0:00:02 > 0:00:04Hello. Like you, we're interested in property.
0:00:04 > 0:00:07That means every aspect of it. Martin, you know what we're like.
0:00:07 > 0:00:10We're always on the lookout for a bargain.
0:00:10 > 0:00:13One way you might be able to get one is to go down to your local auction.
0:00:38 > 0:00:41Well, there are property auctions held all over the country
0:00:41 > 0:00:44throughout the year, so you really are spoilt for choice.
0:00:44 > 0:00:47Let's take a look at the properties that made our buyers
0:00:47 > 0:00:51want to part with their cash on today's programme.
0:00:51 > 0:00:52In Greater Manchester,
0:00:52 > 0:00:56this two-bed mid-terrace opens up a world of possibilities.
0:00:56 > 0:00:59Good, good size space to be getting on with.
0:01:00 > 0:01:04This ground-floor flat in Balham, south-west London
0:01:04 > 0:01:07ticks all the right boxes.
0:01:07 > 0:01:10This flat could look fantastic once you've spent some cash on it.
0:01:10 > 0:01:11And in South Wales,
0:01:11 > 0:01:15upgrading this former bakery might cost too much bread.
0:01:15 > 0:01:18I'd be talking about knocking the whole thing down
0:01:18 > 0:01:20because by the time you've repaired these walls,
0:01:20 > 0:01:22you're into a big amount of money.
0:01:22 > 0:01:25All these properties have been sold at auction
0:01:25 > 0:01:28and we'll find out who bought them and what they paid for them
0:01:28 > 0:01:31- when they went under the hammer. - Yours, sir, thank you very much.
0:01:36 > 0:01:40I'm in Denton, just a few miles from Manchester city centre
0:01:40 > 0:01:42and a mile or so from the M60 and M67.
0:01:42 > 0:01:47It's a popular spot for commuters so it's a busy place
0:01:47 > 0:01:52with the almost constant hustle and bustle of traffic making its way through the town.
0:01:55 > 0:01:58The property I'm here to see is on this street,
0:01:58 > 0:02:01made up of largely turn-of-the-century terraced houses on one side
0:02:01 > 0:02:05and semi-detached properties on the other.
0:02:05 > 0:02:07The house, though, that was up for auction is this one.
0:02:07 > 0:02:13It's a mid-terrace, two bedrooms, guided at £40-45,000.
0:02:13 > 0:02:17Looks like it might need a bit of work.
0:02:19 > 0:02:22Always a bit nervous when there's boarded-up windows
0:02:22 > 0:02:25but actually, at first glance, not too bad.
0:02:25 > 0:02:28Having said that, you can see the damp coming through there.
0:02:28 > 0:02:31My guess is it's either some guttering problem or possibly
0:02:31 > 0:02:34penetrating through the joints in the bricks.
0:02:34 > 0:02:36That needs checking out.
0:02:36 > 0:02:39A good-sized room though and actually with glass in the window
0:02:39 > 0:02:42as opposed to wood, it would actually be nice and light and airy.
0:02:42 > 0:02:45Gas fire, wallpaper that clearly needs to be removed.
0:02:45 > 0:02:48The thing which really hits you when you come in here is this.
0:02:48 > 0:02:51I haven't seen this kind of layout before.
0:02:51 > 0:02:53I've seen a staircase dividing rooms before
0:02:53 > 0:02:57but not this dividing wall which is between them.
0:02:57 > 0:03:01I say between them, as in between the front room and this, the kitchen.
0:03:01 > 0:03:05It's got a bit of Perspex in it but it really doesn't work like that.
0:03:05 > 0:03:08Either block it up completely or take it away.
0:03:08 > 0:03:11Actually, I think blocking that up, keeping the door,
0:03:11 > 0:03:15would be the way to go, because you've got a really nice-sized kitchen space here.
0:03:15 > 0:03:17Enough room for a table there.
0:03:17 > 0:03:19And a nice addition,
0:03:19 > 0:03:23what I guess is an extension at the back where the boiler is or whatever.
0:03:23 > 0:03:24Lots of space to play with.
0:03:24 > 0:03:29Clearly all the units need replaced, the flooring needs to be redone,
0:03:29 > 0:03:33but good, good size space to be getting on with.
0:03:35 > 0:03:36Despite the odd stairwell,
0:03:36 > 0:03:41I really do like the space this property has to offer downstairs.
0:03:45 > 0:03:49Once that wall's reinstated, there are two decent-sized rooms here.
0:03:49 > 0:03:53There's always the potential to move those stairs but you need to
0:03:53 > 0:03:57work out how the extra effort and cost would impact on your return.
0:03:59 > 0:04:02And talking of stairs, what's up there?
0:04:02 > 0:04:06So, upstairs, a small bedroom towards the rear of your property.
0:04:06 > 0:04:09You've got your bathroom and loo which is good news and then
0:04:09 > 0:04:13a half-decent sized bedroom towards the front of the property.
0:04:13 > 0:04:16Lots of light coming through the windows, it's nice to see the cupboards,
0:04:16 > 0:04:20but what I'm really interested in is what's going on on this front wall.
0:04:20 > 0:04:23This is a continuation of the damp that I found downstairs.
0:04:23 > 0:04:28As you can see, it stretches all the way up and as you can see, it is very, very slimy.
0:04:28 > 0:04:32So, obviously very current. Water pouring down here.
0:04:32 > 0:04:34It's leading me to think it's either guttering or the roof
0:04:34 > 0:04:37that's the problem so that needs to be sorted out.
0:04:37 > 0:04:40It won't cost much to repair it but the damage it's doing,
0:04:40 > 0:04:43that is going to cause you... Who knows?
0:04:52 > 0:04:54Fixing both the problem with the damp
0:04:54 > 0:04:57and the damage caused by it should be the top priority here.
0:04:57 > 0:05:02It must be dealt with before starting renovation anywhere else in the property
0:05:02 > 0:05:05or your hard work could literally get washed away.
0:05:07 > 0:05:11Back to the positives though, out the back.
0:05:11 > 0:05:14So, at the rear of the property, that extension I mentioned.
0:05:14 > 0:05:18You've also got this little courtyard area which is quite useful
0:05:18 > 0:05:21but by far the most interesting thing for me
0:05:21 > 0:05:24is out the back gate here where you've got an alley.
0:05:24 > 0:05:28A few years ago, this would have had these alley gates put on it.
0:05:28 > 0:05:30That creates two things.
0:05:30 > 0:05:34One, it means it's much safer in terms of unwanted visitors,
0:05:34 > 0:05:38but also, as a place for kids to play, a real nice area too.
0:05:38 > 0:05:41So, two bonuses. Good stuff.
0:05:42 > 0:05:43Despite the damp,
0:05:43 > 0:05:46this place is getting the thumbs-up from me so far,
0:05:46 > 0:05:50especially with that £40-45,000 guide price.
0:05:50 > 0:05:55We invited the auctioneer who sold it to tell us if he felt the same.
0:05:58 > 0:06:01Obviously, it needs some modernisation,
0:06:01 > 0:06:06but a fairly standard two bedroom terraced property and I like it.
0:06:06 > 0:06:08It's got quite a nice feel.
0:06:08 > 0:06:11Once the work's been done to modernise it,
0:06:11 > 0:06:15what would he expect the house to be worth if sold?
0:06:15 > 0:06:17Once fully renovated, I think the property
0:06:17 > 0:06:21would go on the market for somewhere between £80-85,000.
0:06:21 > 0:06:25How would it stack up in the rental stakes?
0:06:25 > 0:06:28From a rental point of view, if this property was coming
0:06:28 > 0:06:30on the market done to a good standard,
0:06:30 > 0:06:34I would say somewhere in the region of £475-495 per calendar month.
0:06:37 > 0:06:41With properties, it's always the simplest things which cause problems.
0:06:41 > 0:06:44As you can see, the gutter at the front here has got a problem
0:06:44 > 0:06:48that caused water to come down the front of the house.
0:06:48 > 0:06:50You can see there is even mould sticking out.
0:06:50 > 0:06:54That's what's caused the damp but what we don't know is how much damage is done.
0:06:54 > 0:06:58For that reason, a little bit of caution, but still a good property for a good price.
0:06:58 > 0:07:01Let's see who fancies that when it went under the hammer.
0:07:01 > 0:07:04It's late in the day so many bidders have left but
0:07:04 > 0:07:06there's still interest in this property.
0:07:06 > 0:07:1130,000 straight in on my right. 32 here, 34, 36, 38.
0:07:11 > 0:07:17New bidder stood right at the very back. At £40,000. 42 here. 44 then.
0:07:17 > 0:07:2346, yes. 48. 50, sir, yes. 52.
