Episode 72 Homes Under the Hammer

Hello! Now, with all the ups and downs of the property market,

you really need to trust your instincts when buying.

Nowhere is that more true than in the auction room.

Join us, as we take the lottery out of property

on Homes Under The Hammer.

Buying at auction doesn't have to be a scary experience.

If you do your research and stick to your budgets, you can buy with confidence.

Today, we'll meet three buyers who hopefully did just that.

Did they bag a bargain? Or did they get more than they bargained for?

Here's what they bought.

You'll need to dig deep at this derelict Darlington dwelling.

It's a case of going back to foundations, I think.

If time is tight, this one-bed flat in West Hampstead could be ideal.

This is a flat that you can get in, you can do it up and you can get out.

And in Seaton, Devon, this former social club with a first-floor flat went under the hammer.

But why did it go to auction?

I need to find out a bit more about the history of this place.

All of these properties went to auction.

And we'll find out who bought them and what they paid when they went under the hammer.

Darlington, in the County of Durham, is probably most famous as

the birthplace of the world's first steam-powered railway back in 1825.

Today, the town centre's been spruced up and the trains,

well, they're still here.

They'll get you to Leeds in less than an hour

and London in under three.

How's that for a head of steam?

# One ticket for a runaway train... #

Just 500 manly strides from the train station is the property I'm here to see.

It's on this street of attractive Victorian terraces.

Very attractive, in fact, which makes me a little bit nervous,

because the house had a guide price of just 35,000 quid.

Well, clearly, you don't get all your windows for that.

Let's see what else is lacking.

# Walking on broken glass... #

Right, well, it looks like you don't get floorboards either.

Or, my guess,

yeah, no pipes.

Somebody's stolen those as well.

Oh, well, who needs copper pipes anyway?

Oh! Or electric light switches or cables?

Blimey, this place really has had a good seeing to, shall we say?

As you can see, it is in a real mess.

Which is a shame, really, because if you can see through that,

it's actually a big house.

This is the living room area. A nice bay window there.

Even these floorboards, I mean, they are scattered around,

not exactly on the floor, as you'd like them to be, but they're still in a nice condition.

So strip this back and you'd have a really impressive room.

Ah, but it's a case of going back to foundations, I think.

# Back to the start Back to the start again, I'll go

# Back to the start... #

It's always interesting to see a house taken back to basics.

And this one is amongst the worst I've seen in terms of mess.

It really needs everything done.

The trail of devastation continues in the kitchen.

At least, I assume it's a kitchen. It certainly doesn't much resemble one.

As everywhere else, it's totally trashed and horribly ruined.

But at least it's all ready for the skip.

You've got to be careful you don't break any bones but, as viewings go,

this one is rather hazardous.

# I love the sound of breaking glass... #

As I tiptoe my way upstairs, predictably,

the bathroom is in a right old state.

And the rear bedroom, well, the bay may look romantic from the rear,

but it's more "windows, windows, wherefore art thou, windows?"

than anything particularly poetic.

There's a second bedroom in the middle, which is a decent size.

Now onto the front.

Well, clearly, the fairly bad state continues up here.

But let's try and look beyond that for a moment.

What you have got is three bedrooms,

including this absolutely ginormous one.

So, possibly, why don't we think about maybe converting this property into flats?

One bedroom downstairs. A two-bedroom flat upstairs.

That might be worth doing.

But let's take the lead from the other properties

in the street, as none of them have been converted into flats.

And, actually, thinking about it, leave it as a family home.

And what a wonderful family home it would be.

So, for someone not scared of a bit of hard work - ha! -

this house, which had a guide price of only 35,000,

could prove to be a real bargain.

But whoever purchased this place will need to be aware of more than

just the property market as, just down the road,

is a different kind of market altogether, Darlington Farmers Auction Mart.

This isn't the kind of place we find organic vegetables,

strange breads and rare-breed cheeses.

This is the real deal.

Yes, every week, thousands of cows, sheep and pigs are sold just here.

Now, I'm not particularly sure I'd want to live very close to this.

You can imagine the noise and the smells.

But the good news is that this is actually being relocated out of town.

So what will be here, maybe in the future,

a shopping centre, supermarket, who knows?

Well, as I said, at the end of the day, though, it is good moos. News.

Moos?

# Cut 'em out, ride 'em in Ride 'em in, cut 'em out, cut 'em out

# Ride 'em in Rawhide... #

We asked a local estate agent

whether it would be worth working

till the cows come home to get this house in order.

First impressions of this house are that it really needs

a lot of work doing to it. I think that's obvious.

It's been taken back to the bare bones by the previous occupant.

So it needs everything from top to bottom.

So how much might the place achieve, once renovated?

Completely refurbished,

I could see the property realising about £90,000 in today's market.

And the potential rental income?

I think, for rental, this property would realise

an income of about £400-425 per calendar month.

Well, at first glance, this property is in a terrible state.

You walk in and you want to walk straight out again.

But just remember that guide price, 35,000 quid.

The area is on the up and it's not just some pokey little terrace,

it's a big Victorian affair.

I think it's fantastic. Let's see who agreed when it went under the hammer.

An end-terraced house which needs

a little bit of renovation.

35,000 plus, can I ask 35, anywhere?

A bid of 35 to start. Anything further?

36, 37.

