bathroom down here.

Luke and Shaun have budgeted just £17,000

to do the whole house, including the extension.

Although they seem to have worked out exactly what they want to do with it,

there was one thing they missed.

Let's talk about this wall, then, the one with all the mould. What do you know about that?

-When we come and looked at it, I'm sure it wasn't here.

-It wasn't.

-It wasn't here when we looked at it.

-How long ago was that?

Probably about six to eight weeks or something, and it wasn't here.

-Wow. Must have been a shock when you saw it.

-It was.

Yeah, when we walked in, it was a shock.

-You're sure you came to the right house, aren't you?

-Yeah, I hope so.

-100%. It is the right house.

-It is, it is.

I've got all the paperwork, I know it's the right house.

# It's a kind of magic... #

So the mould seems to have appeared as if by magic.

Let's hope they can make it disappear just as fast.

What's the timescale for sorting it out?

-Without the extension, four weeks.

-Without the extension.

With the extension probably more like between four and seven.

-Still quite quick.

-Yeah, pretty quick.

We'll be coming up here, we'll be living in here as well.

I'll be staying here, so I can work till seven or eight o'clock at night.

-What will your involvement be?

-I've moved into the office, trying to get work in,

lot of ordering materials, pricing the jobs up and stuff like that,

so I'll carry on doing my day-to-day job

to ensure there's plenty of work for when the boys get back.

-But you're sharing the profits.

-Yeah, pretty much.

-But you're doing all the work.

-Yeah, seems like a fair deal, doesn't it?

-Good one.

-Yeah, but he'd be working on the sites down in London anyway, so it's no different really.

That's what I've been telling him, anyway.

-Congratulations, guys.

-Thank you.

-We look forward to seeing how you get on.

Cheers.

Well, I think Shaun and Luke have chosen well for their first property development project

and I know that they'll work hard at sorting this place out.

Will they decide to do the extension or not

and will they sort the damp out in that wall?

You can find out later in the show.

I'm smack-dab up in the hustle and bustle of Clapham in Southwest London.

However, just down the road is a peaceful enclave of calm and tranquillity.

Balham in Southwest London, well, it's always been Clapham's poorest relation.

Not any more.

Now, today's property is in the Nightingale triangle

and it's the most desirable part of Balham,

due to the large period properties that are found here.

Properties in this quiet corner of Balham command a high price.

A four-bedroom Victorian townhouse can expect to sell for just under a million quid.

This is the one I'm here to see.

It's a little more modest but still brimming with period features.

It has three bedrooms and came with a guide price of £600,000.

When I walk into a house, I get the feeling,

and in this house, I've got a good feeling.

There are some beautiful original features intact.

Look at all that up there, you've got this wonderful newel post

and please, let's hope, yes, for some original Minton tiles.

Now look at all of that. Look.

they are going to be really well-preserved,

cos I bet this carpet has been down for years and years.

It's got a really nice size front lounge area

with a beautiful fireplace.

Second room here, towards the back of the property.

You could actually think about knocking this through, creating one big room.

Again, another nice fireplace with these beautiful tiles.

I mean, look at these lovely, lovely colours.

Oh, there's a lot going on in this house - you've got doors leading out to the garden

and if you look up at the ceiling,

you've got a lovely ceiling rose with some beautiful cornicing.

That feeling is a good feeling. I like it.

# What a feeling... #

Grand high ceilings and period features galore -

what more could you ask for?

A multi-coloured ceiling, I hear you say?

Well, it's got that, too!

# What a feeling... #

To the rear is a third reception room,

which I imagination would have originally served as kitchen.

It has French doors to the garden,

which is overgrown at present but it's a real sun trap.

# I can have it all... #

Let's take a look upstairs at the bedrooms.

# What a feeling... #

Well, this is a the master bedroom

and, if you ask me, it looks rather grand.

Again, look, you've got one of these nice, big fireplaces

and all of these magnificent windows letting in so much light.

Sadly, they're not that magnificent,

cos if you take a look, they're aluminium double glazed,

they don't go with the character of the property.

Something original like sash windows would look amazing there.

The second bedroom on the top floor is also a good size.

The windows at the rear of the property are all original sash casement

and I'd like to see them refurbished.

On to the mid landing and the bathroom,

which is in need of modernisation.

And next door, the kitchen, which would have originally been a bedroom

with the kitchen downstairs in the third reception room.

