0:00:02 > 0:00:05Hello. Now, buying property isn't always as easy as it seems,
0:00:05 > 0:00:08especially if you get stuck in one of those dreaded property chains.
0:00:08 > 0:00:13But you can eliminate that part altogether, if you buy at auction.
0:00:38 > 0:00:41There are all sorts of properties coming up for auction these days.
0:00:41 > 0:00:45And their buyers have all sorts of plans and budgets for them.
0:00:45 > 0:00:49So let's see which ones are featured on the show today.
0:00:50 > 0:00:55Is it the big garden and rooms in this Canterbury house that had me jumping for joy?
0:00:57 > 0:00:59I shouldn't really be doing that!
0:01:00 > 0:01:03In Derby, don't be put off by the size of this property.
0:01:03 > 0:01:06It needs updating, it needs modernising,
0:01:06 > 0:01:09but, oh, it feels really spacious.
0:01:10 > 0:01:13And this Doncaster end-of-terrace clearly needs work.
0:01:13 > 0:01:18The kitchen's already been stripped out downstairs.
0:01:18 > 0:01:20sadly, it doesn't get much better upstairs.
0:01:21 > 0:01:24All these properties went to auction.
0:01:24 > 0:01:27We'll find out who bought them and what they paid for them,
0:01:27 > 0:01:29- when they went under the hammer. - Sold.
0:01:34 > 0:01:39I've come to Canterbury in Kent, a city brimming with history.
0:01:39 > 0:01:44It's home to England's oldest cathedral, which has attracted thousands of pilgrims,
0:01:44 > 0:01:49as Geoffrey Chaucer told in his famous The Canterbury Tales.
0:01:49 > 0:01:52There are three main universities here,
0:01:52 > 0:01:55so there's a large population of students.
0:01:55 > 0:02:00Well, the property I'm here to see is close by this newly-built student accommodation, which bodes well.
0:02:00 > 0:02:05Right by the side of a main road, but there could be bus routes, so again, that's good news.
0:02:05 > 0:02:09So what is it? Basically, a two-bedroomed end-of-terrace, Victorian,
0:02:09 > 0:02:11at a guide price of 90 to 100,000 quid.
0:02:11 > 0:02:14Obviously, there's lots of learning going on here.
0:02:14 > 0:02:17Let's learn about the property.
0:02:22 > 0:02:25# Locked out... #
0:02:25 > 0:02:28Right, first lesson... Can't get in through the front.
0:02:28 > 0:02:30Better try the back.
0:02:30 > 0:02:32# Locked out... #
0:02:32 > 0:02:34Well, that's the first test failed.
0:02:34 > 0:02:37Let's hope things improve round the back.
0:02:39 > 0:02:41I've got to get in here somehow.
0:02:43 > 0:02:46So what have we got?
0:02:48 > 0:02:50Oh, dear.
0:02:50 > 0:02:53Well, this is the kitchen.
0:02:53 > 0:02:58As you can see, it's, er, yes, it's in a right old state.
0:02:58 > 0:02:59Pfft!
0:02:59 > 0:03:01You're going to rip it all out, let's face it.
0:03:01 > 0:03:04What we like about the room is its size.
0:03:04 > 0:03:08It is good. You could easily get a dining room table in there or whatever.
0:03:08 > 0:03:12Nice high ceilings. What we don't like is all this mould.
0:03:12 > 0:03:13I mean, look at it!
0:03:13 > 0:03:17Well, let's hope the rest of the house isn't quite so...wet.
0:03:19 > 0:03:23And the mushrooms in this kitchen aren't the edible type.
0:03:23 > 0:03:26There are some serious damp issues here.
0:03:26 > 0:03:31So, an alarming start for this property, that went to auction
0:03:31 > 0:03:33guided at 90 to 100,000.
0:03:35 > 0:03:37Let's hope this isn't a sign of things to come.
0:03:39 > 0:03:41- What on earth is that? - HE CHUCKLES
0:03:41 > 0:03:43No idea!
0:03:43 > 0:03:45Well, anyway, I'm liking the size of this room.
0:03:45 > 0:03:48Really good-sized space and I think even these floorboards
0:03:48 > 0:03:50and everything would clean up quite nicely.
0:03:50 > 0:03:54Archway through to the front room, if you like.
0:03:54 > 0:03:57Again, nice floorboards. Well, nice floorboards here.
0:03:57 > 0:04:01But what is going on towards the bay window here. Ooh, my word!
0:04:02 > 0:04:06I shouldn't really be doing that! That is not good.
0:04:06 > 0:04:12My guess is that, well, the joists underneath there have rotted away,
0:04:12 > 0:04:14probably due to water coming in here.
0:04:14 > 0:04:17And, if I'm not mistaken...
0:04:21 > 0:04:24# The dust on the ground... #
0:04:24 > 0:04:26Not very good, is it?
0:04:30 > 0:04:32Hmm, just as I feared, more damp.
0:04:32 > 0:04:36This is a worry, as the back of the house is riddled with damp -
0:04:36 > 0:04:38and the front.
0:04:38 > 0:04:42I just hope whoever bought this property at auction
0:04:42 > 0:04:45factored the expense of getting the damp sorted into their budget.
0:04:47 > 0:04:49This place is gradually rotting away.
0:04:51 > 0:04:55The large garden is slowly taking over.
0:04:55 > 0:04:58So I wonder what the upstairs will be like?
0:04:58 > 0:05:01Well, you've got two really good-sized bedrooms
0:05:01 > 0:05:04and a view of the mountains!
0:05:04 > 0:05:11# Mama, look at the mountain Papa, look at the sea... #
0:05:11 > 0:05:15So, through to the bathroom and the loo. Well, it's a separate loo here.
0:05:15 > 0:05:18And the bathroom itself is here.
0:05:18 > 0:05:21It's got a bath and shower and it's got just way too much space.
0:05:21 > 0:05:25I mean, look at it! I don't know if, at some stage, judging by the fireplace here,
0:05:25 > 0:05:26this might have been a bedroom.
0:05:26 > 0:05:31Well, certainly I think that is something you should consider turning it back to.
0:05:31 > 0:05:33It's disproportionately big, I think.
0:05:33 > 0:05:36Well, if this was a family home, maybe it would work pretty well.
0:05:36 > 0:05:39But if we're thinking about using this as a student let,
0:05:39 > 0:05:41it's all about maximising the number of bedrooms
0:05:41 > 0:05:44and I reckon you could get another bedroom in here.
0:05:44 > 0:05:47So, with a bit of playing around, how many bedrooms do we think we could get?
0:05:47 > 0:05:50Two downstairs, obviously. Convert those two.
0:05:50 > 0:05:55One here, that's three. Maybe that front bedroom, split that into two. So that's another one.
0:05:55 > 0:05:58I reckon you could get six bedrooms in this place.
0:05:58 > 0:06:03Six bedrooms, say, £80 a week, that's £480 a week.
0:06:03 > 0:06:07That's nearly £25,000 a year.
0:06:07 > 0:06:11Take off holidays, maybe it's 24, 23. It's still a lot of money!
0:06:15 > 0:06:19There's one more surprise in this property. There's a basement.
0:06:19 > 0:06:25That could be converted into the ideal communal room for a student let.
0:06:25 > 0:06:27But remember, you must check with the local council
0:06:27 > 0:06:30before carrying out any basement conversion.
0:06:30 > 0:06:34There may be planning permission required and strict
0:06:34 > 0:06:37and strict building regulations to comply with.
0:06:37 > 0:06:40We asked a local estate agent to come and have a look around
0:06:40 > 0:06:46and give his opinions of this house that went to auction, guided at 90 to £100,000.
0:06:46 > 0:06:49There's a lot of potential here
0:06:49 > 0:06:54for someone either to convert into student accommodation
0:06:54 > 0:06:56or to redevelop into a family house.
0:06:56 > 0:07:00If the property was just renovated and kept in its current configuration,
0:07:00 > 0:07:05how much could it be worth if put back on the market?
0:07:05 > 0:07:08Once renovated, if the configuration's kept as it is,
0:07:08 > 0:07:13the value is going to be enhanced to probably £170,000.
0:07:13 > 0:07:19What rent could it generate if it wasn't divided into flats and let to a family instead?
0:07:19 > 0:07:24If renovated and refurbished as is, and then let to professionals
0:07:24 > 0:07:30or a family, the rental value would be about £650 per calendar month.
0:07:30 > 0:07:34How does that £650 a month compare with student lets?
0:07:34 > 0:07:38Let's take a conservative example of four students.
0:07:38 > 0:07:44If renovated and let to four students, they would each pay about £330 per month.
0:07:47 > 0:07:51That would translate to over £1,300 a month in total.
0:07:51 > 0:07:56So there's no doubt that letting to students holds the most profitable future here.
0:07:56 > 0:08:00Well, there's clearly a bit of work required to sort this place out
0:08:00 > 0:08:05but, you know what, spend a bit of money here and I think you've got yourself a real money-earner.
0:08:05 > 0:08:07It's a big house in the right location.