0:07:23 > 0:07:2751? Yes, I'll take it. 51, 52 I need.
0:07:27 > 0:07:33Got it, 53. 53, sir. 54. 54 I've got. 55.
0:07:33 > 0:07:36You're out? 55.
0:07:36 > 0:07:41A half. 55 and a half, I'll take it. 56 I've got. Another half I need.
0:07:41 > 0:07:4457. And a half, yes? 57 and a half.
0:07:44 > 0:07:4758,000 with you, 58 and a half, I need.
0:07:47 > 0:07:5159. On my right, 59 and a half stood up. 60,000.
0:07:51 > 0:07:5560 and a half I've got. 61? Nope.
0:07:55 > 0:07:5960,500, for the first time. 60,500 for the second time.
0:07:59 > 0:08:03Third and final time. Well done. Sold to you, sir. Well done.
0:08:03 > 0:08:07Your paddle number, please. 634, well done.
0:08:07 > 0:08:13That successful bid of 60,500 was made by Sean
0:08:13 > 0:08:18on behalf of himself and brother Fergal, who are both full-time property developers.
0:08:23 > 0:08:27But they're not from round these parts. They're from Dublin.
0:08:27 > 0:08:31I met them back at their new Denton property to find out more.
0:08:33 > 0:08:36Sean, Fergal, lovely to meet you both. Congratulations.
0:08:36 > 0:08:39Tell me why you wanted to buy this place in Manchester.
0:08:39 > 0:08:44Well, we've been over here for a number of years developing property.
0:08:44 > 0:08:47We own the house next door as well. We bought it at auction
0:08:47 > 0:08:50a few weeks previous so when this came up we went with it.
0:08:50 > 0:08:53So, I can tell from the accent you're not from Manchester.
0:08:53 > 0:08:56- That's correct. We're both from Dublin.- OK.- I'm based over here.
0:08:56 > 0:09:01- Come over every Sunday evening, go back on the Thursday.- And do what?
0:09:01 > 0:09:05- Source the properties.- OK. - We buy a lot of stuff at auction.
0:09:05 > 0:09:09I'll obviously do the homeworking and Sean comes and looks at the properties.
0:09:09 > 0:09:14- Right, and so are you a builder? - I don't actually build myself.
0:09:14 > 0:09:18We've got a couple of builders that work for us, that are employed.
0:09:18 > 0:09:21- We employ them full-time.- Right, but it's a partnership between you two?
0:09:21 > 0:09:24- It's a family business, yeah. - Really? Family business.
0:09:24 > 0:09:30- Sean, myself and my wife, Jane. We're all together.- Great.
0:09:30 > 0:09:32Sounds like a great partnership to me.
0:09:32 > 0:09:35They've been investing together for the last 16 years
0:09:35 > 0:09:37so it must be working for them.
0:09:37 > 0:09:40But it does still beg the question of why they're doing it
0:09:40 > 0:09:42so far from home?
0:09:45 > 0:09:48So, why Manchester? Why not Dublin for instance?
0:09:48 > 0:09:51Property prices, as you probably were aware,
0:09:51 > 0:09:55went out of control in Ireland. We've had a property crash there.
0:09:55 > 0:09:57Property was always affordable here.
0:09:57 > 0:10:00We gave just over 60,000 for this property.
0:10:00 > 0:10:04The equivalent property in Ireland still would be at least twice that.
0:10:04 > 0:10:05Right.
0:10:05 > 0:10:09It's a good city, a big population, good infrastructure.
0:10:09 > 0:10:13- That's why we concentrate mainly on the north-west.- The practicalities.
0:10:13 > 0:10:17You are obviously over in Ireland and the properties are over in Manchester.
0:10:17 > 0:10:19- What kind of problems does that bring?- Very few.
0:10:19 > 0:10:23With modern transport now, it's 30 minutes on a flight.
0:10:23 > 0:10:27Again, if we get a ferry over, it's two hours up from Holyhead.
0:10:27 > 0:10:30Same language. One of the major attractions for ourselves
0:10:30 > 0:10:33is the weakness in sterling.
0:10:33 > 0:10:36There's a lot of international money coming into the UK
0:10:36 > 0:10:40because sterling has weakened so much and the euro's so strong.
0:10:40 > 0:10:41There's a double hit.
0:10:41 > 0:10:45Property prices have dropped and also the currency helps as well.
0:10:45 > 0:10:47You're buying in the equivalent of euros.
0:10:47 > 0:10:52We get more for our euro than we did maybe five or six years ago.
0:10:52 > 0:10:56But of course, any rents coming back to you will be in pounds.
0:10:56 > 0:10:59It goes back in pounds but again, if you have a mortgage,
0:10:59 > 0:11:02you're paying a sterling mortgage so it's all...
0:11:02 > 0:11:05- It all works.- It all works.- Good.
0:11:05 > 0:11:10Fergal and Sean are trying to do the best they can with their finances in the current market,
0:11:10 > 0:11:14even though that means commuting between two countries.
0:11:14 > 0:11:17With its boarded-up windows and rather sorry exterior,
0:11:17 > 0:11:20they think this is the worst house in the street.
0:11:20 > 0:11:21If all goes to plan,
0:11:21 > 0:11:25that won't be the case by the time they've finished with it.
0:11:25 > 0:11:28So, tell me what you will do to sort it out.
0:11:28 > 0:11:31Basically, we'll just come in, we'll just literally empty everything
0:11:31 > 0:11:37that's in here, bring it back to the bare bones and we start then.
0:11:37 > 0:11:41We do the floors, skim the walls, new windows, new doors,
0:11:41 > 0:11:45there's a bit of dampness coming in the walls and it's all from the gutter.
0:11:45 > 0:11:47Right. It's that usual thing of
0:11:47 > 0:11:50a simple thing but causes a bit of damage.
0:11:50 > 0:11:52- That's it. - What about the internal layout?
0:11:52 > 0:11:55Because you've got this very unusual layout.
0:11:55 > 0:11:58We had our architect out and he said really,
0:11:58 > 0:12:00we have to leave the stairs as it is.
0:12:00 > 0:12:02We are going to block up the wall there,
0:12:02 > 0:12:05make it two separate rooms, but just leave the layout as it is.
0:12:05 > 0:12:09- Right. So keep just the door there. - A door there into the kitchen, yeah.
0:12:09 > 0:12:12What kind of cost have you got in mind for doing it?
0:12:12 > 0:12:16- Budget probably about 8-9,000. - And then?
0:12:16 > 0:12:20Rent it out. Keep it long term. There's a massive rental demand at the moment
0:12:20 > 0:12:22so don't see too much problem renting.
0:12:22 > 0:12:27- What's the kind of timescale for getting it sorted?- 5-6 weeks.
0:12:27 > 0:12:28Easily, yeah.
0:12:28 > 0:12:32In that time, they also plan to install a new bathroom,
0:12:32 > 0:12:35lay carpet and redecorate upstairs.
0:12:35 > 0:12:38It sounds like they've got the whole thing perfectly planned out.
0:12:40 > 0:12:44Well, brothers Sean and Fergal clearly have a very successful
0:12:44 > 0:12:46property developing partnership going on here
0:12:46 > 0:12:50and no reason to think they'll be any less successful with this place.
0:12:50 > 0:12:53However, I am a little bit concerned about that budget.
0:12:53 > 0:12:55It seems a bit tight, especially when you don't know
0:12:55 > 0:12:58what damage that damp in the front corner has done.
0:12:58 > 0:13:00You can find out how they get on later in the show.
0:13:03 > 0:13:06Today, I have journeyed to Balham in south London.
0:13:06 > 0:13:09Fabulous transport links, shops aplenty and it's also
0:13:09 > 0:13:13the birthplace of the celebrity chef, wait for it, Ainsley Harriott.
0:13:13 > 0:13:15Being a seasoned property buyer,
0:13:15 > 0:13:19I know that location is key to any successful purchase
0:13:19 > 0:13:22and the lot I'm here to see, well, it couldn't be better placed,
0:13:22 > 0:13:25because there is Balham tube station and this,
0:13:25 > 0:13:29well, this is the road where today's auction lot is.
0:13:29 > 0:13:34A great starter. Let's get down there and see the main attraction.
0:13:38 > 0:13:41The question is, will we get our just deserts?
0:13:41 > 0:13:45If location is anything to go by, I think this auction lot
0:13:45 > 0:13:49could be setting itself up for a very sweet review.
0:13:49 > 0:13:52Buying a property that's within walking distance from shops,
0:13:52 > 0:13:54tubes and train lines, well,
0:13:54 > 0:13:57that will always get a massive thumbs up for me.
0:13:57 > 0:14:01It's not just the location that's attractive. The auction lot is too.
0:14:01 > 0:14:03It's a two-bedroom ground-floor flat.
