Episode 28 Homes Under the Hammer

Whether you are buying a home as a house or an investment,

you will want to make sure that you bought wisely.

It can be difficult to find,

but what you're looking for is value for money.

And one way we think you can find that is buying at auction.

From rundown flats to super semis to gorgeous sprawling mansions,

there are all sorts of properties on offer at auction.

Yes, and these are the properties that had our buyers

reaching for their chequebooks on today's show.

In Balham, South London, when I say compact and bijou...

You cannot be prepared for how small this space is. This is it!

Whereas, this two-bed bungalow in County Durham

seems to be getting bigger and bigger.

It starts out quite small and has had bits added on to it over time.

And in Mid Glamorgan,

I find an ex-miner's house in touch with its feminine side.

Now, I am all for a bit of colour, but is it really pretty in pink?

All these properties were sold at auction.

We'll find out who bought them and what they paid for them

when they went under the hammer.

It's yours, sir.

Today I am in Balham, Southwest London,

and it's time to dig out those flapper dresses and two-tone shoes -

we are taking a trip back to the 1930s.

A two-minute walk from Balham Tube Station,

and I am here to see today's auction lot.

It's in this eight-story beautiful Art Deco block.

And I can't wait to have a look at this one.

There is so much to tell you about.

So, get comfy because I'm going to investigate.

Investigate is the right word

because the building, with its Art Deco charm,

was actually used as the location for an episode

of Agatha Christie's Poirot.

I wonder if today's lot will exercise my little grey cells.

This impressive block was built in 1937

and it was described at the time as a magnificent up-to-date building,

providing distinctive accommodation.

Central heating, constant hot water, water softener

and a radio with a choice of two programmes were basic features.

Now, the water softener and the radio don't come with the property

any more, I'm afraid, but the central heating and the hot water does.

So, how much for a studio flat in this block?

200,000? 150,000 perhaps?

No, the guide was set at a very reasonable £70,000.

Great value for this part of the capital.

Mm. Period charm in a sought-after area of London,

so how come the price tag is so low?

Maybe I need the help of that funny little Belgian man.

Oh, my goodness.

Wow! The Art Deco features inside are just incredible!

It is such a beautiful, beautiful building.

You've got this wonderful sweeping staircase behind me,

these big pillars.

There is beautiful, stylised furniture over here.

This is the concierge service.

I am so excited.

I am going to go up and have a good look around the flat.

It's a great start for sure.

Up the sweeping staircase and it's not looking quite so grand,

but fingers crossed for the studio flat itself.

So, there's a bathroom...

and...

This is the main room?

Yes. This is the main room. Hold on.

Have I missed something?

You cannot be prepared for how small this space is. This is it!

Honestly, I am quite shocked.

But this studio used to be what they called the guest room.

It was actually hired by owners of flats for their guests to use

whilst visiting.

So they only had a bedroom and a bathroom,

which is what you've got here.

No need for a kitchen, obviously.

This was a later addition.

So you can see it is a sort of afterthought.

The layout here, it just does not work.

An overly large bathroom in there and a teeny tiny,

little kitchenette, which is - look - not even plugged in.

This whole space requires a serious rethink.

I am a bit disappointed internally, I have to say.

There is barely enough room to swing a kitten here, let alone a cat.

But I am not giving up on this one just yet.

Time to think Japanese pod living or railway carriage even.

First things first,

shrink the oversized bathroom down to the neatest of shower rooms.

Squeeze in a seriously compact and bijou kitchenette,

a fold-down bed perhaps and any other space-saving stuff

you can think of. And it might just work.

What does the local estate agent think?

My personal thoughts on it are

that it would probably be better as a rental investment

than someone who is going to be living there full time.

It would be ideal for somebody who, say, travels a lot,

or comes up to London for work

and just need somewhere to stay for the night,

somewhere safe and secure, which it is here, obviously.

Someone living there full-time, I'm not sure that it's perfect.

How could you fit the place out to make most of it?

On the subject of furniture, I think you haven't much room

for anything other than what you'll be sleeping on.

So, look out for a really attractive day bed or sofa bed.

You'll have the kitchen area there. You don't need a table or anything.

You could put a television up on the wall.

And a chair for a guest.

OK, and what kind of rental income might you be looking at

for the flat?

This property would expect to achieve in the region of £650 to £675

per month.

And if the purchaser were to do the flat up and sell it on?

When renovated,

I would suggest marketing this property in the region

of £120,000 to £125,000.

It certainly is a compact studio, to say the least.

It requires a layout rethink,

but this building has got bags of charm and I think I love it.

It's tiny, but is a great one to go for.

Let's see who agreed with me when it went under the hammer.

That brings us now to lot 105.

Second-floor studio flat.

Who'd like to get me started on this?

100,000 anywhere?

How about 80, then? Let's give it a bit of discount.

80,000, should be cheap enough.

I wouldn't go too much lower than that.

Thank you. 75. Let's start with... 75, I've got.

Thank you. 76.

77.

78. 79.

80,000. 81.

After a slow start, bidding did get going and the price crept up

over the £100,000 mark.

With you.

