Episode 87 Homes Under the Hammer


Episode 87

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

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

-Well, buy your next house under the hammer.

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

-But then you can get a real bargain.

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

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

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This whole really has not been thought through.

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

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Sash windows - check. Ornate mouldings - check.

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

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That needs to be sorted out before anything else.

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

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when they went under the hammer.

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

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

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

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The influx of second home owners buying properties in Cornwall

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

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

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

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

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That's a lot of house for the price.

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

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

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

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

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

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

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

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

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

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However, what's that?

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# Looking through the window... #

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

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It's a huge family one.

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With a massive car parking area to boot.

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So plenty of room to extend or maybe even develop.

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

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The kitchen is just a disaster.

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

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As it is, disastrous units and this hotchpotch feeling.

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Look at this. A main beam going across here.

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

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

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

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Upstairs, there are four main bedrooms,

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a box room

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and a bathroom.

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All are in need of upgrading and potentially some repair work

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

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

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

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

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Let's find out who bought it.

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

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

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165. 170.

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175. 180? 180.

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He's still there. 185.

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190? 190 I want. 185.

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188. 188.

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

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At 190. 190.

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Stood has it. Both sat are out.

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At 190. That's a lot of house.

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At 190. 190 once.

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

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

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

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

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

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I met up with them to find out more.

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Lee, Andrea, well done.

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-Thanks very much.

-Congratulations. It's a lovely house.

-We think so.

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-Why did you want to buy it?

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

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

-Right.

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-What about your background, Andrea?

-I've been in Cornwall about 10 years.

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I came down here for my first job after university.

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

-And tell me about you two.

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

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-Really?

-We had a float, so, yeah.

-Tell me more about that.

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

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-I was a pirate.

-Yeah. A pirate.

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

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-So he was wearing a pirate's outfit?

-Yeah, I pulled a pirate!

-You pulled a pirate!

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

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

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

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

-No!

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

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-So it's meant to be.

-Hopefully!

-You made it happen.

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

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

-There certainly is.

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-A little more than we thought.

-Yeah.

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

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

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

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-and get a bit more light in.

-How long's it going to take?

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

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

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

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We're not looking to make a profit.

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

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finishing off the renovation once they'd moved in.

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

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

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but still hadn't moved in.

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

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

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

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as were the four main bedrooms upstairs,

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although a new bathroom had been installed.

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

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

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

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

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I had my daughter last year.

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She's now 11 months old.

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She's taken up a lot of my time.

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

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We initially said six months.

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But maybe that was a bit optimistic!

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

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

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

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

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and little baby Isabella at their Cornwall property.

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

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

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Stratford - the transport hub for the 2012 Olympic Games.

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

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to handle 120,000 passengers at peak times.

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

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

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and that's exactly why I'm here.

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

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I'm here to see a period property

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

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

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That makes my heart sing.

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So the guide price is £175,000.

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But first orders - cut this bush back! Check!

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

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

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

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which looks in pretty good condition.

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

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

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

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

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

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

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

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

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# Money, money, money, money

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-# Money... #

-But plenty of the original features have remained.

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A second reception room, another fireplace, sash window.

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

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

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

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

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

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

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

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

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

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

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and will it add any significant value?

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

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

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from the landing to the bedrooms.

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

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'it's a bit of a jungle,

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

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

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

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

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

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But it's a very nice family home.

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Could the location of the bathroom deter potential buyers?

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

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It does put some people off.

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

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-how much could it be worth?

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

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What rental return could it achieve?

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For a three-bedroom family home in this area,

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

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depending on the quality of the refurbishment.

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

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That does represent good value in the capital,

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

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

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

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I don't know.

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

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150. 155?

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-180.

-Where's that? How much?

-180.

-180.

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185, yeah?

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190. 195?

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200?

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195, with you. Looking for 200.

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196 by the door?

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195 down here. Looking for 196. 196.

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

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198.

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198, sir? 197.

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Down here, it's going. 197.

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

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Sold. 197.

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That final successful bid of £197,000

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came from Alvin. He worked in retail before retiring.

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

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

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

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

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

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-Are you a property developer?

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

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

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

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

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

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Not content with owning and running a chain of supermarkets,

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

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

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

-East Africa, Kenya.

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-And when did you come to this country?

-1967.

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Me and my brother came over here at London Airport

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

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

-Yes.

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

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

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-You certainly have worked for it.

-Yes.

-For many, many years.

-Many years.

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

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

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

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

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-Everything.

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

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

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

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-I'm going to take it out.