But I did like that sunroom.

Perhaps the kitchen could be moved to the second reception room?

There are so many options!

Now, there's two ways to add value to this house.

Up there, by converting the attic space...

..and out here.

You see, a loft extension and a side extension

could give you another bedroom, a much bigger kitchen

and add as much as £200,000 to the end value.

Extend the house and extend your profit margin. Thank you very much.

This house has a lot of nooks and crannies

and that includes a huge basement.

To be a successful developer,

it's important to see the potential in a property

and this terraced one has oodles.

We asked a local estate agent to give us his opinion on this place,

which had a guide price of £600,000.

Extension-wise, it's got enormous potential.

You can extend out to the kitchen, that's to the side return,

and obviously into the loft to create a master bedroom with en suite.

If extended into the loft space to create an extra bedroom,

what could this property achieve on the rental market?

As a four bedroom house, your rental achievable

could be in excess of £2,500 per calendar month.

And a sell-on valuation?

The potential asking price could be £950,000.

A house with bags of potential in a hugely desirable area.

What is not to like?

Let's go to auction and find out who that winning bidder was.

Start at 600 on this.

I'm not going to go below six, it's worth that all day long.

600 right at the back on my right, 600.

605? 605.

610. 615.

620.

625. 630. 635.

640. 645.

650. 655.

660. 665.

670. 675. 680. 685.

690.

Take it you, 690, another spot. 690. 695.

700. Looking for 700.

First time, second time,

third and last time at 695. If you're all done?

With a successful bid of £695,000, the happy couple are Scott and his wife, Ness.

This will be their new home and with Ness due to give birth

to their first child in under four months,

they'll need to get cracking on the renovation.

# Hey, hey, baby's on the way... #

Guys, congratulations.

-Thank you.

-You must be thrilled you got this at auction.

-Yes.

-Very excited. Yes.

-So is this the home of your dreams?

-For the next short while.

-Yes. I think we've looked at so many houses

and this one has ticked most of the boxes I would say, apart from perhaps the state of it.

What was it that you liked so much to want to buy it?

Well, it's a great spot, it's got potential.

We've been wanting to do a project for a little while.

We looked at about 25 other houses, didn't find one that we both liked.

I think the one thing that really appeals to me

is Wandsworth Common is just on the door as well,

which is a lovely place, especially on a day like today

when it's sunny so, yeah, great location. We're really happy.

-Now, I can see you rubbing your tummy there.

-I am.

-Baby on the way,

how long have you got to go?

Well, I'm just about five and a half months now, so, yeah.

That is going to be fantastic for you.

You've got the common, it's going to be an amazing area,

you can take Baby for lovely walks.

So this will be a lovely family house for you

but obviously not in the state that it's in.

-No.

-No.

-So, Scott, let's talk about that.

It needs a little work, doesn't it?

For starters, that's a rather interesting ceiling up there.

Colours aside, the ceiling is great and we'll be keeping that.

I'm happy to hear Scott and Ness are as taken with the period character of this house as I am.

So what are their plans for it?

Will you decorate, will you renovate, will you add to this house?

Yes, we have just appointed an architect

and hopefully we will have some plans for planning in three or four weeks.

So you are looking at extending?

Extending up and then out the back

and out the side and clearing the rest of it out and new everything.

What sort of budget are you looking at to do the work here?

-Well, it's a bone of contention but...

-With both of you.

Let's start with Scott. How much will you spend?

Well, when we sat down before the auction, I reckoned we could do it for 130

but I think it might go up to sort of 150.

So are you thinking about adding an extra bathroom and bedroom here?

Yeah, so we're going to go into the loft, loft conversion,

definitely one bedroom, maybe two, and an en suite up there.

So that will give us one or two extra bedrooms.

This room we're hoping to knock through

and then have a much bigger kitchen on the back of it as well.

So you are going to eat into your garden space a little.

-A little.

-A little, yes.

-And we're still discussing whether we can extend in glass.

-Yeah.

-But it's an unresolved discussion at the moment.

That may eat into that budget.

Yes, we've had some discussions with a specialist company

and it's not off-the-planet expensive, so maybe.

That would look fabulous and it would also let so much light into this house.

-I believe you, Lucy, and I agree with you.

-I'm actually like that idea, Scott. Sorry, Ness.

