0:00:02 > 0:00:05Hello. Buying property can have its highs and lows
0:00:05 > 0:00:07and it's not always as easy as it looks.
0:00:07 > 0:00:11But there is one part of the process you can eliminate -
0:00:11 > 0:00:13getting rid of that dreadful property chain
0:00:13 > 0:00:15by buying at auction.
0:00:40 > 0:00:45- All sorts of places come up for auction. - Variety is what keeps us interested.
0:00:45 > 0:00:49So these are the places that went under the hammer on today's show.
0:00:50 > 0:00:55In London, we return to a former hostel that got me hot and bothered.
0:00:55 > 0:00:57Look at this - industrial strength heating!
0:00:57 > 0:00:59Phwoar!
0:01:00 > 0:01:03This three-bed lodge house in Gravesend, Kent,
0:01:03 > 0:01:05is made of sturdy stuff.
0:01:05 > 0:01:09What I do like about it is it feels really solid.
0:01:11 > 0:01:14The kitchen in this mid-terrace in Lancashire is better than you think.
0:01:14 > 0:01:20If you put tiles down here and cleaned these units up, it would be OK.
0:01:22 > 0:01:25All these properties have been sold at auction.
0:01:25 > 0:01:29We find out who bought them and what they paid when they went under the hammer.
0:01:34 > 0:01:39I'm in the affluent area of Fulham, west London,
0:01:39 > 0:01:43to return to a property we first visited a couple of years ago.
0:01:43 > 0:01:46It's this huge building
0:01:46 > 0:01:49and the auction lot was, in fact, two separate houses.
0:01:49 > 0:01:52which had been sub-divided into six flats.
0:01:52 > 0:01:55The three-storey property may look elegant from outside,
0:01:55 > 0:01:59but was, until recently, a council hostel.
0:01:59 > 0:02:02The property's a leasehold with 50 years remaining
0:02:02 > 0:02:06and the guide price was a whopping 525 grand!
0:02:06 > 0:02:10So, through the front door and entrance foyer into the first flat.
0:02:10 > 0:02:13And, well, not a bad size space.
0:02:13 > 0:02:17It's a bedsit. High ceilings, which is always a good thing.
0:02:17 > 0:02:21Clearly, kitchen in need of a bit of tender loving care.
0:02:21 > 0:02:25Thankfully, the bathroom slightly better and it's a good size.
0:02:25 > 0:02:29Um... But, as starting points go, not bad.
0:02:32 > 0:02:35'So, onwards and upwards to the first floor,
0:02:35 > 0:02:40'where there are another two flats, one either side of the stairs.'
0:02:40 > 0:02:44So, a similar layout on the left-hand side of the top floor,
0:02:44 > 0:02:46but on the right-hand side of the top floor,
0:02:46 > 0:02:49it kind of gets a bit complicated.
0:02:49 > 0:02:51Another good size flat,
0:02:51 > 0:02:55but the issue here is this is actually a flying freehold.
0:02:55 > 0:02:59That could introduce a few complications.
0:02:59 > 0:03:04'This flat sits above an office which belongs to the next door property.
0:03:04 > 0:03:06'That's a flying freehold,
0:03:06 > 0:03:10'when part of one property extends over another.
0:03:10 > 0:03:14'It can make a mortgage difficult to obtain, so the leaseholder
0:03:14 > 0:03:16'will want to speak to the freeholder
0:03:16 > 0:03:20'to make sure there are no complications here.
0:03:21 > 0:03:26'And we're not done yet. Down in the basement, there's another flat,
0:03:26 > 0:03:28'making four in total.'
0:03:34 > 0:03:38Well, all good so far. But, in case you'd forgotten,
0:03:38 > 0:03:40there's a whole extra house to see yet.
0:03:46 > 0:03:48'Next door, there's more of the same -
0:03:48 > 0:03:52'a flat on the first floor and another one in the basement.
0:03:52 > 0:03:56'On the ground floor, though, things start hotting up.'
0:03:56 > 0:04:02In a place like this, one of the big considerations will be the central heating and hot water supply -
0:04:02 > 0:04:04very expensive to replace.
0:04:04 > 0:04:05But in this case, not a problem.
0:04:05 > 0:04:07It's all been done, and look at this -
0:04:07 > 0:04:10industrial strength heating!
0:04:10 > 0:04:11Phwoar!
0:04:11 > 0:04:15# I said, "It's getting hot in here
0:04:15 > 0:04:17# "So take off all your clothes"
0:04:17 > 0:04:21# I am getting so hot I want to take my clothes off! #
0:04:21 > 0:04:26'And, if that's not enough to get you hot under the collar,
0:04:26 > 0:04:32'there's also some office space on the ground floor that could be turned into one more flat.
0:04:32 > 0:04:35'At the moment, the room feels drab and dreary
0:04:35 > 0:04:38'but since we're in one of London's most sought-after areas,
0:04:38 > 0:04:43'transforming these dingy hostel bedsits into stunning studio apartments
0:04:43 > 0:04:46'might well be worth the challenge.
0:04:46 > 0:04:50'They also had planning permission guaranteed to turn them back into two houses
0:04:50 > 0:04:53'so, whether to buy for flats or homes,
0:04:53 > 0:04:56'with that £525,000 guide price,
0:04:56 > 0:05:00'there was amazing potential in this auction lot.'
0:05:00 > 0:05:04Well, a real double bonus with this place. Two properties
0:05:04 > 0:05:09and the chance to double your money. But don't underestimate the amount of work it'll take.
0:05:09 > 0:05:13It's probably a developer that took it on when it went to the auction.
0:05:15 > 0:05:20Do I have 600 on this? If not, where do you wish to start? It's worth six.
0:05:20 > 0:05:22Standing up, 500.
0:05:22 > 0:05:23505 anywhere?
0:05:23 > 0:05:25505.
0:05:25 > 0:05:26510?
0:05:28 > 0:05:29515.
0:05:29 > 0:05:31520.
0:05:31 > 0:05:33520. 525?
0:05:33 > 0:05:37525, madam?
0:05:37 > 0:05:38530.
0:05:38 > 0:05:41'Despite the slow start, this hot property was up and running.
0:05:41 > 0:05:48'Eventually, the bidding was between two determined parties and had reached a staggering 690,000.'
0:05:48 > 0:05:51Anyone else? That's 690.
0:05:51 > 0:05:52691.
0:05:52 > 0:05:54692.
0:05:54 > 0:05:58693, 694.
0:05:58 > 0:06:00695, 696.
0:06:00 > 0:06:03697, 698.
0:06:03 > 0:06:05699, 700, 701.
0:06:05 > 0:06:08702, 703.
0:06:08 > 0:06:10703?
0:06:10 > 0:06:13702, with you, first time, second time,
0:06:13 > 0:06:16third and last time, if you're all done...
0:06:16 > 0:06:19Sold, 702, well done.
0:06:19 > 0:06:23'After a titanic struggle, the triumphant bidder was Stephanie,
0:06:23 > 0:06:26'with her bid of £702,000.
0:06:28 > 0:06:30'Stephanie actually works next door,
0:06:30 > 0:06:32'from where she runs her marketing company.
0:06:32 > 0:06:36'She's had her eye on these properties for some time.'
0:06:36 > 0:06:38# Tell the fellas We can do what they can do
0:06:38 > 0:06:42# We can do it even better in broken heels... #
0:06:42 > 0:06:45- Stephanie! Congratulations! - Thank you, Martin.
0:06:45 > 0:06:47Tell me why you wanted to buy it.
0:06:47 > 0:06:50I bought the building next door 13 years ago.
0:06:50 > 0:06:54- Oh!- For the last 13 years, I've been trying to persuade the council to sell me the lease.
0:06:54 > 0:06:59When it went up for auction, with residential planning permission, it was a no-brainer.
0:06:59 > 0:07:03After 13 years, it would've been sad not to get this building.
0:07:03 > 0:07:08I would've had to sit next to it, watching the building works unfold.
0:07:08 > 0:07:11- You would've gone mad. - I would've had to move offices!
0:07:11 > 0:07:15The day you got it, then, how did you feel?
0:07:15 > 0:07:16Scared.
0:07:16 > 0:07:17Elated.
0:07:17 > 0:07:23And I was approached immediately after the auction with an incremental bid to sell it on, so very happy.
0:07:23 > 0:07:25Tell me more.
0:07:25 > 0:07:29- For a significant amount more. - How much?- I can't tell you.- Why?!
0:07:29 > 0:07:32More than £150,000 more than I paid.
0:07:32 > 0:07:35- What, the day after?- The day of.
0:07:35 > 0:07:37Two minutes after I bought it.