103 for the first, 103 for the second,

103 for the third and final time.

All done? How much? 104?

Both together, yeah? 104.

105.

106.

107. No?

106 for the first, 106 for the second,

106 for the third and final time.

All done? Sold, 106. Well bought.

The man who snapped up this slip of a property for 106,000

was Girish, who attended the auction with his son, Prasun.

# All the small things

# True care truth brings... #

This was their first ever time at a property auction

and they bought the flat as a means of propping up Girish's pension.

I met up with the father-and-son combo in the lobby

of the building, as the flat was just too small for us all.

-Girish and Prasun, congratulations.

-Thank you.

So, it here we are in this amazing building.

You bought your studio flat.

-Did you see it before you bid for it on auction day?

-No, we didn't.

What happened was we saw the document that came out.

It was 186 pages.

And I was reading through it

and I sort of got tired halfway.

But I read the essential bits.

It was 150 year lease on it.

I did a little research on the building

and it turns out the building has a really nice history.

So we took the risk with that when we got to auction, I think.

So, Girish,

what did you think when you saw this place for the first time?

Were you excited?

Oh, yes, of course.

I never had seen such a big property before.

That was impressive.

Very impressing.

But then I'm sure the fun stopped when you opened your front door.

I saw the plan beforehand, one side,

and we... It said kitchenette in the catalogue.

But we couldn't figure out where it would be.

So we thought surely it couldn't have been in the studio itself,

but when we actually went in, there was a big, unconnected kitchen sink

just built into the wall.

So initially, were you disappointed?

We were. We were a little bit scared that we overpaid for the property.

But we talked to our estate agent and he assured us

that he has sold properties for more.

Or very close to what we paid for it.

So, we were...sort of... That calmed us down a little bit.

Sounds like Girish and Prasun will have to be economical with space

and their budget on this one

if they want to make a decent return on their investment.

-So what are your plans?

-We have very little space,

but we'll try to make the most of it

and work to a really high standard.

There needs to be a kitchenette

and the bathroom is unusually big.

So our plan is to take half the bathroom and turn it into a kitchen.

Instead of the bath that is currently there,

-we are going to put a shower tray in there.

-What is your budget?

-£5,000.

-You'll be knocking a few walls down, aren't you?

Or just creating a bit more space.

You're going to probably need permission to do something like that.

Yeah. We have talked to the office.

They have an in-house office where we have access to the freeholder

quite easily.

So we are going to submit the drawings.

We should get the drawings back and, as soon as we do,

we'll start the work and start knocking the walls down.

£5,000. Girish, what is the timescale?

About four weeks.

Are you going to be letting it or selling it on or don't know?

We don't know yet.

We'll decide after we've done it up, made it look nice and livable.

Well, it will be great to see what they do here.

But I can't help thinking Girish and Prasun would have

passed this over if they had actually looked around the studio

before buying.

Do you now regret not doing as much research as you should have?

Not regretting, but I would say a different way, that

we got a first time buy, first time auction entry.

And now we have learned.

Guys, good luck with everything.

I am really excited for you.

-Girish.

-Thank you very much.

-Thank you.

-Thank you.

Timescale, four weeks. Cash, £5,000. Really?

OK, so it's not huge inside,

but there is quite a bit of work to do before it is ready.

But what will they do with it once it's complete?

Rent it out? Sell it on?

Will the new owners think it is a little bit small to live in?

Let's wait and see what happens. You can find out later in the programme.

This is the little market town of Crook in County Durham,

about ten miles from the city of Durham itself.

It is a pretty little spot surrounded by lovely countryside

and, you know, just what you need, really.

It is just what you may need.

Nestled amongst this beautiful countryside, it has got a good mix

of new and older properties. It is home to Crook Town Football Club.

There are some great specialist shops and it lives up to its claim

of being a market town by having two markets a week.

# I found that warm embrace

# At the marketplace... #

Well, not far from Crook Town Centre is the property I'm here to see.

Built around the 1800s, it is a two-bed bungalow

at a guide price of 85,000 quid.

The first thing I notice about it, nice big front garden.

Let's hope it has got a bit of character inside.

The garden at the side shows the bungalow's a bit of an odd shape

and there is no garden at the back, so what you see is what you get.

So what have we got? Nice high ceilings.

I didn't quite expect that.

It has a good feeling of space,

but straight from outside into your living room.

Obviously, cold air coming in.

Try and maybe put a porch on that to sort that out perhaps.

But main living room here and I guess

that's your bedroom, or one of them, there.

And through to the rear of the property.

I say, because it's kind of a bit strange.

There is the loo there, the second bedroom there and then through

this little corridor into what is actually a decent-sized kitchen.

Although, I noticed from the outside,

this has got a flat roof, which isn't ideal.

So, obviously an extension.

The whole feeling of this property is something that has started off

quite small and has had bits added onto it over time.

I mean, look, there's little sort of... What's that?

A little storage area there, or a larder.

It really needs you to...

I guess, in an ideal world, look at all the internals, just leave

the exterior and really sort it out into a more practical design inside.

# A design for life... #

If the buyer did decide to leave as is,

then all the rooms are a decent size,

they just need some modernisation.