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

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That's it. And forget about it.

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# Am I that easy to forget? #

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

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

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

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and that bathroom is staying.

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-Who's going to be helping you?

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

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

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

-The donkey's work!

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

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

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

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

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

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

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

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And how long will it take you?

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-Three months, round about.

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

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Thank you.

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

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I love it! Look at him now!

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

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

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

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OK. So far, so good.

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

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Plumbing, wiring, skimming. Everything.

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

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-A lot more work than I expected!

-A lot more than I expected!

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

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

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They planned to transform it into a family home.

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

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with the birth of baby Isabella,

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but they still hadn't moved in.

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

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

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

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

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

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

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

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It's light, large and beautifully kitted out.

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

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What a difference from how the house used to be.

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The smaller front living room is now a study.

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And everywhere the quality of the work is truly outstanding.

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

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

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

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

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Water underfloor heating.

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

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but it's just set for six.

0:25:180:25:21

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

0:25:210:25:25

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

0:25:250:25:29

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

0:25:290:25:35

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

0:25:350:25:41

once the garden is landscaped it'll look fantastic.

0:25:410:25:46

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

0:25:460:25:53

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

0:25:550:26:02

with co-ordinated fabrics and accessories.

0:26:020:26:06

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

0:26:130:26:20

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

0:26:230:26:28

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

0:26:280:26:33

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

0:26:330:26:40

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

0:26:400:26:44

-Every wall was stripped back.

-Every bit of plaster came off.

0:26:440:26:48

-It was a bare shell.

-A lot more work than I expected.

-A lot more work than I expected!

0:26:480:26:54

It's been well worth it, guys.

0:26:540:26:56

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

0:26:560:27:02

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

0:27:020:27:07

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

0:27:070:27:12

The living room was originally two rooms.

0:27:140:27:18

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

0:27:180:27:24

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

0:27:240:27:30

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

0:27:300:27:36

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

0:27:360:27:39

The finish they've achieved throughout is outstanding.

0:27:410:27:45

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

0:27:450:27:52

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

0:27:520:27:59

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

0:28:010:28:07

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

0:28:070:28:13

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

0:28:130:28:16

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

-Every Saturday and Sunday.

0:28:160:28:23

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

0:28:230:28:27

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

0:28:270:28:34

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

0:28:340:28:40

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

0:28:400:28:45

Was the interior design a joint decision?

0:28:450:28:48

The bedrooms, I mainly picked the colour schemes for.

0:28:480:28:53

We decided on three colour schemes -

0:28:530:28:56

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

0:28:560:29:00

And we picked curtains and bedding

0:29:000:29:02

and throws around those colour schemes.

0:29:020:29:06

Colourful. What about the kitchen?

0:29:060:29:09

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

0:29:090:29:14

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

0:29:140:29:20

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

0:29:200:29:24

They've created a really beautiful family home.

0:29:240:29:27

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

0:29:270:29:31

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

0:29:310:29:36

That's turned out really well.

0:29:360:29:39

My favourite room is the kitchen-diner.

0:29:390:29:41

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

0:29:410:29:48

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

0:29:480:29:50

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

0:29:500:29:55

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

0:29:550:30:00

that's taken three years to finish.

0:30:000:30:02

I think the biggest appeal to me

0:30:020:30:05

is the kitchen-breakfast room.

0:30:050:30:07

They've extended out from the rear elevation

0:30:070:30:10

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

0:30:100:30:14

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

0:30:140:30:18

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

0:30:180:30:22

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

0:30:220:30:28

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

0:30:280:30:32

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

0:30:320:30:35

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

0:30:350:30:41

underfloor heating. It's stunning.

0:30:410:30:43

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

0:30:430:30:48

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

0:30:480:30:54

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

0:30:540:31:00

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

0:31:000:31:04

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

0:31:060:31:12

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

0:31:120:31:16

I would have expected around the 280 mark maybe,

0:31:190:31:22

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

0:31:220:31:27

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

0:31:270:31:32

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

0:31:320:31:35

-I can't wait.

-Yeah.

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

0:31:350:31:41

And Isabella knows exactly which her favourite room is.

0:31:420:31:46

-I really like my room.

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

0:31:460:31:52

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

0:31:590:32:03

once famous for its thriving steel industry.

0:32:030:32:07

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

0:32:070:32:11

The town oozes industrial history.

0:32:130:32:15

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

0:32:150:32:22

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

0:32:220:32:27

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

0:32:270:32:33

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

0:32:330:32:38

Let's take a look.