38.

39, 40.

41, 42, 43, 44.

45, 46, 47, 48.

49, 50.

51, 52. 52,000, the gentleman sitting in the second row.

Is there anything further? I'll take 500.

52 and a half bid, new bidder in.

53? 53 bid. 53 and a half.

54. 54 and a half.

55. 55 and a half.

55,000, the gentleman sitting down again.

We're going through at 55,000.

Selling it once at 55. You're on the phone for the second time...

At £55,000...

Sold for 55,000 to the gentleman sitting in the second row.

# Baby, you got it... #

That successful bid of 55,000 was made by local couple Phil and Emma.

Phil's a plumber and Emma's a primary school teacher.

Sensibly, I met up with them back at THEIR home,

just around the corner, which, I think it's fair to say,

is in slightly better condition than their new investment.

-Lovely to meet you both.

-Nice to meet you.

-Congratulations.

-You obviously enjoy a challenge, then!

-Yeah. Always up for a challenge.

Tell me why you wanted to buy the house.

Well, I've seen it there for a while,

and it's just around the corner from where we live.

I thought, well, I wanted to buy a house and that was the one I wanted.

Fantastic! Tell me about you two, then.

-Seven years, haven't we?

-Yeah, seven years. Emma's a teacher.

I'm a plumber by trade, but I do a bit of everything now.

Property refurbishment. I do a lot of work for landlords and so on.

Right, I'm glad you said you're a plumber, because there's definitely

-some plumbing required in that place, isn't there?

-And the rest!

What did YOU like about it, Emma?

Well, I hadn't seen it before we went to the auction.

I'd seen the outside and I'd peered through the window, but you'd been round and done a quick viewing.

-Yeah, had a quick look.

-So when we bought it

and we went round to look at it, it was just a total shock.

All the floorboards are up, ready for me to put all the plumbing in.

All the wiring's ready to go in. It's an easy job!

# You make it easy

# Easy... #

Well, I wouldn't quite say that!

But although this is Phil and Emma's first investment property,

they've renovated their own house which, apparently, was in nearly as bad a way.

Phil clearly has the skills to take on this project.

Talk me through the process of exactly what you're going to do to it.

Windows are going in as from next week. They're all ready to go in.

We'll have Emma in, she's on holiday as from next week,

so she'll be in ripping all the wallpaper off...

-Wallpaper!

-..while I'm at work.

We need to get it dried out,

get all the damp seen to and then get it plastered.

We'll go from there, room by room.

And what are your expectations for the amount of money you're going to get back from it?

Well, we paid 55,000 for the house.

We're looking to get 105, 110 for it.

And, hopefully, we should spend 10-12,000 on it.

-So we should make a good bit of profit.

-Mm.

-Mm.

And then plough that into the next project, whenever that might be?

Yeah, next house.

# It's easy... #

The pair are happy to rent it out if they have to, which is wise.

The area is improving and lenders are slowly relaxing.

But there's still a long way to go.

I'm quite concerned about that budget of £10-12,000 for all the work needed here.

How is Phil going to manage it?

The windows, I managed to get for 3,000.

Plastering's going to cost us two.

The electrics will be just about nothing.

What do you mean electrics will cost nothing?

I've got friends in the trade, good friends,

so everyone will be helping out.

Oh, terrific! That's the way to do it.

So, on the face of it, that is a very tight budget but,

-given your experience and friends, you should do it.

-We should do it.

Good, well, congratulations.

Really looking forward to seeing how you get on with it.

Yeah, same here.

-And I wish you all the best.

-Thank you.

Well, everyone needs friends when it comes to doing up property.

It's fantastic news if those friends happen to be in the trade.

It turns this from being a seriously expensive project

into something which is a bit more manageable.

Phil has certainly got the skills.

With those friends on board, maybe it will be a transformation when we return!

This is West Hampstead in North London,

sitting pretty between affluent Hampstead village

and more urban Kilburn.

It's period property heaven, with a good shopping street thrown in.

It's desirable, without being as crazily expensive as Hampstead itself.

So enough reasons to take a look at some property opportunities?

I think so.

West Hampstead, the birthplace of Dusty Springfield.

It's like a little village near the centre of the city.

# Wishing and hoping And thinking and praying... #

With funky, independent shops, cafes and a bustling atmosphere,

I can see why West Hampstead is so desirable.

I can definitely understand why so many people choose to live here.

The property I'm here to see is a ten-minute walk to the nearest tube station.

So it's not transport on your doorstep, but it's liveable with.

And the road the property's on, well, that's more than liveable.

With these attractive, tall Victorian terraces, really nice.

The lot that was up for auction is in this building.

It has one bedroom and the guide price is 180,000.

There are a total of five floors in the building and,

straight through the communal front door,

this flat is the first door on the right.

Ah, well, straight into your main living area,

which is your kitchen and your living quarters.

A little bit disappointing. I'd hoped it might be a bit bigger than this.

Square footage is a little bit on the small side here.

But you have got this really nice bay window.

It's quite weird, because you almost feel like the floor has been raised,

because it's actually nearly my height.

But you can see this is a flat that you can get in,

you can do it up and you can get out.

It is a quick refurb job.

The kitchen, well, it's not in bad shape.

It certainly needs a bit of a tweak.

But I think you could get away with just revamping of this. And, of course, the units are OK.