0:07:37 > 0:07:42- Why didn't you take the £150,000? - There's more value in developing this as it is, obviously.
0:07:42 > 0:07:46Money in the bank, though!
0:07:46 > 0:07:48- Mmmm, speculation.- Really?- Yep.
0:07:48 > 0:07:52Obviously, it's leasehold. Does that affect you?
0:07:52 > 0:07:58- I own the freehold, so I'll marry the freehold and leasehold.- You own the freehold of the building?- Yes.- Wow!
0:07:58 > 0:08:01'The flying freehold is of no concern now
0:08:01 > 0:08:05'as Stephanie owns the buildings and the land they're built on.
0:08:05 > 0:08:07'So, what are her plans?
0:08:07 > 0:08:09'To keep them as flats or return them to houses?'
0:08:09 > 0:08:12Why are you so excited about this? What are you going to do?
0:08:12 > 0:08:16It's a prime position. It's a great building - I love the building.
0:08:16 > 0:08:22I think it could be very useful, either as houses, for which it already has planning permission,
0:08:22 > 0:08:27or, even better, as apartments, for which I'm going to apply for permission.
0:08:27 > 0:08:32Perhaps in future, I will marry the building I own next door and make a whole terrace of apartments,
0:08:32 > 0:08:35- which becomes a very nice development deal.- Absolutely.
0:08:35 > 0:08:38With a view to doing what, keeping them, renting them, selling them?
0:08:38 > 0:08:42Probably selling them when the market picks up, but perhaps renting now.
0:08:42 > 0:08:45What are you going to do? What's the process now?
0:08:45 > 0:08:48- Apply for planning permission for two-bedroom apartments.- How many?
0:08:48 > 0:08:54Seven with a couple of studios included. Seven units in total.
0:08:54 > 0:09:00Um, apply for planning permission for the building next door, my offices, to residential.
0:09:00 > 0:09:04Subject to that, I've got permission to put another floor on the top.
0:09:04 > 0:09:08- And then see what happens. - Wow!- Yeah.
0:09:08 > 0:09:13- This turns it into a huge...- Quite a substantial building, yeah.- Right.
0:09:13 > 0:09:17In terms of doing this project, any idea how much it'll cost?
0:09:17 > 0:09:22- How long it's going to take? - Probably about £300,000 to refurbish the two buildings here
0:09:22 > 0:09:25- and I would guess six months, maximum.- Right.
0:09:25 > 0:09:26Take it at a fairly slow pace.
0:09:26 > 0:09:31They are beautiful buildings. I'd like to restore them to something of their previous glory.
0:09:31 > 0:09:36They've been battered over the years, so it'll be interesting to see them come back.
0:09:36 > 0:09:39'Stephanie has secured her mortgage and is using savings
0:09:39 > 0:09:43'to finance her grand plans for this elegant building.'
0:09:44 > 0:09:47We haven't talked about one thing, which is the boiler.
0:09:47 > 0:09:50- It's a work of art!- Yes! - Something to behold.
0:09:50 > 0:09:55The first time I came in here, I was amazed by it. I thought it might be a nuclear force!
0:09:55 > 0:09:59We're going to have to put individual central heating units in.
0:09:59 > 0:10:02- What happens to the boiler? - Make me an offer!
0:10:02 > 0:10:06I'll be round here with my transit van!
0:10:06 > 0:10:11'Well, that was in March 2009, but when we returned 20 months later,
0:10:11 > 0:10:15'there were no new apartments to admire. The interior was a mess.
0:10:15 > 0:10:19'But that was because Stephanie was thinking big.
0:10:19 > 0:10:21'She'd come up with a much larger scheme
0:10:21 > 0:10:26'which meant starting from scratch. Even the lovely boiler had gone.
0:10:27 > 0:10:32'She'd been working with her architects on applying for planning permission,
0:10:32 > 0:10:35'but it took a lot longer than she'd hoped.'
0:10:35 > 0:10:39We bought the property with planning permission for two family houses.
0:10:39 > 0:10:45We applied to put on an extra floor and changed the planning permission to nine one-bed apartments,
0:10:45 > 0:10:49which took us a while, but we got that about a year ago.
0:10:49 > 0:10:53'So, Stephanie finally got planning permission for nine one-bed apartments
0:10:53 > 0:10:56'with two on the basement level,
0:10:56 > 0:10:57'two on the ground floor
0:10:57 > 0:11:00'and three on the first floor.
0:11:03 > 0:11:05'There'll be a new extension in the attic space,
0:11:05 > 0:11:08'which will allow for the creation of another two flats.
0:11:08 > 0:11:13'Her estimated budget for the whole project was around £1 million.
0:11:13 > 0:11:15'Whilst waiting for planning permission,
0:11:15 > 0:11:18'Stephanie decided to try her wings on the rental market
0:11:18 > 0:11:23'by giving the flying freeholder flat a quick refurbishment.
0:11:23 > 0:11:26'It's currently empty, but if this is a temporary makeover,
0:11:26 > 0:11:29'I can't wait to see the finished product here.'
0:11:29 > 0:11:32I'm really looking forward to getting to the finishing stages
0:11:32 > 0:11:37and to seeing how a building which is really iconic, in my view,
0:11:37 > 0:11:39can be restored to its former glory.
0:11:39 > 0:11:42And then to seeing some very happy people living here.
0:11:42 > 0:11:43'That was then.
0:11:43 > 0:11:48'Stay with us to see how Stephanie transformed this elegant building.'
0:11:56 > 0:11:59I'm in Gravesend in the northwest of Kent.
0:11:59 > 0:12:04It's a busy commercial town with a good range of shops and great transports links to Dartford.
0:12:05 > 0:12:09I'm here to see a lodge house today.
0:12:09 > 0:12:12Lodge house, hmm! You're thinking wooden retreat,
0:12:12 > 0:12:17log cabin, perhaps a fantastic hideaway in the hills.
0:12:17 > 0:12:20Well, do away with those fancy ideas,
0:12:20 > 0:12:22because this is the lodge house.
0:12:22 > 0:12:26I've got to get in there and see if things can improve.
0:12:30 > 0:12:34'Mm, definitely not the kind of lodge I was imagining.
0:12:34 > 0:12:36'Guided at 175 to 185,000,
0:12:36 > 0:12:41'this property was a halfway house for young people.
0:12:41 > 0:12:45'Before that, it was the matron's house for the care home next door. Now, it's empty,
0:12:45 > 0:12:49'and in serious need of some TLC.'
0:12:50 > 0:12:53This house is quite depressing on the outside.
0:12:53 > 0:12:56It's got boarded up doors and windows.
0:12:56 > 0:12:57So, not a great start.
0:12:57 > 0:13:01But, saying that, once you actually walk inside,
0:13:01 > 0:13:03it's fairly big and bright.
0:13:03 > 0:13:05It's a really nice open-plan space in here.
0:13:05 > 0:13:09You've got light from that window, doors leading out to the garden.
0:13:09 > 0:13:11This is an ideal dining area.
0:13:11 > 0:13:14You could fit a big table and chairs in this space.
0:13:14 > 0:13:17Through here is the kitchen.
0:13:17 > 0:13:22'The living room is a good size, but I'd think about knocking this wall down
0:13:22 > 0:13:26'to create a more open area, as it's slightly boxy in here.
0:13:26 > 0:13:29'The kitchen's pretty poky too. I'd knock through here
0:13:29 > 0:13:34'and create an open-plan kitchen living area to maximise this space.'
0:13:34 > 0:13:40Upstairs in this property, you've got a series of bedrooms leading off this landing.
0:13:40 > 0:13:44Even though this house is completely characterless,
0:13:44 > 0:13:47what I do like about it is that it feels really solid.
0:13:48 > 0:13:51# Solid as a rock... #
0:13:51 > 0:13:55'Solid indeed. There isn't a damp patch in sight.
0:13:55 > 0:13:58'The bathroom is in good order and perfectly serviceable.
0:13:58 > 0:14:04'The three bedrooms are all a fair size too, which is good news, and the windows up here look new.
0:14:04 > 0:14:07'There's an extra WC next to the boiler.
0:14:07 > 0:14:10'There's some great potential inside this house
0:14:10 > 0:14:15'that was guided between 175 and 185,000.
0:14:15 > 0:14:21'But it's the generous plot outside where the real possibilities lie.'
0:14:21 > 0:14:24It's rare to find a detached house on such a large plot
0:14:24 > 0:14:26for such a low guide price.
0:14:26 > 0:14:31The property...it's not inspiring, but the land on which it sits is.
0:14:31 > 0:14:34Now, imagine if this house was demolished.
0:14:34 > 0:14:36You'd have a real sizeable plot here.