But I think the layout could be so much better.

The building definitely has development potential.

There may be something that could be done with that garage to create

even more floor space.

With a guide price of £85,000,

it could possibly be a great little investment.

However, it was sold at auction under what is called Option Two.

What does that mean?

Well, we invited along a local property expert to explain.

This particular property is being offered

under the Option Two of the auction,

which means that the buyer will put down a £3,000 deposit

on the property,

have 28 days to exchange a contract and a further 14 days to completion.

This means that the buyer would have to do

their own homework on the property prior to making their bids.

In a more conventional auction,

i.e. under Option One, buyers would put down a 10% deposit and exchange

on the fall of the gavel.

Option Two is aimed at enticing new buyers into the market.

However, legal packs aren't usually available until after the auction.

Checking the property out thoroughly is

the prospective purchaser's responsibility

If you are contemplating buying under Option Two,

it is worth checking with the auction house

that you understand what this entails.

With that aside, first impressions?

The property has been owned for a long time by the same family

and now requires internal updating - refurbishments through the kitchen

and bathroom and such.

What could be done to improve this property?

The property itself is on a limited plot. There is no rear garden.

So it would need to be either a side, front or upward extension.

Probably make it into a dorm room bungalow,

removing the garage, in my opinion.

Given these possibilities,

how much can an investor expect to achieve if it was rented out?

Once the property is renovated, I imagine you'd be able to achieve

somewhere in the region of £500 to £550 per calendar month.

And if the renovations were realised,

how much could it fetch if sold on?

If you put the property on the market

as a newly converted three-bedroom property,

then I'd suggest a recommended asking price in the region

of £125,000 to £130,000.

Well, it is clearly in need of some major refurbishment

and certainly it needs some work on the layout, for sure.

But I think, spend that money on this place

and you've got yourself a decent little property.

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

We are going to move now to lot number 27.

It is an individual period detached bungalow,

a few minutes' walk from the centre of Crook Town Centre.

I need 80 to start. 80,000 bid.

We have got off the mark with £80,000.

Do I have anything further than 80,000?

I've got the one bid of £80,000. 81,000.

Back over to you for 82.

It's at 81,000, sitting down.

Any further in the room? It's £81,000.

82 bid for the gentleman standing. 83.

84. 85?

I've got £84,000.

Anything further? You are both out at 84. I'll take a half.

At £84,000, we're going to sell.

Selling once at 84.

I will take 500. The second at 84.

Sold for £84,000 to the gentlemen standing.

It was a clearly very delighted Ian who got his hands

on this great little bungalow for £84,000,

£1,000 less than the guide price.

Ian lives just around the corner

and is a dental technician with a small portfolio of buy-to-lets.

But this bungalow will be a new home for him

and his 13-year-old son, James.

I caught up with Ian to hear about his plans.

-Ian, lovely to meet you.

-Pleased to meet you.

-Congratulations.

-Thank you.

-You look quite excited to win it, actually.

Well, I didn't expect to get it as cheap as I did.

I don't know what your valuations are, but I expected it to go higher.

-Half the time I didn't expect to get my hand up.

-Really?

-Yeah.

You had a bit of a whoop in the air, didn't you?

And you bought it under Option Two, didn't you?

Which is quite a special thing for this area in lots of ways.

I can see the benefits of it.

What do you understand are its benefits and how is it for you?

It gives you more time to pay and complain.

But to be honest, I don't think the solicitors have a lot of work on,

so we have completed in a similar time to

-what it would have been if it were the other option anyway.

-Right.

But you bought it without the access to a legal pack,

so you didn't know some of the specifics of that.

Did anything come to light?

Not really. I think you take a chance, don't you?

You pay your money, take a chance.

Ian was lucky in this instance not to have any nasty surprises

waiting for him after the auction,

although he would've had 28 days to retract his offer

if there was anything he was unhappy with.

That would have lost him his £3,000 deposit, though.

So do remember that if you are thinking of purchasing an Option Two

auction lot, that you really must do your homework prior to the auction.

But then, of course, that always goes for buying at auction,

full stop.

Tell me a bit more about you, what do you do?

I'm a dental technician, I've done that for 30 years.

What does that mean you actually do?

-Basically, I mend and repair and make false teeth.

-Oh, right, OK.

-Great.

-There is a local dentist here.

-OK, so locally?

-Yeah.

-Fantastic. Do many people have false teeth these days?

-Less and less.

That is why I've diversified into property.

Right. Less dentures and more into rebuilding houses

-than people's teeth.

-Yeah, exactly, yeah.

So, tell me what you'll do to sort it out.

Well, I have a few different plans,

but I think, with planning permission,

if I get planning permission,

I might take that bedroom out there and build a lounge in that area

-and then make the garage, this and this into bedrooms.

-Oh, wow!

I thought about moving the bathroom into the corner of the kitchen

and using this other area as a kitchen.

It doesn't sound like there's going to be many rooms left

as they are at the moment.

It depends on planning permission.

If I get problems, I might have to leave it the way it is, but

the main thing is get a dishwasher in cos I don't like washing up.