I'm thinking on a practical level and the builder said the same as me, I think, didn't he?

That it would be kind of like a greenhouse and the cleaning side of it.

How do you clean a big glass box?

You have such a traditional house here -

it's always such a lovely surprise element

when you walk through a house like this to then go, "Wow".

-You see something you're not expecting at the back.

-Yeah.

-I agree.

-Sorry.

-We'll see.

-It'd be nice to combine something modern with...

It's an old house. If we can get something and stretched the budget, we may do something.

Yeah, you have to keep a bit of the budget back for a cleaner,

that'll clean the glass for you.

Exactly. Or self-cleaning glass.

# Hey, it's a real good day

# Cos baby's on the way... #

Well, let's hope they find it easier to decide on baby names.

# Baby's on the way... #

Scott is a commercial property project manager

and Ness is a risk manager for a bank,

so they should have many of the skills necessary to ensure a smooth renovation.

But I've got one more big question to ask.

So where's the baby's room going to be?

The baby's room is the middle bedroom, so next to our room.

Do you know what you're having? Girl or boy?

-Big secret.

-A blue or a pink room?

-Big secret.

-Blue room.

-Blue room.

-Yes.

-You're hoping. But it could be a pink room?

-Could be a pink room as well.

-We'll have to wait and see won't we?

-We will have to wait and see.

-This house will look fantastic.

It's in a great area, you know, it really has got the bones here to be amazing.

-Yeah.

-Hope so.

-And it's going to be really interesting to see what you do out the back there.

-We look forward to you coming back.

-See the glass box.

The glass... Well, you could have swung it with your...

-You know what you're talking about, Lucy.

-Of course I do.

-Exactly.

Guys, it's been lovely meeting you. Good luck with this and the baby.

-Thank you.

-Hopefully we'll see the baby when we come back.

-Thanks, Ness.

-Thanks.

-Thank you.

-Thank you.

-Thanks.

Well, it's good the couple have got a healthy budget

but they've never taken on such a large project.

Will it prove to be too much for them?

Especially as they've got a baby on the way

and will we see that glass box at the end of this house

or will Ness get her own way?

You can find out how it all goes later in the programme.

Coming up, this flat in Folkestone, Kent

brings out the demolition man in me.

How great would it be to actually just remove this wall?

In south London, did Scott and Ness get the look they'd hoped for?

We wanted it to look like a Victorian house

from the front but to look really modern and contemporary once you came through the door.

But first back to Gainsborough, Lincolnshire, where Shaun is as keen to see the renovation as we are.

This is the first time I've seen it since it's been completed.

In the pretty Lincolnshire town of Gainsborough,

Essex-based builders Shaun and Luke

bought a three-bed semi at auction for 48,000.

Although apparently structurally sound, it did come with some issues.

It backed onto a factory area and the bathroom could only be reached through another bedroom.

But worst of all, there were signs of damp and mould.

News to Shaun and Luke.

When we looked at it, I'm sure it weren't here.

-It wasn't.

-It must have been a shock when you saw it.

-Yes.

-Yeah, when we walked in, yeah, it was a shock.

-You're sure you came to the right house aren't you?

-Hope so!

# It's a mystery

# Oh, it's a mystery

# I'm still searching

# For a clue... #

So it was a bit of a mystery to the pair where all the mould and damp had sprung from.

But having bought this fungal farm, there was not MUSHROOM for regrets,

so armed with a £15,000 budget,

it was down to Luke to solve the mystery.

Just nine weeks later, we're back.

And with a tidy-up at the front, it certainly looks promising.

Inside, well, the old electrical appliances have been removed...

..and the rooms completely refurbished.

In the back reception room, there are now patio doors out onto the garden

and the kitchen area has undergone a total refit.

But perhaps most impressive of all, there's now a new extension,

which houses a brand-new bathroom suite.

So Luke's been pretty busy.

So out here, we've blocked the old kitchen doorway up

and there was a window here and we cut that out

and put the French doors in and we figured this gives us more light

into the dining room and extra kitchen space, like, for the units.

And coming along here, this used to be an outside toilet and a shed

but we knocked all that down and put up a new extension

where we moved the bathroom to.

We had a bit of an issue with the drains, so we had to move the manhole, run new drains,

but overall, I'm pleased with it.

And the addition of the extension to house the downstairs bathroom

has allowed changes to be made upstairs...