0:14:03 > 0:14:08It had a guide price of 190,000. Here it is.
0:14:09 > 0:14:12The windows could do with some attention
0:14:12 > 0:14:15but it's a nice double-fronted flat in a great location.
0:14:15 > 0:14:20Now, the really exciting thing about this property is you get
0:14:20 > 0:14:24the whole of the ground floor so you get the two windows to the front.
0:14:24 > 0:14:28It's double-fronted and it makes this property feel huge.
0:14:28 > 0:14:31It's got a really nice big space in there.
0:14:31 > 0:14:33You could have a bedroom or a lounge.
0:14:33 > 0:14:37A second reception room here, again, it could be a bedroom a lounge.
0:14:37 > 0:14:38Bit of a tatty kitchen.
0:14:38 > 0:14:44In fact, the whole flat is very shabby indeed but look, it goes on.
0:14:44 > 0:14:48You've got lots of rooms back there. This flat quite excites me.
0:14:48 > 0:14:52It could look fantastic once you've spent some cash on it.
0:14:52 > 0:14:56You're going to need to lavish some love on this place
0:14:56 > 0:14:59and it probably requires some serious expenditure.
0:15:02 > 0:15:05The bathroom and toilet will have to be upgraded
0:15:05 > 0:15:08and could be combined into one.
0:15:08 > 0:15:14That bedroom/rear reception room needs to be completely refurbished, as do the other two front rooms.
0:15:14 > 0:15:16But there's a good deal of space here.
0:15:16 > 0:15:18There's even the bonus of a cellar.
0:15:18 > 0:15:23For London, that £190,000 guide price was pretty reasonable,
0:15:23 > 0:15:26but there's a catch.
0:15:26 > 0:15:31This flat comes with a 99 year lease and ordinarily, that would be fine,
0:15:31 > 0:15:35but it was issued in 1975.
0:15:35 > 0:15:38That means there's only 63 years left on it.
0:15:38 > 0:15:41Some mortgage companies will be put off by that and it could mean
0:15:41 > 0:15:44whoever buys this will have to be a cash buyer.
0:15:44 > 0:15:47It's also tricky when it comes to extending the lease.
0:15:47 > 0:15:51The freeholder may be open to negotiation but if they're not,
0:15:51 > 0:15:55you'll have to wait two years before you can apply again.
0:15:55 > 0:15:59After this time, they are legally obligated to extend the lease,
0:15:59 > 0:16:03but the cost of doing so, well, it can run into thousands.
0:16:03 > 0:16:06This will have implications for the new owner.
0:16:06 > 0:16:10So, I hope whoever took this on read that legal pack first.
0:16:13 > 0:16:15Leasehold properties really do need to be checked.
0:16:15 > 0:16:19There's ground rent to pay. Luckily, in this case, just £25 per year.
0:16:19 > 0:16:22There's a shared garden to consider
0:16:22 > 0:16:26but it's not just the short lease that gives me cause for concern.
0:16:26 > 0:16:30This flat is very close to the train station which is great
0:16:30 > 0:16:33but I'm not sure I'd like to be this close.
0:16:33 > 0:16:36The noise from the trains will undoubtedly have
0:16:36 > 0:16:38an impact on the sales market.
0:16:38 > 0:16:42Local agents predict a 6% drop in achievable figures,
0:16:42 > 0:16:45yet another thing to think about when you're doing your sums here.
0:16:45 > 0:16:48A drop of 6% means having that rail track so close
0:16:48 > 0:16:53will knock at least 12-15 grand off the flat's resell value.
0:16:53 > 0:16:58Unfortunately, the trains aren't the only unwanted neighbours.
0:16:58 > 0:16:59Just a little concern of mine,
0:16:59 > 0:17:04slap bang next to the property is this sort of scruffy, derelict plot.
0:17:04 > 0:17:06I would make my inquiries as soon as possible.
0:17:06 > 0:17:11Find out who owns this because as it is, it's a bit of an eyesore.
0:17:11 > 0:17:14This doesn't help the flat's all-important kerb appeal.
0:17:14 > 0:17:18With the trains and the short lease, there's a lot to consider here,
0:17:18 > 0:17:22but I still think that at what was a £190,000 guide price,
0:17:22 > 0:17:24this flat could be a good buy.
0:17:25 > 0:17:29What does the local estate agent think?
0:17:29 > 0:17:31Do the positives outweigh the negatives?
0:17:31 > 0:17:35Incredibly pretty on the outside and the rooms inside are very good sizes.
0:17:35 > 0:17:38Very well proportioned, good high ceilings.
0:17:38 > 0:17:42The short lease is clearly a potential sticking point
0:17:42 > 0:17:45but if the lease was extended and the flat fully refurbished,
0:17:45 > 0:17:48what sort of return could you expect?
0:17:48 > 0:17:53You'd be able to rent this out per calendar month for about £1,600.
0:17:53 > 0:17:58- I would recommend putting this on the market at £395,000.- Yes!
0:17:58 > 0:17:59You did hear that right.
0:17:59 > 0:18:04A potential 395 resale and £1,600 a month rent.
0:18:04 > 0:18:09So for all its faults, this flat could be one mighty fine investment.
0:18:09 > 0:18:12That short lease will undoubtedly put some buyers off but for me,
0:18:12 > 0:18:15there is nothing here that's insurmountable.
0:18:15 > 0:18:18You will be able to extend the lease for a price
0:18:18 > 0:18:22and once that's all in order and the work's complete,
0:18:22 > 0:18:25I think this is a great little investment.
0:18:25 > 0:18:27Let's see who agreed with me as we go to auction.
0:18:30 > 0:18:34Lot 17. Two-bed ground-floor flat, handy location. 200.
0:18:34 > 0:18:37Yes, standing up, 200.
0:18:37 > 0:18:45201. 201, 202, 203, 204, 205.
0:18:45 > 0:18:51206, 207, 208, 209.
0:18:51 > 0:18:54210.
0:18:54 > 0:18:58211, 212, 213,
0:18:58 > 0:19:05214, 215, 216.
0:19:05 > 0:19:12217, 218, 219, 220.
0:19:12 > 0:19:14Have a think. 219 with you, first time,
0:19:14 > 0:19:19second time, third and last time
0:19:19 > 0:19:20if you're all done.
0:19:22 > 0:19:23Sold, 219.
0:19:23 > 0:19:29For 219,000, the successful bidders were David and his wife Debbie.
0:19:29 > 0:19:30David owns a chain of bars.
0:19:30 > 0:19:33They had their first child, Madeleine, just 12 weeks ago,
0:19:33 > 0:19:36so his wife Debbie's on maternity leave from her job
0:19:36 > 0:19:38as an accounts assistant.
0:19:38 > 0:19:42While Debbie attends to the baby, I caught up with David.
0:19:42 > 0:19:45David, congratulations. What was it about this flat
0:19:45 > 0:19:48you liked enough to want to bid for it on auction day?
0:19:48 > 0:19:51The location, mainly. Balham's a great area, I live in Balham.
0:19:51 > 0:19:55- I've had a local business here for 7-8 years.- What do you do?
0:19:55 > 0:19:57I own a bar-restaurant.
0:19:57 > 0:20:00A couple of bar-restaurants, one in Balham, one in Clapham
0:20:00 > 0:20:04- and one in the City. - How's business going?- It's OK.
0:20:04 > 0:20:09Obviously hard times at the moment but it's the same for everyone, so maybe a bit of diversifying.
0:20:09 > 0:20:11The bars are great and I enjoy doing them
0:20:11 > 0:20:14but in the longer term, with Maddie, the new baby coming along,
0:20:14 > 0:20:17I don't particularly want to be working so much in the evenings.
0:20:17 > 0:20:20Maybe try and do some property instead.
0:20:20 > 0:20:23David's hoping that property development may be the way forward
0:20:23 > 0:20:27for a more conducive family life,
0:20:27 > 0:20:30but with this flat, there are a few issues to be resolved.
0:20:30 > 0:20:34Let's talk about a few of the negatives with this property.
0:20:34 > 0:20:37Straightaway, the low lease. Would that not put you off?
0:20:37 > 0:20:39It did a bit but leases can always be extended.
0:20:39 > 0:20:43The upstairs flat has been negotiating with the freehold
0:20:43 > 0:20:47at the moment and I think he's been quoted 15,000 for the new lease.
0:20:47 > 0:20:50It's good to hear that David has already made some enquiries
0:20:50 > 0:20:52with the neighbour about the lease
0:20:52 > 0:20:56and has got a rough idea of how much it would cost to extend,
0:20:56 > 0:21:00but there's that other potential thorn in their side.
0:21:00 > 0:21:03David, what do you know about that plot next door, that bit of derelict land?
