Episode 81 Homes Under the Hammer

Hello. When you look back over time,

the chances are you've never lost money on property.

That's because over the years it's been a rock-solid investment, despite the downturn.

-So where can you find yourself a bargain?

-At an auction, of course!

Whether you're buying property as an investment or as somewhere to live,

you want to make sure you've got a good deal.

The question today is, did the buyers manage that? Here's what they bought.

I'm in Netherton, Liverpool,

where I hold a bit of a candle for this two-bedroom semi.

Interesting that these aren't really connected to electricity.

They're purely for decoration and lovely they are.

In Walworth, South London, elbow grease was in order for whoever bought this one-bed flat.

Quite a bit of work to do, little bit grubby,

but it could really scrub up well.

And in Tiverton, Devon, the downstairs of this former shop is in a terrible state.

And as for upstairs...

I'm judging by first impressions...it's equally dreadful.

All these properties have been sold at auction.

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

Yours, thank you.

So, where do you think I am today?

The south coast? Devon? Cornwall, perhaps? Maybe Brighton?

No. Believe it or not, I'm just outside Liverpool.

This is the estuary of the Mersey

and it's also the location for one of Antony Gormley's famous sculptures -

Another Place.

This fantastic spectacle consists of 100 cast-iron life-size figures.

They were built to symbolise the contrasting emotions of hope and sadness

associated with immigration.

So will today's property fill me with hope or sadness?

I'm just north of the city centre in an area called Netherton.

Very popular with families, and generations seem to stay here.

I'm here to see this.

It's a semi-detached house at the guide price of £39,000

and for that you also get a rather impressive monkey puzzle tree in the garden.

The front has lots of foliage growing close to the house.

Whilst a bit of greenery can add to a property's kerb appeal,

this has a jungle-like quality, which is perhaps hiding

potentially valuable space for off-street parking.

Through the front door we've got this useful little porch area,

somewhere to hang your coat and put your shoes, store the kids' bikes.

Stairs up to the bedrooms, living room over to that side.

It's a good-sized space, but what is going on with that decoration?

Really interesting! A bit dark as you walk through here, but then through into the kitchen.

It's not a huge space and it, uh...

Definitely in need of modernisation.

While you do that, I'd consider extending out into this,

which is like a little ante-area. Door there through to your garage,

but by taking out some of this wall you'd make a nice kitchen/living area.

Lots of work to be done, but it's not a bad canvas on which to paint.

There is potential for more space here.

If you were to utilise the garage you could create an extra room.

That's worth considering, especially if this was bought as a home rather than to sell on or rent out.

Though clearly there is bits of decorations in this house which is possibly not to everyone's taste.

These aren't actually connected to any electricity.

They're purely for decoration and lovely they are too.

More interestingly, the room itself, at some stage, has been converted to create one big space.

As I said before, I really like it.

Not quite sure what's going on with the ceiling!

There seems to be some kind of soundproofing boards up there.

But whatever. It's another refurbishment job,

but from what I can see so far, it's mostly just cosmetic. Which is good.

It wouldn't take much to get the downstairs of this two-bedroom semi sorted out.

But can the same be said for upstairs?

Upstairs, and two really good-sized double bedrooms, but that's not the most interesting bit.

Look at this. The bathroom, complete with flies.

We need to get some fly spray there first of all.

It's clearly in a bit of an interesting, old state,

but maybe we can take a bit of design influence from this.

Pink and black. I like that. Very Art Deco 1930, so maybe retain that.

But apart from that, get rid of the suite.

It's not a bad-sized space.

But gut it...and you'd have quite a nice room.

But unfortunately there are no more Art Deco rooms to be found,

just some evidence of damp in one of the bedrooms.

That means look at the roof would be first on my to-do list.

Soldiering on...

Out the back there are more trees, again, very close to the house.

It looks run down, but not that bad.

We asked along someone from the auction house

that sold the property with a guide price of £39,000.

Good property, not too much wrong with it.

It just needs a little bit of TLC, modernisation, new bathroom,

kitchen, needs a re-wire. Windows are already in, front door, front and rear gardens both need doing,

but probably talking about £15,000-£20,000 total spend.

What could the place be worth as a rental?

This property would achieve somewhere around £475 per calendar month.

What could it sell on for once fully refurbished?

The sales market in this area has picked up in the last six months.

The market had gone up by 20%. But at the moment we're looking somewhere between £80,000-£85,000.

Well, a nice enough house, but effort and money needs to spent to sort it out.

Let's hope there was no monkey business when it went under the hammer.

Start me at £40,000 for this. £30,000. Let's get on. £30,000.

Bid me 30.

30 at the back, then.

At 30. I was wondering if you were going to start it off. Not a nose scratch this time.

31, 32, 33, 34...35.

36. 35, the lady's bid. 500, sir?

36. 500?

£36,000. 37.

500, 38.

500, 39.

500...

30... 500.

£40,000? 500?

500. 41. 500.

42. 500.