..particularly with the back bedroom,

which previously had the bathroom off it, as Shaun explains.

So this used to be the old bathroom, this room,

so we've basically taken it out and moved it downstairs

into the new extension, carpeted, redecorated it,

so hopefully a young family could use it as a nursery

or a walk-in wardrobe or whatever they choose.

Over here, this is where the old fire was in this bedroom.

We've taken it out, replaced it with a full gas central heating system, new boiler.

And then up here... Then we've done new carpets, lined all the walls,

painted the walls, new coving up, new doors and that's about it.

So the extension solved one problem but what about that mystery mould?

# Begone, begone... #

On this wall here, we had a lot of mould when we came here to start the filming

and we thought it was all from the guttering from upstairs

but on further investigation,

we found out that there was a burst pipe in the wall

in the bathroom, so that got fixed.

Once that was fixed, we could hack the wall off

and then let it dry out and then bond and set it

and we haven't had a problem since.

Like the mould, Shaun left the house

and headed back to Essex, leaving Luke to sort out the work.

Obviously it was hard being away from home for six weeks.

Obviously, I had to base myself up in this area,

because it's a two and a half, three hour drive,

and leave my wife for six weeks. It was hard.

And being around the same people I was working with day in, day out.

Yeah, it was hard but it was worth it in the end.

Luke and his team of builders have done fantastically well

to complete all the work, including the extension, in just six weeks.

Did Shaun get involved at all?

# I'm the invisible man

# I'm the invisible man... #

I'm based in Chingford in the office so I didn't really come up

and do a lot of work on this project, it was all left to Luke.

This is the first time I've seen it since it's been completed

and I'm really proud of him and happy with the finished article.

In fairness to Shaun, he was organising the materials and making sure other jobs they had on

were kept on track. After all, time is money.

Well, originally our budget was £17,000 for the whole thing with the extension.

We ended up creeping over by 1,500 to 2,000, but we hadn't accounted for putting in the French doors

and the ceiling came down and had to be redone.

So we were a little bit over but still quite happy with the amount we spent.

A £19,000 spend on top of a £48,000 purchase price plus costs and fees

will see their total outlay reach around £70,000.

So has their investment grown as fast as that mould?

What do two local estate agents think?

The property has been finished to an excellent standard,

improving internal condition

and making the property more of a modern contemporary feel.

My first impressions of the property are that it has been brought up to a very good standard.

I think it will rent very well and it could sell

although the market locally is a little bit weak.

Shaun and Luke really saw this as a long-term investment and therefore

plan to rent the house out, but have they spent their £70,000 wisely?

I think the property is worth somewhere in the region of £85,000 to £90,000 in today's market.

I would expect the resale value of the property to be in the region of £80,000.

-Yeah, I'm happy with that.

-Yeah.

-I'm happy with £85,000 to £90,000.

I'd take £80,000 for it.

There could be a small profit on the retail market but they chose

this area of the country for the potential rental yields.

I would expect the rental value for the property to be £450 per calendar month.

I believe the property would rent for somewhere between £450 to £475 per calendar month.

-Yeah, I think at that money it's pretty much what we were expecting, wasn't it?

-Yeah.

475 would be a little bit more than what we were expecting, so yeah, 450 and upwards is good.

Well, even £450 a month, or £5,400 a year off a £70,000 investment

would bring in a yield of around 8%.

In the current climate that's pretty healthy. So what next?

Well, we're going to go back down south, carry on with our building company,

wait for the six months to come up on this,

remortgage this and then go straight out and buy another property.

So it's back down south to Essex for a while and then hopefully go again,

presumably still as business partners?

I think we will always work together, me and Shaun.

It seems to have been successful so far, so I can't see any reason why not.

No. Maybe when we've made enough money, gone our separate ways

and nobody's working any more. Maybe then.

Eventually they may go their separate ways, but for now

it looks like they're both pulling in the same direction.

I'm down by the sea on the south-east coast in Folkestone.

It's had its day as a thriving holiday resort,

but things are on the up with an increasing number of people moving here from London

because property-wise they can get a lot more bang for their buck.

Well, just a five minute stroll from the beachfront is the property I'm here to see.

Two-bedroom, top-floor flat at a guide price of £44,000 to £50,000.

This purpose-built block of flats looks imposing and grand from the front.

Let's hope it keeps up appearances inside.

