Episode 87 Homes Under the Hammer

People buy properties for all sorts of different reasons - to live in or do up and sell on.

-The main concern is value for money, so how do you do that?

-Well, buy your next house under the hammer.

-You need to do your homework to buy at auction.

-But then you can get a real bargain.

So here's a look at today's potential moneyspinners.

We return to a Cornish house we first showed you in 2010 when it was a bit of a state.

This whole really has not been thought through.

There's a period property in London that ticks a lot of boxes.

Sash windows - check. Ornate mouldings - check.

And this Workington terrace needs a full refurbishment and there's only one place to start.

That needs to be sorted out before anything else.

All these properties went to auction. We'll find out who bought them and what they paid

when they went under the hammer.

Our first property is one we showed you a couple of years ago.

The beautiful beaches and countryside in Cornwall make it highly desirable to live in.

Many people purchase properties here as second homes, but there is a downside to that.

The influx of second home owners buying properties in Cornwall

has pushed prices out of the reach of many locals, but not here in Delabole

where there's a fantastic opportunity. This is it - guide price of £125,000-£150,000.

A five-bedroom detached house. You can't argue with that, can you?

# I call it a bargain The best I ever had... #

That's a lot of house for the price.

You don't know what you're going to find inside a house like this.

Very grand from the outside, but what's been done internally? Don't know yet,

but a fairly cramped entrance, which I'm not too keen on.

Through to a front sitting room there - making use of the local slate for the fireplace.

And then what is going on? They've taken away the enclosure for the understairs cupboard.

You've got this pillar. Doesn't work at all.

Then through to another bit that looks like it's kind of been... well, manked about with.

Two fireplaces in this room. The floors are different levels, which doesn't work.

I like that they're stripped, but it just feels like they had a go and hadn't thought it through.

However, what's that?

# Looking through the window... #

Yes, I know it has a garden, but not just any garden.

It's a huge family one.

With a massive car parking area to boot.

So plenty of room to extend or maybe even develop.

So great news out there, but unfortunately back in the house, the bad news continues.

The kitchen is just a disaster.

For a house like this it should be the focal point, big, family-friendly.

As it is, disastrous units and this hotchpotch feeling.

Look at this. A main beam going across here.

You need to do something here. You need to build it out into that extension,

to open up these walls, to create that central focus. Here.

# It'll be just like starting over... #

Upstairs, there are four main bedrooms,

a box room

and a bathroom.

All are in need of upgrading and potentially some repair work

if that damp's anything more than a few loose tiles or a problem with the flashing.

Well, there you go. That just about sums this house up.

The door, when you open it, goes straight into the stairs. They didn't bother to measure it.

This whole house really has not been thought through, but it has potential to be a beautiful house.

Let's find out who bought it.

Big detached property. Five beds, big chunk of ground at the back.

We know it's 150, don't we? Yes, we do. 150. 55.

165. 170.

175. 180? 180.

He's still there. 185.

190? 190 I want. 185.

188. 188.

190? 190. At 190. It's got to make 200.

At 190. 190.

Stood has it. Both sat are out.

At 190. That's a lot of house.

At 190. 190 once.

190 twice. At 190. Falling short of 200, but at 190. Sure and done?

At 190. You both missed it. Well done, sir. That's a lot of property.

That winning bid of £190,000 came from Lee.

He bought it with his partner Andrea. They live locally and have wanted to buy for some time.

Lee's an electrician and Andrea is a research chemist.

I met up with them to find out more.

Lee, Andrea, well done.

-Thanks very much.

-Congratulations. It's a lovely house.

-We think so.

-Why did you want to buy it?

-I've lived in the village all my life, wanted to stay in the village.

-This seemed an ideal opportunity. In the future, maybe have children and it's a big family home.

-Right.

-What about your background, Andrea?

-I've been in Cornwall about 10 years.

I came down here for my first job after university.

-I really like Cornwall and want to stay here now.

-And tell me about you two.

We've been together four years now. Met at the local village carnival...

-Really?

-We had a float, so, yeah.

-Tell me more about that.

I play football for the village and we do a carnival float.

-I was a pirate.

-Yeah. A pirate.

-I had one too many and got chatting and the rest is history!

-So he was wearing a pirate's outfit?

-Yeah, I pulled a pirate!

-You pulled a pirate!

# I am a pirate, you are a princess We could sail the seven seas... #

Well, shiver me timbers! Love at first sight through an eye patch!

And it seems these two have had an eye on this house for a while now.