0:21:03 > 0:21:06I know a local chap owns it
0:21:06 > 0:21:09and I believe he wants to get planning permission to build
0:21:09 > 0:21:13a live-work dwelling on the land.
0:21:13 > 0:21:16I know he's tried unsuccessfully to get planning permission a few times.
0:21:16 > 0:21:19In fact, I think we find out in a couple of days whether
0:21:19 > 0:21:22he's going to get the planning appeal rejected or accepted.
0:21:22 > 0:21:26I'd prefer him to build something there or if he doesn't build it,
0:21:26 > 0:21:30maybe we can buy it off him and turn it into car parking space or a garden.
0:21:30 > 0:21:35There's two flats in this building so a rear garden and a side garden, we could have one each and there you go.
0:21:35 > 0:21:39I think that would be a great solution and the good thing is, there's no rush.
0:21:39 > 0:21:41David can sort these issues out
0:21:41 > 0:21:44while still renting out the flat to earn income.
0:21:44 > 0:21:48What about the positives? Let's have a look, you have a fantastic house here.
0:21:48 > 0:21:50It's double fronted, lots of light coming in.
0:21:50 > 0:21:54- Lovely big square rooms. It does need a lot of work.- It does.
0:21:54 > 0:21:58I think strip it back to the brickwork and start again.
0:21:58 > 0:22:02It all needs rewiring, new kitchen, new bathroom. The works, basically.
0:22:02 > 0:22:06Maybe knock a wall down between the kitchen and the lounge.
0:22:06 > 0:22:10- What's your budget for the work? - I'm hoping to do it for 15,000.
0:22:11 > 0:22:14It will probably end up being 20 knowing me.
0:22:14 > 0:22:16I plan on doing quite a lot of the work myself
0:22:16 > 0:22:20so I will use some local builders as well who I do know.
0:22:20 > 0:22:21You've just mentioned to me
0:22:21 > 0:22:26that you don't want to be working in the evenings as much because you've got beautiful baby Madeleine,
0:22:26 > 0:22:29but you've just taken on a property and you need to do lots of work,
0:22:29 > 0:22:32and you're going to be here a lot. You're going to be
0:22:32 > 0:22:35- quite busy for the next few months, aren't you?- Yeah.
0:22:35 > 0:22:38It's funny, actually, after I bought it, I thought, I'm not going
0:22:38 > 0:22:42to be at home as much as I thought I was going to be, am I?
0:22:42 > 0:22:44I think the penny's dropped.
0:22:44 > 0:22:46This flat needs a lot of work to turn it around,
0:22:46 > 0:22:49which probably means David will be away from his wife Debbie
0:22:49 > 0:22:53and his baby daughter quite a bit. How do they feel about that?
0:22:53 > 0:22:56Debbie, you really have got so much going on at the moment.
0:22:56 > 0:23:00How are you going to manage it all with little baby Madeleine?
0:23:00 > 0:23:04Well, Daddy will be doing a lot of the work, thankfully for me.
0:23:04 > 0:23:09We'll probably will be doing bits and bobs at home on the internet, making calls.
0:23:09 > 0:23:12Come see Daddy at lunch for sandwich
0:23:12 > 0:23:16and exit sharply before we get roped into some more work.
0:23:16 > 0:23:20Now, Debbie, Daddy did tell me that he planned on having a nice
0:23:20 > 0:23:23relaxing time, wanted to spend more time with you and the family.
0:23:23 > 0:23:27Didn't want to be at the bar late at night working
0:23:27 > 0:23:29and then you go and buy this flat, so why?
0:23:29 > 0:23:31Bit of an investment.
0:23:31 > 0:23:35Obviously, I'm off with this one on maternity so help pay the bills.
0:23:35 > 0:23:38Listen, good luck with the project.
0:23:38 > 0:23:39Don't work too hard,
0:23:39 > 0:23:43make sure you enjoy lots of time with this gorgeous little girl.
0:23:43 > 0:23:45Bye-bye. Bye, Madeleine.
0:23:58 > 0:24:01How will David and Debbie get on extending the lease
0:24:01 > 0:24:04and will they be able to buy the other half of that garden?
0:24:04 > 0:24:08Lots of negotiating required here. How are the couple going to get on?
0:24:08 > 0:24:11And little baby Madeleine, will she affect things?
0:24:11 > 0:24:14Will the sleepless nights take their toll on this project?
0:24:14 > 0:24:18You can find out what happens later on in the programme.
0:24:18 > 0:24:21Coming up - the ground floor of this former bakery
0:24:21 > 0:24:24in Mid Glamorgan is in a right state.
0:24:24 > 0:24:28In terms of up there, you know what, I don't even think I'm going to go up there.
0:24:28 > 0:24:31In Balham, south London,
0:24:31 > 0:24:34just how time-consuming has the renovation been for David?
0:24:34 > 0:24:39I've been here quite a lot actually and my work's probably suffered a little bit for it.
0:24:39 > 0:24:42But first, in Greater Manchester,
0:24:42 > 0:24:44Fergal's getting a buzz from his work.
0:24:44 > 0:24:49Satisfaction seeing the property taken from a shell condition to finished condition.
0:24:53 > 0:24:56Back to Denton, Greater Manchester now where brothers
0:24:56 > 0:25:00and full-time property developers Fergal and Sean
0:25:00 > 0:25:04bought this terraced house at auction for £60,500.
0:25:04 > 0:25:07Born, bred and based in Dublin they may be,
0:25:07 > 0:25:09but there was good reason to be here.
0:25:09 > 0:25:12Tell me why you wanted to buy this little place in Manchester?
0:25:12 > 0:25:15We've been over here for a number of years developing property
0:25:15 > 0:25:19and we actually own the house next door. We bought it at auction
0:25:19 > 0:25:22a few weeks previous so when this came up, we went with it.
0:25:22 > 0:25:25First things first, this house needed a complete overhaul
0:25:25 > 0:25:29and the brothers reckoned they could do it all in five to six weeks.
0:25:29 > 0:25:32So we've come back eight weeks after we first met them
0:25:32 > 0:25:34to see if they've hit their target.
0:25:51 > 0:25:57Looks to me like they have and how! It's no slapdash job either.
0:25:57 > 0:26:01From fixtures to fittings, the standard of finish here is high.
0:26:01 > 0:26:04I'm glad to see that they've reinstated the wall
0:26:04 > 0:26:07next to the stairs, to make the new kitchen diner
0:26:07 > 0:26:09a much better space as Fergal explains.
0:26:11 > 0:26:15Well, the condition of the kitchen as you can see has totally changed.
0:26:15 > 0:26:18We've replaced all the units, brand-new kitchen,
0:26:18 > 0:26:21a new oven hob, washing machine, new boiler.
0:26:21 > 0:26:24It's brought the units up to here.
0:26:24 > 0:26:27I think they were previously just before the cooker.
0:26:27 > 0:26:30New tiling, new extractor fan, new lighting.
0:26:30 > 0:26:33Basically, a whole new kitchen.
0:26:33 > 0:26:36To get it looking like this, first the entire house was gutted.
0:26:36 > 0:26:41Then they had to deal with the issues caused by those gutters.
0:26:41 > 0:26:45There was a damp problem so we had to replace the gutters, front and back.
0:26:45 > 0:26:48That got rid of all the water coming into the house.
0:26:48 > 0:26:52It was totally plumbed the house, totally plumbed. We got plastering done.
0:26:52 > 0:26:55Once it was done, we installed the kitchen, replaced the bathroom suite
0:26:55 > 0:26:58and we started decorating the house.
0:26:58 > 0:27:01And they have given it a top-notch finish
0:27:01 > 0:27:03for very solid commercial reasons.
0:27:03 > 0:27:06We like to keep all our houses at the same standard.
0:27:06 > 0:27:09Obviously, if you're housed to a high standard,
0:27:09 > 0:27:11you're going to get a pretty good tenant.
0:27:11 > 0:27:15They are going to take care of the house, they tend to stay longer,
0:27:15 > 0:27:17so we get better yields, higher rents.
0:27:17 > 0:27:19Sean's absolutely right.
0:27:19 > 0:27:22The better the standard of finish, the more likely the new tenants are
0:27:22 > 0:27:26to look after it, and you'll come out a winner in the long term.
0:27:26 > 0:27:29This renovation didn't take long either.
0:27:29 > 0:27:33From start to finish, about six weeks. Six weeks in total.
0:27:34 > 0:27:37The only surprise problem Fergal and Sean faced during the renovation
0:27:37 > 0:27:40was that the whole house had to be rewired.
0:27:40 > 0:27:43This had a slight impact on their budget.