0:32:380:32:40

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

0:32:440:32:49

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

0:32:490:32:55

So what have we got?

0:32:550:32:57

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

0:32:570:33:01

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

0:33:010:33:06

Front living room there, stairs up to your bedrooms.

0:33:060:33:10

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

0:33:100:33:14

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

0:33:140:33:19

OK, so far, so good,

0:33:190:33:21

but there's more.

0:33:210:33:23

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

0:33:230:33:29

It's not a bad size.

0:33:290:33:32

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

0:33:320:33:37

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

0:33:370:33:42

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

0:33:420:33:47

the only ones in the property, not ideal.

0:33:470:33:50

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

0:33:500:33:53

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

0:33:530:33:55

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

0:33:580:34:04

so a couple of obvious costs avoided there,

0:34:040:34:08

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

0:34:080:34:13

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

0:34:130:34:17

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

0:34:200:34:25

one at the front and one at the back.

0:34:250:34:28

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

0:34:280:34:32

So what was a fairly standard house

0:34:340:34:38

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

0:34:380:34:43

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

0:34:430:34:47

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

0:34:470:34:52

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

0:34:520:34:56

That staircase actually isn't too bad,

0:34:560:34:59

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

0:34:590:35:05

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

0:35:050:35:11

All pretty good, apart from that.

0:35:110:35:14

As you can see, a few bits of damp.

0:35:140:35:18

Lath and plaster on the ceiling here and...

0:35:180:35:21

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

0:35:220:35:26

That needs to be sorted out before anything else.

0:35:260:35:30

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

0:35:300:35:36

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

0:35:360:35:41

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

0:35:410:35:47

but there is just this hugely long extension.

0:35:470:35:50

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

0:35:500:35:56

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

0:35:560:36:01

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

0:36:010:36:07

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

0:36:070:36:12

to create a bigger space in there.

0:36:120:36:15

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

0:36:150:36:21

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

0:36:210:36:26

An elongated house that could just go on and on.

0:36:260:36:30

To find out more about the options here,

0:36:300:36:33

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

0:36:330:36:38

I think it's in dated condition.

0:36:380:36:40

It's been rented out for some time.

0:36:400:36:42

It needs some money spent on it

0:36:420:36:45

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

0:36:450:36:50

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

0:36:500:36:54

and general modernisation throughout the rest of the property.

0:36:540:36:58

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

0:36:580:37:02

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

0:37:040:37:09

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

0:37:090:37:15

On the sales market, this property,

0:37:160:37:18

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

0:37:180:37:25

There is some money needed to sort this place out,

0:37:250:37:28

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

0:37:280:37:33

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

0:37:330:37:37

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

0:37:370:37:41

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

0:37:410:37:46

45, anyone?

0:37:460:37:48

45, I have. In the corner at £45,000.

0:37:480:37:52

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

0:37:520:37:55

48. 49.

0:37:550:37:58

49, I've got.

0:37:580:38:01

At £49,000, are we done? 50, I have.

0:38:010:38:04

And 1? 1, I've got.

0:38:040:38:07

And 2?

0:38:070:38:09

At 51,000 in the corner.

0:38:090:38:12

It's against the phone at 51.

0:38:120:38:15

52. With the phone at 52.

0:38:150:38:17

Here to sell, 53.

0:38:170:38:19

New position at 53.

0:38:190:38:22

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

0:38:220:38:26

at £53,000.

0:38:260:38:28

53,250... 53,250?!

0:38:280:38:32

Too early for 250s.

0:38:320:38:34

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

0:38:340:38:39

54, I've got. Back with you.

0:38:390:38:42

54 and a half?

0:38:420:38:44

54...

0:38:440:38:45

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

0:38:450:38:49

At 54 second time...

0:38:500:38:52

I'll take 250!

0:38:520:38:54

LAUGHTER

0:38:540:38:56

At 54, third and final time.

0:38:560:39:00

Sold. Well done.

0:39:000:39:02

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

0:39:020:39:07

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

0:39:070:39:11

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

0:39:110:39:17

'David is a full-time property developer.

0:39:170:39:19

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

0:39:190:39:25

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

0:39:250:39:31

-Jim, lovely to meet you.

-Hiya.

-Tell me why you wanted to buy this house.

0:39:310:39:36

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

0:39:360:39:41

both for ourselves and the local housing association.

0:39:410:39:46

Work's a bit quiet at the moment,

0:39:460:39:48

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

0:39:480:39:54

-Have you got a team of people?

-There's just two of us now.