-We've driven by two or three times and said, "That's a really nice house. It would suit us."

-No!

Yeah. I was at work and Andrea said, "There's an auction sign up!"

-So it's meant to be.

-Hopefully!

-You made it happen.

What's also meant to be is some drastic changes to the look of the place.

-There is a bit of work to be done, isn't there?

-There certainly is.

-A little more than we thought.

-Yeah.

We'll change the downstairs layout. That's what we hope to do.

We'll have to get a structural engineer to have a look at the walls

but open it up, really. It's very boxy and we'd like to open the downstairs layout

-and get a bit more light in.

-How long's it going to take?

Eh, we've put a minimum of six months. Four to six months to get...liveable.

We're lucky we're not in a real rush to get in, but as soon as possible.

Yeah. This is going to be our home for the next...5-10 years, so there's no hurry.

We're not looking to make a profit.

The original plan was to make the couple's future family home liveable in 4-6 months,

finishing off the renovation once they'd moved in.

In the meantime, they'd stay at Lee's mum's house.

However, when we first returned two years later, they'd started work

but still hadn't moved in.

The sitting room was still very much a work in progress.

There was a new extension at the back where work on a large kitchen dining area was still ongoing.

The smaller front room was replastered and in need of redecoration,

as were the four main bedrooms upstairs,

although a new bathroom had been installed.

The box room was no more and in its place was a stairwell

leading to what would eventually be a master bedroom and en suite.

Lee had been carrying out a lot of the work, fitting it around his full-time job as an electrician.

But there was another very good reason why moving in was delayed.

I had my daughter last year.

She's now 11 months old.

She's taken up a lot of my time.

With the arrival of little Isabella, it wasn't surprising the schedule had run over.

We initially said six months.

But maybe that was a bit optimistic!

We weren't going to do the extension originally, but we thought with the mess, let's do it all now

and get it finished and if it takes two years, then it takes two years.

We'll get it right and how we want it in the end.

Later in the show we return for a second time to visit Lee, Andrea

and little baby Isabella at their Cornwall property.

Find out if they finally move into their much longed-for family home.

I'm in a part of East London that has changed beyond all recognition in the last few years.

Stratford - the transport hub for the 2012 Olympic Games.

The redeveloped station has 10 Tube and railway lines and the capacity has been trebled

to handle 120,000 passengers at peak times.

And if shopping is your pastime, there's plenty of that here, too.

It's also a good place to go shopping for property

and that's exactly why I'm here.

The auction lot I'm here to see is just up the road in Forest Gate.

I'm here to see a period property

and when I go out on these viewings I'm always hopeful the house will have some original features intact.

Sash windows - check. Ornate mouldings - check. And a lovely bay window - check.

That makes my heart sing.

So the guide price is £175,000.

But first orders - cut this bush back! Check!

# I'm a real wild one... #

This hedge may be a wild one, but my to do list is well and truly ticked.

Sure, it'll take some time to tame, but will add to the kerb appeal of the house

which looks in pretty good condition.

Oh! Polystyrene ceiling tiles. I wasn't expecting those.

They may be hiding some ceiling secrets. I'd get those down.

It's a bit dark and oppressive, but once you choose some fresh, light reflective colours,

it will work wonders. Look at that ceiling rose in here.

You've got some lovely cornicing, architrave around the doors, nice high skirting boards.

Fireplace, well, that's of the wrong era, but you can change it easily.

A bit of an update needed, but overall another check.

Unfortunately, you'll also have to write a few bank cheques to make this place habitable.

# Money, money, money, money

-# Money... #

-But plenty of the original features have remained.

A second reception room, another fireplace, sash window.

I wonder what the floorboards will be like. They might well sand and wax up beautifully.

'Next in line, a kitchen with cupboards and shelves that look years old. They'll have to go.

'And more bad news, I'm afraid, because the bathroom and loo are downstairs in this house

'that went to auction guided at £175,000, but could it be relocated upstairs?'

Well, let's look upstairs and see if that is a possibility.

Bathrooms off the kitchen always throw me into a bit of a spin.

Now knocking this wall down, taking a piece of this bedroom, could be the answer.

You could also use a little bit of this hallway. You won't have a window in the bathroom,

but if there's ventilation, that is fine. A structural engineer can tell you if you can knock down this wall.

You may need a supporting beam and you have to think of the cost implications

and will it add any significant value?

Some clever partition walls could make an upstairs bathroom possible and even without a bath

a shower and toilet would add value. But you need to make sure you still have adequate access

from the landing to the bedrooms.