0:08:07 > 0:08:09Let see who spotted it when it went under the hammer.
0:08:09 > 0:08:12Lot 69, it's an end terrace.
0:08:12 > 0:08:15Does has a bit of gas heating, does have some double glazing.
0:08:15 > 0:08:18It's two bedrooms. It's got a guide of 90 to 100,000.
0:08:18 > 0:08:22Start me at 90, give you all a chance. 90, I have, thank you.
0:08:22 > 0:08:26£90,000, I'm bid, and five, I have. 100, and five.
0:08:26 > 0:08:31And five is bid. 110, 115, and 20, and 125?
0:08:31 > 0:08:34125 and 130.
0:08:34 > 0:08:37135? No. £130,000 is bid.
0:08:37 > 0:08:38132?
0:08:38 > 0:08:42132 in a fresh place. 135 is bid. 138?
0:08:43 > 0:08:45135, 136,
0:08:45 > 0:08:47137, 138.
0:08:50 > 0:08:53138 in a fresh place. 139 and 140,
0:08:53 > 0:08:56142 and 144.
0:08:56 > 0:08:58144, 146 and 148? No.
0:08:58 > 0:09:03146, I'm bid. At £146,000 is bid.
0:09:03 > 0:09:09At £146,000, bid on my right-hand side, against the wall.
0:09:09 > 0:09:11And a half?
0:09:11 > 0:09:13And seven?
0:09:13 > 0:09:19At £147,000, I have. For the first time at 147,000...
0:09:19 > 0:09:21For the second time at 147,000...
0:09:21 > 0:09:24Third and final time.
0:09:24 > 0:09:28The bid is on my right-hand side. At £147,000, are you all done?
0:09:28 > 0:09:30- BANGS GAVEL - Sold at 147,000.
0:09:30 > 0:09:37Those successful new owners, who paid £147,000, are local couple Ronnie and his wife Catherine.
0:09:37 > 0:09:41They used to be teachers , but are now full-time developers
0:09:41 > 0:09:44and own other buy-to-let properties in Canterbury.
0:09:44 > 0:09:48I caught up with them back at the house to find out
0:09:48 > 0:09:51why they were so keen to get their hands on it.
0:09:51 > 0:09:54- Ronnie, Catherine, lovely to meet you both.- And you.
0:09:54 > 0:09:56- Congratulations.- Thank you.
0:09:56 > 0:09:58Tell me why you wanted to buy this place.
0:09:58 > 0:10:01Well, I think there's three things about Canterbury that you need to understand.
0:10:01 > 0:10:04Firstly, it's a beautiful, beautiful city. It's full of history.
0:10:04 > 0:10:06It's full of culture. It's got two theatres.
0:10:06 > 0:10:09The second thing is, it's a university city, a vibrant city.
0:10:09 > 0:10:13It's a great place to be, which is why we live here as well.
0:10:13 > 0:10:17And then the third thing is that, in October this year, the legislation's changing,
0:10:17 > 0:10:22so most university city councils can now choose to give permission or
0:10:22 > 0:10:26to withhold permission for people to set up multi-lets for students.
0:10:26 > 0:10:31That means that university city councils like Canterbury can limit
0:10:31 > 0:10:36the proportion of HMOs, or houses in multiple occupation, within a certain area.
0:10:36 > 0:10:40For student landlords, that means the clock is ticking when it comes
0:10:40 > 0:10:46to any likelihood of getting a new HMO licences for new premises.
0:10:46 > 0:10:52So, Ronnie and Catherine bought this place just in time.
0:10:52 > 0:10:54But what was so appealing about it?
0:10:54 > 0:10:58I looked at the spec and I thought, "That's only going to be for four students."
0:10:58 > 0:11:00And I came in here and I looked it and I thought,
0:11:00 > 0:11:04"There's letting room one there." That's a good-sized room. This is a good-sized room.
0:11:04 > 0:11:07Kitchen is a nice-sized kitchen.
0:11:07 > 0:11:13The basement, perhaps, the hope is that we can turn it into a communal area down there.
0:11:13 > 0:11:18Then upstairs, I looked and saw the bathroom and I thought, "Why does this have to be a bathroom?"
0:11:18 > 0:11:22Because the other two rooms are big, as well.
0:11:22 > 0:11:24So, if the bathroom is turned into a bedroom, you've got natural light.
0:11:24 > 0:11:27You don't need natural light for bathrooms, really.
0:11:27 > 0:11:29So we can put two bathrooms up there, still leaving
0:11:29 > 0:11:32a very good-sized bedroom and then two rooms at the front, as well.
0:11:32 > 0:11:36So it's going to be a very spacious student property.
0:11:36 > 0:11:39But a six-bedroom one, so a bit of a money-spinner.
0:11:39 > 0:11:42It depends on what happens with the student market,
0:11:42 > 0:11:46because there are all sorts of changes happening with the student fees.
0:11:46 > 0:11:48The numbers might drop.
0:11:48 > 0:11:54But, on current status, it would be about 28,000 a year.
0:11:54 > 0:11:58A healthy income from the six bedrooms they're proposing -
0:11:58 > 0:12:00two on the ground floor,
0:12:00 > 0:12:05while upstairs, the front bedroom will be divided into two more.
0:12:05 > 0:12:09The fifth bedroom will go where the bathroom is.
0:12:09 > 0:12:13And bedroom six made from what's left over after the back bedroom's
0:12:13 > 0:12:16been split into two bathrooms and a bedroom.
0:12:16 > 0:12:18The couple both clearly have a lot of experience,
0:12:18 > 0:12:22so what are their roles in the business?
0:12:22 > 0:12:25Ronnie does a lot of the maintenance
0:12:25 > 0:12:29and I find the properties, organise the finance.
0:12:29 > 0:12:32I do a lot of the accounts.
0:12:32 > 0:12:35- I started off life as a bench joiner.- Oh, really?
0:12:35 > 0:12:39But obviously, I'll need to bring in gas-safe plumbers and electricians, and things like that.
0:12:39 > 0:12:42But most of the practical work, I do myself.
0:12:42 > 0:12:44And the budget, then, approximately?
0:12:44 > 0:12:48We're looking at around about 25,000, that sort of figure.
0:12:48 > 0:12:50And what's the timescale?
0:12:50 > 0:12:53Well, we want to turn it round in about three months,
0:12:53 > 0:12:57because we've got to get it ready for the end of August/September.
0:12:57 > 0:13:00- The intake.- Yeah, so it's tight, but I'm confident we can do it.
0:13:00 > 0:13:03- Well, congratulations to you both. Good luck with it.- Thank you.
0:13:03 > 0:13:07- And I look forward to seeing how you get on.- OK, thank you.
0:13:07 > 0:13:11Well, Ronnie and Catherine certainly seem to know what they're doing
0:13:11 > 0:13:15and they've got the experience to make a success of this place.
0:13:15 > 0:13:19But I still think it's going to be, well, a bit of a squeeze to get those six bedrooms in.
0:13:19 > 0:13:24And, of course, they're on a timescale to get it all sorted out before the new term.
0:13:24 > 0:13:27How will they get on? You can find out later in the show.
0:13:31 > 0:13:34For the next property that went under the hammer,
0:13:34 > 0:13:36I'm in the Midlands, in the suburbs of Derby.
0:13:36 > 0:13:40In fact, I'm about three miles from the city centre, in Alvaston.
0:13:40 > 0:13:43Alvaston used to be a village on the outskirts of Derby,
0:13:43 > 0:13:48but in the mid-19th century, it became a terminus for a tram route.
0:13:48 > 0:13:52So with this direct commuter link straight into Derby,
0:13:52 > 0:13:54it became a popular place to settle.
0:13:54 > 0:13:59And Alvaston boomed with streets and streets of houses being built.
0:13:59 > 0:14:04Now it's very much a suburb, but it's still a popular place to live for commuters.
0:14:04 > 0:14:09# We're on the outskirts of the town... #
0:14:09 > 0:14:12The tram no longer exists, but Derby is still within
0:14:12 > 0:14:16easy striking distance, with plenty of road and bus links.
0:14:16 > 0:14:22So what am I here to see? Well, it's this semi-detached house,
0:14:22 > 0:14:27which I think looks like it's a bit crammed into the corner of this cul-de-sac.
0:14:27 > 0:14:30It had a guide price of £50,000 and it was described
0:14:30 > 0:14:35in the auction catalogue as "having two or three bedrooms".
0:14:35 > 0:14:38So, come on, which is it, two, or is it three?
0:14:38 > 0:14:40I'm going to go in and find out.
0:14:42 > 0:14:45This entrance path is not that inviting, with all these weeds,
0:14:45 > 0:14:50but the property has double glazing and looks basically sound.
0:14:51 > 0:14:54Not a huge entrance hallway.
0:14:54 > 0:14:59You sort of walk straight in to this rather unusual sort of bookcase
0:14:59 > 0:15:02that goes all the way up the stairs.
0:15:02 > 0:15:04So, here we are.