43. 500.

44. 500. 45.

500. 46.

500. 47. 500. 48.

47,500 at the back now.

At £47,500 for the first time.

47,500 for the second time. To the very back of the room.

For the third and final time, it's going to be sold to the back of the room at £47,500.

Yours, thank you.

And with their successful bid of £47,500, it was husband and wife team Mick and Bernie.

Mick's a self-employed road worker

and Bernie helps with the books and admin. I met up with Bernie

back at the property to find out about their plans.

-Bernie, congratulations.

-Thank you.

-Nice to meet you.

-Nice to meet you.

-Tell me why you wanted to buy this place.

-For me daughter, really.

We saw it on the internet.

And she was looking for somewhere

-and we phoned up and the auction was the next day.

-Oh, wow!

So we ran along to the auction, didn't think we'd get it,

didn't think for one minute we'd get it, and we did.

-Right.

-And this is what we've got.

-There we are.

-How much chance did you have to look round before you bought it?

-Didn't.

-HE GASPS

-Not at all?

-No, and I know that's naughty,

but no, cos we only found out it was in the auction the day before.

It was too late to do anything, we just went and bid.

-And what about the legal pack? Did you get a chance to read that?

-No.

-No?

-No.

HE GASPS

I know. And I watch your programme all the time

and you always shout at people for not reading the legal pack,

but it was too late to get hold of it.

But, saying that, we live...

I live around the corner, I was born in the next street,

so I know the house, I know the history of the house,

so it wasn't really an issue, the legal pack.

So, in Bernie's case, her local knowledge might go some way

to making up for not reading the legal pack.

But I can't stress enough how important it is

when buying at auction to know what the potential pitfalls are,

otherwise it could result in an expensive mistake.

So what does your daughter think?

She's delighted, to be honest, delighted. Yeah.

She came round with us and had a look. At first it was a bit "er...",

but once we explained what was going to be done,

the alterations that were going to be made, she was quite happy.

-And it's a place for her to live?

-Yes.

So a real leg on the property ladder, then?

Yeah, cos otherwise she hasn't got much chance,

so we just thought we'd give her a little lift up.

-So were you happy with what you paid?

-Yeah, yeah.

I thought my husband would go a little bit higher.

In fact, I'm sure he would've done, but I'd warned him on the way there,

"No more than 50,000," and he was quite calm during the auction.

So, yeah, what we paid, I thought, was a fair price.

Bernie plans to renovate the property,

including rewiring and installing central heating.

She'll also re-plaster throughout and install a new bathroom

and kitchen, as well as new doors, frames and floorboards.

-What's the budget for the work?

-We've got 20,000.

-OK.

-That's reasonable.

-We've said 20.

My daughter Siobhan's hoping to turn the garage into a room.

She's extending the kitchen out into the garage,

but leaving a small area at the other end.

She's having a window put in and a small room there.

That's a good way of using that space,

and will make a difference to the kitchen area, too.

What are the plans for the garden

and those trees and plants that are close to moving into the house?

Very close. That's something we'll have to get a tree surgeon onto,

to look at that tree and see what...

It'll have to come out, cos she's having French doors.

And obviously, the close proximity,

the doors probably wouldn't open, it's that close.

So that's got to come out.

-I don't know if you saw the monkey tree.

-Of course, can't miss it.

-That's staying.

-Oh, good.

Keeping the monkey tree.

-I don't know how far their roots go down.

-No, I don't.

We're going to get somebody to have a look, to check it over for us.

But it's very, very healthy and Siobhan wants it.

Everything else taken out of the garden

-and just leave the monkey tree on its own.

-Oh, great.

-Listen, good luck with it.

-Thank you very much.

-I look forward to seeing how you're getting on.

-Right. You're welcome back any time.

Well, it seems that things have turned out really well for Bernie.

It couldn't be a better located house.

Still, lots of work to get it into a state

that her daughter will be happy with.

You can find out how they get on later in the show.

This is Walworth in South East London.

This area has been a bit of an anomaly -

so close to the very heart of the city,

but not the most affluent part.

However, significant regeneration is taking place and,

with new green spaces, shops appearing,

and out-of-date housing being replaced, it may be a very good time

to take a look at Walworth.

This part of London took a bit of a hit in the Second World War,

and lines of attractive Victorian terraces like this

took the brunt of the bombs.

Lucky for us, some of them did survive,

and the lot we're here to see is this property here.

It's a first-floor one-bedroom flat

and it had a guide price of £130,000.

The property is mere steps from Walworth Road,

with all its facilities,

and a five-minute walk to the Elephant & Castle Tube station.

It feels quite hidden here,

tucked away from the hustle and bustle of loud London.

The property itself looks attractive

and next door's flowers are certainly blooming.

I wonder if the flat will be as colourful and appealing.

So let's have a little look around the top-floor flat.

Well, straightaway I can see it's split-level,

which I like, because it always gives the illusion of space.

You've got lovely ceiling height here.