'Outside at the back of this house that went to auction guided at £175,000...

'it's a bit of a jungle,

'but tidy it up and it would be an added benefit for this property.

'There's also the option of potentially extending the kitchen out to this area at the side.

'To find out more about this property and its potential, we invited a local estate agent

'to take a look around. What are her initial thoughts?'

It's lovely wit the original features, but I think the wallpaper is from the original time as well!

But it's a very nice family home.

Could the location of the bathroom deter potential buyers?

Downstairs bathrooms are a problem because people don't like going through the kitchen to them.

It does put some people off.

Let's talk figures. Assuming the house has a good refurbishment from top to bottom,

-how much could it be worth?

-Once the refurbishment is done, I'd put it on the market for £200,000.

What rental return could it achieve?

For a three-bedroom family home in this area,

I would be looking for a rental of about £850 to £1,050 per month,

depending on the quality of the refurbishment.

A three-bedroom house in London that had a guide price of £175,000.

That does represent good value in the capital,

but this auction lot does require the works. Somebody fancied it.

Let's find out who that was as we go to auction.

Lot 32 is a mid-terraced house. So I invite your bids.

I don't know.

200? A house at Forest Gate? Must be 200.

150. 155?

-180.

-Where's that? How much?

-180.

-180.

185, yeah?

190. 195?

200?

195, with you. Looking for 200.

196 by the door?

195 down here. Looking for 196. 196.

Sorry, didn't see your hand. 196. 197.

198.

198, sir? 197.

Down here, it's going. 197.

First time. Second time. Third and last time. All done?

Sold. 197.

That final successful bid of £197,000

came from Alvin. He worked in retail before retiring.

He also owns a property company with his brother of buy to lets.

Alvin lived in Forest Gate when he first moved here from East Africa

and was determined to get this house. I met up with him to find out his plans.

Alvin, congratulations. You got it. What potential could you see in it?

It's a big potential because I like doing these sort of things.

-Are you a property developer?

-Yeah, I've been doing it ever since the 1970s, you know.

-How many properties have you done up? Lots and lots?

-Lots. I used to do it all myself when I was young,

labouring, skip filling. I still do it now as well,

but I get help from my son and family and my brothers.

Not content with owning and running a chain of supermarkets,

Alvin wanted more and started to buy property as a sideline venture.

Although he's retired from retail, he's not ready to put his property developing feet up just yet.

-I want to know more about you. Where are you from?

-East Africa, Kenya.

-And when did you come to this country?

-1967.

Me and my brother came over here at London Airport

with £23 in my pocket. And I never, ever laid about. I always worked.

-So you came to this country with £23 in your back pocket?

-Yes.

Wow! Tell me, what advice would you give to somebody starting out in this business?

First, you need to work for it. That's what I'd give anyone as advice.

-You certainly have worked for it.

-Yes.

-For many, many years.

-Many years.

# Money, money, money, money... #

Alvin's experienced enough to know renovating property doesn't always guarantee you an overnight return.

I suspect he's got a few hard months ahead with this one, so what's his master plan?

We're going to knock everything down, plastering, plumbing, wiring, skimming...

-Everything.

-Are you keeping any of the beautiful period features this house has got?

I don't think I'm going to keep anything. I'm going to take the fireplace out.

The beautiful fireplace upstairs? I like that! And the ceiling rose?

-I'm going to take it out.

-No! Is it more straightforward to get rid of everything?

That's it. And forget about it.

# Am I that easy to forget? #

That's a shame, but I understand where Alvin's coming from.

As a developer, he's looking for straightforward, easy rooms.

He doesn't intend to change any of the layout here. There will be no extensions

and that bathroom is staying.

-Who's going to be helping you?

-It's the family and my son, who is an electrician.

He does lots of other things as well now. And my brother.

-And what about you? Will you be getting involved?

-The donkey's work!

-You won't be able to sit on the sidelines! You filled skips.

-I used to, but I'm getting on!

I still love doing it. Mostly sweeping up I do. I don't like stuff lying about.

Here's hoping he's got a good handle on the finances

so he sweeps up a nice profit and doesn't brush up against any problems.

He thinks it's more likely he'll rent this out rather than sell on, but what budget has he got?

I've got a budget of around about £20,000. Maybe less, maybe more, but that's what my target would be.

And how long will it take you?

-Three months, round about.

-Alvin, good luck. I can't wait to see what this looks like.

Thank you.

Alvin started off with just £23 in his back pocket!