0:15:04 > 0:15:08Now, actually, it's just shows you first impressions can be WRONG,
0:15:08 > 0:15:10because that's quite a big room.
0:15:10 > 0:15:13That's quite a big room and, come in here,
0:15:13 > 0:15:16look at the size of this kitchen!
0:15:16 > 0:15:17Wow!
0:15:17 > 0:15:21There's a lot of space in here. You could really use this to your advantage.
0:15:21 > 0:15:25A lovely family table down that end, so you could eat in here.
0:15:25 > 0:15:28You could get away with potentially just changing the worktops.
0:15:28 > 0:15:33You could change the units as well, but they don't look to be in that bad a condition.
0:15:33 > 0:15:37Er, some rather interesting features in this house so far. Look at that!
0:15:37 > 0:15:41It like a radiator cover that they've wrapped round the boiler.
0:15:41 > 0:15:44You know, it needs updating, it needs modernising. But, erm, cor!
0:15:44 > 0:15:46It feels really spacious.
0:15:46 > 0:15:50Like the kitchen, the two reception rooms could also do with
0:15:50 > 0:15:53a bit of updating and redecorating.
0:15:53 > 0:15:55But the house, that was guided at 50,000 plus,
0:15:55 > 0:16:00has gas central heating and appears to be structurally sound.
0:16:02 > 0:16:05But, at the back, the original windows and doors
0:16:05 > 0:16:09have obviously been moved and the large garden needs attention.
0:16:09 > 0:16:13Well, that's not great to look at when you walk out your back door,
0:16:13 > 0:16:17so, I think we're agreed, a lot of that's got to go.
0:16:17 > 0:16:20You need to get a skip with this house but,
0:16:20 > 0:16:23when you buy a corner plot property, you don't always get a lot of room.
0:16:23 > 0:16:26Well, look. Check this out.
0:16:26 > 0:16:28This is a huge garden!
0:16:28 > 0:16:30I can really see a family loving this,
0:16:30 > 0:16:33but you must always remember, when you let to tenants,
0:16:33 > 0:16:36you've got to make sure that they maintain the garden.
0:16:36 > 0:16:39And it's got to be done on a regular basis.
0:16:39 > 0:16:45Otherwise, this large family garden could quickly become an untamed jungle.
0:16:45 > 0:16:50So, back inside, I head upstairs to discover just how many bedrooms there are.
0:16:52 > 0:16:56So here we are upstairs. There's bedroom one - quite big.
0:16:56 > 0:17:00We've got bedroom two over here - spacious.
0:17:00 > 0:17:02A bathroom - that's really large.
0:17:03 > 0:17:07Is that the possible third bedroom, as described in the catalogue?
0:17:07 > 0:17:12Aha! No, it's a shower room. There is literally a shower squashed in the corner.
0:17:12 > 0:17:15Now, I suppose at one point in the house's history,
0:17:15 > 0:17:17it would have been the third bedroom.
0:17:17 > 0:17:19Should you convert this back again?
0:17:19 > 0:17:22Well, I like plenty of bathrooms, but for a house this size,
0:17:22 > 0:17:25two just seems a bit excessive.
0:17:25 > 0:17:28And a third bedroom, well, that would make the place more saleable.
0:17:28 > 0:17:30And it will give you a higher rental return.
0:17:30 > 0:17:36So, if this was mine, I would ditch the shower, I would steal a bit of the bedroom from next door,
0:17:36 > 0:17:40knock that wall down so you've got a big, large bedroom here.
0:17:40 > 0:17:43You could leave the bathroom where it is.
0:17:43 > 0:17:46Or you could turn this bathroom into a bedroom
0:17:46 > 0:17:49and put that three-piece suite into here.
0:17:49 > 0:17:52So you've got a few options to help get that third bedroom.
0:17:52 > 0:17:58Would all that rearranging and replumbing to get a third bedroom really be worth it?
0:17:58 > 0:18:03# Everything must change... #
0:18:05 > 0:18:07Time to ask a local estate agent what
0:18:07 > 0:18:09she thinks of this corner house.
0:18:09 > 0:18:12The property itself, tucked away in a little corner.
0:18:12 > 0:18:16It's deceptive from the front, opens out into this nice, spacious house.
0:18:16 > 0:18:19Needs a little bit of TLC.
0:18:19 > 0:18:21In general, it's in good, solid condition.
0:18:21 > 0:18:24Two bathrooms and two bedrooms doesn't really make any sense.
0:18:24 > 0:18:30I think the larger of the two bathrooms could be made back into a bedroom.
0:18:30 > 0:18:33If it was bought by a buy-to-let investor,
0:18:33 > 0:18:36how much rental income could they hope to generate here
0:18:36 > 0:18:40as a two or, if converted, three-bedroom property?
0:18:40 > 0:18:43If the property remained as a two-bedroom property,
0:18:43 > 0:18:46you're looking between 400 and £425 per calendar month.
0:18:46 > 0:18:51If it was made into a three-bed, you'd increase that up to
0:18:51 > 0:18:54approximately £475 per calendar month.
0:18:54 > 0:18:58What could it be worth if sold on after a refurbishment?
0:18:58 > 0:19:01If the property was improved to a reasonable standard,
0:19:01 > 0:19:04yet remained as a two-bedroom property, the maximum you can expect
0:19:04 > 0:19:07on the open market at the minute would be £75,000.
0:19:07 > 0:19:13Made into a three-bed, you're looking at up to about 90, maybe 95,000.
0:19:15 > 0:19:18This house needs a bit of an update but, other than that,
0:19:18 > 0:19:21I think it's quite a nice little property.
0:19:21 > 0:19:24But will the new owner think the shower room
0:19:24 > 0:19:26is a bonus or better off as a bedroom?
0:19:26 > 0:19:29Let's find out who bought this at the auction.
0:19:29 > 0:19:32Lot number four, tucked away in the corner of a cul-de-sac,
0:19:32 > 0:19:37it's a two/three-bedroom semi-detached property
0:19:37 > 0:19:39with a large garden, illustrated there for you.
0:19:39 > 0:19:43How much for this one? 48 will start me.
0:19:43 > 0:19:4548? 48,000, thank you.
0:19:45 > 0:19:48At 48,000, 49 I've got.
0:19:48 > 0:19:5249,000, 50? 50,000.
0:19:52 > 0:19:53At 50,000, 51 is bid.
0:19:53 > 0:19:55At 51, 52?
0:19:55 > 0:19:5952. At 52? 53?
0:19:59 > 0:20:0453. At 53, 54? 54?
0:20:04 > 0:20:10Try another one, sir. It's worth another bid. 54 and a half. 55?
0:20:10 > 0:20:15At £54,500 and across the way, 55 quickly, anywhere else?
0:20:15 > 0:20:18For the first time at 54,500... Second time...
0:20:18 > 0:20:20Third and last...
0:20:20 > 0:20:24- BANGS GAVEL - Sold at 54,500, thank you.
0:20:24 > 0:20:29Well, that final successful bid of £54,500 was made by
0:20:29 > 0:20:31Birmingham-based developer Aziz.
0:20:33 > 0:20:37He used to teach electrical engineering, but is now a full-time developer,
0:20:37 > 0:20:40so why did he want to add this to his portfolio?
0:20:42 > 0:20:46I met him back at his latest purchase to find out.
0:20:46 > 0:20:50- Aziz, hello. Congratulations! - Thank you very much. - What a lovely surprise!
0:20:50 > 0:20:53You know, from the outside, your house looks incredibly pinched,
0:20:53 > 0:20:56but you walk in - it's just like a big TARDIS!
0:20:56 > 0:20:59Very deceptive. Corner plot, massive garden at the back, big-size rooms.
0:20:59 > 0:21:02All the amenities very close by.
0:21:02 > 0:21:03So how well do you know Alvaston?
0:21:03 > 0:21:08I've got a couple of other properties in Alvaston and Allenton, so I know it's an established area.
0:21:08 > 0:21:10People do want it, it's in demand.
0:21:10 > 0:21:12So what have you bought this for?
0:21:12 > 0:21:16Renting it. I'm in the letting business, so I'll rent it.
0:21:16 > 0:21:18So how many years have you been developing for?
0:21:18 > 0:21:24Oh, I've been dabbling in properties on and off for the last 10-15 years. But this is now first year full-time.
0:21:24 > 0:21:25How many properties are in your portfolio?
0:21:25 > 0:21:29Well, in Derby, about nine or ten, in the last six months.
0:21:30 > 0:21:34Being an experienced developer, Aziz did his homework with this house.
0:21:34 > 0:21:37He read the legal pack before the auction, which was just as well,
0:21:37 > 0:21:43because there was a potential fly in the ointment for anyone who wasn't prepared.
0:21:44 > 0:21:47It was cash buyers only.
0:21:47 > 0:21:51# Stop acting like the fly in my ointment
0:21:51 > 0:21:53# Cos that's what you are... #
0:21:53 > 0:21:58The reason he had to pay cash was because the property had only
0:21:58 > 0:22:01been bought very recently and then offered straight back for sale.