Although I can see straightaway a load of work needs to be done in this property.

Look at the walls, they all need skimming. Look at that.

There's years and years of gloss paint on this banister.

Once that's all peeled away, though, that would look beautiful.

There definitely is potential here.

Bathroom, it's sort of squeezed in on the corner,

but it's got its own window, that always helps with ventilation.

And fantastic, look, lovely storage.

Although have a look in there,

I think you'd only make a bookshelf out of that.

It's not very deep, bit of a disappointment.

The kitchen, right at the back of the property,

and I don't think I need to tell you what you need to do in here.

The whole place needs to be ripped out, chucked in the skip

and a brand-new, gorgeous, shiny kitchen fitted.

Quite a bit of work to do, little bit grubby,

but it could really scrub up well.

So whilst a new kitchen and bathroom are needed,

overall it's not in too bad a state.

The bedrooms are a decent size and there are some great original features.

The floorboards would benefit from a good sanding,

but before you do that, check the lease conditions

as sometimes there are restrictions from the freeholder.

I'm really falling for this place.

It's not spacious, no, you could never argue that,

but what do you expect from just the top half of what was once a little workers' cottage?

This is where the flat really does come into its own.

What a lovely room.

Shame about the fireplace, not original, fake stone cladding,

I'd like to see something a little more traditional

and in keeping in its place.

But these windows are what really get me excited.

You've got two in here, original sashes, beautiful.

I think, by far, this is my favourite room.

# Smile like you mean it. #

And I really mean it. It's just as well this space works

since it'll be where you spend most of your time.

It's lovely to find these large rooms at the front of houses still intact,

not subdivided to create a kitchen/diner or a second bedroom.

But is there any way to make more of it without going stud wall crazy?

There are two other first-floor flats on the same street

that have recently gone up for sale.

One for £233,000 and one for £235,000.

So it's fair to say once renovated, the property could go on the market

for around that figure, which,

if the flat was bought for the guide price, is a very decent profit.

But what about looking into making more money by adding an extra bedroom in the loft?

Well, there's no-one else on the street that has done the same thing, which is telling,

and you don't actually own the loft space here, the freeholder does.

So you'd have to make enquiries into buying it,

potentially for thousands of pounds, and try for planning for which there is no precedent.

I wouldn't dismiss this plan out of hand,

but I don't think it will be easy.

If you really wanted that extra space, then go for it,

but my feeling is that it could be a lot of hassle and expense

which may equal little or no profit.

Still, I do like options.

We asked along a local estate agent to hear his views on this flat,

which had an auction guide price of £130,000.

My first impressions of this flat is that it's a great size

and it's well located, being just by Wharf Road and Elephant & Castle.

Plenty of natural light throughout

so it certainly could be a fantastic double bedroom conversion.

How much would it be worth now and after renovation?

If I was to put a value on this property in its current condition,

I would look at in the region of £190,000.

Fully refurbished, you're certainly looking in the region of £250,000.

What about rental?

As far as rentals is concerned,

you can expect to achieve in the region of £1,250 per calendar month.

This flat is all about location and character charm,

two things young buyers and renters are all after.

A short walk or bike ride to the centre of London

in an improving area with period features.

What more could you want?

Let's see who snapped this one up at the auction.

One-bed flat, requires modernisation. Handy location.

Who'd like to start this? 120?

120.

125. 125 at the back.

130.

135.

140.

145.

A bidding war developed between a few eager participants.

We rejoin the auction when it's reached 182,000,

a hefty 52 grand over the guide price.

182.

183.

184. 185.

186. 187.

187, sir? 188 with the tie.

189, new spot.

190. 191. 192.

193. 192, sitting down. First time, second time.

Third and last time, have you all done?

Sold, 192, well done.

That successful bid of 192,000 came from Rizvan.

He's a senior manager for a telecom company

and has developed several properties in the past.

I met up with him at the flat to find out

if local knowledge would help this London lad be successful.

So how well do you know this area of South London?

Not, not quite that well.

I don't live too far away from it, Maida Vale,

but I tend to deal in properties in North West London.

This is the first time I've actually come south of the river.

-So did you view this property prior to the auction?

-No, I didn't.

It was kind of blind when I got it.

The price seemed very good, I'd done some research,

looking at the catalogue the night before the auction.

It seemed... I basically set my limit on what would be a good price.

I think I went about 5-10k over,

but overall I am pretty much happy with what I've got.

So while you were bidding, did you feel that you were taking a slight risk?

Erm, I think there's always a risk in whatever you do, really.

Obviously they should be a calculated risk.

But yeah, yeah, there was a risk, but generally I had a good feeling.

# And I'm feeling good. #

A good feeling?

Well, Rizvan, I'm afraid a good feeling is not quite good enough.

Feelings and impressions are important once you're inside the property on a viewing,

but really, a feeling about just a photo in an auction catalogue can be described as a massive gamble.

However, he had done his research into the regeneration of the area,

which does make his gamble a little bit safer.