Along this little corridor, this is where it gets a bit dark, a little bit pokey.

And into the bathroom area.

Now, straightaway, I can see there's no bath in here.

But I think, with a bit of careful planning,

you could possibly get one in along here.

I think a bath and a shower is the way to go.

Also, you could rearrange the toilet and sink space to make sure you get that in nice and tightly.

And look at these. Too many doors!

What's through here? Ah, bedroom.

Which is small. It takes a double bed but, with this size of room,

my advice would be that it pays to get custom-made furniture to optimise every bit of space.

In this part of town, the expectations for a refurbishment go beyond a mere splash of paint.

So I'd be investing in solid wood floors, a new bathroom suite,

kitchen and maybe restoring some of the character features.

# I want love

# But it's impossible... #

The potential to add value to this small flat

that had the relatively low guide price of 180,000

could depend on just how much you're prepared to invest.

I'm aware similar flats sold for around 300,000.

I headed back to the high street for some light refreshment

and to find out why the flat was guided at just 180,000.

So, why so cheap? Well, it's the dreaded short lease.

In this case, there's only 67 years left, and it does need renewing

if you wanted to sell on or get any decent mortgage deal.

In theory, buy it for the guide price, spend around 20,000 renewing the lease,

add another 20,000 to do it up and you're still quids in.

But new leases are complicated, they're time-consuming

and completely frustrating.

And the low guide price accounts for the risk factor involved here.

Once your solicitor gets going on the legals,

it could be all nice and straightforward.

Or it could turn out to be a real headache and, pre-auction,

there is no time for in-depth research.

So it could seriously pay off.

But don't assume it will be a piece of cake.

# Can I have another piece of chocolate cake? #

Well, that guide price of 180,000, for this area,

is extremely tempting.

But, like too much cake, a short lease on this place

could leave you feeling a bit sick and regretting your decision.

We invited a local estate agent to take a look at the property

and tell us more about the prospects for this flat.

The houses around here are all Victorian period properties.

On this street, it's about 50-50 of flats to family houses.

So it's a really good ratio between the two.

It's a decent-size flat and it's got a lot of potential.

So a popular area but, to maximise the potential here,

what level of refurbishment would he recommend?

I'd expect the property to be done up to a high standard,

with a new kitchen and wood flooring throughout.

Once refurbished, how much rental income could the property generate?

The property would rent for around £1,300 per calendar month.

If the lease was sorted, how much could it sell for?

Once the lease has been renewed,

I would expect that it would be worth today 300,000.

And, done up in a very good condition, 350,000.

Property is never easy. It's never straightforward.

Never as clear-cut as you want.

But, if you balance up the risk to reward factor here,

it looks like somebody could do very well indeed on this place.

Let's just hope they have cash

and patience aplenty to pay for any unexpected complications.

Let's see who went for it at the auction.

Right, West Hampstead.

One-bedroom flat. This is lot 64.

Who'd like to start off on this? 150?

150 on my right. 155?

155, thank you.

160? 160.

165? 170?

175? 180?

185? 190?

195? 200?

196?

Have a think. £195,000.

Anyone else?

£195,000.

First time.

Second time. Third and last time.

If you're all done...

HE BANGS THE GAVEL

Sold, 195. Well bought.

That winning bid of 195,000 was made by father-and-son team

John and Andrew.

Dad John is financing the deal, while Andrew,

who's director of a mobile technology company,

will project-manage.

Andrew's friend, Amy, is the architect on the project.

I met up with the two of them to find out more.

Guys, congratulations. First of all, you got this at a great price, didn't you?

Well, yes, we think we did. It was certainly below what we thought.

We were going to go up to 210, and we got it for 195.

So why did you want to buy this? What was the attraction here?

The attraction is the area. It's a great area.

And it's a pretty good flat. It's a good size.

I mean, it's not huge, but every room is a decent size.

So, Amy, tell me your involvement with this project.

I've come in as architectural designer here.

I've been working with Andy for the last year or so on quite a few properties.

There's quite a lot of things to be done. A lot of them are cosmetic.

There's not too much structural work that we're going to be doing here.

We're looking at adding possibly a window or two to maximise the light and rejigging the kitchen

and bathroom layouts, and drainage, and a few bits and pieces.

So, Andy, you guys work together. Do you leave a lot of this work up to Amy?

Yeah, well, she's the expert on these things. She's the architect.

But I do like to try to make sure you've got the old floorboards

and exposing those, exposing the fireplaces.

I think people like that these days. And that's what I like as well.

I completely agree with you there. It's a shame about this flooring,

but I think you're going to have to bring it up.

-It is coming up, yeah.

-Exactly, the original floorboards are under here as well.

You do sometimes have problems with sound, but what we do is often take up the floorboards,

lay down soundproofing and then relay them again.

This sounds very promising,

and Andrew has a healthy £20,000 budget.

But, as I mentioned earlier, this area of the city expects a pretty high standard of finish.

So, what else will they spend the 20 grand on?

What are the plans for the kitchen?

Well, it's very small at the moment.

Only half of it is there,

so we haven't got much to play with.

That will come out completely and we'll make it slightly larger.

And the bathroom. Now, at the moment, as it stands,

you've got just a shower in there.

Me, girly, like to have my baths.