I love it! Look at him now!

It just shows how good, savvy business sense can pay off.

But will he make a success of this and turn it around in three months? Find out later in the programme.

Coming up: in Cumbria, first impressions of this mid-terrace are promising.

OK. So far, so good.

We return to London where Alvin was planning a complete makeover.

Plumbing, wiring, skimming. Everything.

But first, back in Cornwall, was it plain sailing for Lee and Andrea?

-A lot more work than I expected!

-A lot more than I expected!

We're now going back to Delabole in Cornwall, where earlier we saw how, back in 2008,

Lee and Andrea bought this five-bedroom detached house for £190,000.

They planned to transform it into a family home.

But when we returned the first time, they'd started work and the family

with the birth of baby Isabella,

but they still hadn't moved in.

We weren't going to do the extension originally, then we thought with the mess and everything, let's do it

and if it takes two years then it takes two years. So be it.

We'll get it right and how we want it at the end.

Well, it's now 12 months later and we're back to see the house.

The good news is that the young family are finally about to move in.

At the back, the kitchen dining room is now a wonderful living space for entertaining.

There are great bi-fold doors that will open out onto a patio area.

It's light, large and beautifully kitted out.

And the big living room flows seamlessly from the kitchen area.

What a difference from how the house used to be.

The smaller front living room is now a study.

And everywhere the quality of the work is truly outstanding.

In the kitchen, we've put in some false beams. They're not structural.

We put four of these in. These aided the plasterer,

so he didn't have to skim the whole ceiling. We've gone for low energy and LED lighting.

And in the kitchen we've got the granite, slate floors, underfloor heating.

Water underfloor heating.

And then the kitchen sort of flows through into a dining area where we've put this table. It seats eight

but it's just set for six.

We went for a tall rad here because of the shape of the room.

With the slate floor, we'll run it out onto the patio area.

These bi-fold doors go right back, so it will all be on the same level with the same flooring.

That patio area sounds lovely and although it's still a bit of a building site outside,

once the garden is landscaped it'll look fantastic.

The seamless flow of the house is excellent. It's one of the things you instantly notice coming in.

Upstairs, three of the four bedrooms have been decorated. Each has been done in a different colour scheme

with co-ordinated fabrics and accessories.

Bedroom four is baby Isabella's room. Pink pastel shades and all suitably girly.

The fittings and luxury touches have now been completed in the bathroom.

It's taken about three years from start to finish.

During that time, Andrea and Lee lived with Lee's mum while doing the total refurbishment here.

We pretty much took it back to the four walls, really.

-Every wall was stripped back.

-Every bit of plaster came off.

-It was a bare shell.

-A lot more work than I expected.

-A lot more work than I expected!

It's been well worth it, guys.

Lee has installed all the pipework and plumbing for the fifth bedroom conversion up in the loft,

but he and Andrea have decided to leave that until some time in the future.

Meanwhile, they plan to have some relaxation time in the new lounge.

The living room was originally two rooms.

When we bought the house, the partition wall had already been taken out.

We decided on engineered wood boards. They're more hard-wearing than real oak.

We spent a long time looking for a wood burner to fit perfectly. I love the lounge.

I think we'll spend a lot of time in here.

The finish they've achieved throughout is outstanding.

High spec fittings and equipment have been used everywhere. How much has it all cost?

Initially I said £20,000 budget, but I would say we're close to £35,000, maybe a little more.

With their £190,000 purchase price, that takes their total to £225,000.

Of course, it would have been a lot more if Lee hadn't done most of the renovation himself.

It's been very hard, the last three years.

-Lee gets in from work, has his tea and then leaves again to work here.

-Every Saturday and Sunday.

And then to half-past ten, eleven every night for the majority of it.

Lee's put in so much hard work here. We could never afford this if he hadn't done it himself.

The amount of work Lee has done here is eye-watering and it goes on.

He also installed a fully tiled wet room by the back door next to the kitchen.

Was the interior design a joint decision?

The bedrooms, I mainly picked the colour schemes for.

We decided on three colour schemes -

the silver room, the gold room and the purple room.

And we picked curtains and bedding

and throws around those colour schemes.

Colourful. What about the kitchen?

It was really my decision because we had the grey floor with the black granite worktop.

It was looking a bit bland, so we tried to incorporate a bit of colour with the tiling above the range

and some of the pots are orange. We'll incorporate that as well.

They've created a really beautiful family home.

Now the work is complete, which one room are they most fond of?

My favourite room, I would say, would be the study, the second lounge.