0:14:36 > 0:14:39Obtain planning permission to build
0:14:39 > 0:14:41and this lot could be a financial winner.
0:14:41 > 0:14:45# Everyone's a winner, baby That's the truth!
0:14:45 > 0:14:46# That's the truth
0:14:46 > 0:14:49# Making love to you is such a thrill. #
0:14:49 > 0:14:53'A developer would see real potential here. You wouldn't miss this house
0:14:53 > 0:14:58'if you got planning permission to demolish it and build two new ones, would you?
0:14:58 > 0:15:00'With a guide price of between 175
0:15:00 > 0:15:03'and 185,000, we asked a local estate agent
0:15:03 > 0:15:05'what he thought of the place.'
0:15:05 > 0:15:08This property is a very good size
0:15:08 > 0:15:10three bedroom detached house.
0:15:10 > 0:15:13I think there's minor cosmetic work that needs doing,
0:15:13 > 0:15:17but, otherwise, as a whole, it would be a good buy.
0:15:17 > 0:15:20'So, it's off to a good start.
0:15:20 > 0:15:22'But what work is necessary?'
0:15:22 > 0:15:28'The work that needs to be done to bring this up to a good standard is really minor cosmetic work.
0:15:28 > 0:15:31'Bit of paintwork, and, as you go around,'
0:15:31 > 0:15:34really minor work, to be honest with you.
0:15:34 > 0:15:37It is as it is a good property.
0:15:37 > 0:15:41'What about knocking down the house and developing the site?'
0:15:41 > 0:15:44'The site is a very good size.
0:15:44 > 0:15:48'As a redevelopment, I think you're more than likely better off'
0:15:48 > 0:15:51extending the property rather than demolishing and rebuilding.
0:15:51 > 0:15:54I think it'd stick out from the other properties around.
0:15:54 > 0:15:59'So, he doesn't really agree with any grand development ideas here,
0:15:59 > 0:16:02'though does think you could convert it into two flats.
0:16:02 > 0:16:05'Back to basics - what could you sell it for
0:16:05 > 0:16:08'if you just renovated it as it is?'
0:16:08 > 0:16:14Once this property was renovated, the resale value would be about £220,000.
0:16:14 > 0:16:18'What level of rental income could you get per calendar month?
0:16:18 > 0:16:22Three bedroom properties are very sought after in Gravesend.
0:16:22 > 0:16:26We've got a lot of people moving from London to this area.
0:16:26 > 0:16:30You would be fetching around £750 plus.
0:16:30 > 0:16:34The house is a good size and it doesn't require too much work.
0:16:34 > 0:16:38Having said that, if you're looking to make real money on this site,
0:16:38 > 0:16:42demolition and redevelopment on this site is the only way to go.
0:16:42 > 0:16:45Let's see who wanted this as we go to auction.
0:16:48 > 0:16:50The next one...
0:16:50 > 0:16:52It's a detached modern house
0:16:52 > 0:16:55for investment, occupation or possible redevelopment.
0:16:55 > 0:16:57What can I be bid for this one?
0:16:57 > 0:17:00Lovely opportunity. Guide at 175 to 185.
0:17:00 > 0:17:01170 anywhere to start me off?
0:17:01 > 0:17:04Looking for 170.
0:17:04 > 0:17:06170 anywhere. Give me 160,
0:17:06 > 0:17:09not going lower than 160, if you're here to bid. 160, I've got.
0:17:09 > 0:17:11160 and 5.
0:17:11 > 0:17:13165, 170.
0:17:13 > 0:17:16170 and 5. He says no.
0:17:16 > 0:17:19Got 170 sitting down on the right, looking for 175,000.
0:17:19 > 0:17:20I'll take 2 if it helps.
0:17:20 > 0:17:22170 on the right, looking for 172.
0:17:22 > 0:17:24172 and 5.
0:17:24 > 0:17:26And 5, and 7...
0:17:26 > 0:17:28177 and 180.
0:17:28 > 0:17:29180 and 2.
0:17:29 > 0:17:32Says no. 180, sitting down on the right.
0:17:32 > 0:17:34It's in the room and it will be sold.
0:17:34 > 0:17:38180, and it'll be sold. For the first time at 180,
0:17:38 > 0:17:42second time at 180. Sure you don't want to go another 2?
0:17:42 > 0:17:46180, second time. Third and final time, 180,000,
0:17:46 > 0:17:48if you're sure you're all out, 180,000,
0:17:48 > 0:17:51sitting down, it's going to be sold.
0:17:51 > 0:17:52180,000. Your number is?
0:17:52 > 0:17:56'The successful bid of 180,000 was made by Graham
0:17:56 > 0:18:00'bidding on behalf of a charity for the elderly.
0:18:00 > 0:18:03'He's been finance director of the charity for three years
0:18:03 > 0:18:06'and, before that, worked in the film industry
0:18:06 > 0:18:08'when he ran the South Bank Studios.
0:18:15 > 0:18:20'I caught up with Graham back at the house to hear his plans for it.'
0:18:21 > 0:18:27Graham, congratulations. What were your reasons for wanting to buy this house at auction?
0:18:27 > 0:18:29We own the property next door
0:18:29 > 0:18:35which we're going to completely remodel or rebuild for elderly care.
0:18:35 > 0:18:38This house basically completes the site
0:18:38 > 0:18:44and enables us to put probably at least a dozen independent housing, affordable housing, units
0:18:44 > 0:18:48on the site, which makes it all viable and a complete site.
0:18:48 > 0:18:52So, what has this been over the last few years?
0:18:52 > 0:18:55It was the matron's house that went with the care home.
0:18:55 > 0:18:59But Kent County Council, when they sold us the care home,
0:18:59 > 0:19:04kept this as a drop-in centre for some kind of social care,
0:19:04 > 0:19:06step-up, step-down social care.
0:19:06 > 0:19:11They've now decided they don't want it and that's perfect timing for us.
0:19:11 > 0:19:15'There was a lot riding on getting this property,
0:19:15 > 0:19:18'so, how did Graham feel on auction day?'
0:19:18 > 0:19:22Very nervous! It's the first time I've ever taken part in an auction.
0:19:22 > 0:19:25But you did look incredibly calm on the day.
0:19:25 > 0:19:27Well, that's years of practice.
0:19:27 > 0:19:31What is it that you do? Explain your job to me now.
0:19:31 > 0:19:36I'm an accountant by background, but I spent 25 years in the film industry, strangely,
0:19:36 > 0:19:40and then came to the charity world when I got too old
0:19:40 > 0:19:42to relate to the film people.
0:19:42 > 0:19:46I basically started as the director of finance
0:19:46 > 0:19:51but I've now taken over as director of development as well.
0:19:51 > 0:19:55What role will you play in developing this site?
0:19:55 > 0:19:57The scary guy in the suit.
0:19:57 > 0:20:00- You're not scary. - The progress chaser.
0:20:00 > 0:20:05I won't be directly involved. We will have a professional project management team.
0:20:05 > 0:20:08They're quite a big firm of architects
0:20:08 > 0:20:10who will be looking after it for us.
0:20:10 > 0:20:14- Are you the man everybody has to answer to?- Yeah.
0:20:14 > 0:20:17'So, Graham is the head honcho on this project.
0:20:17 > 0:20:21'What plans do his team have to bring this care home up to modern standards?'
0:20:23 > 0:20:26We're in consultation with Gravesham Borough Council
0:20:26 > 0:20:29to find out exactly what sort of housing they want.
0:20:29 > 0:20:33We will then liaise with the housing corporation to decide whether or not
0:20:33 > 0:20:37to knock it down and rebuild the whole site
0:20:37 > 0:20:42or to remodel it extensively, to allow independent living units,
0:20:42 > 0:20:46to put nursing capacity in there.
0:20:46 > 0:20:48And also varying degrees of independence,
0:20:48 > 0:20:51so we can cater for elderly people
0:20:51 > 0:20:53at every stage of the rest of their lives.
0:20:54 > 0:21:00'To get a clearer idea of the development, I asked Graham to talk me through the plans.'
0:21:00 > 0:21:03- It certainly has got a contemporary feel to it.- We think so.
0:21:03 > 0:21:05We don't want to go traditional,
0:21:05 > 0:21:08but we do want to be as eco-friendly as possible.
0:21:08 > 0:21:12We're bringing in modern products - sustainable timber cladding,
0:21:12 > 0:21:15plenty of trees and grass round the outside,
0:21:15 > 0:21:20to keep the visual effect acceptable to all the local residents.
0:21:20 > 0:21:23It does matter to us what they think.
0:21:23 > 0:21:26We're not a property developer. We're not in it for profit.
0:21:26 > 0:21:29We are care providers and that means caring for our environment.