First thing I'd do would be trying to squeeze a bath in there.

There's plenty of room to put a bathtub in there.

Whether we put a bathtub with a shower over the bath,

or whether we can jiggle it round to have a shower unit in there as well,

that's something we'll look at.

How long do you think it will take you to get all the work done?

We can get most of it done quite quickly.

Like I said, there's not really anything structural that's going on, apart from a small window.

So we're talking a manner of weeks, really.

So, guys, if this is only going to take a few weeks,

how long have you got before you're going to be a bit busier?

Not so much longer. I'm looking at four or five weeks now.

Hopefully, it doesn't come out any earlier than that,

because I've got a lot to get done in those weeks.

But, either way, I'm running a lot of other projects along as well.

I've got six or seven on site at the moment.

They all overlap and you can take one or two weeks out

if you've got trusty builders and people like Andy that you're working with.

So it shouldn't be too much of a problem.

Yeah, I can always step in.

Andrew's more of a deskbound entrepreneur,

working on his mobile technology business

and doing property development more as a hobby.

But it's no surprise that Amy has no intention of keeping still,

even with a baby on the way,

because she had a former career that was rather more physical.

How did you get involved in this?

Well, obviously, I studied architecture for a long time

and have been doing that for quite a few years.

Then I did have a little break for about a year and a half

to do something completely different

from the architectural and developing side of things,

to become a Gladiator.

-Wow!

-So that was quite fun.

I put a lot of my architectural skills into it as well,

climbing over ladders and...

AMY LAUGHS

Wow, so that must have been quite a challenging year for you?

Yeah, I mean, it was a dream job and something very different from what I was used to.

It was quite difficult telling some of my clients that

I was going away for a month or two, and I couldn't tell them why.

Then they saw me pop up on TV.

But most of them liked having an architect that was a Gladiator!

# Are you tough enough?

# Hanging tough

# Hanging tough

# Hanging tough... #

Well, from hanging tough to houses, quite a change in pace.

But there's one major issue with the flat,

which could mean that you could fall and end up in a property pit.

This property comes with a very short lease,

which means that you obviously have to pay cash for this at auction.

Did that not put you off, the fact that you weren't going to get

a mortgage straightaway on a property like this?

No, I think at auction, it's relatively difficult to sort out a mortgage anyway,

because of the short timescales you've got.

So, typically, we buy in cash anyway and, if necessary,

we mortgage afterwards.

Yeah, the short lease, basically, it puts off other buyers potentially,

particularly those who would need to get a mortgage.

And it just means, I guess, that we'll have to spend some money

extending the lease or buying a share in the freehold.

It's been lovely meeting you. Good luck with this project.

-Can't wait to see what it's like. Good luck with the baby as well.

-Thank you.

So, with Amy's eye, Andrew could transform

this place into something really special.

And with that lease sorted,

he could see some quite serious profit.

Find out how it all goes later on in the programme.

Coming up, you get something special with this Devon property.

Huge windows looking out across the sea.

That is priceless.

We return to this London flat, where there's been a wake-up call.

I've had a lot of sleepless nights, but we're back on track with work.

But, first, it's back to Darlington, where Emma used her school holidays well.

The first one was stripping wallpaper.

Then cleaning, the next one. And the last one's been painting.

We're darting back to Darlington now where, earlier in the programme,

local couple Phil and Emma paid £55,000

for this three-bedroom end of terrace.

It needed a total refurbishment.

Phil's a plumber, with his own company,

and Emma's a primary school teacher.

They plan to renovate it and sell it on.

I'd met up with them in their own house on the neighbouring street,

and Emma was certainly of the opinion that they'd got more than they bargained for.

I hadn't seen it before we went to the auction. I'd seen the outside

and I'd peered through the window, but you'd been round and done a viewing.

Yeah, had a quick look.

So when we bought it and we went round to look at it, it was just a total shock.

-Was it worse or better than you thought it was going to be?

-Worse than I thought!

All the floorboards are up, ready for me to put all the plumbing in.

All the wiring's ready to go in. It's an easy job.

It's five months later and they've invited us back to see the finished product.

And what a result!

The house you'd have hurried past now makes you want to stop and stare.

# Come back, baby You'll find a change in me

# Everybody... #

With new windows throughout, the bay-fronted living room is the first room to catch your eye.

It was already knocked through to the dining room.

But Phil could see the potential to make even more of the ground floor.

There was a wall here which we took out. And there was a doorway here.

Going on through here, there was another door here,

which leads us into the kitchen.

All these walls have been timber-framed and insulated.

Had to be built out just to square off for the kitchen.

The same with the ceiling.

The ceiling had to be dropped a foot just to level that out.

The kitchen itself, we were going to go for a cream one, but, erm,

I went and come back with this one, which I'm rather pleased with.

It's created a stylish look.

The whole house has been rewired and central heating installed.

Upstairs, the rotten rear bedroom is now a lovely space,

making the most of the views across the park.

The mangled middle bedroom now has a floor, carpet and a feature wall.

And the bathroom that was just a pile of rubbish,

it's now a beautiful designer-look bathroom.

But what happened to the master bedroom at the front?

Well, no disappointment there either, because it's been rejuvenated,

and the choice of decor hints at a possible change to their original plan to sell the house.