0:27:43 > 0:27:47They originally estimated between £8 and 9,000
0:27:47 > 0:27:50and ended up spending 10,200, but there were certainly
0:27:50 > 0:27:56no problems with working together thanks to the geography.
0:27:56 > 0:27:59The way we managed, Sean is based in Manchester.
0:27:59 > 0:28:02I live in Ireland so it works well.
0:28:02 > 0:28:05Sean project manages everything from start to finish
0:28:05 > 0:28:08and I have my uses also.
0:28:08 > 0:28:11Now that this property is ready to let out,
0:28:11 > 0:28:14they are going to start on the one they already own next door.
0:28:14 > 0:28:18Since we last met them, they've bought the house on the other side too.
0:28:18 > 0:28:22Something tells me they're aiming for the whole street.
0:28:22 > 0:28:25They clearly seem to have found a job that they love doing.
0:28:25 > 0:28:27Obviously, satisfaction seeing the property
0:28:27 > 0:28:30taken from a shell condition to finished condition.
0:28:30 > 0:28:33It's an interesting lifestyle, interesting business.
0:28:33 > 0:28:36They bought this property for 60,500
0:28:36 > 0:28:40and spent 10,200 on the renovations,
0:28:40 > 0:28:44making their total outlay 70,700.
0:28:45 > 0:28:48We invited two local property experts
0:28:48 > 0:28:52to the newly refurbished house to see if they were impressed
0:28:52 > 0:28:56with the work Sean and Fergal had done.
0:28:56 > 0:28:58First impressions are wow!
0:28:58 > 0:29:00It's just a major transformation, we see a lot
0:29:00 > 0:29:02but this has been done really well.
0:29:02 > 0:29:04They've gone that extra mile in terms of the finish
0:29:04 > 0:29:08and it just looks really good, very pleased to see it.
0:29:08 > 0:29:11I think they've done an amazing job. It was done to
0:29:11 > 0:29:13a very high standard, as you can see from the plastering.
0:29:13 > 0:29:16It's not a cheap job, impressed with it.
0:29:16 > 0:29:18But will the financial returns be impressive?
0:29:18 > 0:29:21If the property were to be put on the market to sell,
0:29:21 > 0:29:24what price would the experts recommend?
0:29:26 > 0:29:31Remember, their total spend is not far off 71,000.
0:29:31 > 0:29:34The current market conditions, I think this property's worth
0:29:34 > 0:29:36somewhere in the region of 85, possibly £90,000.
0:29:36 > 0:29:39I would put this property on the market
0:29:39 > 0:29:42at offers over £85,000 to achieve £90,000.
0:29:42 > 0:29:44Happy with those figures.
0:29:44 > 0:29:47Again, we're going to keep it long-term but it's nice to know
0:29:47 > 0:29:50if we ever need to sell, we should make a profit.
0:29:50 > 0:29:54Long-term or not, it still goes to show that in just a few weeks,
0:29:54 > 0:29:56the brothers have the potential to make a pre-tax profit
0:29:56 > 0:30:03of between around 14 and £19,000, not too shabby at all.
0:30:03 > 0:30:06But the crux of the matter is all in the rental yield.
0:30:06 > 0:30:08So, give us those please, experts.
0:30:09 > 0:30:13I thought we could rent this property out at £500 per calendar month.
0:30:13 > 0:30:16The standard of the property would make it comfortably
0:30:16 > 0:30:18£500 per calendar month, possibly more.
0:30:18 > 0:30:23- The rental figures, nearly spot on. We got 525.- Yes, you heard right.
0:30:23 > 0:30:27Sean and Fergal have already rented the property out
0:30:27 > 0:30:29for £525 per calendar month.
0:30:29 > 0:30:33That gives them a fantastic rental yield of just under 9%
0:30:33 > 0:30:36and it's not the only thing they're happy about.
0:30:39 > 0:30:42We finished relatively easy, didn't hit any snags.
0:30:42 > 0:30:44Not every job's going to be as smooth as this
0:30:44 > 0:30:48- but we take the rough with the smooth.- You certainly do.
0:30:54 > 0:30:57I'm in Pontypridd in Wales.
0:30:57 > 0:31:02This area has a rather mystical and magical history
0:31:02 > 0:31:05because apparently, the famous wizard Merlin was helped
0:31:05 > 0:31:09across a river here so blessed the area with good fortune.
0:31:09 > 0:31:14Now that's what I like to hear when it comes to looking for property.
0:31:18 > 0:31:22Pontypridd got its name from the Welsh for bridge of earth
0:31:22 > 0:31:26since people took advantage of the shallowness of the River Taff here
0:31:26 > 0:31:29to cross from one side to the other.
0:31:29 > 0:31:33Let's hope that today's property is not for someone wet behind the ears.
0:31:36 > 0:31:39The property I'm here to see is a former bakery.
0:31:39 > 0:31:40It's a real shame it's a former one
0:31:40 > 0:31:44because it would have been lovely if it had been operational.
0:31:44 > 0:31:46You'd have that smell of freshly baking bread in the air.
0:31:46 > 0:31:51Given that the property has been unused for several years,
0:31:51 > 0:31:54something tells me that that beautiful aroma
0:31:54 > 0:31:57that you sometimes have in houses when trying to sell them
0:31:57 > 0:32:00will be replaced by something slightly less pleasant.
0:32:00 > 0:32:01Oh well, here goes nothing.
0:32:04 > 0:32:09Yes, the run-down dilapidated state isn't encouraging either.
0:32:09 > 0:32:13But with a guide price of only £10,000,
0:32:13 > 0:32:16it's got to be worth a look, hasn't it?
0:32:19 > 0:32:22OK, sticky door there. So what have we got?
0:32:22 > 0:32:28Basically, one big downstairs room with more upstairs
0:32:28 > 0:32:30which I'll explore in a minute.
0:32:30 > 0:32:32Obviously, it's in a right old state.
0:32:32 > 0:32:38Quite disappointingly, no indication of its life as a bakery in the past.
0:32:38 > 0:32:42Just this fairly rough walls. I also want to investigate what's on the other side of this wall
0:32:42 > 0:32:45because you might have issues with party walls.
0:32:45 > 0:32:49A reasonable-sized space and in terms of converting old industrial premises like this
0:32:49 > 0:32:54into residential units, they do make quite characterful properties,
0:32:54 > 0:32:57but you've got to know what you're taking on.
0:32:57 > 0:33:00As you can see, it's in a right old state
0:33:00 > 0:33:02and in terms of up there, you know what,
0:33:02 > 0:33:04I don't even think I'm going to go up there.
0:33:06 > 0:33:09But climb a few of those steps, stick your head up
0:33:09 > 0:33:13and you can see that again, there's a huge space to work with,
0:33:13 > 0:33:15offering plenty of potential.
0:33:15 > 0:33:19Remember, the guide price was only £10,000 but still,
0:33:19 > 0:33:23all the joists, woodwork and wiring should be consigned to the past
0:33:23 > 0:33:26and put in a skip. That's not all.
0:33:26 > 0:33:31Unfortunately, outside, one of the walls is definitely showing signs of decay.
0:33:31 > 0:33:35There are two ominous cracks that really should be checked out
0:33:35 > 0:33:37by a structural engineer.
0:33:37 > 0:33:41If there's a serious problem, then I can see that costing big bucks to fix.
0:33:41 > 0:33:42With all these negatives,
0:33:42 > 0:33:46maybe it would take old Merlin back in the town to sort them.
0:33:49 > 0:33:53So why on Earth would you want to take on a place that requires this much work?
0:33:53 > 0:33:57The good news is that in 2009, planning permission was granted
0:33:57 > 0:34:00to convert this old bakery into a dwelling.
0:34:00 > 0:34:04One bedroom house. Interesting design though.
0:34:04 > 0:34:07If I start downstairs, a huge great double garage which takes up
0:34:07 > 0:34:10virtually half of the size, then you've got a kitchen,
0:34:10 > 0:34:12dining room and a downstairs loo.
0:34:12 > 0:34:15Moving upstairs, you've got one bedroom and a living room.
0:34:15 > 0:34:18Have to say though, if it was me,
0:34:18 > 0:34:21I'd be talking about knocking the whole thing down because
0:34:21 > 0:34:25by the time you've repaired these walls, you're into a big amount of money.
0:34:25 > 0:34:27In the end, the question is,
0:34:27 > 0:34:31will the rewards be high enough after an expensive renovation?
0:34:33 > 0:34:37For a second opinion on this building guided at £10,000,
0:34:37 > 0:34:39we asked along a local estate agent
0:34:39 > 0:34:42to hear her thoughts on the old bakery.
0:34:44 > 0:34:46I think this property is absolutely brilliant.
0:34:46 > 0:34:51It's a blank canvas and it could be something really special.