0:21:29 > 0:21:34'The plan is to build the accommodation units in a U shape around the courtyard.
0:21:34 > 0:21:37'If the charity hadn't bought the former lodge house,
0:21:37 > 0:21:40'the number of new units would've been much more limited,
0:21:40 > 0:21:43'so this purchase has been a huge boon.
0:21:43 > 0:21:48'How much is it all going to cost? Remember, their budget will cover development of the whole site,
0:21:48 > 0:21:53'including the lodge house, care home next door, plus the land they're both on.'
0:21:53 > 0:21:56At this stage, we're looking at about £4.5 million.
0:21:56 > 0:22:00It'll probably take about two years to build.
0:22:00 > 0:22:04We'd be targeting end of 2010 for completion.
0:22:04 > 0:22:06So, if anybody goes over budget here,
0:22:06 > 0:22:10you're the man in control of this! It's all down to you.
0:22:10 > 0:22:15Well, yes, but as I said before, we're a not-for-profit organisation.
0:22:15 > 0:22:20What we really want is the best we can produce from this site,
0:22:20 > 0:22:22for the elderly of Gravesham. That's our target.
0:22:22 > 0:22:24I think it's a really exciting project
0:22:24 > 0:22:27and I'm so pleased it was you that got that at auction.
0:22:27 > 0:22:32- I hope it goes really well for you, Graham.- Thank you.- It's been very nice to meet you.- And you.
0:22:32 > 0:22:37Graham has clear objectives and his cool and calm exterior
0:22:37 > 0:22:40will no doubt sail him through this development.
0:22:40 > 0:22:42With over £4 million in the pot,
0:22:42 > 0:22:45I'm sure his team will make a huge success of this.
0:22:45 > 0:22:48And what a great project to be part of -
0:22:48 > 0:22:53constructing safe, secure and comfortable accommodation for the elderly.
0:22:53 > 0:22:57You can find out how the build is going later on in the show.
0:22:58 > 0:23:02'Coming up, this two-bed in Bury has me hunting for the bathroom.'
0:23:02 > 0:23:07There, you'd expect to see a loo. It's not. It's been moved. Great.
0:23:08 > 0:23:13'We head back to Kent to see if the charity's plans have come to fruition.'
0:23:13 > 0:23:17Buying the house was integral to our plans. It's allowed us to develop what we've achieved.
0:23:20 > 0:23:25'But, first, in Fulham, London, has Stephanie realised her vision?'
0:23:25 > 0:23:27The flats look exactly as I imagined.
0:23:31 > 0:23:35'Earlier in the show, we looked back to March 2009
0:23:35 > 0:23:38'where, in fashionable Fulham, southwest London,
0:23:38 > 0:23:44'Stephanie had bought this attractive three-storey building for £702,000.
0:23:44 > 0:23:47'She owns and works in the house next door,
0:23:47 > 0:23:50'where she runs her own marketing business.
0:23:50 > 0:23:53'Stephanie had her sights on this building for 13 years.
0:23:53 > 0:23:55'Although it looked grand on the outside,
0:23:55 > 0:23:57'inside was a different story,
0:23:57 > 0:24:01'with six very uninspiring flats.
0:24:01 > 0:24:05'There was planning permission to turn them back into two houses,
0:24:05 > 0:24:10'but Stephanie had bigger ideas - to develop nine apartments.
0:24:10 > 0:24:12'When we first returned,
0:24:12 > 0:24:15'the interior was nothing but a gutted shell,
0:24:15 > 0:24:21'but Stephanie had got planning permission for her development and the excitement was plain to see.'
0:24:21 > 0:24:24I'm really looking forward to getting towards the finishing stages,
0:24:24 > 0:24:27to seeing how a building which is really iconic
0:24:27 > 0:24:29can be restored to its former glory.
0:24:29 > 0:24:32And then to seeing some very happy people living here.
0:24:32 > 0:24:34'Well, that was 11 months ago.
0:24:34 > 0:24:38'We returned to Fulham to see if Stephanie's 13-year dream
0:24:38 > 0:24:42'for this building had finally come true.
0:24:42 > 0:24:44'The freshly-pointed exterior
0:24:44 > 0:24:46'has recaptured the elegance of this building.
0:24:46 > 0:24:49'Let's hope it's the same for the interior.'
0:24:57 > 0:25:00'Well, this is impressive.
0:25:00 > 0:25:01'Very impressive indeed.
0:25:01 > 0:25:05'From an empty shell, Stephanie has created nine new flats,
0:25:05 > 0:25:07'top to bottom.
0:25:07 > 0:25:12'Each just one bed, but all smart, contemporary and stylish.
0:25:14 > 0:25:17'With the same attention to decor and styling,
0:25:17 > 0:25:21'they're definitely going to appeal to the fashionable set of Fulham.
0:25:21 > 0:25:25'Up at the top are the most attractive of all.'
0:25:25 > 0:25:27These are two new flats.
0:25:27 > 0:25:32A mansard roof extension, flats eight and nine, both fairly sizeable.
0:25:32 > 0:25:37An open-plan kitchen, as per the other units, and the bathroom with the Italian sanitary ware.
0:25:37 > 0:25:40This one's gone under offer in the last couple of days.
0:25:40 > 0:25:43'Good news for Stephanie there.
0:25:43 > 0:25:45'The loft flats also have balconies -
0:25:45 > 0:25:49'a small one at the front, offering views of Fulham,
0:25:49 > 0:25:51'and another at the rear.
0:25:54 > 0:25:59'Also getting a taste of the London air are the two basement flats.'
0:26:01 > 0:26:05This is one of the original lower ground floor units.
0:26:05 > 0:26:08This is one I'm particularly pleased with.
0:26:08 > 0:26:11It's got this conservatory finish, the open-plan kitchen
0:26:11 > 0:26:16and real wow feature of the garden with bi-fold doors opening into it.
0:26:16 > 0:26:21'Expanding the lower ground floor flats has eaten into the garden area
0:26:21 > 0:26:25'but once the work's finished, these outdoor spaces will be a bonus
0:26:25 > 0:26:28'because while the two lower ground floor flats
0:26:28 > 0:26:30'and the two loft apartments are a good size,
0:26:30 > 0:26:33'the remaining five properties are more compact.
0:26:34 > 0:26:38'They all have an open-plan kitchen living area.
0:26:38 > 0:26:42'While the two ground floor flats mirror each other,
0:26:42 > 0:26:44'one benefits from a small balcony.
0:26:44 > 0:26:48'On the first floor, the original flying freehold flat
0:26:48 > 0:26:52'has been transformed with the addition of a balcony.
0:26:52 > 0:26:56'With nine apartments in all, some still needing finishing off,
0:26:56 > 0:26:59'Stephanie has almost realised her dream.'
0:26:59 > 0:27:01The flats look exactly as I had imagined they would.
0:27:01 > 0:27:05I think the kitchens and bathrooms are a real wow factor.
0:27:05 > 0:27:10The balconies look terrific. The building's been restored to its former glory, so I'm very happy.
0:27:10 > 0:27:13'And it's not just the look she's happy with.
0:27:13 > 0:27:18'It seems the loft flat that was under offer was just the start!'
0:27:18 > 0:27:21Yep, we have already got five flats either sold or under offer,
0:27:21 > 0:27:24so that's great news as we're only just finishing at the moment.
0:27:24 > 0:27:26So, yes, it's gone very much to plan.
0:27:36 > 0:27:39'I love it when a plan comes together.
0:27:39 > 0:27:43'It's taken much longer than the six months Stephanie anticipated,
0:27:43 > 0:27:49'but the plan evolved and the 2½ year wait has been worthwhile.'
0:27:49 > 0:27:52It's been a real labour of love. I've wanted to do it a long time.
0:27:52 > 0:27:55I've learnt a lot in the process, not begrudgingly.
0:27:55 > 0:27:57It's been a terrific piece of work to do.
0:27:57 > 0:28:00'With five of the nine flats already under offer,
0:28:00 > 0:28:05'it looks like this investment is already starting to pay for itself.
0:28:05 > 0:28:07'But, for such a big renovation,
0:28:07 > 0:28:11'how did her forecast for a £1 million spend hold out?'
0:28:11 > 0:28:13The budget has gone pretty well.
0:28:13 > 0:28:16It slipped a little over the original budget of a million,
0:28:16 > 0:28:18but not in too bad a way.
0:28:18 > 0:28:21Of course, the market has gone up in the intervening period,
0:28:21 > 0:28:24so, actually, the whole profit looks quite good.
0:28:26 > 0:28:29'Stephanie originally bought the building
0:28:29 > 0:28:35'for £702,000, so her outlay could be just over 1.7 million.