0:39:540:39:58

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

-Yeah.

0:39:580:40:01

So tell me, why this particular house?

0:40:010:40:04

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

0:40:040:40:08

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

0:40:080:40:13

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

-Yeah, yeah.

0:40:130:40:17

So talk me through the finances then.

0:40:170:40:20

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

0:40:200:40:24

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

0:40:240:40:28

spending round about 6,000 on it.

0:40:280:40:30

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

-Hopefully.

0:40:300:40:34

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

0:40:350:40:39

No.

0:40:400:40:42

Are you saying, "You fool"?

0:40:420:40:44

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

0:40:460:40:52

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

0:40:520:40:56

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

0:40:560:41:02

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

-I'm quite happy with it.

0:41:020:41:09

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

0:41:090:41:13

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

0:41:130:41:18

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

0:41:180:41:25

Obviously, the paper, etcetera, needs stripped off.

0:41:250:41:29

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

0:41:290:41:32

-Right.

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

0:41:320:41:38

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

0:41:380:41:43

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

0:41:430:41:47

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

0:41:470:41:51

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

0:41:510:41:57

-Yes.

-It meets building regulations?

0:41:570:41:59

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

0:41:590:42:06

-What's the timescale for sorting it out?

-About six weeks, hopefully.

0:42:060:42:10

-Congratulations.

-Cheers.

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

-That's great.

0:42:100:42:16

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

0:42:160:42:22

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

0:42:220:42:29

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

0:42:290:42:32

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

0:42:350:42:38

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

-Let's go back and find out.

0:42:380:42:44

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

0:42:440:42:48

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

0:42:480:42:54

'It was bought for 197,000 by Alvin.

0:42:540:42:57

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

0:42:570:43:00

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

0:43:000:43:05

'The house needed a full refurbishment,

0:43:060:43:10

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

0:43:100:43:15

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

0:43:150:43:20

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

-I'm going to take it out.

-Really?

-Yeah.

0:43:200:43:26

-Is it easier just to get rid of everything?

-Yeah.

0:43:260:43:30

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

0:43:300:43:33

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

0:43:330:43:37

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

0:43:370:43:44

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

0:43:450:43:50

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

0:43:500:43:57

The bay-fronted living room has a laminate floor

0:44:000:44:04

and the fireplace has gone...

0:44:040:44:06

..although the staircase does retain its original character.

0:44:090:44:13

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

0:44:160:44:21

The bathroom and loo are still downstairs.

0:44:230:44:26

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

0:44:260:44:32

But nothing survived in the kitchen. Everything is new

0:44:340:44:38

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

0:44:380:44:43

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

0:44:450:44:51

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

0:44:510:44:57

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

0:44:570:45:01

I really like all this tiling and the floor.

0:45:010:45:05

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

0:45:050:45:09

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

0:45:090:45:13

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

0:45:130:45:18

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

0:45:180:45:24

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

0:45:240:45:28

Upstairs, the re-plastered walls look great

0:45:280:45:31

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

0:45:310:45:37

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

0:45:420:45:45

Alvin has been refurbishing properties for years.

0:45:470:45:51

He used to do all of the labouring,

0:45:510:45:53

but now project-manages his team.

0:45:530:45:56

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

0:45:570:46:01

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

0:46:040:46:11

Well, yes, time is money

0:46:110:46:14

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

0:46:140:46:18

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

0:46:180:46:24

How did that go?

0:46:240:46:26

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

0:46:260:46:29

Clearing the garden was a big job,

0:46:290:46:32

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

0:46:320:46:36

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

0:46:380:46:42

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

0:46:420:46:49

on Alvin's £20,000 budget.

0:46:490:46:51

We went slightly over.

0:46:510:46:53

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

0:46:530:46:59

With the 197,000 he paid at auction,

0:46:590:47:03

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

0:47:030:47:07

So have plans for the house stayed the same?

0:47:070:47:10

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

0:47:120:47:15

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

0:47:150:47:20

A couple of local estate agents are on their way

0:47:200:47:23

to take a look around.

0:47:230:47:25

Maybe their valuations will change Alvin's intentions.

0:47:280:47:33

Everything is light and fresh.

0:47:330:47:35

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

0:47:350:47:39

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

0:47:390:47:42

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

0:47:420:47:46

and all of the new flooring.

0:47:460:47:49

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

0:47:490:47:55

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

0:47:550:48:02

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

0:48:020:48:06

Well, they both agree.