Rizvan, why would a buyer want this flat? What are you going to do to it?

Well, there are a few ideas floating in my head at this moment in time.

One is potentially converting the kitchen into the second bedroom

and bringing the kitchen into this reception room.

Obviously, that will make the reception room slightly smaller.

Another potential is going to the loft, subject to the council giving consent.

But I think the option which I may go with is stick to the same layout

and just put in a new kitchen, bathroom and redo up the place.

I think you're absolutely right.

This room, in my opinion,

is too small to share the kitchen with the lounge.

I think going up into the loft is a great idea,

although you don't own the freehold of this,

which means you don't actually own the loft.

Have you done any research into how much it might cost you to develop?

I have actually instructed my solicitors to speak with the council

with regards to looking at if I have usability of the loft since I'm the only one who has access to it.

We are still trying to get answers from the council.

Hopefully within a week or so I should be in a position to find out

whether I can have usability of the loft.

# Let's go up on the roof. #

Rizvan is looking at £7,000-£10,000 to do the work

if he doesn't go up into the loft and £35,000-£40,000 if he does.

Of course, that doesn't account for how much he'd have to pay to be able to do that, still unknown at present.

So come on, what's your experience? Have you done this before?

Erm, I have been doing this for the last four years, part-time, over the weekends.

In my normal day job, I work in the telecoms sector.

So this is something I've caught on from the rest of my family,

who have been in this business for around 40 years now.

So you are one busy guy,

you've got a full-time job which takes you all around the country

and every weekend you've been renovating, converting and a paintbrush in your hand.

-Am I right?

-No, not really.

The reason for that is because I tend to...

Because we've already got teams.

I mentioned earlier my family has been in this business for 40-odd years

so they have got established teams who have been working on other projects.

So I tend to bring them into the place and I tell them

what I want and I leave them to do the work.

So it's just you and a mobile phone.

Yeah, it's me on the mobile phone and then obviously

I do come in the middle for periodic inspections.

-So you're good at delegating?

-Yes. Yes.

So what's his timescale to do the work?

I would like to have it ready for the market within four to six weeks.

And then hoping to achieve the sale eight to ten weeks from today.

What are you most worried about?

If I miss the four to six weeks time frame,

there's some new builds which will be ready for the market

and I don't want to be competing against them because they tend to be

studios and they'll also be marketed under the stamp duty price.

So I'd like to get this off my hands as soon as possible, really.

Well, I'm really intrigued to see what you do to it,

how you're going to turn this place around.

-Good luck. It's been great meeting you today. Well done, thank you.

-Thank you.

If you're not handy with a paint brush,

you need to be good at delegating,

skills Rizvan has obviously developed.

I don't think he should try and squeeze a second bedroom in, though, without that loft conversion.

And I'm worried that will take a bit longer than he wants.

You can find out what he decides later in the programme.

Coming up, in Tiverton, Devon, this building is a write-off, but...

It doesn't matter because what I'm thinking is development plot. Fantastic.

In South London, has Rizvan led a charmed life?

I think I was very, very lucky. It could have been much worse.

But first, in Liverpool, Bernie's been committed to the cause.

Our life has been on hold...

until this project has been completed.

Back now to Netherton in Liverpool, where Bernie and her husband Mick

bought this two-bed semi for £47,500.

The plan was to help their daughter Siobhan get on the property ladder,

but in their haste to do this, they broke one of the golden rules of buying at auction.

-What about the legal pack? Did you get a chance to read that?

-No.

-No?

-No.

I know, and I watch your programme all the time

and you always shout at people for not reading the legal pack.

But it was too late to get hold of it.

But saying that, we live... I live around the corner.

I was born in the next street so I know the house,

I know the history of the house, so it wasn't really an issue.

The house had a jungle-like front garden that was obscuring

the view somewhat, and inside, it needed some real cosmetic surgery,

especially on some of the more original features.

Well, we're back six weeks later to see if this particular monkey puzzle has been solved.

The new kitchen has been fitted

and the place now has a more open-plan feel, as Bernie explains.

So we've open this up to make it an easier access into what is our breakfast room.

We had the French doors installed to throw some light in

because it is only small.

That leads us on to our television room,

which has turned out really well.

We had the roof pitched to give us more height

because the room is quite narrow with the height of the ceiling.

It makes it look a little bit more spacious.

Just need to add a television and that room is complete.

Upstairs, there's a new bathroom suite with a small bath

replaced by a shower cubicle.

The whole room has been retiled.

The bedrooms are nearly complete and now look lovely and bright.

With new central heating installed, Bernie has turned this place around,

although it sounds like there were plenty of people on hand to help.

All the family have been involved.

My daughter's partner's family have also been up and helped -

cleaning and moving rubbish and things like that,

so the whole family have been involved in some way or another.

As for those gardens, they've been totally cleared apart from the monkey puzzle tree.

This has given some parking space at the front

and the back has been cleared too.