That's turned out really well.

My favourite room is the kitchen-diner.

We haven't been able to sit at a table for three years as a family and that would be nice.

We've waited so long to have our own home.

It will just be amazing when we actually get in and start living here.

Time to see what two local estate agents think of this project

that's taken three years to finish.

I think the biggest appeal to me

is the kitchen-breakfast room.

They've extended out from the rear elevation

and it makes it into a real family area that will appeal to everyone.

The kitchen-dining area is fabulous, particularly the way it flows.

I love the multi-coloured tiles and use of colour in the kitchen.

The living room is to die for. The wood-burner is the focal point when you enter the room.

You don't get many done to this workmanship and standard.

It's one of the best I've seen in a long while.

A lot of extras have been added to this property, the quality doors, granite worktops,

underfloor heating. It's stunning.

But how much do the property experts think it's now worth?

Remember, Lee and Andrea spent £225,000 in total on their home.

If we were to put the property on the market at the current time, we'd hope to achieve about £300,000.

I would put the property on the market for somewhere around £315,000

Well, those valuations of between 300,000 and 315,000 could produce a gross profit

of 75,000 to 90,000 before the usual selling expenses.

I would have expected around the 280 mark maybe,

so delighted if we ever did sell and we could get that sort of figure. Fantastic.

Well, after three long years, that's the last thought on their mind.

It must be exciting to be only days from moving in now.

-I can't wait.

-Yeah.

-It's been a long time coming, so really looking forward to it.

And Isabella knows exactly which her favourite room is.

-I really like my room.

-I'm not surprised, Isabella. Daddy and Mummy have done a great job.

I'm in the town of Workington on the West Cumbrian coastal plain,

once famous for its thriving steel industry.

# And the big steel rail gonna carry me home to the one I love... #

The town oozes industrial history.

The trappings of modern engineering make an appearance in the backdrop of the Lake District hills.

Workington was once famous as the place where they produced railway tracks

which were exported around the world. It was once said that Workington held the world together.

This is it. It's a two-bedroom mid-terrace. It had a guide price of 45,000 to 55,000 quid.

Let's take a look.

Like the railways, these sturdy old houses stand the test of time.

By the looks of it, this one is no exception, but appearances can be deceptive.

So what have we got?

Nice to have that little entrance porch. We like that.

Radiator there. It's a small thing, but at least it means there's central heating.

Front living room there, stairs up to your bedrooms.

I like the layout already, then through into your rear living room.

Good sized space. A bit of a dated old fireplace, probably want to get rid of that.

OK, so far, so good,

but there's more.

Through here, what I reckon is an extension contains the kitchen.

It's not a bad size.

Clearly, the units need to be sorted out and you're fairly limited in terms of the layout

because it's actually, in reality, a corridor through

to a bit of a downside - the toilet and the bathroom,

the only ones in the property, not ideal.

But from the front, it doesn't look that big.

Come in here... It's a big property.

A big property and a warm one too as it benefits from gas central heating and double glazing,

so a couple of obvious costs avoided there,

but I'd always advise getting the wiring and the boiler checked out.

This mid-terraced house went to auction guided at 45,000 to 55,000.

Up a narrow set of stairs, there are two decent-sized bedrooms -

one at the front and one at the back.

Both get plenty of light, but the stairs don't stop on the landing.

So what was a fairly standard house

suddenly becomes very exciting because you've got this third floor.

Obviously, this was the attic at some point and it's been converted.

Whether or not it's been converted to building regulations standards, I don't know.

You'd have to check the floorboards. It seems reasonably solid.

That staircase actually isn't too bad,

so possibly I'd err on the side of saying this could actually be used as a bedroom.

My only concern would be whether or not it's got the correct fire escape provisions in place.

All pretty good, apart from that.

As you can see, a few bits of damp.

Lath and plaster on the ceiling here and...

Right, so clearly there's something going wrong there.

That needs to be sorted out before anything else.

It could be relatively easy to do or not, but it definitely needs checking out.

Sort that out and you've got a very acceptable, spacious home.

At the rear of the property, you might have expected a courtyard or, hopefully, a garden,

but there is just this hugely long extension.

It goes all the way from the rear of the house the full depth of this rear area.

It's where the kitchen is and it does provide fantastic extra space for the property.

Right at the back, though, is something which is on the other side of the downstairs loo.

It's a bit of a waste of space, so I'm wondering whether or not you could block this up

to create a bigger space in there.