Well, you can tell a lot about a flat by the communal areas

and in this case it's not looking too brilliant.

These are the responsibility of either the management committee or the landlord

and as you can see, it's all a bit grubby.

So not the most sparkling of communal areas and let's hope the flat itself improves a bit.

You have to ignore the clutter. What have we actually got?

A bit of a suspended ceiling.

You can tell we're right on the top, you can see the concrete!

Large bedroom there, we quite like that, and then through into your main living area.

It is a nice size, but by far the most impressive feature is that view.

It doesn't matter what size the flat is, if you can stare out on that,

you're never going to feel like you're closed in.

A view which includes the Folkestone Downs is quite a treat.

On the down side is that ceiling.

A suspended ceiling isn't the most attractive feature

in a period building, and it appears to be suffering from damp.

There is one decent-size bedroom, but the other leaves a lot to be desired.

Not only is it pokey and small, it's not in great condition.

Still, it's not the only thing suffering from a lack of space here.

Well, unfortunately the compromise for having that fabulous, large,

lovely living room area is here, the kitchen.

As you can see it is really, really cramped.

What do you do? Well, I think I've got a solution, but first of all,

microscopically small boiler to fit in as well. That looks terribly out of date.

Get that serviced or replaced and then think about the layout in here.

Actually don't, because I've got an idea.

I noticed that you've got this wall here in between the living room area and the kitchen.

Now, it's fairly solid, so it is structural, but how great would it be to actually just remove this wall?

Maybe with an archway, ideally by sticking some kind of a structural beam across the top there

and then taking this wall out completely.

You then extend the kitchen out here, maybe have a breakfast bar coming slightly into this room.

You can sit here having your breakfast cereal looking out over the view, it's fantastic.

The only fly in the ointment is this is a leasehold property and therefore probably before you get involved in

any major structural works, you've got to get hold of the landlord and get his or her permission.

You've also got to think about whether the expensive structural work would be worth it.

These flats will have a ceiling price

and unless you are going to be living in it yourself,

you should probably keep the renovation to a minimum.

We asked a local estate agent what he thought about it.

The flat needs a lot of TLC.

It's in a building which has been

neglected to a certain extent for some time and it wouldn't take a lot of money to actually revive it

so that it is more attractive on the approach through the corridors

and obviously leading to the apartment itself.

The layout of this particular apartment is not to everyone's liking.

I think some people would say that having the bathroom immediately adjacent to the kitchen,

although from a plumbing perspective one can consider why that's done,

it's not the more ideal situation.

You have to pass the bathroom on the way to the kitchen.

Some of the rooms have suspended ceilings

and that might be hiding a nest of problems, I think,

and in fact my first view of those particular ceiling areas exposed

suggests there is some damp that needs to be dealt with.

Lots of work to do then, but when this place is back

in ship-shape condition, what could it be worth?

Once this flat has been renovated, and we'll say to a high standard,

this apartment would be worth in the region of £100,000.

And for rental?

A two-bedroom apartment in this block would fetch between £500

and £550 per calendar month in good condition.

So, all in all, a good-sized flat in a decent location.

Nice place to live or something that could be a good rental or resale money earner.

Let's see who bought it when it went under the hammer.

Start me where you will on that one.

We've got a very good guide price of 45 to 50.

We'll say £45,000 and hands should be shooting up everywhere. 45,000?

Well, one hand has shot up slowly.

45 I'm bid. 45 I've got, 47 now, do I see?

Do I see two more anywhere? Just you and me at the moment.

47 bid I've got. 48 now if you like. At 48, 48 I'm bid.

Fill it up to 50, and two, 52 I'm bid, 54 if you like.

54 I have, 56 now if you like.

56 may I say?

58, are you coming back in again?

58 may I say?

At 58 by the door, I've got 56 in the aisle, 58 I'm looking for, 58 I've got.

Fill it up to 60, may I say?

At £60,000, £60,000.

At £60,000.

If we're all done at 58, then I will sell for the first time, £58,000 on the left-hand side

for the second time, third and final time at £58,000.

All done, happy, all done, yours at 58. Well done, sir.

# It takes two, baby It takes two, baby... #

Successful at the auction with their bid of 58,000 were Nina, a mechanical design engineer,

and Alistair, an electrical engineer, who have teamed up to start a business in property investment.

Alistair, Nina, lovely to meet you both.

-Congratulations.