0:22:01 > 0:22:05This is known as a back-to-back sale
0:22:05 > 0:22:08and mortgages are not available in these situations.
0:22:08 > 0:22:12Like I always say, it really pays to do your research.
0:22:14 > 0:22:18What do you intend doing here, to really get the most out of a house like this?
0:22:18 > 0:22:21Relocate the bathroom, do the kitchen up again,
0:22:21 > 0:22:25tile it and redecorate it, new carpets, obviously.
0:22:25 > 0:22:28So let's talk about that bathroom.
0:22:28 > 0:22:31You've got a really big bathroom, a very small shower room
0:22:31 > 0:22:33and, currently, only two bedrooms.
0:22:33 > 0:22:37Now, in the auction catalogue, it said "two or three bedrooms".
0:22:37 > 0:22:39How are you going to turn that around?
0:22:39 > 0:22:41Well, we're going to take the bathroom where it is
0:22:41 > 0:22:45at the moment into the smaller room, where the shower cubicle is.
0:22:45 > 0:22:46It's a waste of space, to me.
0:22:46 > 0:22:50For my returns, the bathroom has to be the smaller one.
0:22:50 > 0:22:52We'll get the shower in there, we'll get the bath in there,
0:22:52 > 0:22:55we'll get the wash basin and the WC - the lot - in there.
0:22:55 > 0:22:58And the current bathroom will become a third bedroom.
0:22:58 > 0:23:00And downstairs, how will you change the kitchen around?
0:23:00 > 0:23:04The kitchen is coming out, new kitchen is going in. This will become a kitchen-cum-diner.
0:23:04 > 0:23:08The kitchen is concentrating, basically, on that window there
0:23:08 > 0:23:12along there and all this will be taken out and dining table in here.
0:23:12 > 0:23:15So do you think this is a really rentable house, it'll go like that?
0:23:15 > 0:23:18Oh, it is. I've already got two potential tenants for it.
0:23:18 > 0:23:22- Really?- Yep.- So what's your budget for the work here?- About five grand.
0:23:22 > 0:23:25- So you can turn this around with five grand?- About £5,000, yes.
0:23:25 > 0:23:27And have you got a team of builders?
0:23:27 > 0:23:31I've got a team of workmen who work with me all the time, very closely.
0:23:31 > 0:23:33For the last nine months they've been working with me.
0:23:33 > 0:23:38We'll turn it around, with that money, in about four weeks.
0:23:38 > 0:23:42Aziz might be very experienced, but turning this place around
0:23:42 > 0:23:46in just a few weeks, on such a small budget, is going to be tough.
0:23:46 > 0:23:49But he seems more than capable of getting the job done.
0:23:52 > 0:23:55What is it about you that keeps you striving forward?
0:23:55 > 0:23:57It's the passion about it.
0:23:57 > 0:24:01I just love doing something, meeting new people. Like the properties.
0:24:01 > 0:24:04I don't know whether it's in my blood or not, but I just like 'em,
0:24:04 > 0:24:10like doing them and I like to get out and do something, rather than sit on my laurels and do nothing.
0:24:10 > 0:24:14Aziz, I can't wait to see what you do. Congratulations. Well done.
0:24:14 > 0:24:15Thank you very much.
0:24:20 > 0:24:23Aziz has been property-developing for quite a while now
0:24:23 > 0:24:27and he seems to have everything under control,
0:24:27 > 0:24:31and he's well on his way to building up a nice rental portfolio.
0:24:31 > 0:24:36But will he really be able to get this done in four weeks for just five grand?
0:24:36 > 0:24:39After all, he's switching bathrooms for bedrooms
0:24:39 > 0:24:41and turning showers into baths.
0:24:41 > 0:24:43That's a lot of plumbing to sort out!
0:24:43 > 0:24:47Will he do it? Find out later on in the programme.
0:24:48 > 0:24:52Coming up. This Doncaster terrace needs major work, in the bedrooms,
0:24:52 > 0:24:57the bathroom and the kitchen, as you can see, is in a right old state.
0:24:58 > 0:25:04We return to Derby, where Aziz has found extra work.
0:25:04 > 0:25:08I wasn't very happy with the wiring, so I took it out and rewired it.
0:25:10 > 0:25:16But first, it's back to Canterbury, where the mountain air has been most refreshing.
0:25:16 > 0:25:18We're very pleased with the way it's all turned out.
0:25:20 > 0:25:26We're now returning to Canterbury in Kent where, earlier in the programme,
0:25:26 > 0:25:30local full-time property developers, Ronnie and his wife Catherine,
0:25:30 > 0:25:35bought this two-bed end-of-terrace for £147,000.
0:25:37 > 0:25:40The deceptively large house was in a right old state.
0:25:40 > 0:25:45The couple plan to add it to their portfolio of student lets.
0:25:47 > 0:25:52And Ronnie soon discovered that the place had mountains of potential.
0:25:52 > 0:25:56I looked at the spec and I thought, "That's only going to be for four students."
0:25:56 > 0:26:00Then upstairs, I looked and saw the bathroom and thought, "Why does this have to be a bathroom?"
0:26:00 > 0:26:03So it's going to be a very spacious student property.
0:26:03 > 0:26:06But a six-bedroom one, so a bit of a money-spinner?
0:26:06 > 0:26:13The numbers might drop, but on current status, it would be about 28,000 a year.
0:26:13 > 0:26:17It's now four months later and we're back.
0:26:24 > 0:26:28Inside, the dry rot in the bay window has been fixed and new joists
0:26:28 > 0:26:34and floorboards installed, and the first of six bedrooms created.
0:26:34 > 0:26:37The large through-living room has been bricked up
0:26:37 > 0:26:41and bedroom two has been constructed.
0:26:41 > 0:26:45The wall has been removed, so access to the kitchen is now through the hall.
0:26:45 > 0:26:52That damp kitchen has been completely refitted with new appliances and units.
0:26:55 > 0:26:58There's just the ceiling to plaster.
0:27:00 > 0:27:04So, two bedrooms on the ground floor and four more on the first floor.
0:27:04 > 0:27:07OK, so as you might remember,
0:27:07 > 0:27:10this is the original door which went through to the second bedroom.
0:27:10 > 0:27:14That was the one that had the big alpine fresco on the wall.
0:27:14 > 0:27:17So now it's a shower room with a WC.
0:27:17 > 0:27:21Then what we did, we opened up here and put in a bathroom
0:27:21 > 0:27:24so we've got a bath/shower over.
0:27:24 > 0:27:27So now you have the two shower facilities that you need.
0:27:27 > 0:27:30Then we opened up this area here.
0:27:30 > 0:27:32So we took this wall back
0:27:32 > 0:27:35and created a corridor through into this bedroom.
0:27:36 > 0:27:41So that's one bedroom upstairs and then the large front bedroom
0:27:41 > 0:27:45has been split into two further bedrooms.
0:27:45 > 0:27:48The original bathroom takes the bedroom count
0:27:48 > 0:27:52to four upstairs, plus two downstairs, making a total of six.
0:27:52 > 0:27:55We're very pleased with the way it's all turned out.
0:27:55 > 0:27:59The outside presented just as many challenges.
0:28:01 > 0:28:05So how have Ronnie and Catherine divided up the work here?
0:28:05 > 0:28:08Ronnie spent more time here than me
0:28:08 > 0:28:11when it was in the middle of the project.
0:28:11 > 0:28:15I started off doing a lot of the wallpaper-stripping.
0:28:15 > 0:28:19That was my contribution at the beginning of the project.
0:28:19 > 0:28:21And then, towards the end of the project,
0:28:21 > 0:28:26I organised all of the furniture and the decor.
0:28:26 > 0:28:31And what about the basement? Were they able to create a communal room?
0:28:33 > 0:28:36There sure were and the new window lets in lots of daylight.
0:28:38 > 0:28:42So the first thing we had to do was to tank it.
0:28:42 > 0:28:46Then we put a stub wall, with a cavity behind that and insulated the stub wall.
0:28:46 > 0:28:50Had to build a new set of stairs so I built those in situ.
0:28:50 > 0:28:54The biggest challenge, of course, though, was actually raising the ceiling.
0:28:54 > 0:28:56One choice was to dig down, which didn't appeal at all.
0:28:56 > 0:29:00So we just had to raise the ceiling up and that's worked brilliantly well.
0:29:00 > 0:29:03Really nice space. I really like it. It's my favourite room in the whole house.
0:29:03 > 0:29:07You can see the extra height Ronnie gained in the cellar
0:29:07 > 0:29:10in the hall, where the floor has been raised.
0:29:10 > 0:29:12Apart from building the staircase,
0:29:12 > 0:29:15Ronnie's done a lot of the other work himself, too.
0:29:15 > 0:29:19But he employed a certified gas-fitter and electrician
0:29:19 > 0:29:22and took on an apprentice, called Louie.
0:29:22 > 0:29:24They set a budget of around £25,000.
0:29:24 > 0:29:27Did they manage to stick to that?
0:29:27 > 0:29:31Er, we've come in at around about 24,000, which was really quite remarkable,
0:29:31 > 0:29:35you know, because I was expecting to have to spend more.