I don't know if this has been built correctly with a damp-proof course and a double course of bricks.

Either way, investigate it and it does give the house amazing extra space.

An elongated house that could just go on and on.

To find out more about the options here,

we asked the auctioneer who sold it for his thoughts on the place.

I think it's in dated condition.

It's been rented out for some time.

It needs some money spent on it

and you would spend more if you were going to re-sell or live in it.

The rear extension is single-skin brick, so that needs attention,

and general modernisation throughout the rest of the property.

Given all of that, what's the likely rental income here?

A property like this with a little bit of work done would get £395 per calendar month.

So once renovated, is it a similar story if you were to put it up for sale?

On the sales market, this property,

when refurbished, would probably re-sell for between £75,000 and £80,000.

There is some money needed to sort this place out,

but I think it could deliver a good return on the investment of whoever bought it.

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

Two-bed terraced house with attic room, two reception rooms,

kitchen, bathroom, central heating and double glazing. This is Lot 5.

45, anyone?

45, I have. In the corner at £45,000.

46, anyone? 46, I have. And 47.

48. 49.

49, I've got.

At £49,000, are we done? 50, I have.

And 1? 1, I've got.

And 2?

At 51,000 in the corner.

It's against the phone at 51.

52. With the phone at 52.

Here to sell, 53.

New position at 53.

It's with you, sir, at 53. It's against you in the corner

at £53,000.

53,250... 53,250?!

Too early for 250s.

53 and a half? 53 and a half. I'm taking that. 54, sir?

54, I've got. Back with you.

54 and a half?

54...

You're out. At £54,000 then, first time...

At 54 second time...

I'll take 250!

LAUGHTER

At 54, third and final time.

Sold. Well done.

'That final successful bid of £54,000 was made by two new business partners -

'David in yellow and Jim in the middle there in white.

'It's their first project together and they've invested equally in the project.

'David is a full-time property developer.

'Jim is a qualified electrician and has also had a property maintenance company for 11 years.

'I met up with Jim back at the house to find out about their plans.'

-Jim, lovely to meet you.

-Hiya.

-Tell me why you wanted to buy this house.

We've been doing this type of work for some time now, property maintenance,

both for ourselves and the local housing association.

Work's a bit quiet at the moment,

so we thought we'd give it a go, see if we can make any money to keep the business ticking over.

-Have you got a team of people?

-There's just two of us now.

-It'll be primarily you two taking this on?

-Yeah.

So tell me, why this particular house?

Well, we just thought a good location close to the town centre

and we thought it's probably ideal for a first-time buyer.

-So the basic plan then is to do it up and sell it on?

-Yeah, yeah.

So talk me through the finances then.

What do you hope you might be able to get back on it?

We're looking round about 70,000, 72,000, hopefully,

spending round about 6,000 on it.

-So a bit of a profit in there for you?

-Hopefully.

'So had Jim and Dave seen the house before they bid at auction?'

No.

Are you saying, "You fool"?

We did look at the outside. We did look in another one which we were interested in.

At the last minute, we came to look at this one, but just the outside.

The one we were looking at we thought went for too high a price so we didn't go for that one.

-So a shock or a pleasant surprise when you first walked through the door?

-I'm quite happy with it.

'Well, I would never advise buying blind at the best of times

'and certainly not on the first joint venture with a new business partner.

'Jim and David plan to do the work themselves, so what's their plan for the house?'

Obviously, the paper, etcetera, needs stripped off.

The main job will be moving the bathroom into the first bedroom.

-Right.

-We'll move that, extend the kitchen, possibly try and keep the downstairs toilet.

At the expense of room in the bedroom, but not the whole bedroom?

It will reduce that bedroom to a single bedroom and a bathroom.

There'll still be a double bedroom upstairs and one in the attic.

In terms of the attic room, are you satisfied that that's a proper room that can be described as a bedroom?

-Yes.

-It meets building regulations?

It may not meet them at the moment, but we'll have to have a look at that. It's certainly big enough.

-What's the timescale for sorting it out?

-About six weeks, hopefully.

-Congratulations.

-Cheers.

-Good luck with it. We look forward to seeing how you get on.

-That's great.

Well, Jim seems pretty confident that he'll be able to sort this place out on that budget,

but six grand and six weeks sounds like some fairly low numbers to me.

Let's find out how he gets on later in the show.

It's been a while since we saw those properties.

-Do they look any different? Has all that time and money been well spent?

-Let's go back and find out.

'Earlier in the programme, we were in Forest Gate, East London,

'where hidden away behind this hedge was a Victorian terrace, desperate to be seen.