-Thank you, Martin.

-Thank you.

-So why did you want to buy this place?

We both have money left over from pension funds and banks

not making anything at the moment so we thought we'd try property investing.

Right. Is this the first venture into that world?

We have bought a plot of land

which we are going through a planning permission to build a couple of houses.

-Oh, wow.

-But this is to keep us amused over the winter.

Fair enough. So what about the relationship between you two?

We're business partners.

We were working together in a consultancy in London and discussed the lack of interest in the banks

-and thought we could do something together to keep ourselves amused.

-Oh, great.

So how did that turn from that kind of conceptual idea to actually buying somewhere down here in Folkestone.

Well, we couldn't afford something in London, so this was good value.

I mean, we're looking for value obviously.

What was it about this flat that appealed?

When we went to auction, we had a list of about ten properties we were interested in.

-The earlier ones we had bid on and lost and this one we won.

-We won.

So you'd looked at ten properties you could potentially buy.

-We didn't look at any properties.

-You didn't look at any of them?

-We did research them all and looked at the selling prices of properties nearby.

-Google Earth.

The essential, and also looked carefully at the quality of the property that was being sold.

Buying blind can be a very risky strategy

and not one I would recommend, but this plucky pair seem unfazed.

What experience do both of you have in terms of property renovation and restoration?

Very little domestically, apart from the few houses that I've owned,

but being in the construction industry, commercially we've built buildings,

we've knocked down buildings, we've renovated them.

Not necessarily with our own fair hands, but technically we have.

When I was younger, as an electrician,

I did work for a small building firm that did a lot of conversions

of flats in south London so I have got some experience of that sort of work,

but not on my own account.

Tell me step by step what you're going to do to sort the place out.

We're on a tight budget so it's hard to know if we can afford to do much structural work

but we were going to replace the existing boiler system with a combi boiler

which will free up some space in the cupboard

which will open up the kitchen, and with new kitchen units

we hope that it will look a lot better in there.

So what kind of budget have you got for the work?

-We're going to try and get it under about £7,000.

-£5,000.

You say five, you say seven.

And that's going to be mostly spent on what?

Well, I think the ceiling was going to take a bit of sorting out one way or the other.

But the kitchen and bathroom will cost the money.

Time scales for the work?

That's changed because Alistair has decided to go back to work, but...

She says through gritted teeth.

We were going to turn it around in two months, but I think it's probably three, so four maybe.

-No, I still think it should be turned around in six to eight weeks.

-OK. There we are.

So six to eight weeks, seven grand. And three months...five grand.

-Five grand.

-How does that work?

Not sure. But it will be interesting to see anyway. Now, there is some

enthusiastic banter between you two.

How is it going to work as a business relationship, do you think?

-I think at the end of the day...

-You're the boss.

-I am, yeah.

-You do as you are told, don't you?

-Yes.

-Is it OK? Because you're not together as a couple so are you OK?

-Not. No.

"Definitely not!" she says.

-No, it's...

-The guy's got feelings, come on.

-No.

-I've got standards as well.

But so there's no, there's no chance of a bit of friction between you two when it comes to making decisions.

-Oh, I think there will be.

-I think there will be but it's a professional friction

and at the end of the day we both want to make money.

Congratulations. Good luck with it.

-Thank you very much.

-Looking forward to seeing how you get on.

-Thank you.

-See you soon.

Well, I don't know about you, but something tells me there will be

fireworks on this renovation before the day is out. Will they make any money?

Will they still be friends at the end of it all?

You can find out later in the show.

There's been plenty of time for our buyers to have started work on their properties.

But have they actually done anything or have they been beset by problems?

Time is money, and have they made any or just lost out?

Let's go back and find out.

It was in Balham, south-west London, that we first saw

a rather splendid three-bedroom, bay-fronted Victorian terraced house.

It may be a real estate-agent's cliche, but this property really did have loads of potential.

You could build up into the loft, extend out the back or open up into the cellar,

and with many features still intact, albeit some of them rather interestingly painted

this was one of those auction lots to get excited about.

It was bought by young couple Scott and Ness for £695,000.

They'd been living in a small house in Tooting and were keen to find somewhere bigger.

So is this the home of your dreams?

For the next short while.

Yes. I think we looked at so many houses and this one has ticked most of the boxes, I'd say.

-I can see you rubbing your tummy there.

-I am.