0:29:35 > 0:29:37And I have to say that's largely due to my apprentice
0:29:37 > 0:29:40doing the skirting boards and the architraves and hanging the doors.
0:29:40 > 0:29:43He's made a big difference to the project.
0:29:43 > 0:29:46It's been a successful, fast turnaround project for the couple.
0:29:46 > 0:29:53They've let all six rooms in time for the start of the new university term.
0:29:53 > 0:29:56Moneywise, including their £24,000 budget,
0:29:56 > 0:29:59they've spent a total of around 171,000 here.
0:30:02 > 0:30:05But how have their improvements impacted on its value?
0:30:08 > 0:30:10Let's see what two local estate agents think.
0:30:12 > 0:30:16I think they've reconfigured the space very well
0:30:16 > 0:30:18and there's no tiny rooms.
0:30:18 > 0:30:21They're all a very good size and the lounge works very well.
0:30:21 > 0:30:24They've made very good use of the floor plan.
0:30:24 > 0:30:26This was always a good-sized house
0:30:26 > 0:30:30and they've been able to adapt the layout to provide good accommodation,
0:30:30 > 0:30:32ideal for the purpose that it's intended.
0:30:32 > 0:30:36How much rental income could each room achieve,
0:30:36 > 0:30:38if let out to students?
0:30:38 > 0:30:41Student rents here in Canterbury
0:30:41 > 0:30:47are between £330 and £350 per person, per month.
0:30:47 > 0:30:50If I was to rent the property out to students,
0:30:50 > 0:30:53it would be £350 per student, per room, per month.
0:30:53 > 0:30:58That's an income of around £2,000 a month and a yield of 13-14%,
0:30:58 > 0:31:03if they let the six rooms out all year round.
0:31:03 > 0:31:04What do they think of that?
0:31:04 > 0:31:07Well, I think we've achieved a bit better than that and I think
0:31:07 > 0:31:11- they're slightly sort of undervalued, actually, from our experience.- Mm.
0:31:13 > 0:31:15They spent £147,000 at auction
0:31:15 > 0:31:21and the budget's come in at around 24,000, making 171,000 in total.
0:31:21 > 0:31:24So what's the property now worth,
0:31:24 > 0:31:28as a six-bedroom, student, buy-to-let investment?
0:31:30 > 0:31:33The market value here would be greatest as an investment to the
0:31:33 > 0:31:37buy-to-let student landlords, where the value would be towards £250,000.
0:31:37 > 0:31:44I'd market this property today as a student let for 265,000 to 270,000.
0:31:44 > 0:31:49That valuation range of 250 to 270,000 would generate
0:31:49 > 0:31:54a gross profit, before the usual selling expenses, of between 79 and £99,000.
0:31:54 > 0:31:57What do they think of that?
0:31:57 > 0:32:02I was sort of thinking in excess of 200, but 250-plus is very good.
0:32:05 > 0:32:09Would they perhaps consider selling and taking an instant profit?
0:32:09 > 0:32:12Well, I think we might think about it!
0:32:12 > 0:32:14Yes. I don't know, it is tempting.
0:32:14 > 0:32:16Makes all the labour worthwhile.
0:32:16 > 0:32:19These last four months have been worth it.
0:32:19 > 0:32:23Well, it would certainly come in handy, since they're currently planning a renovation
0:32:23 > 0:32:27and extension of their own family home, including a swimming pool.
0:32:29 > 0:32:31So how many pools could you buy with that?
0:32:33 > 0:32:36- Just the one will be fine.- Yes.
0:32:40 > 0:32:43Today, I'm in Hexthorpe, in Doncaster.
0:32:43 > 0:32:46There are plenty of local amenities and rows and rows
0:32:46 > 0:32:51of affordable Victorian houses that look perfect for rental.
0:32:53 > 0:32:57Well, the property market may have its ups and downs but
0:32:57 > 0:33:02there's one thing that never changes and that's the importance of yield.
0:33:02 > 0:33:05That is the amount of money you have to spend on a place
0:33:05 > 0:33:07and what you might get back, in terms of rent.
0:33:07 > 0:33:10And, in that case, this place is absolutely brilliant!
0:33:10 > 0:33:12It may not look that inspiring from the outside
0:33:12 > 0:33:15but the guide price was 20,000 quid.
0:33:15 > 0:33:18I don't really care what it's like inside.
0:33:18 > 0:33:20# Oh, honey, I don't care
0:33:22 > 0:33:25# Oh, honey, I don't care... #
0:33:25 > 0:33:28When the guide price is that low,
0:33:28 > 0:33:31there's potential for a good yield to be harvested as a buy-to-let.
0:33:31 > 0:33:36I'd be interested whatever the state of this place.
0:33:36 > 0:33:40That said, what is on offer? Well, a very pink hallway, that's for sure.
0:33:40 > 0:33:44But, oh, look! We've even got some lovely original features, that's nice to have.
0:33:44 > 0:33:46When you set your sights low, you can be pleasantly surprised.
0:33:46 > 0:33:48And, you know what, this place is not at all bad.
0:33:48 > 0:33:51I've been in a lot worse that have cost a lot more money.
0:33:51 > 0:33:55Big through sort of living room/dining room area.
0:33:55 > 0:33:59Obviously, we're going to have to sort out something to do with the central heating,
0:33:59 > 0:34:01but a couple of fireplaces in here make it really nice.
0:34:01 > 0:34:03It feels pretty spacious.
0:34:03 > 0:34:07Heading back towards the rear of the property, it gets a bit strange.
0:34:07 > 0:34:11A little anteroom there. That could be the place where you have your washing machine or whatever.
0:34:11 > 0:34:14And the kitchen, as you can see, is in a right old state.
0:34:14 > 0:34:17And, sadly, it doesn't get much better upstairs,
0:34:17 > 0:34:19because there isn't actually a bathroom.
0:34:19 > 0:34:22Well, there's a bathROOM, as in, the room the bath would go in.
0:34:22 > 0:34:24It doesn't actually have a bath in it at the moment.
0:34:24 > 0:34:26But do I care? No, I don't!
0:34:26 > 0:34:29You spend, what, 2,000 quid on a kitchen, £1,000 on the bathroom,
0:34:29 > 0:34:33sort out the electrics, sort out the central heating.
0:34:33 > 0:34:37You'd still have this whole place sorted out for 30,000 quid. Pfft!
0:34:37 > 0:34:38Brilliant!
0:34:39 > 0:34:44Of course, that's if you bought it bang on that £20,000 guide price.
0:34:44 > 0:34:48But it would be a lot of house for not a lot of money.
0:34:48 > 0:34:53So, up the pink staircase to the pink landing and into the, er,
0:34:53 > 0:34:55green bathroom, minus the bath.
0:34:55 > 0:34:57The toilet looks bereft.
0:34:57 > 0:34:59Wouldn't it be great if I could find the bath
0:34:59 > 0:35:02and restore it to its rightful place?
0:35:02 > 0:35:05Well, yippee, because I've found it!
0:35:05 > 0:35:08The toilet will be happy and the new owner will be, too.
0:35:08 > 0:35:12You could easily reinstate this once you've repaired the hole in the floor...
0:35:12 > 0:35:14but would you, really?
0:35:14 > 0:35:19Both bedrooms are good sizes, although the ceilings do look as if they've had some water damage.
0:35:19 > 0:35:24A slipped roof tile may have caused this, so rectifying that would be my first job.
0:35:24 > 0:35:28Well, at the rear of the property under the explosion of buddleia,
0:35:28 > 0:35:31there is actually a pretty decent-sized garden
0:35:31 > 0:35:34and a weekend's work out here, I think, will make a massive amount of difference.
0:35:34 > 0:35:36And, another bonus, there's a garage.
0:35:36 > 0:35:39# I just haven't met you yet... #
0:35:39 > 0:35:42No, there really IS a garage down there.
0:35:42 > 0:35:45Look hard enough and you can just make it out.
0:35:47 > 0:35:51The new owner also benefits from side access to the back garden.
0:35:51 > 0:35:55Apparently all the houses along here have keys for this shared gate
0:35:55 > 0:35:58and pathway that leads to the back of the terrace.
0:35:58 > 0:36:02It will certainly make clearing the house and renovating it much easier.
0:36:02 > 0:36:05Dragging materials through a property is far from ideal,
0:36:05 > 0:36:10so having this side entrance will make those problems disappear.
0:36:10 > 0:36:14So, what will a local estate agent make of this place,
0:36:14 > 0:36:17with its guide price of only £20,000?
0:36:17 > 0:36:20We asked one along to find out.
0:36:20 > 0:36:22It needs a bit of work inside.
0:36:22 > 0:36:26It needs a new kitchen, bathroom, boiler, windows.
0:36:26 > 0:36:28So it's a proper refurbishment job.
0:36:28 > 0:36:30Lots of potential in this area.
0:36:30 > 0:36:33It's a very good rental market area and first-time buyers.
0:36:33 > 0:36:36Let's talk figures.