-HE LAUGHS

-All that to get...

There's no dishwasher, that's a big...

Elaborate plans to get a dishwasher.

Why didn't you just buy a bigger house or a house that was

a different design rather than buy this and have to do all that to it?

Well, I think I get a better quality thing for less money.

He'd like to get the work done for less than £20,000.

Apart from getting tradespeople in for the important jobs,

he'll do most of it himself.

But a major reconfiguration like this isn't for the faint hearted.

So, what kind of experience do you have in property?

Well, I bought one in auction...

What? In 2000.

I never really bought anything since then because the prices went up.

But... Oh, and I bought a building that I made into a pub

three years ago, which is now a bank.

-You kind of almost forgot that. Isn't that quite significant?

-Yeah.

Well, actually, it's more business then residential, isn't it?

-So, you own a pub?

-Yeah.

-Oh, great.

Well, I put a manager in, but I work a few shifts.

I've learned the ropes a little bit myself.

Right. You do diversify, then.

Making false teeth to pouring pints to building properties.

That's right, yeah.

He is certainly keeping a few fingers in a few pies.

But this property isn't a business venture,

it is going to be his new home.

So how long will it take before he can move in?

-What about a timescale for doing it?

-Well,

it depends how fast I can get through the planning, I think.

If I can get through the planning, get the planning all done,

I can start next week stripping the paper off.

Have a look, see if it needs any damp work doing, things like that.

-Well, congratulations anyway. Good luck.

-Thanks.

I hope it turns out to be

-a successful project for you.

-Thanks a lot.

Well, dental technician Ian seems to have the palate to take

this project on, but will he find more decay than he expects?

Will it be a bridge too far? Or will it we the crown

in his property portfolio?

Ahem.

You can find out later in the show.

Coming up, in Mid Glamorgan, Wales,

three floors mean three times the problems.

The list could go on. What is down here?

Uh-oh!

In Crook, County Durham,

it looks as though Ian has got all of his renovation priorities right.

I've got a dishwasher, so I don't have to do any washing up.

But first, back in Balham,

were any lessons learned from this first auction purchase?

I suppose we could, next time, go and see the property.

Back now to Balham, Southwest London,

and this Art Deco block where Girish and his son, Prasun,

bought this teeny-weeny studio flat at auction for 106,000.

While the building has been used as a location for Agatha Christie's

Poirot, there was no great mystery about what needed doing here.

We are going to take half the bathroom

and turn it into a kitchen.

Instead of the bath that is currently there,

we're going to put a shower tray in there, which is probably

what a young professional will need.

With a £5,000 budget and a four-week timescale,

there wasn't much wiggle room on this one.

Three and a half months after our first visit,

we're back to see what has become of the studio flat.

# Tiny bubbles make me warm all over

# With the feeling that I'm gonna love you till the end of time... #

Well, with Girish overseas, his son, Prasun,

has been overseeing the work on the flat.

If you remember, there used to be a door here.

We took the door and the frame out in order to give it a feel of space

and, you know, sort of freedom, you know, not so constricted.

Secondly, there was another wall around this way,

with a door in there, and we removed the whole wall.

The bath which used to be behind the wall,

that got removed, which gave us all this space free.

Then we put a pocket door to divide the kitchen,

which we made from scratch. There was no kitchen here before.

So, you know, it's really made a big difference

in doing what we've done.

But below the Art Deco-inspired surface,

there has been quite a bit of remedial work done here, too.

The plumbing needed a complete overhaul.

All new electrics have been put in. Complete new plaster and paint.

So that's...

It had to be done and it was done.

Then there was the sourcing of the neatest of stuff

to put into the flat.

The compact kitchenette is the model of minimalist ingenuity.

And although the sliding pocket door into the bathroom

cost £600, it does its job pretty well.

Let's see that smooth sliding action again.

So, is Prasun happy with the end product?

I am very, very happy with it.

My dad, I sent him the pictures.

He is abroad at the moment. I sent him the pictures and he was ecstatic.

Obviously, we have heard from my estate agent. He loved it as well.

So we have had good feedback already.

We have had a lot of interest in it, so what more can I ask?

Parsun's team was delayed in starting the work,

but they did manage to get everything done

within the four-week timescale.

How about the budget?

We were hoping to spend five grand.

Unfortunately, due to some delays and the new electrics

and the specialist equipment that we needed, we went over budget.

But again, we are quite happy with that. It was £7,500.

We were more than happy to spend that.

£7,500 on top of the purchase price

of 106,000, brings the total outlay here to £113,500.

The day before filming,

Prasun put the flat up for sale and for rent to test the water.

We asked along

two local estate agents to get there take on the place.

Very contemporary feel. It has been modernized to a good standard.

We would have potentially either a lot of first-time buyers

or investment buyers looking to increase

their portfolio of properties.

So, yeah, it has been done very well.

It looks really nice and clean and bright.

But I am a little bit disappointed. I think I had hoped to see something

a bit more inventive done with the space.

Mixed reactions there. But can they agree on a sale price?

I would recommend marketing this at 125,000, 130,000,

with a view to getting in excess of 120,000.