0:48:060:48:08

That valuation would produce a gross profit of 51,000

0:48:080:48:13

before the usual selling expenses.

0:48:130:48:15

That's good. Wonderful.

0:48:160:48:19

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

0:48:210:48:25

I was expecting 245, something like that.

0:48:250:48:28

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

0:48:280:48:33

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

0:48:330:48:36

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

0:48:360:48:41

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

0:48:410:48:47

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

0:48:470:48:52

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

0:48:520:48:58

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

0:48:580:49:01

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

0:49:020:49:08

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

0:49:080:49:13

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

0:49:130:49:17

can he now see himself kicking back and retiring?

0:49:170:49:22

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

0:49:220:49:27

I might hang the boots.

0:49:270:49:29

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

0:49:350:49:40

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

0:49:400:49:45

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

0:49:450:49:50

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

0:49:500:49:56

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

0:49:560:50:02

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

0:50:050:50:09

'His plan was to move the bathroom upstairs

0:50:090:50:12

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

0:50:120:50:16

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

0:50:160:50:19

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

0:50:190:50:25

-Yes.

-It meets building regulations?

0:50:250:50:27

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

0:50:270:50:32

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

0:50:350:50:41

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

0:50:440:50:48

with new appliances and a striking tiled wall.

0:50:480:50:52

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

0:50:570:51:02

The embossed wallpaper has gone from the rear reception room.

0:51:020:51:06

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

0:51:100:51:16

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

0:51:180:51:22

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

0:51:220:51:28

but the main problem was the four-inch wall

0:51:280:51:32

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

0:51:320:51:37

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

0:51:370:51:41

compared to what it was.

0:51:410:51:44

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

0:51:460:51:50

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

0:51:560:52:00

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

0:52:040:52:08

The front bedroom is a good-sized double.

0:52:120:52:15

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

0:52:180:52:22

as the planning and building regulations were sorted out.

0:52:220:52:26

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

0:52:290:52:35

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

0:52:350:52:39

The second one was moving the stairs

0:52:390:52:42

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

0:52:420:52:48

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

0:52:480:52:52

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

0:52:520:52:55

The house has been re-wired and re-plumbed

0:52:570:53:00

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

0:53:000:53:05

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

0:53:050:53:11

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

0:53:110:53:15

We were quite chuffed about doing this first one together,

0:53:150:53:19

but unfortunately, he took quite badly.

0:53:190:53:21

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

0:53:210:53:28

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

0:53:280:53:34

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

0:53:340:53:40

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

0:53:400:53:45

So what was the final bill?

0:53:450:53:49

The original budget was £6,000,

0:53:490:53:51

but ours has eventually cost about £10,250.

0:53:510:53:56

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

0:53:560:54:02

and also the extra cost of electrics and plumbing works.

0:54:020:54:06

That spend added to the purchase price of 54,000

0:54:060:54:09

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

0:54:090:54:14

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

0:54:140:54:20

Let's hear what two local property experts think

0:54:210:54:25

of this refurbished end terrace.

0:54:250:54:27

I think it's a good spread of accommodation.

0:54:270:54:30

The two reception rooms are of a decent size

0:54:300:54:33

and the kitchen having been enlarged is a bonus.

0:54:330:54:36

He's done really well getting the bathroom upstairs,

0:54:360:54:40

retaining a downstairs toilet, whilst keeping three bedrooms.

0:54:400:54:44

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

0:54:440:54:50

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

0:54:500:54:54

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

0:54:540:55:01

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

0:55:010:55:05

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

0:55:050:55:11

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

0:55:110:55:15

Could David be tempted to hang on to this one?

0:55:150:55:18

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

0:55:180:55:21

but no, I still wish to sell.

0:55:210:55:24

Sounds like a plan to me.

0:55:240:55:27

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

0:55:270:55:33

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

0:55:340:55:40

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

0:55:400:55:47

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

0:55:480:55:54

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

0:55:540:56:00

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

0:56:000:56:06

David has done a great job turning this property around

0:56:060:56:10

and turning a profit in the process.

0:56:100:56:13

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

0:56:130:56:18

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

0:56:180:56:22

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

0:56:220:56:28

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

0:56:290:56:34

We wish them both well for the future.

0:56:340:56:37

# I wish you well

0:56:370:56:39

# I wish you well... #

0:56:400:56:43

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

0:56:480:56:53

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

-See you then.

-Goodbye.

0:56:530:57:00

Subtitles by Subtext for Red Bee Media Ltd 2012

0:57:160:57:21

Email [email protected]

0:57:210:57:24

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