0:34:51 > 0:34:55Potential-wise, it depends what the owner wants to do with it
0:34:55 > 0:34:58and if it's for rental, then you can go one way.
0:34:58 > 0:35:01If it's for themselves, they could really push the boat out
0:35:01 > 0:35:03and do something special.
0:35:03 > 0:35:07How much would it cost to get this place up and running?
0:35:07 > 0:35:12I think to get this particular property up to a saleable condition,
0:35:12 > 0:35:15the minimum would be 25 to 30,000.
0:35:15 > 0:35:17Anything over that would be luxurious.
0:35:17 > 0:35:20With a guide price of 10,000,
0:35:20 > 0:35:24that would mean a possible outlay of £40,000 plus.
0:35:24 > 0:35:28How would the returns look, first, if sold?
0:35:28 > 0:35:32I think the resale value on the property as a one-bedroom property
0:35:32 > 0:35:36could be between 40 and 55, even up to £60,000.
0:35:36 > 0:35:39And rental?
0:35:39 > 0:35:43I think the property, even as a one-bedroom property,
0:35:43 > 0:35:46would get between 250 and 350 per calendar month.
0:35:46 > 0:35:51So did this old bakery rise to the occasion
0:35:51 > 0:35:55when it went to the auction rooms or fall completely flat?
0:35:55 > 0:35:57At YEAST it had that planning permission
0:35:57 > 0:36:01although it is going to KNEAD a lot of work to sort it out!
0:36:01 > 0:36:05Let's see who had the bread to buy it when it went under the hammer.
0:36:10 > 0:36:13Lot number three. Bid me 14 to start, surely.
0:36:13 > 0:36:17Got to be worth more than that. 12 if you like, let's get on.
0:36:17 > 0:36:2112, put it in. Eight, I'm bid then. Thank you.
0:36:21 > 0:36:248,000 is all I'm bid. Nine I'm bid and 10, is it? 10 I'm bid.
0:36:24 > 0:36:29At £10,000, all right, make it 500. This is no money for it.
0:36:29 > 0:36:33At 10,000, 11. Thank you, sir. 11 I'm bid.
0:36:33 > 0:36:37Make it another half. 11 and a half and 12 if you like, sir.
0:36:37 > 0:36:4112, I'm bid there, standing. Half at the back. At 12 and a half.
0:36:41 > 0:36:46I thought you'd got it, sir. At 13 and again half is bid.
0:36:46 > 0:36:4913 and a half standing. 14, please, 14, I'm bid.
0:36:49 > 0:36:50You're out, sir.
0:36:50 > 0:36:54Half, at 14 and a half. 15, is it? 15 is bid.
0:36:54 > 0:36:5815 and a half I'm bid. 15 and a half, 16, will you?
0:36:58 > 0:37:03Don't shake your head, you'll go home and think, I should have bought that! Try one more.
0:37:03 > 0:37:0716, is it? Thank you, sir. At 16.
0:37:07 > 0:37:10You're not going to lose it for 500 as well, surely? Have you done?
0:37:10 > 0:37:17There is my bid at 16. At £16,000. Yours, sir. Thank you very much.
0:37:17 > 0:37:22The bidder who snapped up this lot for £16,000 was Norman.
0:37:23 > 0:37:27Norman's a local man who has been a builder for 40 years.
0:37:27 > 0:37:29Along with his son, Neil,
0:37:29 > 0:37:32they aim to bring the old bakery back to life as a new house.
0:37:32 > 0:37:34I met them to find out more.
0:37:36 > 0:37:40- Neil, Norman. Good to meet you both. Congratulations.- Thank you.
0:37:40 > 0:37:42Tell me why you wanted to buy the building.
0:37:42 > 0:37:45We were looking for a property to do up between me
0:37:45 > 0:37:49and my father and my brother-in-law.
0:37:49 > 0:37:51It's local and the price.
0:37:51 > 0:37:54Is this threesome you've got
0:37:54 > 0:37:56something that works together quite a lot?
0:37:56 > 0:37:59Me and my father are in business together anyway.
0:37:59 > 0:38:03My brother-in-law, Steve, has done some work with my father
0:38:03 > 0:38:07so it's my father's idea to get the three of us working together.
0:38:07 > 0:38:10Great, OK. What prompted that, Norman?
0:38:10 > 0:38:13I've done this type of thing in the past on my own.
0:38:13 > 0:38:17Steve has worked with me then just as a help and I thought
0:38:17 > 0:38:20just get these two together and start doing it as a joint thing, like.
0:38:20 > 0:38:23It's been more you doing it on your own?
0:38:23 > 0:38:24I've always done it on my own.
0:38:24 > 0:38:27This is the first time as a joint venture.
0:38:27 > 0:38:32- What are the advantages of bringing other people on board? - I'm getting old!
0:38:32 > 0:38:35So you're going to bring in younger blood to help you out.
0:38:35 > 0:38:39Norman has spent his working life restoring and renovating properties.
0:38:39 > 0:38:42In fact, Neil manages two convenience stores
0:38:42 > 0:38:44which the pair have renovated together.
0:38:44 > 0:38:47And with son-in-law Steve, who's a trained carpenter,
0:38:47 > 0:38:51Norman hopes the team will make a success of this project
0:38:51 > 0:38:52despite its run-down state.
0:38:52 > 0:38:58- I knew the building because we live local.- You knew it?
0:38:58 > 0:39:02- We knew the building. The first time we'd been inside was today.- OK.
0:39:02 > 0:39:04Any great surprises?
0:39:04 > 0:39:07No. We can see that the one end is falling down
0:39:07 > 0:39:10- so this is how we expected it to be. - Right.
0:39:10 > 0:39:14The fact that you've got a bit of experience, Norman, does that make
0:39:14 > 0:39:18you comfortable about not having a look inside before you bought it?
0:39:18 > 0:39:21Imagining the worst so whatever I see is better.
0:39:21 > 0:39:23Tell me exactly what you're going to do to this place.
0:39:23 > 0:39:27Are you pretty much going to stick to the plans as they are?
0:39:27 > 0:39:30At the moment, I haven't even spoke to the building officer yet.
0:39:30 > 0:39:33If there's a possibility of turning it into a two-bedroom dwelling,
0:39:33 > 0:39:37I'm mostly looking to do that. I don't think there is.
0:39:37 > 0:39:41Reading the literature, because the plans have been refused
0:39:41 > 0:39:45so many times, the final plans have been amended and passed.
0:39:46 > 0:39:49I'm going to ask but I don't think we'll get past
0:39:49 > 0:39:52the one bedroom dwelling that's been passed.
0:39:52 > 0:39:55Well, you don't know if you don't ask
0:39:55 > 0:39:59and a two bed would certainly add more value to a finished product.
0:39:59 > 0:40:04Also ideally, Norman would like to take the building down to the ground
0:40:04 > 0:40:06and start from scratch, though he'll
0:40:06 > 0:40:09obviously have to get planning permission to go that far.
0:40:09 > 0:40:11Talk me through the numbers on that,
0:40:11 > 0:40:14how it stacks up in terms of a profitable venture.
0:40:14 > 0:40:17We've laid down at the moment about £17,000.
0:40:17 > 0:40:21We've got a budget excluding labour, because we do the labour,
0:40:21 > 0:40:25of about 13,000.
0:40:25 > 0:40:28- 13?!- Yes.- Whoa! - HE LAUGHS
0:40:28 > 0:40:32That can stretch to 20 if it needs to be but in my experience,
0:40:32 > 0:40:33I know it won't.
0:40:33 > 0:40:36- Wow! So how are you going to build it for 13?- No labour.
0:40:36 > 0:40:40- No labour, it's just material. - Right.- That's just material. - Just material.
0:40:40 > 0:40:43The labour we put in free, for a better word,
0:40:43 > 0:40:46and we'd be taking labour costs out of the profit at the end.
0:40:46 > 0:40:50How are you going to divide out the labour between you?
0:40:50 > 0:40:54The labour will be done mainly myself and my son-in-law, Steve.
0:40:54 > 0:40:58- Right. You were laughing then.- I've got no building skills whatsoever.
0:40:58 > 0:41:01- Right.- My father could build the house on his own,
0:41:01 > 0:41:03I've got no building skills,
0:41:03 > 0:41:06so I'll just do whatever he tells me to do.
0:41:06 > 0:41:09Go and fetch materials, get the materials in,
0:41:09 > 0:41:11do some labouring for them.
0:41:11 > 0:41:15- Right.- All the skilled work will be my father and Steve.
0:41:15 > 0:41:19- Are you looking forward to learning a few things? You're bound to pick up stuff.- No!
0:41:19 > 0:41:23I've worked with them before and I've never learnt anything
0:41:23 > 0:41:27so I won't be learning anything here either. I just do as I'm told.