If I had to put the property onto the open market today,

I would probably anticipate putting it on in the region of 125,000

to £130,000.

I think that is quite low.

We have already put it on the market speculatively for over 135, 140.

And we're already getting some sort of interest on it.

And, again, it's been less than 24 hours.

So, we're happy with the purchase.

Even at those prices, I think we have done quite well.

So, I am quite happy anyway.

If you're happy, we're happy, Prasun.

The estate agents' valuations mean a profit, before fees

and expenses, of between £6,500 and £16,500.

What about rental figures?

In terms of rental income, per calendar month, I'd be looking

to achieve a rent of somewhere in the region of about £600.

On the rental market, I would expect this to achieve

in the region of £600 per calendar month.

I think they are quite a bit low.

We've gone with an estate agent that is getting us

viewings already for over 750, so, you know,

we are quite happy with the estate agent we've gone with.

In fact, since filming, they rented the flat out for £780 a month.

But before they move on to the next auction property,

what have they learned from their first?

I suppose we could next time go and see the property.

But, you know, we haven't regretted anything we've done so far,

so if we had to do it all over again, we would.

I have travelled to Wales today and the auction property I'm here

to see is in a small village, and it is called Penrhiwceiber.

Now, the village has all the amenities you would expect

plus it is well-connected.

It's only 18 miles from Cardiff and there is a train station,

so we are definitely in commuter territory.

Oh, and one more thing, the average three-bedroom property

in the village costs just over £70,000.

Perfect!

You're never far from the mining heritage of this part of Wales.

Today's property is a little slice of that history, too.

These Victorian terraces were built for miners' families 150 years ago

from locally quarried stone and grey slate.

And one of them is today's auction property.

It is this one here.

Now, I am all for a bit of colour, but is it really pretty in pink?

I think I'd change that. It won't suit everybody's tastes.

But the guide price will probably appeal to everybody.

It was set at just £27,000.

That guide price is seriously low,

low enough to set an alarm bell ringing, I'm afraid.

Just what is lurking behind that pretty pink exterior?

And it is how I imagined on the inside.

It needs a lot of work.

Terribly dated wallpaper,

but you have got a really good-sized reception room.

In fact, it is all quite spacious,

which is making me think this could be a potentially good buy.

Look at this. A second reception room.

Again, lots of light coming in here.

It does need some work.

You need your carpets, the walls need doing, the list could go on.

What's down here?

Uh-oh!

Down the stairs

and it looks like we've run into the start of a new mineshaft.

# Working in a coal mine Going down, down, down

# Working in a coal mine Oops! About to slip down... #

In all seriousness, this was the old coal store

and needs a bit of work to make it a dry, usable space.

And there's more on this lower ground level.

There is also the kitchen, which is a decent size,

the only bathroom in the property and a rather rickety lean-to porch.

It's a decent space, but it's all worryingly damp down here.

Pop outside to the steeply sloping garden, look back

at the property's three levels and you can see it is going to be

quite a trek from the bedrooms at the top floor down to the bathroom.

So you may want to think about moving the bathroom upstairs.

That's going to cost.

# Back to nature... #

Up on the first floor, there are three bedrooms.

They're not huge and you might have to sacrifice one

to move the bathroom.

But for me, there is a more pressing concern.

Mm, there are signs of damp everywhere in this house!

It's not ideal. But it doesn't have to be a deal breaker either.

In many cases, damp is the result of poor maintenance.

And that's usually quite easy to rectify.

If there is a damp patch visible inside the home,

the cause can usually be identified from an issue on the exterior.

Time to investigate further.

# There's just one thing that I just can't stand

# I can't stand the rain I can't stand the rain... #

It looks like someone has tried to use a bit of lead to patch up

some broken tiles, and it looks like a rather botched job.

I would say fix or replace that

and you'll be some way to solving the problem on the inside.

The mid-terrace went to auction with a guide price of 27,000.

We asked a local estate agent for his thoughts.

What would he do with the property?

If I was to keep this as a home, I would definitely consider

transforming this into a two-bedroom house by moving the bathroom.

If I was to keep it as a rental property,

I would leave it as a three-bed to maximise the rental return.

If the purchaser leaves the layout as it is,

what kind of rental income might the mid-terrace achieve?

If it was left as a three-bed property, I would estimate

a rental value of £375 per calendar month.

And again, if they left the bathroom where it is, did the property up

and sold it on?

If the property was fully refurbished,

I would as estimate a value of between £50,000 and £55,000.

The damp issues and the amount of work required here

will no doubt put people off,

and there is the added headache of the lower ground floor bathroom.

Now, this property, I think,

is crying out for a second loo facility up there.

Renovating this is not going to be quick

and it certainly won't be cheap.

But somebody wanted it.

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

All right, we go on to lot number 19 now then, ladies and gentlemen,

which is the three-bedroom mid-terraced house.

Who has 30,000 to start me?

Can I see 30 for it?

25 then, let's get on. Five is bid, thank you. At 25,000,

this is no money for it. At 25,000. And six?

At 25,000, all done then?

Is it a bid on six? Thank you.