-So baby on the way, how long have you got to go?

Well, I'm just about five and a half months now, so yeah.

So the clock was ticking, and with grand plans for loft conversions

and kitchen extensions, they had their work cut out.

And now nearly one year to the day, we're back.

From outside, the house is looking crisp and clean.

With the bush removed from the front garden,

the delicate traditional ironwork on the wall is now visible.

But it was inside where Ness and Scott hoped

they could bring a modern touch to what is now a proper family home.

With the arrival of eight-month-old baby Monty,

they moved in just three weeks ago.

And what a home they've made for themselves here.

Two reception rooms were knocked through to make a wonderful lounge dining area...

..which then leads on to a stunning open-plan kitchen.

And though Scott's original plans for a glass box extension were refused,

what they ended up with isn't half bad.

Last time you were here, this space was completely different and much smaller.

I think the room probably finished maybe around here.

And what we also did was extend out

to the next wall and also put in this beautiful glass window here.

And the tiles, the idea was that once the bi-folding doors are open,

that this area then becomes actually

one room leading into the garden.

It feels great when those are open,

lots of air and being able to step straight out.

We really love this room, it's one of our favourite bits of the house.

And those great bi-folding doors lead

out onto that lovely sunny terrace and child-friendly garden space.

Upstairs, that high quality, chic modern finish continues

with a stylish white and black bathroom suite.

The old kitchen space has been returned to being a bedroom...

..while in the master bedroom, gone is the dated wallpaper

and dilapidated carpet, to be replaced by bespoke fitted wardrobes.

And the third bedroom is now baby Monty's nursery.

But they didn't stop there.

We also added a loft conversion.

The extra sort of piece we wanted in terms of making the loft conversion

feel slightly different was to have sort of a different staircase going up to the loft.

Sort of a slight mezzanine feel to it when you're standing at the top of the house

because the stairs don't actually join the wall,

there is actually a space which enables you to look down.

This loft space has turned out to be a fantastic bonus with en suite

shower room and balcony doors to look out over sunny Balham.

But getting to this stage hasn't been easy.

The original extension plans were rejected and their first builder went into liquidation.

Then there was a delay finding another builder, making this a year-long process.

But now they have finished and they've turned this

ordinary three-bed terraced house into a four-bed house that I think is rather special.

In terms of style, we wanted it to look like a Victorian house from the front,

but to look modern and contemporary once you came through the door and I think it succeeded.

What we decided was we wanted to always make this a big spacious family house with lots of light.

There is a wonderful calming feeling about this house now.

What a huge difference to that drab, tired property I saw a year ago.

But I suspect they may have gone over their £130,000 to £150,000 proposed budget.

Did we really say 130 to 150?

We smashed that by some margin as I think you probably would have guessed.

I think we spent, if you include everything, including the fitted furniture

and bits and pieces of the loose furniture, about £225,000.

£225,000 to make this house a home is a reasonable outlay

on a place Ness and Scott bought for £695,000.

With costs and fees they will have invested nearly £930,000.

So was this money well spent? What do two local estate agents reckon?

My first impressions of the property are really good quality has been done, very stylish fittings,

and the kitchen has been done beautifully,

especially with the bi-fold doors onto the garden, and a great size.

The loft conversion is done to a very high standard, in keeping with the rest of the house.

The overall standard of work is second to none.

It's certainly one of the very best I've seen.

With their total costs heading towards £930,000,

has finishing the house to a high standard paid off?

If we were to put it onto the open market, we'd expect it to achieve in the region of £980,000.

I would put this on the market for £975,000.

So not huge returns here,

maybe a pre-tax profit of around £45,000 to £50,000.

What do they make of the resale valuations?

I think it's more than we would have expected. Um, but...

And it's more than we've spent added to what we paid, which is pretty good, I suppose.

-Which is a bonus.

-Yeah, good news.

So financially it does stack up fine.

What are their reflections on their year-long project?

It's been painful, but worth it, I think.

Yeah, I'm sure we'll forget all the pain in the future.

Now, with the house just about completed,

they can concentrate on caring for and bringing up Monty in their stunning new home.

Now it's time for us to go back to Folkestone in Kent

where old friends and new property developers Alistair and Nina purchased a top-floor flat

in this grand building with a not so grand interior for £58,000.

But they had a plan for it. In fact, they each had different plans.