0:41:27 > 0:41:30I won't be learning anything.
0:41:30 > 0:41:33Because Neil will be managing the shops during the day
0:41:33 > 0:41:37and Steve working full-time on other jobs, the trio will do
0:41:37 > 0:41:41the renovation in their spare time during evenings and weekends.
0:41:41 > 0:41:45They've given themselves six months to get it all done.
0:41:45 > 0:41:48The three of you working together, if that's a success,
0:41:48 > 0:41:50you'll repeat that?
0:41:50 > 0:41:53Oh yes. It's really to get them started. I'm getting too old now.
0:41:53 > 0:41:56Get them started and hopefully do a few more of these.
0:41:56 > 0:42:01- Are you up for that?- He will still be doing them when he's 85.
0:42:01 > 0:42:04- He's never going to retire. - Listen, congratulations anyway.
0:42:04 > 0:42:08We look forward to seeing how you get on.
0:42:08 > 0:42:11Hope you can fit it in with everything else you're doing.
0:42:11 > 0:42:15So, Neil and dad Norman taking on a big project here,
0:42:15 > 0:42:18but Norman for one having the experience to make it happen
0:42:18 > 0:42:22and Neil, well, maybe he can look after the shop
0:42:22 > 0:42:24while Dad finishes the job off!
0:42:24 > 0:42:28Lots of work to do, will they make any dough out of it?
0:42:28 > 0:42:31You can find out later in the show.
0:42:34 > 0:42:38There's been plenty of time for our buyers to start work on their properties.
0:42:38 > 0:42:42But have they actually done anything or have they been beset by problems?
0:42:42 > 0:42:46Time is money. Have they made any or have they lost any?
0:42:46 > 0:42:48Let's go back and find out.
0:42:48 > 0:42:51In the south-west London area of Balham,
0:42:51 > 0:42:55this two bed ground floor flat went to auction.
0:42:55 > 0:43:00Close inspection revealed a property that despite its slightly sorry condition,
0:43:00 > 0:43:06had a lot of hidden charm, but take a few steps and the view was less encouraging.
0:43:06 > 0:43:09There were trains passing close by and I saw a bit of empty land
0:43:09 > 0:43:14next door, a shared garden and issues on the length of the lease,
0:43:14 > 0:43:16so not one for the faint-hearted.
0:43:16 > 0:43:20But to bar owner David, the positives outweighed the negatives.
0:43:20 > 0:43:25With his wife Debbie on maternity leave, since the arrival of their first child Madeleine,
0:43:25 > 0:43:30he saw this as an opportunity to venture into a new business.
0:43:30 > 0:43:33The bars are great. I enjoy doing them.
0:43:33 > 0:43:39In the longer term, with the new baby coming along, I don't want to be working in the evenings
0:43:39 > 0:43:41and try and do some property instead.
0:43:41 > 0:43:44It may have sounded like a good idea,
0:43:44 > 0:43:47but with David planning to do a lot of the work himself,
0:43:47 > 0:43:50I'm not sure how much free time he really was going to get.
0:43:50 > 0:43:58He paid 219,000 at auction and hoped to do it all for 15-20,000.
0:43:58 > 0:44:01Now, four-and-a-half months later, we're back.
0:44:04 > 0:44:09The outside shows signs of improvement with new windows and fresh paintwork.
0:44:11 > 0:44:14But what about inside?
0:44:17 > 0:44:21The front bedroom has been revamped and modernised with solid wood floors,
0:44:21 > 0:44:27a new central heating system, re-plastered walls and fresh decoration throughout.
0:44:27 > 0:44:31The front reception room's also been completely refurbished.
0:44:31 > 0:44:36But it's been turned into another bedroom.
0:44:36 > 0:44:39So what's happened to the back bedroom?
0:44:39 > 0:44:44Well, that's now a fabulous open plan lounge-cum-kitchen diner.
0:44:47 > 0:44:51We've ripped out the old kitchen, put in a new fitted kitchen.
0:44:51 > 0:44:56This wall's come down to open it all up between kitchen,
0:44:56 > 0:45:00dining and lounge and then we've just moved the old kitchen door,
0:45:00 > 0:45:06so we've got patio doors onto the garden. It makes a nice big integrated space.
0:45:06 > 0:45:09Wow! What a difference that makes!
0:45:10 > 0:45:14With the bathroom and toilet also refurbished to a good standard,
0:45:14 > 0:45:18David seems to have made the most of what he had to work with.
0:45:18 > 0:45:23But turning this around must have taken some doing.
0:45:23 > 0:45:30Down here quite a lot actually, my work's probably suffered a bit for it, my other job, and my little baby
0:45:30 > 0:45:35and wife, but I've been down here most days, five or six days a week.
0:45:35 > 0:45:41In the end, David hasn't had as much free time as he originally hoped for.
0:45:41 > 0:45:45He's done a top job here, but it wasn't just the fixtures
0:45:45 > 0:45:49and fittings that needed sorting out, there was the small issue
0:45:49 > 0:45:53of the short 63 year lease that was affecting the flat's value.
0:45:53 > 0:45:58Myself and the chap upstairs are in the process of buying the freehold.
0:45:58 > 0:46:02We've had it valued and it's come back in at £40,000.
0:46:02 > 0:46:07It's going to be significant, 20,000 plus costs per flat,
0:46:07 > 0:46:09but in the long run it'll be well worth it
0:46:09 > 0:46:14and we'll have control of the house, which is the main issue.
0:46:14 > 0:46:19It might be another 20,000, but it would be worth every penny to get the freehold
0:46:19 > 0:46:22because with the current short lease,
0:46:22 > 0:46:28the flat would be very difficult to sell on and to extend the lease would have cost thousands anyway.
0:46:28 > 0:46:32Not only will buying the freehold increase its market value,
0:46:32 > 0:46:36issues such as the shared garden could be more easily resolved.
0:46:36 > 0:46:39With the garden, it sort of depends on the freehold.
0:46:39 > 0:46:45If we get the freehold, we'll probably end up splitting it or I'll buy it off the neighbour upstairs.
0:46:45 > 0:46:50There's also a possibility we'll get more land on the side of the house,
0:46:50 > 0:46:53which then he can have a bit on the side and we'll all be happy then.
0:46:53 > 0:46:58Yes, it looks like the freehold includes the messy plot at the side.
0:46:58 > 0:47:02What a fantastic bonus! David really has rolled up his sleeves
0:47:02 > 0:47:05and turned each potential challenge into a positive
0:47:05 > 0:47:09and not only has he finished the refurb, he's also got a tenant.
0:47:09 > 0:47:13At the moment, I have my cousin, who's moved in,
0:47:13 > 0:47:15just to keep the place warm.
0:47:15 > 0:47:20I might move in, I'm not sure, with my wife, we'll see. But yeah.
0:47:21 > 0:47:25With most boxes ticked, the only other issue was expenditure.
0:47:25 > 0:47:29Did he stick to his tight budget of 15-20,000?
0:47:29 > 0:47:31I've ended up about 25, in all.
0:47:31 > 0:47:36So I've put some nice flooring down and some extra bits
0:47:36 > 0:47:40which are a bit better than for the rental market.
0:47:41 > 0:47:46£25,000's still pretty good. With the purchase price of £219,000
0:47:46 > 0:47:50he's spent to date before the usual costs and fees
0:47:50 > 0:47:55and without the cost of buying the freehold would be around 244,000.
0:47:55 > 0:47:58So has this new venture into property paid off?
0:47:58 > 0:48:01What do two local estate agents think?
0:48:01 > 0:48:04My first impressions are that they've done a very good job.
0:48:04 > 0:48:06A high standard finish,
0:48:06 > 0:48:09and transformed what was a sorry-looking flat.
0:48:09 > 0:48:12The flat's fantastic. It's been done to a high standard.
0:48:12 > 0:48:14It's ideal for professional sharers.
0:48:14 > 0:48:17This area is high end and the finish matches that.
0:48:17 > 0:48:20It definitely gets the stamp of approval,
0:48:20 > 0:48:24but in order to make this viable for the resale market,
0:48:24 > 0:48:27David will need to pay around £20,000 for the freehold.
0:48:27 > 0:48:34That would take his total spend to around £264,000, so would that investment be worth it?
0:48:34 > 0:48:36If they put the property up for sale,
0:48:36 > 0:48:42I'd expect to achieve in the region of 375-385,000.
0:48:42 > 0:48:48This property on the sales market at the moment would achieve between £370,000 and £380,000.
0:48:48 > 0:48:51Wow! Even with the cost of buying a freehold,
0:48:51 > 0:48:54those kind of values could net a whopping pre-tax profit
0:48:54 > 0:49:01of between £106,000 and £121,000, minus the usual selling expenses.