The French windows open up onto some lovely new decking.

Some serious graft has clearly gone into transforming the outside space.

My husband and a couple of his work colleagues did the gardens,

which were hard work.

I think they were harder than the interior.

60 tons of rubble, they took out of the back garden.

He had three 20-ton lorries took rubbish out of the garden.

With her husband and colleagues kept busy in the gardens,

what was Bernie's role?

Well, I've been project managing as much as I can,

been round to let the joiners and what have you in.

It has impacted on my life.

My husband's been coming home from work

and his tea hasn't been ready and things like that.

Luckily, he's been patient and a lot of the time,

he's followed me round here anyway to work.

Our life has been on hold till this project's been completed.

Bernie was in charge of the spending.

So, how close did she stick to that budget?

Our original budget,

I budgeted for around 20, possibly 22.

We've actually spent 25.

On the basis, we've had more work done than we intended.

We had the front rendered

and the garden took a lot more of our budget than we thought it would do.

When added to the purchase price of 47,500,

that makes a total outlay of £72,500.

What do two local property experts think of the house?

First impressions, I like a house a lot.

I saw it before the work was carried out.

Walking around and looking at the finish, you can see that it has been

done for an owner-occupier as opposed to your typical buy-to-let property.

My first impressions of the property are very good.

It's been refurbed to quite a high standard.

It looks like whoever they got in to do the job,

they must be quite experienced at doing this type of thing.

What about the conversion of the garage?

I think what they've done with the garage is very good,

it's certainly added value, somewhere in the region of £5,000-£10,000.

How much would they value the house for?

A property in this condition, this area,

I would value at approximately £90,000.

The resale of the property would be £90,000.

Very good, yes, that's OK.

I'm really pleased with that, yeah.

That would give Bernie and her family a pre-tax profit

of £17,500, before the usual selling expenses.

What about rental?

The rental of the property would be £575-£600 per calendar month.

The rental value of a property in this condition

is approximately £600 per calendar month.

Excellent. Not that we would even consider renting out,

because my daughter's moving in, but it's good, really good.

How has the whole experience

of helping her daughter onto the property ladder gone for Bernie?

I think it's been a great success. I mean, you've just got to look at it -

somewhere nice for my daughter and her boyfriend to live

and I've really enjoyed the whole doing-up of it.

It's turned out really, really well.

I would like to buy another house in the same state that this one was in and do it again.

Next time, I would take my time,

I wouldn't do it in such a short space of time.

I would take a little bit longer over it,

but definitely do it again, yeah.

# Go west Where the skies are blue

# Go west This is what we're gonna do... #

Tiverton in Devon is a market town in the middle of the county.

In recent years, the population has been steadily on the rise

and with that, of course, so has the demand for housing.

I'm here to see a property which had a very interesting price.

I say that, because they actually said what the reserve was.

It actually said under £30,000 was the reserve price.

So, why would that be? Why would they give you that information?

I think it's because somebody's very keen to sell

and you'll soon understand why.

This is the property. It's actually a former shop.

It's got living accommodation above.

But don't be fooled by this side -

once you go inside, it gets much, much, much worse.

# I'm only happy when it rains

# I feel good when things are going wrong

# I only listen to the sad, sad songs... #

I wasn't exaggerating!

This garage building is the current entrance to the property

and judging by the number of puddles,

it's not even watertight on a rainy day.

There are holes in the roof

and Acrow props have been put up to support the beams.

It's hardly a welcoming entry to a house, is it?'

Well, you've got a living area here.

Well, I say living area, I'm not sure you'd particularly want to live in it.

But then, through to sort of like a rear area at the back.

Kitchen on the side, I call it a kitchen, it's where a kitchen would be but totally unusable.

Through here, this steel door actually is to stop people

going into the front of the property, which is where the shop unit was.

That's actually completely dangerous and in fact,

held up by the scaffolding.

Upstairs, I'll just tell you about it! Three bedrooms and a bathroom.

Judging by first impressions...

it's equally dreadful.

# Danger! Danger!

# High voltage!

# When we touch When we kiss... #

Dreadful indeed and not very safe either.

There were several rooms we didn't venture into.

Judging by the dark and dingy light up there,

it doesn't look as though this place has been lived in for a while.

Once you get up to the top attic room,

the height of the building gives the impression

that there might be a good view of Tiverton out there but for that, we'll have to wait.

At the rear of the property there are these outbuildings

and like the rest of the place, they're falling to pieces

but I've stopped being worried about that

because I'm not seeing this as something that I would restore any more.

I'm thinking about knocking the whole thing down, so I'm looking at the footprint.

The location in Tiverton's really good and there's actually quite a lot of land here.

So, the fact that, you know, I'm guessing if I leant on that it might fall down,

it doesn't matter, because what I'm thinking is, development plot. Fantastic!

We asked the auctioneer who sold the property

to get his views on this site.

It had an apparently modest reserve price of under 30,000.

There's a need for more housing everywhere

and Tiverton's no different.