0:36:36 > 0:36:40I would be able to rent this out for £325 per calendar month,
0:36:40 > 0:36:44to £375 per calendar month.
0:36:44 > 0:36:50When renovated, I would look to market this property at £64,950.
0:36:51 > 0:36:55Well, yes, there is a hole in the bathroom floor.
0:36:55 > 0:36:57Yes, it needs a complete new kitchen.
0:36:57 > 0:37:01Yes, the whole house is desperately in need of some tender loving care.
0:37:01 > 0:37:03But, you know what, for that guide price of just 20,000 quid,
0:37:03 > 0:37:05you can't go wrong, really, can you?
0:37:05 > 0:37:07Let's see who bought it at the auction.
0:37:07 > 0:37:11Lot number 18. This has caused some interest, for obvious reasons.
0:37:11 > 0:37:13As you can see, two bedrooms, bathroom.
0:37:13 > 0:37:16Needs some modernisation. Who's going to start me?
0:37:16 > 0:37:20And what's that, sir? 316,000?
0:37:20 > 0:37:22Jolly good! Where do you want to start?
0:37:22 > 0:37:2620,000, that's fair enough. At £20,000, I'm bid.
0:37:26 > 0:37:2821, 22, 23,
0:37:28 > 0:37:3124, 25, 26,
0:37:31 > 0:37:3327, 28, 29,
0:37:33 > 0:37:3530,000?
0:37:35 > 0:37:3630,000. 31?
0:37:36 > 0:37:3932, 33,
0:37:39 > 0:37:4134,000.
0:37:41 > 0:37:4535,000, just round the corner. 36,000?
0:37:45 > 0:37:4737,500?
0:37:47 > 0:37:50Is it 38?
0:37:50 > 0:37:52500, sir?
0:37:52 > 0:37:54500? 38,500?
0:37:54 > 0:37:5739. 500?
0:37:57 > 0:38:0040,000. 500?
0:38:00 > 0:38:0241,000? Bear with us.
0:38:02 > 0:38:0541,500?
0:38:05 > 0:38:0742,000. 500?
0:38:07 > 0:38:1043 now. 500?
0:38:10 > 0:38:1343,500. Is it 44 now? I'm losing my way.
0:38:13 > 0:38:16At 43,500 for the first time...
0:38:16 > 0:38:17Second...
0:38:17 > 0:38:19Third and last time, any more bids?
0:38:19 > 0:38:21TAPS GAVEL
0:38:21 > 0:38:23Well done. Thank you very much.
0:38:23 > 0:38:27Pleased as punch with their successful bid of £43,500,
0:38:27 > 0:38:30over double the auction guide price,
0:38:30 > 0:38:32are husband and wife, Joanne and John.
0:38:34 > 0:38:37Joanne's a full-time mum and John's a self-employed electrician
0:38:37 > 0:38:40which will come in handy in this property.
0:38:40 > 0:38:44I met them back there to find out their plans.
0:38:44 > 0:38:48- John, Joanne, good to meet you both. Congratulations.- Thank you.
0:38:48 > 0:38:51So, how about the auction, because you were very excited, weren't you?
0:38:51 > 0:38:54- Yeah. It was brilliant, wasn't it? - Yeah, it were really good, yeah.
0:38:54 > 0:38:57I didn't expect it to be like that.
0:38:57 > 0:38:59We didn't think, really, that we'd get it, did we?
0:38:59 > 0:39:03No, we knew that there was going to be a lot of people bidding because of, obviously, the price.
0:39:03 > 0:39:05- When we got it, it were a nice surprise.- Yeah.
0:39:05 > 0:39:08Paid more than what we thought we was going to do, though.
0:39:08 > 0:39:11- We said about 38, didn't we?- Yeah.
0:39:11 > 0:39:12But Jo kept nudging me!
0:39:12 > 0:39:15We just... I kept nudging him!
0:39:15 > 0:39:18So tell me why you wanted to buy this place.
0:39:18 > 0:39:23Erm, for an investment, really. We bought it to rent, basically.
0:39:23 > 0:39:26- Is this anything like you've done before?- No.- No, never.
0:39:26 > 0:39:28- First time, isn't it?- Yeah.
0:39:28 > 0:39:30So why this house particularly?
0:39:30 > 0:39:32- Erm...- It was going really cheap!
0:39:32 > 0:39:34Well, you know, that's a good reason!
0:39:34 > 0:39:35- Pretty much, wasn't it?- Yeah.
0:39:35 > 0:39:39Before you bought it, did you come to see it, hopefully?
0:39:39 > 0:39:41- I didn't.- Ooh! OK.
0:39:41 > 0:39:43- But you did.- Yeah, I came round with the estate agent.
0:39:43 > 0:39:47They had an open day. There were a few others having a look round.
0:39:47 > 0:39:50- Bit of a poke about?- Yeah, that's it.- And what about the legal pack?
0:39:50 > 0:39:51CLEARS THROAT
0:39:51 > 0:39:52Legal pack?
0:39:52 > 0:39:55Clearing of throat usually means "Hm?"
0:39:55 > 0:40:00Erm, well, we didn't do anything legal until we actually bought it.
0:40:00 > 0:40:02- Got a bit of a telling-off from the solicitor.- Yeah.
0:40:02 > 0:40:05- Good! - JOANNE LAUGHS
0:40:05 > 0:40:08- Yeah, we didn't do any searches or surveys or anything, did we?- No.
0:40:08 > 0:40:10I mean, I came round and had a good look.
0:40:10 > 0:40:12- Had a bit of a stamp around floors.- Right.
0:40:12 > 0:40:14Had a look outside front road.
0:40:14 > 0:40:16- Structurally, it looks all right, don't it?- Yeah.
0:40:16 > 0:40:18Right. But that's not quite legal stuff, is it?
0:40:18 > 0:40:21It could have had all sorts of covenants and all sorts of issues.
0:40:21 > 0:40:24I mean, you wouldn't know that from stomping about, would you?
0:40:24 > 0:40:27No, you wouldn't, and that's why solicitor sort of had a go at us.
0:40:27 > 0:40:30- It is, yeah.- Did he? You got told off by your solicitor?
0:40:30 > 0:40:32- We did, yeah, so we'll know next time, won't we?- Yeah.
0:40:32 > 0:40:35# My whole world is falling down... #
0:40:35 > 0:40:38I hope the couple have learned their lesson.
0:40:38 > 0:40:42Things could have been a whole lot worse than a ticking-off from a solicitor.
0:40:42 > 0:40:46But it sounds like their plans for the rest of the house are right on track.
0:40:48 > 0:40:51So tell me what you're going to do to sort it out.
0:40:51 > 0:40:54- New flooring downstairs. - Yeah, laminate, probably.
0:40:54 > 0:40:58- Carpets upstairs. - New kitchen, new bathroom.
0:40:58 > 0:41:00- Wiring, rewiring. - Yeah, that's your forte.
0:41:00 > 0:41:02- Plumbing.- Yeah.
0:41:02 > 0:41:04Pretty much everything.
0:41:04 > 0:41:07Bit of tiling. Maybe try and fit a kitchen.
0:41:07 > 0:41:10- Then see if we can reach those ceilings upstairs. They are about ten-foot high!- I know!
0:41:12 > 0:41:14Never mind those ceilings, John.
0:41:14 > 0:41:19That HOLEY bathroom's praying for salvation!
0:41:19 > 0:41:22John's trade as an electrician will be a huge bonus,
0:41:22 > 0:41:24but what about Joanne?
0:41:24 > 0:41:27I'll be the decorator's lad!
0:41:27 > 0:41:29- The handyman.- I'll be the handyman.
0:41:29 > 0:41:31- Apprentice.- Yeah.
0:41:31 > 0:41:34- And what's the budget for the work? - Probably about four to five.
0:41:34 > 0:41:38Somewhere around that, hopefully. Try and come in under that.
0:41:38 > 0:41:40Wow! That's quite a tight.
0:41:40 > 0:41:43Do you think? Well, you're the sparky, aren't ya?
0:41:43 > 0:41:46Well, that don't mean I'm good with money!
0:41:46 > 0:41:49I was going to say, that'll save us a few, won't it, the rewiring?
0:41:49 > 0:41:52Well, hopefully that'll save us about 1,500, 2,000.
0:41:52 > 0:41:55Got a few friends in t'trade, plumbers, things like that,
0:41:55 > 0:41:58so if we bribe them a bit, a few cups of tea...
0:41:58 > 0:42:03I'd stock up on the teabags, as I can see weeks of tea-drinking for the tradesmen.
0:42:06 > 0:42:10John and Joanne expect it will take three to four months to renovate this property.
0:42:10 > 0:42:13I think it will take them at least that.
0:42:14 > 0:42:18- Well, congratulations and good luck with it.- Thank you.
0:42:18 > 0:42:21- I look forward to seeing how you get on.- Thank you.
0:42:21 > 0:42:24Well, I know John's an electrician
0:42:24 > 0:42:29but £4-£5,000 budget to sort this place out seems a little tight to me.