0:49:01 > 0:49:05It's good, given the market's still not that great at the moment.
0:49:05 > 0:49:08It's in line with what we hoped when we bought it.
0:49:08 > 0:49:12Just need to sort out the lease and a few other issues. It'll be good.
0:49:12 > 0:49:15Despite those healthy resale values,
0:49:15 > 0:49:18for the moment the plan is to rent the flat out.
0:49:18 > 0:49:25If we were to put this up for rent, we'd achieve in the region of 1,600-1,650 per calendar month.
0:49:25 > 0:49:30This property on the rental market would achieve £1,600-£1,700 per calendar month.
0:49:30 > 0:49:34It's really good. Excellent.
0:49:34 > 0:49:37A bit of income for while this little one's growing up.
0:49:37 > 0:49:40With a rental yield of between 7 and 8%,
0:49:40 > 0:49:43this investment stacks up on all fronts.
0:49:43 > 0:49:47Now with it finished, is Debbie looking forward to having David home a bit more?
0:49:47 > 0:49:53# I want you back, I want you back, I want you back for good... #
0:49:53 > 0:49:57Yes. Have some help with the little one, definitely. I think she's missed him as well.
0:49:57 > 0:50:01Have a little break and move on to the next project.
0:50:01 > 0:50:05Well, with his bars, property and daughter Madeleine,
0:50:05 > 0:50:08it looks like David's got his hands full for some time to come.
0:50:14 > 0:50:20Earlier, we were in Pontypridd in Wales where experienced builder Norman
0:50:20 > 0:50:25purchased this rundown ex-bakery at auction for £16,000.
0:50:25 > 0:50:31He planned to turn it into a one or two bedroom dwelling with the help of son Neil and son-in-law Steve.
0:50:32 > 0:50:36- So in the past it's been you on your own.- I've always done it on my own.
0:50:36 > 0:50:39This is the first time we've done it as a joint venture.
0:50:39 > 0:50:43- What are the advantages of bringing in other people?- I'm getting old!
0:50:43 > 0:50:47You're bringing in younger blood to help you out.
0:50:47 > 0:50:51# I must be getting older
0:50:51 > 0:50:56# Cos I've never been smarter than I am. #
0:50:56 > 0:51:01The building already had planning permission to be made into a one bedroom house.
0:51:01 > 0:51:07Norman, Steve and Neil plan to do the work within six months, carrying out the labour themselves
0:51:07 > 0:51:11and to keep down their renovation budget of between 13 and 20 grand.
0:51:11 > 0:51:14But boy oh boy, was there a lot of work to do!
0:51:14 > 0:51:20Bare brick walls, rotten joists and antiquated wiring were just the tip of the iceberg.
0:51:20 > 0:51:25I also noticed some large cracks in one of the walls, which needed serious attention.
0:51:28 > 0:51:31So not six but nearly 20 months later,
0:51:31 > 0:51:34we're back in Pontypridd and...
0:51:36 > 0:51:40Ah! This is all looking much the same now as it was back then.
0:51:44 > 0:51:48In fact, the only change I can see is what's growing out
0:51:48 > 0:51:52of the side of the building, rather than what's going on inside.
0:51:52 > 0:51:56Time for Neil and his dad Norman to spill the beans.
0:51:58 > 0:52:05I had a meeting with the council. I proposed to take two-thirds of it down and rebuild the walls
0:52:05 > 0:52:12in block work, which that constitutes a new planning permission.
0:52:12 > 0:52:17In order to start the work, Norman first wanted to rebuild that dilapidated rear wall,
0:52:17 > 0:52:22but the planning permission in place states the structure of the building must stay the same.
0:52:22 > 0:52:28To rebuild the wall requires a new planning application, which may or may not be approved.
0:52:28 > 0:52:32One thing for sure though, that wall needs fixing.
0:52:32 > 0:52:36This elevation of the property is in the worst state.
0:52:36 > 0:52:39I propose now to take this portion of the property down.
0:52:39 > 0:52:45It's only the outside section of the wall is collapsing, so the outside section will be taken down
0:52:45 > 0:52:48and rebuilt in the existing material.
0:52:48 > 0:52:51But the planning office have already indicated to Norman
0:52:51 > 0:52:57that any amendments to the original approved plans are likely to be knocked back,
0:52:57 > 0:53:00which leaves him with one option.
0:53:00 > 0:53:04The only way forward is to repair the building as it stands
0:53:04 > 0:53:07and convert it to the original plans, just take the front
0:53:07 > 0:53:11of the building down and convert it into a garage and a flat above.
0:53:11 > 0:53:16Although not what he ideally wanted, as it was the only way forward,
0:53:16 > 0:53:19why hasn't Norman gone ahead with the work?
0:53:19 > 0:53:25In the meantime, I have sold my property and bought a bungalow directly opposite.
0:53:25 > 0:53:31So this has been very convenient to use as a building store and as a store for that project.
0:53:31 > 0:53:34At least the building's not sitting doing absolutely nothing.
0:53:34 > 0:53:39But a £16,000 store cupboard seems a tad excessive to me.
0:53:39 > 0:53:42I hope Norman's still glad he bought it.
0:53:44 > 0:53:49Yes, but with the climate, it is a burden but I will get over it
0:53:49 > 0:53:53and convert it eventually.
0:53:53 > 0:53:58So the bakery will be converted at some stage. You've got to love Norman's attitude.
0:53:58 > 0:54:01# Que sera sera
0:54:01 > 0:54:05# Whatever will be will be
0:54:05 > 0:54:08# The future's not ours to see
0:54:08 > 0:54:11# Que sera sera. #
0:54:14 > 0:54:19Despite no work being done to the property so far, the frustrations around the planning issues
0:54:19 > 0:54:23and the amount of time that's passed, Norman's undeterred
0:54:23 > 0:54:26and is quite happy to do the renovation as and when.
0:54:26 > 0:54:28We invited two local property experts
0:54:28 > 0:54:32to have a look at the building and give their assessment.
0:54:32 > 0:54:36I don't see the problem with the planners wanting the walls
0:54:36 > 0:54:38to remain as are being a problem.
0:54:38 > 0:54:40Particularly as the building's not listed.
0:54:40 > 0:54:44I'm sure a compromise could be reached where the walls could be taken down
0:54:44 > 0:54:48and rebuilt in similar stone to match the existing area.
0:54:48 > 0:54:50The project is still a good idea.
0:54:50 > 0:54:55However, the timing with the market, it won't hurt him to sit on it.
0:54:55 > 0:55:00Norman purchased the property for £16,000 and if he manages to stay
0:55:00 > 0:55:06within his proposed £20,000 budget, his total spend will be £36,000.
0:55:06 > 0:55:11Once the property's complete, he plans to use the garage as a store for his building materials
0:55:11 > 0:55:17and let the one bedroom flat out. So what kind of rent might the flat achieve?
0:55:17 > 0:55:20Once the property is converted,
0:55:20 > 0:55:23we could achieve £395 per calendar month.
0:55:23 > 0:55:30I would expect it to achieve in the region of £450-475 per calendar month,
0:55:30 > 0:55:33provided it is done to a good standard.
0:55:33 > 0:55:39Those rental figures could turn the old bakery into a nice little earner. What does Neil think?
0:55:39 > 0:55:45That's great. We thought anything over 350, so if you could get 395,
0:55:45 > 0:55:48it'd be great, but obviously 450 is better.
0:55:48 > 0:55:53And if they repair rather than rebuild the walls and convert the property
0:55:53 > 0:55:59according to the existing plans, what could it be worth on the resale market?
0:55:59 > 0:56:06Once fully converted, I think the property would probably reach between £59,000 and £65,000.
0:56:06 > 0:56:10I would expect the property to be worth in the region of £80,000.
0:56:10 > 0:56:15£80,000 is more near the mark, but we've got no intention of selling it.
0:56:15 > 0:56:18We're going to rent the flat out and use the building.
0:56:18 > 0:56:22I think the 65 is a good value, but the 80 would be brilliant.
0:56:22 > 0:56:27So without getting too carried away, given that no work's been done yet,
0:56:27 > 0:56:31it does look as if some money can be made here.
0:56:31 > 0:56:37Norman's set on letting this one out and despite some of the headaches, he also still wants to build.
0:56:37 > 0:56:42I don't think I'll ever stop building. I'll keep building.
0:56:42 > 0:56:44That's dedication for you!
0:56:44 > 0:56:48# Que sera sera. #
0:56:53 > 0:56:57See you next time when we have more auction stories to inspire you.
0:56:57 > 0:57:01- Yes, more stories from Homes Under The Hammer.- See you then. Goodbye.
0:57:08 > 0:57:11Subtitles by Red Bee Media Ltd