The council are short of affordable accommodation

and would be keen for anybody who's going to build affordable-type accommodation.

Encouraging news for people

wanting to knock this down and create something sympathetic in its place.

The site's going to take about 10 or £15,000 to clear

and you'd certainly fit four two/three-storey cottages in its place.

They'll cost 50,000 each, maybe a fraction more, to create.

We're talking about a possible budget of £200,000 to build houses on the site.

What about potential resale values?

They'll be worth something around £100,000 each.

Wow, that would be a great return, although it would mean a big capital outlay at the start.

What rent could you expect from each cottage?

It's a brilliant rental town.

You'll get something in the region of £500 per calendar month.

Well, if that low reserve price of under 30,000 quid didn't get them interested in the auction,

I think the potential of this place definitely should.

It's well located in Tiverton, it's a nice-size plot.

If you accept the fact you're just going to knock it down and start again,

then I think there's a huge opportunity here to make a lot of money.

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

The reserve is a very, very reasonable.

Who'll just start me off nice and simply with £20,000 for lot 29?

20, sir, thank you, 20 I have. At 20. At 20.

At 22? And 25, if I may?

28. And 30? 30?

30 I have. 32.

35?

35, 37, 38.

40, 42? 42.

45? Thank you, sir, 45.

45, 45. 48 in blue, 48.

-At 48?

-Nine.

49, OK, I will. 49. At 49?

50. At 50. All over the place.

I'm going to go 52,

52, 54's right at the back.

56, thank you, sir, 56.

58. 60...

Two, at 64 is set, 66.

68, 68. 68 in the blue.

At 68. 70 is set. At 70, at 70?

Two. At 72, 72. At 72.

At 72, you should... Three.

At 73, at 73.

74. At 74, 74 is in blue. 74.

75 or not? 74 I have.

At 74, once and twice.

74, now it's serious, you sure and done?

Third and last time. 74, in the blue, here we go, at 74 and out.

74, in the blue.

# Come on, baby, and rescue me

# Cos I need you by my side... #

It was Gerry who made the final successful bid of 74,000.

He works in finance for the oil and gas industry

and describes himself as a hobby developer.

He's local to the area,

but will that knowledge be enough for the mammoth task ahead?

-Gerry.

-Hello!

-Congratulations.

-Thank you very much.

-Now, what have you bought?

LAUGHTER

Well, I'm not quite sure, actually.

I think what I've bought

is a property in a lot of need of love and care

and I think we can build

four pretty decent dwellings here.

You said love and care - I think a bulldozer springs to mind.

The care factor is it's actually falling down at the front, as you've seen.

But what we aim to do, really, is to knock down the existing structure

but to rebuild it in the same sort of style.

It is in a Conservation Area.

But to create four what you'd call "affordable homes"

with great living space

and some wonderful views over the Devon hills from the top.

I'm a great believer,

there's certainly nothing that's cut and dried here,

but where everything's cut and dried there's no opportunity, so I hope this is an opportunity.

# Smash it up

# Smash it up

# Smash it up

# Smash it up. #

I agree that Gerry will have to demolish the original building as it's in a sorry state,

but why does he want to build four properties on this site?

I think there's a real need for affordable housing

within a number of these Devon towns, Tiverton in particular.

I think there should be a good supply of people

waiting to rent good living spaces.

Great, a social aspect to it as well.

I don't want to sound too magnanimous, but yeah,

I'd like to think it would give people some nice places to live as well at a good price.

Tell me a bit more about you. What do you do when you're not doing this?

I'm used to much bigger projects than this.

I'm a civil engineer by background but I've been working in finance.

I advise on multi-billion pound projects, mostly in oil and gas.

-Multi-billion?

-Multi-billion pound.

-Like, how many multi-billions?

-Well, you name it, but commonly in 5 billion, 10 billion bracket.

-Wow!

I advise on those sorts of projects

and as there's not a huge amount of oil and gas in this part of the world,

I have to do a lot of travelling, but it's lovely to come back.

So, do you have any experience of this kind of thing?

I think this is probably the most ambitious I've taken on to date,

although it's not probably the biggest I've taken on to date.

I have always been interested in property development.

My parents moved house so many times,

-I'm one of four children, we had to do a lot of work for them...

-Really?

..on many different properties, and from my teens, really, I've been doing up houses.

I've got a few properties that I have done this sort of thing to,

but this is really the most ramshackle I've ever taken on,

so I think that the vision has to be the greatest here

and I hope we can do something really quite special here.

Gerry's aim with this project is to build in a style

that's is in keeping with existing properties in the area.

Good news for the locals, but what about his budget and time scale?

I've really got a budget to do the whole lot, including the purchase, of 225.

-Right.

-I'd like to think we could come in below that.

I mean, we've got to keep costs down by doing things in one big swoop.

What kind of time is this going to take, do you think?

I've got to get plans in for what I intend to do here quite quickly,

I mean within a couple of months.

That's been set by the local authority.