0:42:29 > 0:42:32Still, he's got a very willing helper in Joanne.
0:42:32 > 0:42:36How are they going to get on? You can find out later in the show.
0:42:38 > 0:42:41Well, it's a while since we saw those properties.
0:42:41 > 0:42:44Have our buyers been racing ahead with the work?
0:42:44 > 0:42:48Or has it all come to a complete halt? Let us go back and find out.
0:42:50 > 0:42:54Back now to Alvaston in Derby, where earlier in the programme,
0:42:54 > 0:42:57this semi, tucked away in the corner,
0:42:57 > 0:42:59was bought for £54,500 by Aziz,
0:42:59 > 0:43:02a property developer based in Birmingham.
0:43:03 > 0:43:09The house had two bedrooms and the potential to create a third.
0:43:10 > 0:43:13Now, you've got a really big bathroom,
0:43:13 > 0:43:16a very small shower room and, currently, only two bedrooms.
0:43:16 > 0:43:19Now, in the auction catalogue, it said "two or three bedrooms".
0:43:19 > 0:43:21How are you going to turn that around?
0:43:21 > 0:43:26Well, we're going to take the bathroom, where it is at the moment, into the small room,
0:43:26 > 0:43:31where the shower cubicle is, and the current bathroom will become a third bedroom.
0:43:31 > 0:43:33Aziz had a team of builders standing by
0:43:33 > 0:43:37and planned to have the work done in just four weeks.
0:43:42 > 0:43:45Well, it was seven weeks later when we met up again with him.
0:43:50 > 0:43:54At the front, the overgrown weed-filled entrance has now been cleared.
0:43:54 > 0:43:59New gravel has gone down and the house looks much more inviting.
0:43:59 > 0:44:02Round the back, the big, overgrown garden has been cleared.
0:44:10 > 0:44:13And a new patio door has been installed.
0:44:13 > 0:44:16Inside, the hall's been decorated.
0:44:18 > 0:44:21The red carpet has gone from the first living room,
0:44:21 > 0:44:25which has been neutrally decorated, but it has kept the wooden ceiling.
0:44:25 > 0:44:28The fireplace remains in the second living room,
0:44:28 > 0:44:32but it's gained a new patio door and been re-carpeted.
0:44:37 > 0:44:41And the kitchen's been totally refitted.
0:44:41 > 0:44:43Aziz is on hand to give us the tour.
0:44:45 > 0:44:49Hi. This is the kitchen. Taken the old kitchen out, completely.
0:44:49 > 0:44:51Put a new kitchen in.
0:44:51 > 0:44:54Tiled the floors, smoke-alarmed it,
0:44:54 > 0:44:58rewired the whole power circuit in this area.
0:44:58 > 0:45:02Any family would love this kitchen, because it gives them
0:45:02 > 0:45:06a good working surface and a lot of space for a dining area.
0:45:06 > 0:45:10Perhaps the kitchen's not neutral enough to appeal to everyone,
0:45:10 > 0:45:13but the property is now ready to rent out.
0:45:13 > 0:45:17Upstairs, the two bedrooms have also been given a makeover.
0:45:24 > 0:45:29And the former bathroom has been converted into bedroom three.
0:45:31 > 0:45:34This is where the old bathroom was.
0:45:34 > 0:45:37It was a challenge to take a bathroom out of there,
0:45:37 > 0:45:40bring it into what was old shower area,
0:45:40 > 0:45:42but we managed it.
0:45:42 > 0:45:43It's a lovely bathroom.
0:45:43 > 0:45:48Fully tiled floor, fully tiled walls and a bonus -
0:45:48 > 0:45:50there is a towel rail, as well.
0:45:50 > 0:45:53Gave me an extra bedroom and now I can rent it as a three-bedroom.
0:45:53 > 0:46:01# Things have changed... #
0:46:01 > 0:46:05So, three bedrooms and one bathroom - much more practical.
0:46:05 > 0:46:07Aziz has project-managed the work, inside and out.
0:46:07 > 0:46:10He's now a full-time property developer,
0:46:10 > 0:46:12but he used to teach electrical engineering and,
0:46:12 > 0:46:16when he started to probe around, he got a shock!
0:46:19 > 0:46:22Er, unexpectedly, we had to rewire the house.
0:46:22 > 0:46:26I wasn't very happy with the wiring, so I took it out and rewired it.
0:46:26 > 0:46:31Extra work, so how did that affect his budget?
0:46:31 > 0:46:37I wanted to ideally spend under 6,000, but it just went over 6,000 - 6,200.
0:46:37 > 0:46:39How long has the work taken?
0:46:39 > 0:46:43I was aiming for four weeks, but we did it in three weeks.
0:46:43 > 0:46:44Fast work!
0:46:44 > 0:46:48So have the plans changed or is he still looking to let?
0:46:48 > 0:46:51I want to keep this property and I have rented it,
0:46:51 > 0:46:54and there is a family moving in on Monday.
0:46:54 > 0:46:58Aziz has spent around £61,000 on this place,
0:46:58 > 0:47:01including the £54,500 purchase price.
0:47:03 > 0:47:06Time to see what two local estate agents think of the house,
0:47:06 > 0:47:08now it has three bedrooms
0:47:08 > 0:47:11and a tiny garden.
0:47:11 > 0:47:13The property now is a blank canvas really for somebody to move in
0:47:13 > 0:47:16and put their own mark onto it.
0:47:16 > 0:47:18I think the creation of the third bedroom
0:47:18 > 0:47:21- has proved invaluable. - The layout changes
0:47:21 > 0:47:23work for the property.
0:47:23 > 0:47:26Maximising the amount of bedrooms certainly works in their favour.
0:47:26 > 0:47:30And reducing the bathrooms from two to one is perfect.
0:47:30 > 0:47:33The level of finish certainly isn't the best that I've seen.
0:47:33 > 0:47:37However, it's adequate for a property at this price range.
0:47:37 > 0:47:40Aziz has already got tenants, but what sort of income
0:47:40 > 0:47:44do the estate agents think he should be achieving?
0:47:44 > 0:47:48I would look to offer this property to let somewhere between
0:47:48 > 0:47:52£435 per calendar month and £450 per calendar month.
0:47:52 > 0:47:54Rental value, I think the property will receive
0:47:54 > 0:47:57approximately £450 per calendar month.
0:47:57 > 0:47:59Oh, I've beaten that handsomely!
0:47:59 > 0:48:01675, I've rented it.
0:48:01 > 0:48:04No wonder Aziz is happy.
0:48:04 > 0:48:11675 a month will give him a remarkable yield of just over 13%.
0:48:11 > 0:48:14But will the estate agents' resale valuations make him smile?
0:48:14 > 0:48:18Remember, he has spent around £61,000 on this property,
0:48:18 > 0:48:23which he's turned around in a matter of weeks.
0:48:23 > 0:48:27Resale value here, I believe, would be no more than £80,000.
0:48:27 > 0:48:30I would look to put this to the market at £74,000,
0:48:30 > 0:48:32with a view to achieving £70,000.
0:48:32 > 0:48:36That valuation range, from 70 to 80,000, could produce
0:48:36 > 0:48:42a healthy potential gross profit for Aziz of between nine and £19,000,
0:48:42 > 0:48:45minus the usual selling expenses.
0:48:45 > 0:48:47What does he think of that?
0:48:47 > 0:48:50That's not bad. I'm happy with that.
0:48:50 > 0:48:53Yeah. For three weeks' work. Beating the bank!
0:48:53 > 0:48:56# Things have changed... #
0:48:58 > 0:49:03So a quick turnaround. Tenants in place and a happy Aziz.
0:49:03 > 0:49:05What's next?
0:49:05 > 0:49:11I've got two more projects straight after this, so we're getting
0:49:11 > 0:49:15ourselves involved with that and I'll be at the auction next time, as well.
0:49:15 > 0:49:17So, probably see you guys!
0:49:17 > 0:49:20Well, we'll keep an eye out for you!
0:49:24 > 0:49:28We're back in Hexthorpe, near Doncaster, in South Yorkshire
0:49:28 > 0:49:34to see how self-employed electrician John and his wife Joanne got on with that classic red-brick terrace.
0:49:34 > 0:49:38The two-bedroomed house had a few problems.
0:49:38 > 0:49:42The damp patches on the ceilings pointed to a probable hole in the roof,
0:49:42 > 0:49:45whereas the bathroom floor was...
0:49:45 > 0:49:47mostly just a hole.
0:49:47 > 0:49:52First-time developers John and Joanne bought the house as a buy-to-let.
0:49:52 > 0:49:55But they started off their property adventure by breaking
0:49:55 > 0:49:59one of the golden Homes Under The Hammer rules.
0:49:59 > 0:50:01And what about the legal pack?
0:50:01 > 0:50:03CLEARS THROAT Legal pack?
0:50:03 > 0:50:05Clearing of throat usually means "Hm?"
0:50:05 > 0:50:08We didn't do anything legal until we actually bought it.
0:50:08 > 0:50:12- Got a telling-off from the solicitor.- Yeah.- Good!