Originally, in here, the ceilings were wallpapered,

the walls were wallpapered and then painted on top,

so it was a bit of a nightmare getting it back down to the brick.

Then we've had it all plastered.

And then it was choosing colours - because we're thinking of maybe moving in -

colours that we might like to have.

But now the carpet's fitted, I wish we'd gone for cream carpets,

but it shouldn't take too much to change the purple to a more neutral colour.

So, if they choose to live in the house,

it's been decorated more to their taste.

But with the back-up plan of making the colours more neutral

if they do decide to sell.

Smart thinking!

Phil and Emma have totally transformed the place and, to their credit,

they've done most of the work themselves in their spare time.

I did everything, basically, apart from plaster the walls

and put the carpets in.

I put all the single windows in, had a window fitted to the bays.

Me grandad built the front wall and painted the back for us.

And we've had a lot of help off Emma's mum and dad.

I'm looking forward to the summer holidays. I've used my past couple of holidays...

The first one was stripping wallpaper.

Then cleaning, the next one.

And then the last one's been painting, so I just can't wait for a bit of a break!

What is still left to do?

We've still got to have the front of the house rendered

and the back of the house, there's still a bit of guttering to do,

but that'll be done in the next couple of weeks.

They've created a beautiful house, but how much has it cost?

The original budget was 12,000.

We're at about 14,000 now.

Probably take us to 15 by the time we're finished.

Emma and Phil are in two minds about whether to move into the house or sell it.

Their current home is on the market and they plan to put

this one on, too, to test the water.

Perhaps the opinion of two local property experts

we invited along will help steer them one way or another?

I'm very, very impressed. Love the kitchen. Love the bathroom.

Right up to date. Super!

The final finish, I think, has been particularly good.

There's a lot of attention to detail and the kitchen and bathroom,

I think, are a particularly nice feature.

I think it was a good decision to take the wall down.

It's let so much more light through.

You can walk in, put your furniture down and that's it.

It's a cracking house.

They bought the house for 55,000 and Phil reckons

the budget will hit £15,000 once everything is done.

So will it be worth more than 70 grand?

I would recommend an asking price in the region of £110,000.

In my opinion, I think the property would be likely to sell for around £110,000.

That would generate a 40 grand gross profit for the couple

after five months, before the usual selling expenses.

So the hard work's been worth it.

It's been a really successful project

and we're pleased with the valuations.

We'll definitely do it again.

We've already had a look at another house to start on,

as soon as we finish this one.

So, with two houses up for sale at the same time,

do they now have a preferred outcome?

We'll put both of them up for sale.

I don't mind which one goes first, really.

-It would be nice to move into this one, wouldn't it?

-Yeah.

And the other one to sell first, but it just depends.

Whichever one goes first.

I'm in Seaton, on the Dorset and East Devon coastline,

known as the Jurassic Coast.

The rocks here record over 185 million years of history.

As well as being scientifically interesting,

it's a very popular spot with holidaymakers.

And, you know what? You can see why.

Seaton is a traditional seaside town.

Busy in summer and quieter in the winter months.

But the year-round attraction is this great beach

and these magnificent cliffs.

Right opposite those beautiful views is the property I'm here to see.

Central location.

It used to be a hotel, a B&B, a social club.

It's certainly been well used.

The guide price was 150-180,000 quid.

Let's take a look inside.

The building looks impressive. But it turns out

it was only the former social club on the ground floor

and the first-floor flat above it that went to auction.

Even so, with a prime location right on the seafront,

that was surely a lot of property

for a guide price that was only 150,000.

Wow! That is kind of unusual.

It's laid out pretty much as a social club.

Well, as a social club almost that was operating last night.

You've got a pool table. You've got the chairs and tables.

There's a stage area here with a light. We've got dartboards.

Look at this!

Bar area.

Actually, you know what? That's all still operating.

This is very unusual.

It is literally like people have just walked out and left it.

I need to find out a bit more about the history of this place.

But I'll take a look upstairs first.

# What's going on?

# What's going on?

# What's going on? #

It is a bit of a mystery.

Clearly, it wasn't that long ago that it was still running as a social club.

The rear bar kitchen is quite serviceable.

And the cellars are clean and tidy.

It all looks like a well cared for, if slightly dated, club.

But what's the apartment upstairs like?

It's a long old stairway. But what's up here?

Well, at first glance, a lot!

Lots and lots of rooms, all pretty much full of clutter at the moment.

But we can cope with that, because the good news is

that they've all got some kind of toilet facilities.

Loo, basin, bathroom. Fantastic.

What they don't necessarily have is roofs on those facilities!

But straightaway, I'm thinking the options for renting this out are an HMO.

Individual rooms. Perfect.

Another room there.

And then through to... Oh, my goodness me!

What a fantastic room this is!

It's huge. It's got those facilities,

but it's got huge windows looking out across the sea.

That is priceless.

Ooh, I want to stay here!

With its own balcony, what a living room this could be!

And, with three bedrooms up here, all with wash and toilet facilities,

plus a separate bathroom and shower room, there are plenty of options.

Turn one of the rooms into the kitchen and you could make this

into a self-contained apartment, or you could let it out room by room.

Or it could just be living accommodation for anyone running the business downstairs.

What does an estate agent think

would best serve the local community?