'It was bought for 197,000 by Alvin.

'He's retired after years in the retail industry,

'but still owns a company with a portfolio of buy-to-let properties.

'The house needed a full refurbishment,

'but Alvin wasn't as keen as me on the character features.'

I don't think I'll keep anything. I'll take the chimney, fireplace out

-I like that fireplace. And the ceiling rose in the lounge?

-I'm going to take it out.

-Really?

-Yeah.

-Is it easier just to get rid of everything?

-Yeah.

There was an overgrown garden to go with the front hedge.

Alvin planned to add the property to his buy-to-let portfolio

and he'd supervise the work that his son Raj, an electrician, and the other tradesmen would do.

It's now three and a half months later and the hedge has gone.

We meet Alvin again back at the house that now has replacement windows and a new paint job.

The bay-fronted living room has a laminate floor

and the fireplace has gone...

..although the staircase does retain its original character.

But there's no fire left in the dining room or the original door.

The bathroom and loo are still downstairs.

There's a new suite, although Alvin did retain the old cast-iron bath which looks great.

But nothing survived in the kitchen. Everything is new

and Alvin was able to fit everything in without any layout changes.

I was thinking of extending the kitchen further down there, but I changed my mind.

I found it bigger than what it was before because this water tank was taking all this room.

We took all that out, knocked it dow and refurbished the whole thing.

I really like all this tiling and the floor.

I think the kitchen is one of the prime things in this house.

Most of the work in the kitchen was done by my son.

Alvin's son Raj is a qualified electrician, but did a lot more than just the wiring.

We hacked off all the old plaster, re-plastered everything, new central heating, new wiring.

I did the skirting, kitchen fitting, bits of tiling.

Upstairs, the re-plastered walls look great

and the gloss paintwork and neutral colours really open up this old house.

But I'm sad to see none of the fireplaces survived.

Alvin has been refurbishing properties for years.

He used to do all of the labouring,

but now project-manages his team.

So do Raj and all the others find him a tough task-master?

He's not bad. He pushes us about, but we get the work done, you know, as quick as we can.

Well, yes, time is money

and a quick turnaround means the rental income comes in faster.

Alvin's been supervising the work, but he told me he'd be busy with the broom, sweeping up the mess.

How did that go?

I didn't do much. It was too dirty for me.

Clearing the garden was a big job,

but several skips later and you can now see what a decent size it is.

Alvin's costs have been reduced as Raj has done the electrical work,

but having to plasterboard the entire house and install central heating must have impacted

on Alvin's £20,000 budget.

We went slightly over.

With the legal fees and all that, we went to about 26-5, maybe 27.

With the 197,000 he paid at auction,

that takes Alvin's total outlay to £224,000.

So have plans for the house stayed the same?

We're going to let it out. We've got tenants waiting.

But if someone comes with lots of money, I might sell it.

A couple of local estate agents are on their way

to take a look around.

Maybe their valuations will change Alvin's intentions.

Everything is light and fresh.

The clean walls, kitchen and bathroo will appeal to a lot of purchasers.

I think it's been done up to a high standard.

I think the new kitchen has made a big difference to the property

and all of the new flooring.

So will the property be worth more than the 224,000 that Alvin has spent so far?

If I was putting this property on the market for sale, I'd put the property on at £275,000.

I'd place this property on the marke with an asking price of £275,000.

Well, they both agree.

That valuation would produce a gross profit of 51,000

before the usual selling expenses.

That's good. Wonderful.

I don't think I'm going to sell it, but it's a wonderful offer.

I was expecting 245, something like that.

What rental income do the agents think this place could generate?

If I was putting this property on the market for rental,

I would put it on at £1,250 to £1,300 per calendar month.

If I was to put this property for rent, I would expect between £1,200 and £1,300 per calendar month.

That is right. That's what the other agent that we use offered, that much

So I'm quite pleased with the property value and the rental market as well.

I'll have to sit down and think about it now.

How has Alvin found this refurbishment and what is he up to next?

I really enjoyed doing the property. I might move to the next one if it comes on the market.

There's no stopping him, but after years of property developing,

can he now see himself kicking back and retiring?

At the moment, I've got no intention of stopping, but one day maybe...

I might hang the boots.

'We return now to Workington where, earlier in the programme,

'this mid-terraced house was bought for £54,000 by two new business partners -

'David, a full-time developer, in yellow, and Jim next to him in the middle.