0:50:12 > 0:50:17John and Joanne paid £43,500 for the house
0:50:17 > 0:50:21and had a budget of just £4-£5,000 to fix all the holes,
0:50:21 > 0:50:23as well as redecorating.
0:50:23 > 0:50:28They planned to rope in some friends and do as much as they could themselves.
0:50:28 > 0:50:31They hoped to turn the place around in three to four months.
0:50:31 > 0:50:34Well, we've come back 11 months later to see if the couple
0:50:34 > 0:50:38have managed to resurrect this classic terraced house.
0:50:43 > 0:50:48The rear garden dumping ground- cum-jungle has been cleared
0:50:48 > 0:50:50and there are new double-glazed windows at the back.
0:50:50 > 0:50:53But this project is far from finished.
0:50:53 > 0:50:56Something tells me there's a story to tell here.
0:50:56 > 0:50:59Yeah, we started doing things, chopping out floor sockets
0:50:59 > 0:51:02and things like that.
0:51:02 > 0:51:03We cleared the back garden.
0:51:03 > 0:51:06We had a few kitchen companies coming round, didn't we?
0:51:06 > 0:51:10- Yeah, we got some prices for kitchens.- Yeah, bathroom.
0:51:10 > 0:51:13And then what happened was, we had a lot of snow in December.
0:51:13 > 0:51:15We couldn't get here for several weeks.
0:51:15 > 0:51:18Once the snow had melted, we noticed that it had damaged
0:51:18 > 0:51:20a lot of the roof at the front and the back.
0:51:20 > 0:51:22A lot of the slates had come away.
0:51:22 > 0:51:25And the melted water had come through. Caused a bit of damage.
0:51:25 > 0:51:27We had insurance on the property.
0:51:27 > 0:51:29With it being a vacant property,
0:51:29 > 0:51:31- it were a slightly more expensive insurance premium.- Yeah.
0:51:31 > 0:51:34So we started the ball rolling with the insurance company
0:51:34 > 0:51:37to claim for repairs to the roof.
0:51:37 > 0:51:38Well, they basically said that
0:51:38 > 0:51:42if we'd have read the small print on the insurance policy, we should
0:51:42 > 0:51:45have had an extensive survey done on the property before we bought it,
0:51:45 > 0:51:49- which we didn't because, initially, the roof looked OK from outside. - Yeah.
0:51:49 > 0:51:54So the insurance company wouldn't pay out for the repairs to the roof
0:51:54 > 0:51:58and I couldn't do anything in the house until the roof were fixed.
0:51:58 > 0:52:01I couldn't afford to repair the roof, because we hadn't budgeted for it.
0:52:01 > 0:52:06- So we, kind of, were left in limbo. - That's when it kind of all started.
0:52:06 > 0:52:09# My whole world is falling down... #
0:52:09 > 0:52:14So, with a tiny budget and now no insurance cover,
0:52:14 > 0:52:17and a roof to repair, plus a house that was still in tatters,
0:52:17 > 0:52:21John and Joanne discovered a lifeline, from the local council!
0:52:21 > 0:52:27What it basically is, is that there's 21,000 people
0:52:27 > 0:52:30on the waiting list, so the council were looking for properties like this
0:52:30 > 0:52:33and what they do is, they'll give you a grant for up to £12,000.
0:52:33 > 0:52:38And they will get their workers in. They've actually been now. They've took photographs.
0:52:38 > 0:52:41So the council are going to take the property over.
0:52:41 > 0:52:46- They're going to renovate it and then they'll put tenants in and pay us rent.- Yeah.
0:52:46 > 0:52:49All in all, I think we've come out quite well,
0:52:49 > 0:52:52considering it were a bit of a disaster to start with.
0:52:52 > 0:52:55We seem to have not done too bad, have we?
0:52:55 > 0:52:58No kidding. John and Joanne have had a narrow escape.
0:52:58 > 0:53:03If the council had not desperately needed rental properties in this area,
0:53:03 > 0:53:08the entire financial burden for repairing this house would have fallen on their shoulders.
0:53:08 > 0:53:12Now the council will spend up to £12,000 renovating the house
0:53:12 > 0:53:15and then rent it on to one of their tenants for five years.
0:53:15 > 0:53:21The council will charge 10%, to cover their costs, and pass on the rest of the rent to the couple.
0:53:21 > 0:53:24But if there was ever a cautionary tale, it's this one.
0:53:24 > 0:53:28- We try and keep cheerful about things.- Yeah.
0:53:28 > 0:53:31It's been quite, erm, at times, emotional.
0:53:31 > 0:53:35It's been a bit distressing so, yeah, it's been a bit of a rollercoaster.
0:53:35 > 0:53:38Hopefully, things will work out.
0:53:38 > 0:53:40I hope so, too, Joanne.
0:53:40 > 0:53:43And, with the house finally on the way to being mended,
0:53:43 > 0:53:47the couple are now about to embark on a huge life change on the other side of the world,
0:53:47 > 0:53:50which they've been considering for a few years.
0:53:53 > 0:53:56We'll be leaving for Australia in about six weeks.
0:53:56 > 0:53:59With a one-way ticket, hopefully, not to return.
0:53:59 > 0:54:02And, hopefully, we don't have to come back and sort this place out.
0:54:02 > 0:54:07- Yeah, it's exciting, but it's also a bit daunting. - It is a bit daunting, yeah.
0:54:07 > 0:54:10Well, it's a long way to go,
0:54:10 > 0:54:13but John hopes he'll find more work opportunities
0:54:13 > 0:54:16in the Australian building market for his electrical skills.
0:54:16 > 0:54:20Talk about the highs and lows of property developing.
0:54:20 > 0:54:24This has definitely been a rollercoaster ride for John and Joanne.
0:54:24 > 0:54:27They bought the house for £43,500
0:54:27 > 0:54:31and have spent £2,500 so far on the renovations,
0:54:31 > 0:54:34bringing their total spend to £46,000.
0:54:38 > 0:54:43Time to find out what two local property experts think of the house.
0:54:43 > 0:54:45Positives about the property?
0:54:45 > 0:54:48It's got potential to be a good family home,
0:54:48 > 0:54:51once it's renovated, but there's a long way to go.
0:54:52 > 0:54:55This property still needs a lot of work.
0:54:55 > 0:54:57In this current market, it is only
0:54:57 > 0:54:59aimed at investors.
0:55:01 > 0:55:03So, if the house was refurbished,
0:55:03 > 0:55:05what could it make on the resale market?
0:55:05 > 0:55:08Remember, their total outlay here is £46,000
0:55:08 > 0:55:12and the council are footing the bill, up to £12,000, for the renovations,
0:55:12 > 0:55:15to bring it back into the housing stock.
0:55:17 > 0:55:21On the market, a good two-bed mid-terrace is fetching
0:55:21 > 0:55:26in the region of £60,000, to the maximum of £65,000.
0:55:26 > 0:55:30I would anticipate this property achieving, fully renovated,
0:55:30 > 0:55:32in the region of £60,000.
0:55:32 > 0:55:37Those valuations would give John and Joanne a profit of between
0:55:37 > 0:55:4014 and £19,000, before costs and expenses.
0:55:40 > 0:55:44Although, of course, they are tied into a rental deal with
0:55:44 > 0:55:47the council for the next five years.
0:55:47 > 0:55:50I think that's what the going rate is around here, yeah.
0:55:50 > 0:55:52Sounds about right for this area.
0:55:52 > 0:55:56- Well, we're not selling it, are we? - We're not going to sell it, no.
0:55:56 > 0:55:59So what rent are they likely to get from the council?
0:55:59 > 0:56:03They've sort of told us that, the kind of property in this area,
0:56:03 > 0:56:05we should get about £400 a month.
0:56:05 > 0:56:09Given the council get 10% of the rent, then the couple
0:56:09 > 0:56:14would eventually get £360 a month, a yield of about 9%.
0:56:14 > 0:56:20That's a light at the end of the tunnel that they really could do with right now.
0:56:20 > 0:56:24So, as they embark on their new life in Australia,
0:56:24 > 0:56:27what tips can they leave behind for us?
0:56:27 > 0:56:31Things like older properties, where you've got old roofs, they may look fine,
0:56:31 > 0:56:33it might be worth getting a survey done.
0:56:33 > 0:56:37We didn't, you know, and it's caught up with us and bit us on t'bum.
0:56:37 > 0:56:40- It has, yeah.- But you never know until you try, do you?
0:56:40 > 0:56:42- So at least we tried it.- Yeah.
0:56:46 > 0:56:49The world of property is never static or boring.
0:56:49 > 0:56:52You need to know what you're doing and we hope we can help with that.
0:56:52 > 0:56:55Yes, join us next time for more cautionary tales
0:56:55 > 0:56:58and stories of success here on Homes Under The Hammer.
0:56:58 > 0:57:00- See you then.- Goodbye.- Goodbye.
0:57:06 > 0:57:09Subtitles by Red Bee Media Ltd
0:57:09 > 0:57:12E-mail subtitling@bbc.co.uk