It would be best used as a wine bar or tapas bar,

which would be obviously popular in the summer with tourists

and holidaymakers, and with local residents throughout the year.

I think the rooms on the first floor would be better suited to

a three-bedroom apartment with fantastic sea views.

Certainly upgrading what's here already may be the most effective use of the space.

But would it bring in a reasonable return

on this lot that was guided at 150,000?

With the flat renovated, and subject to the turnover of the social club,

the total value is likely to be somewhere in the region of £200,000.

So, perhaps some uplift on resale.

But maybe rental would be a better route

for both downstairs and the first floor.

If the apartment was renovated,

the rental value would be in the region of £650 per calendar month.

If, downstairs, the social club stayed as it is,

the rental value would be somewhere in the region of £10,000 per year.

Well, a really interesting opportunity for somebody here.

You've got the rooms upstairs.

You've got this area down here that you could pretty much operate as it is.

The one thing that you can't deny is the location of the property itself.

It doesn't get much better than this.

Let's see who potted it at the auction.

And lot 94 is a two-storey mixed commercial

and guesthouse-type premises.

Who's going to start me off at 140?

I have a gentleman there. 140, thank you, sir.

Looking for 145. 145 I have. Against you now, sir, at 145. 150, sir?

Is that a nod? 150, I thank you, sir.

150, looking for 152.

Definite shake of the head further back.

Ladies and gentlemen, going to go once at 150.

Great deal of property for 150,000.

Going twice at 150.

For the third and final time at 150. Definite shake of the head.

Sir, it's yours at 150. Thank you.

For £150,000, the new owners of the old social club

and apartment are Pat and Julie, who saw this

as a once-in-a-lifetime opportunity to fulfil a cherished dream.

Pat, Julie, lovely to meet you both.

-And you, Martin.

-Congratulations.

Tell me why you wanted to buy it.

Basically, it was a wonderful opportunity

to buy a business and somewhere to live.

Right, you're talking about buying a business.

Is the idea, then, to carry on running the business?

Yes, we want to still run it as a social club.

A privately owned social club.

Wow!

Plus, we'll be living upstairs.

So, it's everything thrown into one, really.

Gosh! Julie, tell me a bit more about you two

and your backgrounds and things.

Well, we're originally from Manchester,

and it was always a big thing that we always wanted to live by the sea.

-And the dream has come true, hasn't it?

-Absolutely.

# Dreams can come true

# Look at me, babe, I'm with you... #

Well, this place is certainly right by the sea

and Julie, Pat and their two teenage sons

can't wait to move in and get started.

It's quite a change of direction

but, after taking voluntary redundancy from his old job as a technical support engineer,

Pat's prepared to give it his all,

to realise his long-held ambition to run his own social club.

In terms of the business, when do you hope to get that up and running?

We're literally waiting for the licence, which takes ten working days,

so as soon as we get the OK with that, we'll be opening for business.

So you could literally have people in here in ten days?

-Yeah.

-Well, we're actually going to have people in tonight.

Tonight?!

A bingo crowd. We can't sell any alcohol, but we can do refreshments,

-teas and coffees and soft drinks, can't we?

-Yeah.

We can't let them down, they're regulars,

-and they love their weekly bingo, so we're doing it for them, aren't we?

-Yeah.

They must be absolutely thrilled to bits that,

rather than ripping it out and turning it into a posh wine bar,

you are actually keeping it as a place for them.

Yes. All the people that have spoken to us are very much behind us

and what we're trying to do.

So, hopefully, the tills will start ticking over.

So when did the business here actually stop operating?

-Ten days ago.

-Ten days ago?

-Yeah.

So that explains why everything is in such good condition.

But Pat and Julie are keen not just to get the social club back

to where it was, but to build on that core community support and grow the business.

First and foremost, they need to turn the first floor into the family home

and do some refurbishment work downstairs.

So, talk me through exactly what you're going to do downstairs and upstairs to sort it out.

Downstairs, just a coat of paint, the windows and a few radiators.

We've got to make it a viable business before we start

chucking money down here.

The majority of the work upstairs,

we're still under negotiation about the bedrooms.

We're fighting with the boys on who's having what room!

Then what we're looking at is putting a kitchenette in the front room,

make that the lounge.

-That front room is spectacular, isn't it?

-It certainly is, yeah.

I have to say, when I go up there and look and think of all the work

we've got to do, I think, "Oh, my days, what have we done?"

Then you just go and look out of that front room and you think,

"Yeah, that's why we did it."

As they've already spent £150,000 at auction on buying the apartment and social club,

in order to make sure they hang onto those views, they need to keep their spending down

and get going and sorted as soon as possible.

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

Realistically, including the operating costs, about 25,000.

I'm looking at having roundabout £10,000 set aside for operating costs.

So, out of the 25,000, we've got about 15,000 to spend on jigging it around as to what we want.

And what about timescale for doing the work?

Downstairs will be a long-term project.

It may be three, four years before we're making a decent profit

and we say, yes, it's now worthwhile doing this.

Upstairs, it may be we spend three, six months and just get it somewhere near right

and then the extra bits we'll do, dependent on budget.

If it doesn't work, we live here, right on the seafront, can't be bad!

# Dreams can come true

# Look at me, babe, I'm with you

# You know you've got to have hope

# You know you've got to be strong... #

Well, an exciting adventure for Pat and Julie, that's for sure.