'Jim is a qualified electrician who has had a property maintenance company for 11 years.

'They decided to go 50/50 and buy this house together as a test run for a potential joint business.

'It was Jim who I met back at the property.

'His plan was to move the bathroom upstairs

'which meant reducing the size of one of two bedrooms,

'but there was still the attic room up top.'

In terms of the attic room, are you satisfied that that's a proper room that can be described as a bedroom?

-Yes.

-It meets building regulations?

It may not meet them at the moment, but it's certainly big enough.

It's now five months later and it's David's turn to show us round the property as Jim's been unwell.

At the back of the house, the narrow kitchen has been completely refitted

with new appliances and a striking tiled wall.

The front living room has lost the fireplace, but the chimney breast remains.

The embossed wallpaper has gone from the rear reception room.

And you get a great view of the restored garden path that is now bordered with reclaimed duck stones.

But it's the kitchen that has taken most of the effort.

Originally, the kitchen was in three parts. One was a bathroom, one was a toilet, then the small kitchen,

but the main problem was the four-inch wall

which was the flank wall, so we had to do some major work to the wall.

And from its original concept, the kitchen has turned out fabulous,

compared to what it was.

I couldn't agree more and it means that upstairs now has a bathroom.

It's been created by dividing the former rear bedroom in half.

There is still a single room at the back with a new window.

The front bedroom is a good-sized double.

Plus at the top of the house, there is now a third bedroom

as the planning and building regulations were sorted out.

The third bedroom - this was a real tease as we had to take down all the plasterboard,

so we could get insulation. That was our first problem.

The second one was moving the stairs

Originally, the stairs came up here and we've had to move those about three foot this way

to make sure that we could get the right height on the treads,

so we could use it as a bedroom and make it safe.

The house has been re-wired and re-plumbed

and a new boiler has been installed at the back next to the downstairs loo.

Their first joint project was going well, but when Jim was taken ill, David had to step up to the plate.

I've known Jim for some time. We've worked on various properties.

We were quite chuffed about doing this first one together,

but unfortunately, he took quite badly.

It was best for the project if I actually bought him out of his interest, so I did that,

then throughout the project, I've kept in touch and he's helped m with the re-wiring

because he's a qualified electrician and got a good reputation, so you've got to use him.

Apart from Jim's expertise, David also employed a plumber and decorator.

So what was the final bill?

The original budget was £6,000,

but ours has eventually cost about £10,250.

But in that, we had extra conveyancing fees to make the transfer

and also the extra cost of electrics and plumbing works.

That spend added to the purchase price of 54,000

means a total outlay here of just over 64,000.

Now that David has bought out Jim's share, will this investment prove a good one?

Let's hear what two local property experts think

of this refurbished end terrace.

I think it's a good spread of accommodation.

The two reception rooms are of a decent size

and the kitchen having been enlarged is a bonus.

He's done really well getting the bathroom upstairs,

retaining a downstairs toilet, whilst keeping three bedrooms.

I think because there's good head height up there and it's a nice, light bedroom, it'll be very useful.

David says he always sells the properties that he's refurbished,

but what income do the estate agents think it could generate if he was to put it up for rent instead?

At this point, I would rent this out for £425 per calendar month.

I think he would probably achieve a monthly income of about £395 per calendar month.

That's a yield of between 7 and 8%.

Could David be tempted to hang on to this one?

It's a lot better than I expected, to be honest,

but no, I still wish to sell.

Sounds like a plan to me.

David's total outlay here is just over 64,000, but can he make a profit on the resale market?

I think you would expect to achieve a figure between £75,000 and £80,000.

I'd put the property on to the market for £87,500 to look to achieve approximately £85,000.

That valuation range from 75,000 to 85,000 would give David a gross profit

before the usual selling expenses of between around £11,000 and £21,000.

That's good. That's good, yes. I'll definitely be selling. I'll be definitely selling.

David has done a great job turning this property around

and turning a profit in the process.

He has every intention of keeping his working relationship with Jim going.

We've bought...or I've bought a hotel in Egremont.

Jim will definitely be doing the wiring in the hotel because you can only really trust Jim.

And trust is vital when it comes to a solid business partnership.

We wish them both well for the future.

# I wish you well

# I wish you well... #

We hope you've enjoyed watching Homes Under The Hammer and learnt some useful lessons.

-We'll see you next time for more hot properties and some that turn out to be lukewarm.

-See you then.

-Goodbye.

Subtitles by Subtext for Red Bee Media Ltd 2012

Email [email protected]