At 26, bid. At 26,000.

Seven now? At 27, thank you. At £27,000. At 27.

Half, is it now? At 27,000, half. Fresh bidder at 27,500.

Eight if you like. £27,500.

Eight if you like. Is it eight? Thank you. At 28.

At 28. Half bid. At 28.5, I took it in the back.

At 28.5. Can I see nine quickly?

Still... 29, thank you.

At 29,000, you are out on my right. At 29,000.

There is the bid, make no mistake, I'm selling all the time.

Half if you like.

At £29,000... It's yours, sir. Thank you very much.

That successful bid of £29,000 was placed by Cardiff-based Alex,

a project manager, and his partner Adele, who is a doctor.

I met up with a couple at the property to find out

why they went for this particular mid-terrace.

# We could've had it all

# Rolling in the deep... #

Guys, congratulations.

-You must be so pleased you won this on auction day.

-Yeah.

What is the story behind you buying this? Are you property developers?

We're starting out as property developers.

We did up our own house last year and were quite successful

and had it valued. So we decided to come to auction.

We got this property in the end.

So, Alex, when the hammer went down, and you knew you'd won it,

what happened?

We went to the auction and we didn't think

we were going to buy a property,

we just wanted to go to the auction and see what it's like.

We ended up putting a bid in and we got it.

Adele was grabbing me by the arm, saying, "Oh, my God, we've got it."

And I have to get on camera, I'm shaking and sweating.

So, wait a minute, let me get this straight,

you weren't intending to buy this on that day.

-You went for a little auction rehearsal.

-Yeah.

-Yeah.

You thought, "We'll just see how it goes."

-But you ended up spending £29,000.

-That's right, yeah.

Well, we went prepared with the things to get it, if we did,

but we didn't think we'd actually get it.

So, Adele, what sort of research did you do before you bought

this property?

Well, we didn't actually come into the property,

but I spoke to the estate agent who had it on and looked

at the pictures there and asked him what sort of work it had done to it,

asked about the electrics, asked about the plumbing,

what sort of work it needed doing, from that point of view.

He let me know that the electrics were quite new,

they had a new plumbing system installed,

so I thought that all sounded pretty good.

-Did he remember to tell you the state it was in?

-No.

He didn't tell me quite how bad the damp was downstairs.

But you just take a gamble sometimes.

-So, you really were prepared to take a rather huge risk?

-Yeah, we were.

-Even though the guide price was temptingly low?

-Yeah.

You have come unstuck a little bit now, I'm sure you've seen that.

Yeah. It's a bit more than we thought, isn't it?

Yeah, it's a bit more, but it's still within our budget,

so we are not too bothered by it.

We're going to do a lot of work ourselves.

By not viewing their first investment project beforehand,

Alex and Adele did not give themselves the best chance of success here.

There is just loads of work to do.

They have got a budget of between 7,000

and 8,000 and a timescale of between two and three months.

But they do at least seem to have property developing in their blood.

I work in construction myself as a project manager,

so I work in property.

Adele's father does property development and helped us.

So we've both got an upbringing in it, so we'll see how it goes.

-Is this what you'll be doing full-time?

-No.

I work full-time as a doctor at the moment.

-So you're a doctor!

-Yeah.

But you love property more, by the sound of things.

Well, I love the job that I do,

but, but this is like a hobby that I love doing,

sort of a de-stress hobby.

Oh, I love that coming from a doctor! A DE-STRESS hobby.

-So, for you, this is somewhere where you can unwind.

-Yeah.

-For most people they get more stressed than ever.

-No.

I love doing it, honestly. Haven't I been happier since we bought it?

She has been bored for a year doing nothing and I have to put up

with it every evening, saying, "Let's do something."

So we're doing it now.

She sat at home yesterday with a big smile on her face from working

all day.

Oh! What's it like working with Alex? Is he a great...?

Is he a good hands-on guy?

No. I am so much better in work,

but when it comes to getting your hands dirty, she is so much better.

On her own, she did all the tiling, built walls,

bossing all the electrical people about, and I just let her do it.

And she enjoys it.

I'll get my hands dirty when she tells me to do it.

Hold on a minute, you're supposed to be the project manager.

-I know.

-What's going on with you two?

I seem to do better on bigger projects, which I run.

I can't do the refurbishment projects, and she does it herself.

-So, it keeps her happy.

-So what do you think you bring to the table?

I actually organise a lot of stuff and deal with people and then Adele

does all the designing and, I don't know, the hard work, really.

I'm there digging out floors, knocking walls down

and Alex will drag an old bucket up the stairs or something.

-Is that really how it is?

-Yeah.

-Yeah, it is.

She was shovelling the other day and I was taking everything upstairs. It shouldn't be that way.

# Cos to my mind She's my kind of girl... #

Well, however they divide the labour,

Alex and Adele are opting to leave the layout as it is.

That is probably wise, given their fairly tight budget and timescale.

Their plan is to sell the mid-terrace on.

If they can keep their total outlay to under 40,000,

they could be looking at a pretty healthy profit.

What are you going to do

to really turn it around and make this place worthy of that price?