But, you know what? Running a business like this is not going to be easy.

They certainly like the place, and who wouldn't?

In terms of lifestyle, it's brilliant.

Will they, in fact, hit the bull's eye?

You can find out later in the show.

It's been a while now since we last saw our brave buyers.

Yes, have they been firing on all cylinders,

or have the projects blown a gasket?

Let's go back and find out.

Earlier in the programme, we were in West Hampstead,

a desirable London suburb, where Andrew had bought this one-bedroom flat for 195,000.

It was a joint investment with his father, John.

Andrew's the director of a mobile technology business

and was going to project-manage the refurbishment while

his architect friend, and former gladiator, Amy, was going to design it.

INAUDIBLE SPEECH

So why did you want to buy this? What was the attraction here?

The attraction is the area. It's a great area.

And it's a pretty good flat. It's a good size.

I mean, it's not huge, but every room is a decent size.

There's quite a lot of things to be done. A lot of them are cosmetic.

There's not too much structural work that we're going to be doing here.

We're looking at adding possibly a window or two and rejigging

the kitchen and bathroom layouts, and drainage, and a few bits and pieces.

Amy had about four to five weeks before she was due to give birth.

Well, it's now three months later, and we're back.

And Andrew and Amy have delivered a delightful addition to

the West Hampstead property market.

The Victorian chimney's been exposed in the living room.

Plus, the original floorboards.

They just need final sanding and staining.

The layout has remained the same.

But a quality kitchen's been installed.

So we have ripped out the old kitchen and put in a brand-new one.

I think the key was to make it slightly bigger than before,

so that we could fit in every modern appliance that I think people want these days.

So we have a full-size dishwasher,

quite a nice kind of range-style hob,

a built-in microwave.

And then, the washing room, we moved from the bathroom into here.

It will hopefully be appealing to someone who likes the kind of old Victorian house,

but wants all the modern features of a kitchen.

So, all new cupboards, but then exposing the features of the Victorian fireplace.

So this unsophisticated baby-size flat has matured into a classy grown-up property.

And it's all down to Amy DELIVERING the goods!

My life's changed a lot. I'm minus, well, a big bump.

I've got a little one now. But we have a little baby girl, Coco.

She's ten weeks old now and growing like crazy.

Lots of sleepless nights, but we're back on track with work.

The original floorboards are on show in the bedroom as well.

But there's no sign of that extra window.

And the tiny bathroom has been beautifully refitted.

We've ripped it all out and we've started from scratch.

We've managed to get a full-size bathtub in here.

We've still kept the shower element, so it's dual-purpose.

That's very important, and a good selling point as well.

We've moved the basin over from here,

so we've created the maximum amount of floor area possible.

And, in this space here, where the boiler's kept,

we're not going to be keeping MDF doors on here.

They're just purely done for the templates.

Then we'll take these to a glass manufacturer.

So there'll be a white, glass, painted door.

That way, we can keep the polished look of the tiles going through,

over the storage areas as well.

I think we've really achieved a nice look and a nice finish.

You've got good space. You've got a good bit of storage.

And you've got a lot of natural light, as well, which is very good.

So why did they have second thoughts about

adding more windows in the bedroom?

While we were building it, it kind of occurred to us that

there was a flat roof just outside this window here.

So we are currently also talking to the freeholders about extending here

by putting in doors here and then putting in a roof terrace.

That will create a huge amount of light into this room.

And then it will create some outside space which,

for a flat in London,

is very desirable.

Andrew intends to put the flat on the market once the planning's been granted and then carry out the work.

He's still in discussions about extending the lease, or buying part of the freehold.

How much has this refurbishment cost?

We haven't spent a huge amount, probably around £15,000.

But that is without the roof terrace and without extending the lease.

So if we extend the lease, 20,000, that will come to 35,000.

The roof terrace will probably be another 10,000.

So it's a significant amount of money to spend.

About 45 grand,

on top of the 195,000 he and his father paid at auction.

So, are they likely to see a good return?

Time to get some advice from two local estate agents.

First impressions of the flat are, it's quite a nice conversion.

A little bit on the small side. But that's normal for the area.

The kitchen's a big improvement.

They've exposed some of the brick and they've got a nice gas hob.

And they've done it up to a very good standard.

I'm not so sure about the idea of a roof terrace,

especially as it's accessed from the bedroom.

If it was accessed from the living room, perfect.

But I don't think it will create a great deal of extra value.

I think this property would appeal to a single professional or perhaps a couple.

And, on the rental market, per calendar month,

I'd expect the property to achieve £1,450.

I believe, if this came on the market,

it would achieve somewhere in the region of £1,300 per calendar month.

Could that sort of income tempt Andrew to reconsider and let out the flat, after all?

It's something that I would consider,

but I've been doing this as a kind of joint venture with my dad,

and it's not something that he wants to consider.

So sale, it is.

But will the flat be worth more than the 240 grand they could end up spending on it,

if they renew the lease and get permission for the roof terrace?

I would put this on the market for something in the region of £300,000.

The lease is very important for the sale.

It'll add on a good amount of money.

I'd expect it to achieve between 325-350,000.

That valuation range from 300-350,000 would generate a gross profit,

before the usual selling expenses of between 60 and 110,000.

Quite a difference.