We've had to shore up and make safe the bits that aren't safe, such as where the scaffolding is.

I'd like to think we can get the main structure up

so that we can start fittings and electrics, et cetera, inside

-under a dry roof within a new structure within a year.

-Right.

So, who's actually going to do the work?

Two builders in particular I've used... We've worked on a number of developments locally.

They'll be doing most of the work, but we'll be bringing in all sorts of different tradespeople,

even the local farmer with his tractor might show up during the demolition.

It's going to be a community project. People have said they'd love to get involved.

Great. Congratulations. Good luck with it.

We really look forward to seeing how you get on.

Gerry's obviously got some ambitious plans for this place,

but it seems like he's got the whole community behind him.

Turning this into four houses, I think, makes good financial sense.

Still, you shouldn't underestimate the work involved in a project like this.

So, how is he going to get on? You can find out later in the show.

Time has been impatient as ever. Have our buyers kept to their promises?

Yes, have all those plans been carried out?

Has the work been done? Let's go back and find out.

So, it's back to Walworth in South London now where Rizvan who works in the telecoms sector,

bought this one-bedroom, top-floor flat for 192,000.

With some lovely original features, it just looked in need of updating and decorating.

But Rizvan was also considering extending into the loft

although he needed to negotiate with the council

as they had the freehold and control of the roof space.

We're still trying to get answers from the council.

Hopefully, within a week or so, I should be in a position

to find out whether I can have usability of the loft.

He wanted a quick turnaround on this project

as he was keen to get it on the market as soon as possible.

We've returned just over one month later to see how he got on.

Well, it looks like the quick renovation job that Rizvan was after.

Everything appears finished and there has been a total freshening up of the place.

The bathroom has a new suite installed and is totally retiled.

Next on the menu must be the kitchen.

We've put in nice, neutral-coloured cabinets in here.

We've put in some nice, flashy tiles which were chosen by my wife.

We've put in a new cooker and oven with a hob and extractor fan.

We put in a nice, decent sink in here.

I think the costs which we managed to save was with the boiler.

The boiler seemed fine, it just needed a service.

So we've basically done that service and we've kept the original boiler.

Not having to replace the boiler definitely saved Rizvan some money.

Going to the upper level,

the bedroom has been re-plastered and decorated.

What about the living room?

The whole place itself has been redecorated.

There used to be a fireplace over here which we've taken out and blocked off.

The sash windows over here. They were in very, very good condition

and because they were an original feature,

they've just been redecorated.

I'm so glad he opted to keep the original windows.

They really help retain the character and charm.

After consulting local estate agents,

he's decided not to split the living room to make an extra bedroom.

But what about that possible loft conversion?

Basically, the head height wasn't exactly great

and the cost of actually putting in a loft extension and the resale value...

The numbers didn't really tally up together,

so I thought it would be much wiser just to keep the existing layout as it is.

Consulting the local estate agents was the smart thing to do.

There's no point in spending extra cash

when the sums don't add up. Although Rizvan took a gamble

when he bought this property without viewing it,

considering the apparent smoothness of the renovations,

despite buying blind, does he feel fortunate?

I think I was very, very lucky. It could have been much worse.

But the structure was fine. Works only took three weeks.

The expectation was that it was going to take four weeks.

But basically the guys who were working here did a great job

and they finished much earlier.

With his reliable team making short work here, did that help the budget?

We actually went slightly over budget.

We spent 10,500.

So, all in all, I think I am pretty much happy

with what I've spent on it.

Adding the 10,500 to the purchase price of 192,000

gives a total outlay of £202,500.

What do two local estate agents think of Rizvan's renovation?

My first impressions coming back to the property today

are really good. Very neutral, very smart, well done.

It's going to suit a multitude of applicants in the area.

I think the property's been done to a good standard.

The standard does reflect the area and the market

he's trying to promote the property to, so he's done a good job.

How much rent could this property earn?

If we were to put this property on the market for rent,

I would expect it to achieve in the region of £1,200 per calendar month.

If we were to put this poverty on the rental market today,

I would expect to achieve around about £1,100 per calendar month.

That would give a yield of between 6.5% and 7%.

However, this place has already been marketed for sale by one of these estate agents.

We were marketing the property

and we found we had an enormous amount of interest

from first-time buyers and investors alike.

When people were viewing the property, it came across that they really liked the space

and they really liked the fact that it was well done and very neutral.

That coupled with the location meant that it was always going to be a winner.

What would the other agent value it at?

If I was to put this on the open market now,

I would expect to achieve £235,000.

I had quite a few offers in.

The highest one, which I have accepted, is of 230,000.

So I'm not all that surprised but I am very much happy

that I've managed to get this offer which I've accepted.

That gives Rizvan a pre-tax profit of £27,500.

What does his estate agent think of that?

I feel that's a fair offer. Had we marketed the property a little bit longer,

we could maybe have achieved a little bit more.

But 230 is certainly a fair offer.