-So what kind of budget have you got?

-We're going to try to get it under about £7,000.

-£5,000.

-Time scales for the work?

We were going to turn it round in two months, but I think it's probably three, so four maybe.

No, I still think it should be turned around in 6-8 weeks.

-So six to eight weeks, seven grand. And three months...

-Five grand.

-..five grand.

-How does that work?

-Not sure. But it will be interesting to see anyway.

So with budget and time scales already areas of disagreement,

did their friendship survive the refurbishment?

It's been four months since we last saw them and their property.

As well as tidying up the place in terms of decor,

Nina and Alistair got rid of the horrible suspended ceiling

and it's looking much better as it's been replastered and painted.

The renovation is 90% complete and things are taking shape,

but it turns out that time and money weren't the only things they didn't agree on.

Well, the fireplace was a bone of contention between me and Nina.

Nina wanted it stripped out, but I wanted to keep it for two reasons.

One, I knew that it would make a lot of mess and quite a lot of work to strip it out

and the second is it is an original feature

and I believe in trying to keep original features within the flat.

It's proved to a certain extent Nina's right

in that the work involved in stripping it has been considerable

but the features we see, the art deco design

and the typical 1930s marbled tiles

I think will come through as worthwhile

once the process is finished and it's all tidied up.

I'm with Alistair on this one.

It's a real luxury to be able to retain period features if you can.

But something I hope they didn't retain was that nasty cramped kitchen.

Well, in here we used to have a cylinder in the corner and a wall which we've knocked down,

put in a combi boiler for the hot water and essentially made better use of the kitchen.

Obviously new kitchen tiles, gas cooker, new window, and that's about it.

Nina had planned on a £5,000 budget, but Alistair thought £7,000.

Were either of them right?

-I was closer.

-But then we changed the whole concept.

-We did, yes.

But it was a conscious decision. We decided to aim for a different market effectively,

so improved a lot of the finishes and by the time

we finish, there's a couple of hundred pounds left to spend

on finishes and carpets, but we'll come out just under £11,000.

What about their estimated time scale?

The time scales have slipped. Of course, they generally do on projects

-so it's taken the best part of three months really.

-Four months.

Three or four months, is it? Four months now.

Even now they've nearly finished, they can't agree on the time scale

but hopefully there was enough agreement along the way to keep their friendship intact.

-We're still talking, aren't we?

-Yeah.

-We have quite a satisfactory business relationship.

-Exactly, yes.

-We never had a big row really, did we?

-No, I don't think we did.

-No, and you never hit me.

-No. Well, not often.

-No.

The teeth marks don't show at all.

Well, they certainly got their teeth into this

with re-plumbing, re-wiring, new central heating and double glazing, as well as the cosmetic work.

We asked two local estate agents to give us their opinion on it.

Coming into the property, it looks like

they've spent some time and effort trying to make it more presentable

and I think it's definitely an improvement on what it was.

It's changed a lot since I first saw it.

They've obviously enhanced a lot, the kitchen and bathroom are very nice.

Overall a fairly good impression, fairly good for tenant appeal too.

Speaking of tenants, what could this place be rented out for?

To rent this apartment out would be in the region between £500 and £550 per calendar month.

I would advise the client to advertise it for £550 per calendar month.

We're not looking to rent, although if we can't sell it in two months

then maybe we'll look at renting in the short term.

Having paid £58,000 and spent £11,000 on the renovations, Nina and Alistair's total spend

was £69,000, making the rental return very attractive

at between 8% and 9½%.

But as they said, they're all set to sell,

so what would the estate agents estimate for that?

The value of this apartment would be around £90,000.

It would be potentially higher if the building were

of a greater standard in terms of its common areas.

I would recommend you advertise it for a maximum of £95,000

and hopefully achieve something just over £85,000.

That still gives us, what, 25%, 30% return?

Well, yeah, 20% anyway.

Which is more than you get in the bank, so yes, we're happy.

Based on the estate agents' recommendations, they could see a potential profit

of between £16,000 and £21,000 minus the usual selling expenses.

But Alistair is reserving judgement.

It's one thing for the price to be given to us, it's another thing

for it to actually be sold at that price.

When it's sold at that price, come back again and ask if I'm happy.

Well, that's it for now. We'll have more auction stories to warn or inspire you next time.

-So make sure you join us then.

-Goodbye.

-Goodbye.

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