0:28:35 > 0:28:37'We asked two local estate agents
0:28:37 > 0:28:41'what they thought of her big investment.'
0:28:41 > 0:28:44'I think the whole project that has happened is fantastic.'
0:28:44 > 0:28:47The property was obviously in pretty poor repair,
0:28:47 > 0:28:48it needed a lot of work.
0:28:48 > 0:28:51They've refurbished it to a very good standard.
0:28:53 > 0:28:57'I think this building has been an amazing find.'
0:28:57 > 0:28:59'The project is a really sweet development.'
0:28:59 > 0:29:02The saying is location, location, location
0:29:02 > 0:29:04and you can't get better than this.
0:29:04 > 0:29:09They've been clever in the way they've incorporated outside space in the upper units.
0:29:09 > 0:29:12That balcony will add a great amount of value.
0:29:12 > 0:29:17The light they've created downstairs is also good, with the garden.
0:29:17 > 0:29:21'The whole building itself fits in perfectly with the area.'
0:29:21 > 0:29:25The buyers love this type of building.
0:29:25 > 0:29:32The property itself, they've retained the character people are looking for and the feel of it.
0:29:32 > 0:29:36The amount of time it's taken to do the project has worked in her favour.
0:29:36 > 0:29:38If we were marketing these a year and a half ago,
0:29:38 > 0:29:41we would've seen significant over-values.
0:29:41 > 0:29:45Due to confidence in property against the stock market, she's caught the timing right.
0:29:45 > 0:29:49'It seems like a big thumbs-up from the estate agents.
0:29:49 > 0:29:53'But will Stephanie get the return she's after?
0:29:53 > 0:29:56'She spent over £1.7 million on four large one-bedroom apartments
0:29:56 > 0:29:58'and five smaller one-beds.
0:29:58 > 0:30:01'So, what could she achieve here?'
0:30:01 > 0:30:07The larger properties, I could see fetching £350,000 to £375,000.
0:30:07 > 0:30:13For the smaller units, I would put them in the range of £275,000 to £300,000.
0:30:13 > 0:30:16If I were to market these flats, I know I have buyers
0:30:16 > 0:30:20that would buy these for about £300,000 for the smaller ones.
0:30:20 > 0:30:26For the larger ones, I could see buyers paying £420,000, maybe £430,000.
0:30:26 > 0:30:29I think your second agent is spot-on.
0:30:29 > 0:30:33We're selling for a minimum of 300 and 420 to 440 as our top price.
0:30:33 > 0:30:36So, yeah, that's spot-on, that second valuation.
0:30:36 > 0:30:40'Wow! If Stephanie can get the figure she says for all nine flats,
0:30:40 > 0:30:46'she could turn over a staggering £3.6 million to £3.7 million!
0:30:46 > 0:30:50'That's a potential gross profit of £1.9 million to £2 million,
0:30:50 > 0:30:56'minus the usual taxes, fees and expenses. Phew!'
0:31:01 > 0:31:05'Although it wasn't planned, riding the dip in the London property market
0:31:05 > 0:31:08'has worked to Stephanie's advantage
0:31:08 > 0:31:12'and will hopefully secure her some pretty serious returns
0:31:12 > 0:31:15'on this big investment. But she doesn't plan to stop there.'
0:31:15 > 0:31:20We've put in a tender for a much larger development in the same area.
0:31:20 > 0:31:22I don't know whether we'll get it,
0:31:22 > 0:31:25but that would be six houses and 15 apartments,
0:31:25 > 0:31:28so significantly bigger. We're thinking big.
0:31:28 > 0:31:33'Thinking big can lead to bigger rewards, as Stephanie has seen on this project.
0:31:33 > 0:31:36'I wish her all the best.'
0:31:45 > 0:31:50'I'm in Bury, Lancashire, smack in the middle of England's Northwest.
0:31:50 > 0:31:56'There are great transport links into Manchester city centre, with many commuting daily.
0:31:56 > 0:32:00'But there's plenty going on in Bury to keep people right here.'
0:32:00 > 0:32:05Bury town centre is currently undergoing a £350 million rejuvenation programme
0:32:05 > 0:32:09with new shops and all sorts of things.
0:32:09 > 0:32:12So, is this the place to buy? Well, it could be.
0:32:12 > 0:32:16This is the property that's up for auction at a guide price of £50,000 to £55,000,
0:32:16 > 0:32:20two-bed, mid terrace. Let's take a look inside.
0:32:20 > 0:32:22# Got a lust for life
0:32:23 > 0:32:25# Got a lust for life... #
0:32:25 > 0:32:28'First impressions of the exterior are favourable,
0:32:28 > 0:32:31'with lovely railings and brickwork.
0:32:31 > 0:32:34'In fact, the whole terrace looks in pretty good nick.
0:32:34 > 0:32:37'Let's hope it's not hiding a multitude of sins inside.'
0:32:37 > 0:32:39What have we got?
0:32:39 > 0:32:42A fairly standard layout so far, as far as I can see.
0:32:42 > 0:32:45I'd like to see that enclosed,
0:32:45 > 0:32:49a little porch is a lovely thing. It keeps the draught and the cold out.
0:32:49 > 0:32:52Put a door on there, perhaps. Apart from that, decent size lounge.
0:32:52 > 0:32:55At some stage, it's had an open fire. That's gone.
0:32:55 > 0:32:58It's been replaced by a lovely bit of Artex-ing(!)
0:32:58 > 0:33:01Replace that, I think.
0:33:02 > 0:33:05'Getting rid of that Artex is an absolute must
0:33:05 > 0:33:09'and, if you had the inclination, why not open up the fireplace?
0:33:09 > 0:33:12'It would give the room a lovely focal point.'
0:33:14 > 0:33:20Through to the kitchen and, well, it looks a lot worse cos it doesn't have anything on the floor.
0:33:20 > 0:33:24I'm sure if you put tiles down here and cleaned these units up,
0:33:24 > 0:33:28it would be OK. I mean, not ideal,
0:33:28 > 0:33:31but if you're going to rent it out, you make do and mend.
0:33:31 > 0:33:36One of the good things - there, you'd have expected to see a loo.
0:33:36 > 0:33:39It's not. It's been moved. Great.
0:33:39 > 0:33:43'Terraced houses like this originally had outside loos,
0:33:43 > 0:33:47'but around the 1970s, they started to be moved inside.
0:33:47 > 0:33:53'Back then, the trend was to put it in a ground floor extension, off the back of the kitchen.
0:33:53 > 0:33:57'But it looks like the bathroom here has been and gone,
0:33:57 > 0:33:59'leaving a great space for a utility or dining room.
0:33:59 > 0:34:02'Fingers crossed that means the bathroom's upstairs.'
0:34:02 > 0:34:04This is a fairly classic layout.
0:34:04 > 0:34:10Stairs in the middle of the house, and what was originally a bedroom one side and a bedroom the other.
0:34:10 > 0:34:13What do you do to get over the issue of the downstairs bathroom?
0:34:13 > 0:34:16You want to move it upstairs. How do you do it?
0:34:16 > 0:34:19I think they've come up with a good solution.
0:34:19 > 0:34:22They've converted part of the bedroom into the bathroom,
0:34:22 > 0:34:25then they've created this... a stud partition wall.
0:34:25 > 0:34:30A small corridor, which leads down to the second bedroom.
0:34:30 > 0:34:33This is the most effective way of getting your bathroom upstairs,
0:34:33 > 0:34:35but retaining your two bedrooms.
0:34:35 > 0:34:40'OK, so this bashed-up suite is beyond redemption,
0:34:40 > 0:34:43'but at least the bathroom's upstairs,
0:34:43 > 0:34:46'the plumbing's sorted and it's already partitioned.
0:34:46 > 0:34:50'A big saving on your renovation budget for starters.
0:34:50 > 0:34:53'Something else that may need attention is the ceiling.
0:34:53 > 0:34:56'A spot of damp is visible in both bedrooms,
0:34:56 > 0:34:58'so some roof work will be needed.
0:34:58 > 0:35:02'At a guide price of between £50,000 and £55,000
0:35:02 > 0:35:06'we asked a local estate agent to give us his thoughts on the place.'
0:35:06 > 0:35:10'It's a very popular location, all your amenities on your doorstep.'
0:35:10 > 0:35:13Quite a lot of work to be done, full scheme renovation.
0:35:13 > 0:35:15There's a few signs of damp.
0:35:15 > 0:35:18New kitchen, new bathroom, a full re-plaster.
0:35:18 > 0:35:21A few of the windows, you could possibly get away with a clean,
0:35:21 > 0:35:24but there's quite a bit of work to be done.
0:35:24 > 0:35:27'Is it an advantage, having the bathroom upstairs?'