Yes, that is quite a big difference.

I mean, 300 to 325 was the kind of area I was thinking.

Maybe, I think, 350 is pushing it.

But, with the planning permission, if we get it, for the roof terrace,

then I think 350 suddenly then becomes, hopefully, a viable option.

Andrew and Amy seem to be a dream team.

They certainly delivered the goods here.

So, what's next?

We've already got another project lined up.

Amy has already done the plans for that and submitted them to the council.

In fact, I'm kind of handing over some of the project management to Amy.

And we're looking to buy another one, once this is done and on the market.

Back now to Seaton, in Devon.

Earlier in the programme, Pat and his wife Julie had paid £150,000

for this first-floor former guesthouse,

plus a ground-floor club,

which had only closed fairly recently.

This was more than just an investment for the couple.

It was the realisation of a long-held ambition.

We want to still run it as a social club.

A privately owned social club.

Wow!

Plus, we'll be living upstairs,

so it's everything thrown into one, really.

We're originally from Manchester,

and it was always a big thing that we always wanted to live by the sea.

And the dream has come true, hasn't it?

# Dreams can come true

# For me and for you

# Doo-doo-doo doo-doo Doo-doo doo-doo

# Na na-na... #

They'd moved to Seaton five years ago.

Pat took voluntary redundancy from his technical support engineer job a year ago.

So their new venture was about to begin.

Ten months have now passed

and we've come back once again to take the sea air in Seaton.

Julie and Pat's pub and club have been given a coat of paint.

The room is now set up, ready to serve food.

But they've sensibly been cautious not to wade in too quickly

with this business by the sea.

We've had central heating installed.

We've got a lot of ongoing work at the moment.

We've cleaned the place up.

New furniture.

We're in the process of sorting the kitchen out.

That's being ripped out completely.

We've got a lot more that we still want to do.

But, obviously, we've got to be sure that the business is viable

before we spend too much money on a complete refurb job.

So they're dipping their toes into the water gradually,

which makes sense.

Upstairs, the conversion of the former guesthouse

into their family home has been slow.

That massive front room that overlooks the sea

is now their living room.

But there's just not enough space for everything

they've brought from their four-bedroomed house.

But work on the bedrooms and the en suite is going well.

Their two teenage sons have separate rooms, as Julie explains.

This is our youngest son's room.

I would say, of them all,

this is probably the major work that's been done.

It was an L-shaped room with a very long, thin bathroom down there.

We ripped the whole bathroom suite out,

and we pinched some space from the cloakroom area in the lounge.

So it was a case of knocking a big wall down

and then putting this in to make it a lovely oblong room with,

thank goodness, a nice modern bathroom.

Obviously, as you can see, I've still not finished yet.

I just haven't got enough hours in the day to complete it.

But we will get there. We will, I hope!

The rest of the cloakroom

and the lounge is now being converted into a small office.

It is a big refurbishment project.

But, unlike other ambitious relocations we see on the programme,

Pat and Julie are having to concentrate on the social club first.

Is the business rewarding all their hard work?

It is going really well.

Even during the winter,

we well exceeded what our expected turnover was.

So, we're really pleased with that.

They'd set a budget of £15,000 for their seafront property.

So how much have they had to splash out so far?

At the moment, we've spent in the region of £6,000.

Pretty much on budget for what we wanted to do.

Obviously, we've not met the schedule,

but we didn't fully understand

how much work we were going to do to get the business up and running.

We're open 12 hours a day, every day.

So we're not able to put the time

into the work upstairs that we would like to.

With this seven-day-a-week commitment,

how do they divide their time?

I generally do earlier. I'm not good at late nights.

So I do the earlier shift and Pat does the late shift.

Our eldest son, he's started helping now.

And the youngest son does help as well.

What about the refurbishment?

Who's been doing that?

We've done bits ourselves.

We've had a couple of plumbers in.

We've got a builder in the moment.

I've done the decorating.

You've done the decorating.

Time to see what two local estate agents will think

of Pat and Julie's new venture.

The social club and the first-floor flat overlooking the sea.

They've made a lot of improvements towards the flat, with en suites.

I know they've got other plans, in terms of windows,

but it's a great improvement.

Delightful little property.

It's got an excellent sea view from both the front windows,

downstairs and upstairs.

They're working hard to create a business here.

From what I hear locally, it's going very well.

Pat and Julie paid £150,000 for the flat and social club and,

so far, their outlay is just 6,000.

What could their investment be worth?

If the business was sold as a whole,

with the flat finished and the business running,

it would be somewhere in the region of £160 to 170,000.

The whole building, including the premises downstairs,

could achieve around £150-170,000.

Judging by that valuation range of 150-170,000,

there's not going to be any significant profit here.

But, with any commercial property, the value can change dramatically,

depending on how successful the business is.

I'm quite surprised that that's so low.

As I say, the business has picked up really well.

But to know that we're exceeding what we paid for the place

is quite pleasing in this current market.

We've got the family business

and we've got what will potentially be

a lovely home, with stunning views of the sea.

So very pleased, overall.

So, happily for Pat and Julie,

it certainly seems like their seaside dreams HAVE come true.

Well, join us next time,

as more bold bidders brave the auctions on Homes Under The Hammer.

From Martin and I, goodbye.

-Goodbye.

-Goodbye.

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