I just think making it modern.

We obviously need to take all the wallpaper off,

just make sure the walls are skimmed, everything looks clean,

painted all white, put new carpets down, laminate flooring downstairs,

modern kitchen, modern bathroom.

Just make it all up to date, modern, that someone just walks in

and thinks that this is really nice and just buy it.

We are hopeful that it's not needing any major work.

That could smash our budget really.

Is there anything you are worried about?

-Not really.

-No, not really.

We're quite enthusiastic

about doing it and taking on a challenge with it.

-I'm not worried about any of it.

-Guys,

I'm looking forward to seeing the outcome. Congratulations.

-It's been lovely to meet you both.

-Thanks.

-Thank you.

So, Dr Adele needed to find a way to de-stress.

And so she thought she'd buy herself a property that required

a total refurbishment.

Mm. Joking aside, buying blind is never ideal.

A viewing is vital,

especially when it's your first investment purchase.

Well, I have given them a telling off,

but let it be a lesson to you all.

This has had budget implications

and now they may not make the profit they had hoped for.

How are they going to get on?

Join me later on in the programme and you can find out.

Well, the clock has been ticking

and work should be well underway with our properties.

Have those piles of dusty bricks and bags of cement gone?

Is the paint dry on the walls?

Let's find out.

Back now to Crook, in County Durham, where Ian had bought

this two-bedroom bungalow at auction for £84,000.

He is a local dental technician,

who has diversified into property development and also owns a pub.

He had a budget of £20,000 and a timescale of around six months

to turn the bungalow into a home to enjoy with his son, James.

And the dental technician really wanted to get his teeth

stuck into this one.

Take the bedroom out there and build a lounge in that area.

-And then make the garage, this and this into bedrooms.

-Oh, wow.

Then moving the bathroom into the corner of the kitchen

and using this other area as a kitchen.

It doesn't sound like there's going to be many rooms left

-as they are.

-Well, the main thing is get a dishwasher in,

because I don't like washing up.

HE LAUGHS

Well, 16 months after our first visit, we're back

to see if Ian and his son, James,

are smiling from ear to ear

or did they bite off more than they could chew?

Now, I know that Ian had big plans, but I wasn't quite expecting this.

The garage is moved, there is a brand-new porch, and what a porch!

And the roof has been replaced.

And we haven't even seen inside yet.

The old sitting room has become the first of three bedrooms,

which you now enter from the newly extended corridor.

And the bedroom that was off the old sitting room is now part of

an enormous kitchen-living room.

The bathroom and the old larder have been knocked into a bigger

and brighter bathroom.

The bedroom opposite the bathroom hasn't changed much,

but there is access to the new garage next to that.

And the old kitchen is now a bedroom with en suite.

It's quite a transformation

and very different to what Ian had initially planned.

But it has all been possible

because he managed to increase the size of the plot.

The land to the rear of the property, we purchased that land.

The man was willing to sell us it.

We've used that land to build a kitchen,

which I think was a wise decision.

# Doo, doo, doo, doo Da, da, doo, doo... #

It's a great space and certainly makes a big difference

to the bungalow.

But extending out the back has not been completely straightforward.

We had to buy this land at the back of the property

because the soil was this far up, so it was creating damp.

So with having to buy the land,

we thought we might as well utilise this as a patio area and garden.

So, we put patio doors in and we build a kitchen extension

on the land to save knocking the little bedroom down at the front.

So I think it's made a really good job of it

and made a better property of it at the end of the day.

While there is still a bit to do to finish things off,

this looks like it's going to be a lovely home.

Ian's son, James,

seems pretty pleased with his new en suite bedroom, too.

# And I gotta see your sweet sweet smile every day... #

What does Ian like best about the bungalow?

I like the big kitchen.

I like the big bathroom.

I like the porch from the outside.

One of my friends just bought a porch and I say,

"My porch is better than your porch."

I've got a dishwasher, so I don't have to do any washing up.

Well, it sounds like a clean sweep for Ian.

He did plan to take six months to renovate the property,

but the goalposts shifted and the extra work here

accounts for the delay.

But what about his £20,000 budget?

I would say I've absolutely lost all sight of that.

The main reason was I paid 11,000 for the extra piece of land

and I finished it off to a higher standard.

So, the real budget is about 40 grand more than what I anticipated,

but I'm still happy. I'm OK.

Ian's budget of around £60,000

takes his total outlay here - including £84,000 purchase price -

to around £144,000.

So, has this been a canny investment?

We invited along two local property experts to hear their thoughts

on the bungalow.

He has done a fantastic job in refurbishing.

I think the key to it was all in the purchase of the rear garden

to give itself extra scope to go backwards as well as forwards.

I really like the size and layout of the property.

There's a good kitchen with working space in there.

The bedrooms are decent sizes. And also the bathroom is quite big.

Ian does plan to live in the bungalow,

but if he were to think about letting it out, the experts

suggest a rental of between £575 and £595 per month.

That's a yield of just under 5%.

But what about the resale value,

bearing in mind Ian's total spend of £144,000?

I would put it on the market at £185,000,

hoping to get in the region of £175,000 to £180,000.