Is Rizvan happy with his decision to go for a quick sale

or should he have held out for more?

The aim was to get it up and ready for the market

and sell it off as soon as possible.

Timing is crucial cos I wanted to move over to a new property.

All in all, I'm very much happy with the results.

This is actually the eighth property Rizvan has bought,

having sold on all but two of the others.

What are his plans now?

The aim medium to long term, is to develop a portfolio

and gradually leave my job and start managing property full-time.

Back to Tiverton in Devon now,

where part-time property developer Gerry bought this dilapidated place for 74,000.

Even though he's used to conducting multibillion-pound deals

in his day job in the oil and gas industry,

he knew he had a challenge on his hands here.

I've got a few properties that I have done this sort of thing to,

but this is really the most ramshackle I've ever taken on.

So I think the vision has to be the greatest here,

and I hope we can do something really quite special here.

Jerry's plan was to demolish the crumbling property and,

as it's a Conservation Area,

build four cottage-style homes in keeping with the local style.

Well, 22 months later, we've come back to see if Gerry's vision is now a reality.

# Beautiful vision

# Stay with me all of the time

# Beautiful vision. #

Well, it's still a building site and very much a work in progress,

but a lot has been done.

The old property has been demolished and

although his original vision of building four dwellings has changed,

Gerry is well on the way to building three fantastic new homes.

Originally we thought up to four houses,

but when I looked at the plans, they were going to be really quite small

to get four houses here.

It's a confined site.

I wanted to have parking and I wanted to have some outside space,

we needed to have some outside space, utility area, etc,

for the planning approval.

I actually thought when I walked around with the architect,

three is going to be nicer than four.

And I didn't want to build rabbit hutches, I wanted to build three character properties.

They're all different.

Slight change in plan, then,

with the development now consisting of a two-bedroomed house...

..and a one-bedroom flat with a two-bedroom maisonette above.

Also, Gerry wanted to introduce something

which was slightly lacking in the original property -

light.

Yes, so here we are in the two-bedroom maisonette.

We're standing on what is essentially going to be a thoroughfare.

We've got the bedroom over there.

What I really like about this is we're going to have stair access up to the second bedroom,

which will have some really nice views

from a Velux window in the circular slated roof.

We've also tried to use a lot of natural light in the design.

If you look down here, you can have quite a good view

of what is essentially quite a pretty Tiverton street.

I think it's going to be a nice place to live.

Kitchen, bathroom... Yeah. I'd be pleased to entertain people here.

# Let me entertain you

# Entertain you Come on, come on... #

Well, this project hasn't always been entertaining for Gerry. There's been a lot of hard work.

Before construction could begin, the old building had to be demolished,

a technical challenge in itself.

We had structural engineers involved. We had to be sure that everything was safe.

In fact, we were using the scaffolding to support the building

because if you recall when I bought the building,

the front face over the shop was falling down.

One of the reasons I got the building for a good price was it was unsafe.

So we shored everything up and then took it down brick by brick.

All the windows and the rotten wood out, roof structure, rafters -

the whole lot.

Everything we could use, we did. In terms of hard-core.

Gerry has spent more than he expected.

He purchased the property for 74,000 and the demolition and building work

has come in at around 200,000,

giving him a projected overall outlay of £274,000.

We asked two local property experts for their opinions on the work so far.

Well, it's quite a transformation from what was here before.

It's a new-build development, so it's obviously going to be finished to a good standard.

It's a good location for getting into town.

It's really nice to see the developers are replacing

a lot of the old features

with the new, up-to-date edition.

But what they are trying to do is keep those in mind

with the curved fascia and the sash windows that are going in.

What about valuations for the two-bedroom house?

We'd be looking to achieve something in the region of £115,000.

Around about £120,000 for the house.

And the two-bedroom maisonette?

Perhaps 110,000 for the maisonette.

We would look to market the property at £105,000.

And finally, the one-bedroom flat.

Probably in the region of £75,000-£80,000.

We would expect to achieve something in the region of £85,000.

So those estimated values would make the whole site

worth between £295,000-£315,000

giving Gerry a pre-tax profit of between £21,000-£41,000.

However, his plans have always been to rent these properties out.

And the expert's valuations on these properties

give him an estimated rental income of between £1,250 and £1,525 per month.

That would mean a yield of between 5% and 6%.

My plan is normally just to rent them out at slightly below market value

and get long-term tenants who look after the place,

treat it as their own, and quid pro quo is I give them a good deal on monthly rental.

Despite the time this development has taken,

how does Gerry feel about it all?

I really enjoyed the whole experience of buying at auction.

I'm very pleased with how it's turned out.

I'm very excited about doing further developments in the locality.

He seems very unfazed by all the challenges he faced.

What advice would he give other would-be developers?

I've got a saying,

if it doesn't frighten you, you're not thinking big enough.

So many different auction experiences.

We'll have plenty more where they came from.

-Look forward to seeing you then.

-Goodbye.

-Goodbye.

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