0:35:27 > 0:35:33'The fact it's upstairs, they have sacrificed some bedroom space,'
0:35:33 > 0:35:34but it's a good sacrifice to make.
0:35:34 > 0:35:37'Is there demand for rental in this area?'
0:35:37 > 0:35:41There's a great demand in the area. Two bedroom terraces are popular
0:35:41 > 0:35:45and you'd look to achieve around about £425 per calendar month.
0:35:46 > 0:35:49'Once refurbished, what could it sell for?'
0:35:49 > 0:35:55Done up to a good standard, you'd be looking to achieve around £85,000.
0:35:57 > 0:35:59So, a nice enough little property.
0:35:59 > 0:36:01What do you think?
0:36:01 > 0:36:04Do it up, spend a bit of money on the kitchen and bathroom,
0:36:04 > 0:36:06and it'd be ideal for rental or a place to live.
0:36:06 > 0:36:09Let's see who spotted it at the auction.
0:36:14 > 0:36:17Vacant two bedroom terraced property, guide £50,000 to £55,000.
0:36:17 > 0:36:19Start this one at 55.
0:36:19 > 0:36:2355,000. Anywhere at... 55 bid, thank you.
0:36:23 > 0:36:2555... Sorry, 50, I have, tell a lie.
0:36:25 > 0:36:2650,000.
0:36:26 > 0:36:30Your bid, 50,000. Do I see 51?
0:36:30 > 0:36:3251, 52?
0:36:32 > 0:36:3352.
0:36:33 > 0:36:3551,500?
0:36:35 > 0:36:3851,500. 52?
0:36:38 > 0:36:4052,500? At 52,000, then.
0:36:40 > 0:36:42At 52. 52,500 now.
0:36:42 > 0:36:4353.
0:36:43 > 0:36:4553, 53,500?
0:36:45 > 0:36:49At 53,000, seated. It's going to be sold at 53,000.
0:36:49 > 0:36:5153,500
0:36:51 > 0:36:5453,500. Your turn, 54?
0:36:54 > 0:36:5754,000. 54,500?
0:36:57 > 0:37:00At 54,000, seated, for the first time.
0:37:00 > 0:37:04At 54,000, then, for the second time, are we all done?
0:37:04 > 0:37:0754,500. 55? 55.
0:37:07 > 0:37:0855,500?
0:37:08 > 0:37:1055,500. 56, 56,500?
0:37:10 > 0:37:1256,500. 57?
0:37:12 > 0:37:1457. 57,500?
0:37:14 > 0:37:18No. At 57,000, then, for the first time.
0:37:18 > 0:37:22At 57,000 for the second and final time, are we all done at 57,000?
0:37:22 > 0:37:25At £57,000.
0:37:25 > 0:37:28'It was Mohammed who got the property for 57,000.
0:37:28 > 0:37:31'He was at the auction with a friend, who did the bidding.
0:37:31 > 0:37:37'Mohammed owns a takeaway business and works as an area manager for a security company,
0:37:37 > 0:37:41'but has always hankered at trying his hand at property developing.'
0:37:47 > 0:37:51- Mohammed, lovely to meet you.- Hi. - Congratulations.- Thank you.
0:37:51 > 0:37:54- Tell me why you wanted to buy this place.- It's my ambition,
0:37:54 > 0:37:56to renovate a property,
0:37:56 > 0:38:01then, once I'm satisfied, try to sell it or rent it
0:38:01 > 0:38:04and see what is more worth.
0:38:04 > 0:38:07'This is his second property purchase.
0:38:07 > 0:38:11'He currently lives in the first house he bought and renovated,
0:38:11 > 0:38:14'but this is his first investment project.'
0:38:14 > 0:38:18It was just a hobby, you can say,
0:38:18 > 0:38:20you know, hobby, plus profession.
0:38:20 > 0:38:23So, do you see yourself as a property developer?
0:38:23 > 0:38:25Student of property development.
0:38:25 > 0:38:26THEY LAUGH
0:38:26 > 0:38:32It's a big field and you can't say you are anything and you have to keep learning.
0:38:32 > 0:38:34You can't learn without experience.
0:38:34 > 0:38:39Once you have experience, you can say either you done well or you learnt wrong.
0:38:39 > 0:38:42You need to have a start and this is going to be mine.
0:38:42 > 0:38:46So, why this place, then? Why did you choose this one?
0:38:46 > 0:38:49I have my place roughly two miles away.
0:38:49 > 0:38:52If I come back from my work at six or seven,
0:38:52 > 0:38:56still I can come over here for an hour or something
0:38:56 > 0:38:58and see what I can do here.
0:38:58 > 0:39:02I came here before buying this property, I looked around,
0:39:02 > 0:39:04not inside, outside.
0:39:04 > 0:39:07So you hadn't seen it inside before you bought it?
0:39:07 > 0:39:10Not properly, but...
0:39:10 > 0:39:12I had a little idea.
0:39:12 > 0:39:15What do you think, now you've seen it?
0:39:15 > 0:39:17It's more work than I suppose it will be.
0:39:17 > 0:39:20Trust me, I've seen much worse.
0:39:20 > 0:39:23I really have seen a lot worse.
0:39:23 > 0:39:27'Mohammed got off lightly here, though he may not think it.
0:39:27 > 0:39:31'But not viewing beforehand isn't the best way to start a property developing career.
0:39:31 > 0:39:35'Mind you, he's no stranger to the auction room.
0:39:35 > 0:39:38'Over the past years, he's been to quite a few.'
0:39:38 > 0:39:42- 22nd auction where I've been. - Huh?
0:39:42 > 0:39:48- This is the first time I've bought something.- You've been 22 times before and not bought?- No.
0:39:48 > 0:39:50- Just looking or went over your prices?- Prices,
0:39:50 > 0:39:54looking, getting an idea and all this.
0:39:54 > 0:39:56What are you going to do with it?
0:39:56 > 0:40:00What actually I want to do is I will try to do bits and pieces
0:40:00 > 0:40:02which I can do myself actually.
0:40:02 > 0:40:05Like the walls and all this stuff,
0:40:05 > 0:40:07which is quite easy.
0:40:07 > 0:40:11Obviously not, like, roofing and all that stuff.
0:40:11 > 0:40:15I have to hire a builder or something. But, renovation,
0:40:15 > 0:40:18I will be more than happy to do myself.
0:40:18 > 0:40:21I want to remove the chimney and all this stuff.
0:40:21 > 0:40:23That's a big job.
0:40:23 > 0:40:25Yeah, it will be a big job.
0:40:25 > 0:40:29So, OK, any idea how much it's going to cost to do the work?
0:40:29 > 0:40:36When I came first time, I was thinking it will be roughly 15 to 18.
0:40:36 > 0:40:42But, now, it can go from 16 to 20.
0:40:42 > 0:40:43Thousand pounds?
0:40:43 > 0:40:47Actually, at the moment, I'm not sure what the roof will be.
0:40:47 > 0:40:48If you see the upstairs,
0:40:48 > 0:40:51you can easily see there's water coming from the roof.
0:40:51 > 0:40:53So, first of all, the roof needs to be fixed.
0:40:53 > 0:40:57You don't have any water on your head.
0:40:57 > 0:41:00'Mohammed's right to prioritise fixing the roof.
0:41:00 > 0:41:05'He also plans a new bathroom and kitchen, so £16,000 to £20,000 should cover that.
0:41:05 > 0:41:08'He's been realistic with his timescale too.
0:41:08 > 0:41:13'Because it's his first renovation, he's giving himself six months.'
0:41:13 > 0:41:16And, if this is successful?
0:41:16 > 0:41:19If it's successful, I'll go for another one,
0:41:19 > 0:41:21cos I will learn from this place.
0:41:21 > 0:41:25Obviously the next time, I'll go with a lot of experience,
0:41:25 > 0:41:31with more things I can do better and stuff like that.
0:41:31 > 0:41:34Listen, congratulations, well done.
0:41:34 > 0:41:37- We look forward to seeing how you get on.- Thanks a lot.- Thank you.
0:41:37 > 0:41:41Well, Mohammed broke, of course, the cardinal rule.
0:41:41 > 0:41:44He didn't see the property before he bought it.
0:41:44 > 0:41:47As a result, there's more work needed than he anticipated.
0:41:47 > 0:41:48I don't think it's too bad
0:41:48 > 0:41:53and as long as he keeps a tight rein on his budget, there's still money to be made.
0:41:53 > 0:41:55Find out how he gets on later in the show.
0:41:58 > 0:42:01It's been a while now since we last saw those purchasers.
0:42:01 > 0:42:03Have they been busy bees?
0:42:03 > 0:42:06Or have they been stung and the projects ground to a halt?
0:42:06 > 0:42:08Let's go back and find out.
0:42:11 > 0:42:14'Time to head back to Gravesend in Kent,
0:42:14 > 0:42:17'where earlier we met finance director, Graham,
0:42:17 > 0:42:19'who worked for an elderly care charity,
0:42:19 > 0:42:22'who'd bought this detached property
0:42:22 > 0:42:25'and its sizeable plot for £180,000 at auction.
0:42:25 > 0:42:27'The site was ripe for redevelopment
0:42:27 > 0:42:32'and that's exactly what the non-profit charity intended to do.'
0:42:32 > 0:42:35What were your reasons for buying this house at auction?
0:42:35 > 0:42:40We own the property next door, which we're going to completely remodel
0:42:40 > 0:42:43or rebuild for elderly care.
0:42:43 > 0:42:45This house completes the site
0:42:45 > 0:42:51and enables us to put probably at least a dozen independent housing,
0:42:51 > 0:42:53affordable housing units on the site,
0:42:53 > 0:42:56which makes it all more viable and a complete site.
0:42:56 > 0:43:00'There were big bucks involved in this redevelopment,
0:43:00 > 0:43:03'with a proposed 4.5 million needed for the work.
0:43:03 > 0:43:08'With a timescale of two years, this project depended on getting funding
0:43:08 > 0:43:11'and planning before anything could start.
0:43:11 > 0:43:14'The heat's been on, but three and a half years later,
0:43:14 > 0:43:17'I can't wait to see how things have progressed.
0:43:21 > 0:43:24'Wow! The site is unrecognisable.
0:43:24 > 0:43:27'The former care home and house have been demolished and, in their place,
0:43:27 > 0:43:29'there's a whole complex of apartments.
0:43:29 > 0:43:32'Since Graham's now left to work elsewhere,
0:43:32 > 0:43:35'it's down to Ian, the charity's director of property,
0:43:35 > 0:43:39'to explain what looks like an ambitious change of plan.'
0:43:39 > 0:43:43You may notice we've demolished the house we bought from the auction.
0:43:43 > 0:43:47And we've built 56 apartments for older people,
0:43:47 > 0:43:51obviously not all on the site of the three bedroom house,
0:43:51 > 0:43:54but it's obviously quite a transformation
0:43:54 > 0:43:57and buying the house was integral to our plans,
0:43:57 > 0:44:00cos it's allowed us to develop what we've achieved here.
0:44:00 > 0:44:04'It certainly looks very welcoming from the outside.
0:44:04 > 0:44:08'Let's go inside and take a look around.'
0:44:15 > 0:44:18We've built 56 apartments.
0:44:18 > 0:44:23There are 42 one bedroom apartments and 14 two bedroom apartments.
0:44:23 > 0:44:26The one bedroom apartments are designed for two people,
0:44:26 > 0:44:30so they're suitable for a couple. Each flat, even the one-beds,
0:44:30 > 0:44:35have a separate bedroom, lounge, bathroom and kitchen.
0:44:35 > 0:44:40They meet the modern standards for older people's independent living.
0:44:40 > 0:44:43'Independent living is a key factor in the complex.
0:44:43 > 0:44:46'But it's hand-in-hand with 24/7 support, care
0:44:46 > 0:44:49'and companionship and a secure building.
0:44:49 > 0:44:54'It's all been carefully designed with its future residents in mind.'
0:44:54 > 0:44:57We're standing in one of our standard, two bedroom apartments.
0:44:57 > 0:45:00This is the kitchen, lounge, dining area.
0:45:00 > 0:45:01It's fairly spacious.
0:45:01 > 0:45:04It's been designed with a furniture layout
0:45:04 > 0:45:09to make sure you can get all the furniture you need in here and still access everywhere in a wheelchair.
0:45:09 > 0:45:13The kitchen is fully fitted out
0:45:13 > 0:45:16and we've made it very easy to change the units if we need to.
0:45:16 > 0:45:20We've got fittings in here, such as this advanced warden call system,
0:45:20 > 0:45:25which has lots of different attachments we can put onto it to meet people's needs.
0:45:25 > 0:45:28'But don't think of this place as a standard care home.
0:45:28 > 0:45:31'There are still quite a few surprises.
0:45:31 > 0:45:33'Anyone for a haircut?'
0:45:39 > 0:45:44We've got a hairdresser's, an on-site kitchen, a restaurant,
0:45:44 > 0:45:47shop, there's a health suite.
0:45:47 > 0:45:50There are smaller lounges around the building, so that residents
0:45:50 > 0:45:53don't have to come down into the central area,
0:45:53 > 0:45:57they can chat to friends and meet them on the floor they live in.
0:45:58 > 0:46:02'I'm sure these areas will nurture a real sense of community here.
0:46:02 > 0:46:06'It all seems much bigger than originally planned!'
0:46:06 > 0:46:10Originally, we were going to build a slightly smaller unit for each flat.
0:46:10 > 0:46:13We've increased the size of each unit,
0:46:13 > 0:46:17so now I think you'll find there are eight apartments on the site of the old house.
0:46:17 > 0:46:21It also allowed us to make the courtyard wider.
0:46:21 > 0:46:28We squeezed another two apartments over the central lounge areas.
0:46:28 > 0:46:32We've achieved ten extra, probably, through purchasing the house.
0:46:32 > 0:46:36'The timescale of this development was originally two years,
0:46:36 > 0:46:41'but raising finance for the new plans during the economic downturn,
0:46:41 > 0:46:44'plus some very bad weather, all held the building back.
0:46:44 > 0:46:48'However, once the building started, it took 18 months from demolition
0:46:48 > 0:46:50'to completion.
0:46:50 > 0:46:55'What impact has the bigger plan had on the original 4.5 million budget?'
0:46:55 > 0:46:58The building contract value was about £6.6 million.
0:46:58 > 0:47:02The overall spend as a development for us is about £8.3 million,
0:47:02 > 0:47:07including land purchase, fees, financing costs.
0:47:09 > 0:47:13'The flats will be let out at affordable rents to elderly tenants
0:47:13 > 0:47:15'on a local council waiting list.
0:47:15 > 0:47:20'The overall spend here is a whopping 8.3 million.
0:47:20 > 0:47:23'It'll be interesting to hear what two local estate agents
0:47:23 > 0:47:25'make of this exciting development.'
0:47:29 > 0:47:32All of the room sizes are well apportioned.
0:47:32 > 0:47:35Good sizes. All retirement homes do have communal areas.
0:47:35 > 0:47:40Here, it's been well apportioned and the quality is there to see.
0:47:40 > 0:47:45'The reality is, the market is poor on residential and commercial property,
0:47:45 > 0:47:47'basically down to the lack of lending.'
0:47:47 > 0:47:51The beauty about retirement homes is, quite often, lending's not required.
0:47:51 > 0:47:57The communal areas in this building have been spaced out quite nicely, so everybody's got their own area.
0:47:57 > 0:48:00The rooms have been decorated so they have a nice, homely feel.
0:48:00 > 0:48:04I've had a look around. It's very spacious, neutral decor
0:48:04 > 0:48:07and the kitchen is very well equipped.
0:48:07 > 0:48:13'If we were to treat this as a normal flat, what kind of rental could it earn?'
0:48:13 > 0:48:16If we treated this flat as a normal residential rental,
0:48:16 > 0:48:22we would expect to achieve around the £600 per consecutive month mark
0:48:22 > 0:48:24for a one bedroom apartment.
0:48:24 > 0:48:27For a two bedroom apartment,
0:48:27 > 0:48:30we would expect to achieve £725 per consecutive month.
0:48:30 > 0:48:36The rental price for a new build in Gravesend, which would carry a premium, because it's new build,
0:48:36 > 0:48:39would be £525 per calendar month.
0:48:39 > 0:48:43The two bedrooms, £675 per calendar month.
0:48:43 > 0:48:47Obviously delighted with those, cos they're a lot more than we charge.
0:48:47 > 0:48:50Obviously, being a charity, our rents are set a lot lower than that.
0:48:50 > 0:48:54Delighted that they've achieved a good market rate.
0:48:55 > 0:48:56'What about resale?'
0:48:56 > 0:49:00The one bedroom price for a retirement home locally
0:49:00 > 0:49:02would be £215,000.
0:49:02 > 0:49:05For a two bedroom, it would be £235,000.
0:49:05 > 0:49:10For a one bedroom, around the £220,000 mark.
0:49:10 > 0:49:14For the two bedrooms, we'd be looking at £235,000.
0:49:14 > 0:49:16I'm absolutely delighted.
0:49:16 > 0:49:20They're much better than we estimated before we started the development.
0:49:20 > 0:49:24Absolutely fantastic the charity has such a great asset.
0:49:25 > 0:49:29'What if the whole development was for sale? What could it be sold for?
0:49:29 > 0:49:35'Remember the total investment here is 8.3 million.'
0:49:35 > 0:49:39If they were considering selling the whole complex as a business,
0:49:39 > 0:49:44I think they would achieve around the £12-13 million mark.
0:49:44 > 0:49:48The price for the sale of the whole development - £12.5 million.
0:49:48 > 0:49:52Again, it just proves what a good development it was, worth the effort.
0:49:52 > 0:49:58It's just great they're low cost, affordable rent, but it's nice to know we invested our money wisely.
0:49:58 > 0:50:02'The charity has really done itself proud here.
0:50:02 > 0:50:07'They've potentially added value of between 3.7 and 4.7 million.
0:50:07 > 0:50:12'to a site that's been completely transformed for the better in three and a half years.
0:50:12 > 0:50:16'How does Ian think the project has gone?'
0:50:16 > 0:50:17It's been a good process.
0:50:17 > 0:50:20It's our first major development for many years.
0:50:20 > 0:50:24We're delighted the people of Gravesend who couldn't afford to buy
0:50:24 > 0:50:27this sort of accommodation can have access to it.
0:50:27 > 0:50:30It's a flagship project for us and a blueprint for the future.
0:50:34 > 0:50:38'Back to Bury in the northwest of England where we met Mohammed,
0:50:38 > 0:50:42'who bought this house at auction for £57,000.
0:50:42 > 0:50:45'He runs his own takeaway business and works for a security firm,
0:50:45 > 0:50:49'but has always been interested in property developing.
0:50:49 > 0:50:52'This was his first investment purchase.'
0:50:52 > 0:50:56- Do you see yourself as a property developer?- Student of property development.
0:50:56 > 0:50:57THEY LAUGH
0:50:57 > 0:51:03It's a big field and you can't say you are anything and you have to keep learning.
0:51:03 > 0:51:05You can't learn without experience.
0:51:05 > 0:51:10Once you have experience, either you done well or you learnt wrong.
0:51:10 > 0:51:13You need to have a start and this is going to be my start.
0:51:16 > 0:51:20'Worryingly, Mohammed bought this place without seeing it inside first,
0:51:20 > 0:51:24'as he didn't get time to see it before the auction.
0:51:24 > 0:51:27'When he got in, he discovered how much work it needed,
0:51:27 > 0:51:28'but this didn't put him off
0:51:28 > 0:51:33'as he planned to do some of it himself on a budget of £16,000 to 20,000.
0:51:33 > 0:51:35'We returned six months later
0:51:35 > 0:51:37'to see if Mohammed has managed to fix this place.'
0:52:02 > 0:52:07It was nothing here. And we put each and every bit and pieces here,
0:52:07 > 0:52:11like all the shelves,
0:52:11 > 0:52:16all the cupboards, worktop, sink. We hired a professional and he did it.
0:52:19 > 0:52:22'Out the back, well, it's not changed that much.
0:52:22 > 0:52:25'The ground floor extension off the rear of the kitchen
0:52:25 > 0:52:29'is now used as a storage area for building supplies,
0:52:29 > 0:52:32'so, no utility area yet.
0:52:32 > 0:52:36'Upstairs, a new bathroom's been installed
0:52:36 > 0:52:37'and is starting to take shape.
0:52:37 > 0:52:40'But there's still a lot of work to do here.
0:52:40 > 0:52:42'As for the bedrooms,
0:52:42 > 0:52:47'those cracks in the walls have been repaired and painted
0:52:47 > 0:52:49'and new floorboards and carpets laid.
0:52:52 > 0:52:57'Mohammed currently has house guests staying in the property while he finishes it off.
0:52:57 > 0:53:01'Did he run into any problems during the renovation?'
0:53:01 > 0:53:05There were a lot of difficulties, so we hired some people.
0:53:05 > 0:53:07Then we hired a professional as well.
0:53:07 > 0:53:10Slowly and slowly, it's almost done.
0:53:10 > 0:53:12Almost 90% of the work is done.
0:53:12 > 0:53:16I'm not in a rush. I want to complete everything.
0:53:16 > 0:53:21It's always good to do full work, before to rent out.
0:53:23 > 0:53:26'Mohammed did some of the easy jobs himself to help save the costs.
0:53:26 > 0:53:30'But for everything else, he hired tradesmen.
0:53:30 > 0:53:33'What is there left to do?'
0:53:33 > 0:53:39Still a few bits and pieces. Toilet needs to be tidied up,
0:53:39 > 0:53:42tiled up and all that.
0:53:42 > 0:53:46'His original budget was between £16,000 and £20,000.
0:53:46 > 0:53:50'Has he been a spendthrift or has he been on a spending spree?'
0:53:50 > 0:53:53There's no ending for the spending.
0:53:53 > 0:53:55But hopefully around 20.
0:53:55 > 0:54:01'£20,000 does seem rather a lot for a renovation on this scale.
0:54:01 > 0:54:04'Adding that to the purchase price of 57,000
0:54:04 > 0:54:07brings the total outlay to 77,000.
0:54:07 > 0:54:09Do two local estate agents
0:54:09 > 0:54:13think it's money well spent?
0:54:18 > 0:54:20First impressions - good rental property.
0:54:20 > 0:54:23It does want a bit of work on the edges. Bathroom, kitchen,
0:54:23 > 0:54:25little bit dated.
0:54:25 > 0:54:27But rental prospect, very good.
0:54:27 > 0:54:30If it's going for sale, I'd put a new kitchen in it, new bathroom,
0:54:30 > 0:54:32bit of decorating,
0:54:32 > 0:54:34tidy it up and it might sell quite well.
0:54:34 > 0:54:37You can clearly see there's been some subtle improvements.
0:54:37 > 0:54:41But I don't think enough to warrant an increase in price.
0:54:41 > 0:54:45By the looks of it, there's perhaps been some minor decoration,
0:54:45 > 0:54:47but, in reality, the things that counted -
0:54:47 > 0:54:50central heating, kitchen, bathroom -
0:54:50 > 0:54:54I don't think have been done to the extent they should've been for a profit.
0:54:57 > 0:55:02'Let's get down to figures. What kind of rental could you expect?'
0:55:02 > 0:55:07A property like this, in good condition, you could achieve in the region of £400 per calendar month.
0:55:07 > 0:55:09In the current condition,
0:55:09 > 0:55:13you'd look to achieve £400 to £420 per calendar month.
0:55:13 > 0:55:14Lovely!
0:55:16 > 0:55:17Yeah, fantastic.
0:55:17 > 0:55:23'Those rentals would give a tidy yield of around 6% to 6.5%.
0:55:23 > 0:55:25'That beats the banks hands down.
0:55:25 > 0:55:28'But what about the property's resale value?
0:55:28 > 0:55:31'Remember, total outlay here is around 77,000.'
0:55:31 > 0:55:35To put the property on the market in its current condition,
0:55:35 > 0:55:40I would recommend asking £65,000, with a view to achieving £60,000.
0:55:40 > 0:55:42In its current condition,
0:55:42 > 0:55:45I'd expect it to be selling for in the region of £60,000.
0:55:45 > 0:55:50'A resale value of £60,000 means Mohammed would make a loss
0:55:50 > 0:55:54'on his first investment project of £17,000.
0:55:54 > 0:55:59'So, there's no money to be made if he sells it in its current condition.
0:55:59 > 0:56:01'But all is not lost.'
0:56:01 > 0:56:05It's a good rental property, so I'd expect put it on the market to rent,
0:56:05 > 0:56:09put a tenant in it for a few years, then reap its capital value later.
0:56:09 > 0:56:12'Wise words. It's a trend we've become very familiar with
0:56:12 > 0:56:17'on Homes Under The Hammer, due to the current financial climate.
0:56:17 > 0:56:21'I think Mohammed has learned some valuable lessons on his first investment,
0:56:21 > 0:56:24'but will this be his last auction purchase?'
0:56:24 > 0:56:30I'll go back to the auction again and I will try to have a go again.
0:56:30 > 0:56:35This is the first try. I'll go for the next one as well.
0:56:35 > 0:56:37But not too soon!
0:56:39 > 0:56:44That's it for now. We'll be back next time with more action from the auction.
0:56:44 > 0:56:48Will the buyers make huge profits or a loss? Will you be jealous or relieved?
0:56:48 > 0:56:53- Find out next time on Homes Under The Hammer.- See you then.- Goodbye. - Goodbye.
0:57:14 > 0:57:17Subtitles by Red Bee Media Ltd