In the current climate, I would suggest placing the property

on the open market for a price in the region of £190,000.

That has got to bring a smile to his face.

If Ian sold the bungalow,

he could be looking at a potential profit of between £31,000

and £46,000 before the usual fees and expenses.

Does that change the way he feels about the project?

I am very happy with the property.

I am very happy with the way the works turned out.

I plan to, hopefully, live here a long time.

It is now back to the valleys of South Wales

and the former coal mining village of Penrhiwceiber,

where earlier we saw this three-story three-bed terraced house

bought for 29,000 by Adele and Alex.

Adele is a junior doctor while Alex is a project manager.

They seem to have the right credentials

to cure the property of its problems.

Or so you'd think.

What is it like working with Alex?

Is he a great...? Is he a good hands-on guy?

No. I'm terrible.

I'm so much better at work,

but when it comes to getting your hands dirty, she is so much better.

She did all the tiling, built walls,

bossing all the electrical people about.

I just let her do it. And she enjoys it.

I'll get my hands dirty when she tells me to do it.

With the experience of renovating their own house, Dr Adele

and Alex plan to do this one themselves.

But with a tight budget of 7,000 to 8,000 and a mere two to three month

turnaround, it will be interesting to see

if they can get this particular patient back on its feet.

Five months later, we returned. From the outside,

the house doesn't look in the pink of condition,

but actually it's a lot healthier with the lintels painted

and a new front door.

Inside, and the two tired reception rooms have been transformed,

with re-plastering and redecoration, into much fresher spaces.

Remember, the house is three-story,

with the kitchen downstairs. And what a great change here.

We'll leave it to Adele to explain the turnaround of this room.

When we bought it, the kitchen was all damp.

We had to take everything off, strip it completely back.

We had everything done, proofed, all the floor damp proofed.

We rendered the whole kitchen, boarded it out

and plastered everywhere.

I really wanted an island, so we got that put in.

Put the units with these two recessed around the chimney breast.

And a new electric hob, an extractor fan, but we also left

a gas point there as well in case anyone wanted a gas hob instead.

I'm really happy with the tap as well.

Nice, big, modern, pull-out, spray tap. I really like that.

Yes, the kitchen is looking good.

And tucked away on the side, the old bathroom has been re-plastered

and replaced with a completely new suite and tiles.

Meanwhile, the extension has been refurbished with a new sink unit.

On a day like today, it must rank as one of the best views

from a utility room we've ever seen.

And it's a view that can also be appreciated from the newly

re-plastered and redecorated rear bedroom.

The two front bedrooms have been refurbished in the same style.

You may have noticed that I've mentioned the re-plastering

a lot because, with no previous experience,

the couple took on this job themselves.

I started off with a nice, big bucket

and then I had a mixing stick,

I didn't even have the proper mixer for the plaster.

I had nice, big stick.

And just basically learned as we went along, really.

The start-off wasn't the best, was it?

We progressed in doing the whole house.

I got shouted out a lot cos I was so bad at the start,

but I eventually got there with Adele's training.

To push the renovations through,

it was vital to have clearly defined roles.

-I'm the boss.

-She's the boss. I listen.

I moaned like a girl half the time saying, "I'm not happy," she shouts

at me, I go off in a mood, come back and we are friends straight away.

It is quite a good working relationship.

I'd rather her be the boss cos I'm terrible at leading sometimes.

Considering I'm a project manager at work.

# She's the boss, yeah She's the boss... #

Don't be too hard on yourself, Alex. After all,

you did supply the muscle to clean up the plot out back,

lay a new patio and re-turf the garden.

Alex also repainted the house

and damp proofed the cellar. And the result?

A new home that they plan to sell on.

But it was a tough job for them.

I think next time we'd want other people doing things

when we've got a bit more money, because it took weeks, didn't it?

It took us three or four weeks to get everything done.

Because it was just the two of us doing the whole house.

And because we had full-time jobs,

we have to come on weekends or maybe in the evenings.

And it took a long time to do.

The couple live a 25-minute drive away in Cardiff,

so their hours on the project were limited.

That did push their original two to three month timescale

up to five months.

By doing most of the work themselves, their predicted 7,000

to £8,000 budget has been pushed only just over the nine grand mark.

Along with their £29,000 purchase price,

their total outlay is just over 38,000.

So, it may have proved tough going,

but the results have given them lots to be pleased with.

I think we've done an amazing job, really, in the amount of time.

We would have liked to do it quicker,

but I think what we've done, it all looks new, it looks fresh.

I'm really happy with what we've done, really proud of Adele

cos she project managed it, led us through,

done a lot of the work herself and, you know,

some days I went off and played football and she stayed here

and got on with it. It's a really good house, it's amazing.

But will the local property market agreed?

We asked two local estate agents

for their thoughts on Adele and Alex's 38 grand investment.

The property has been improved considerably

since the last time that I visited.

They've upgraded the kitchen, general upgrades to the house.

They've not overspent on this property,

probably aligning it towards the rental market.

Well, it's a great improvement.

And I can see they've spent a few quids bringing it

to a decent standard.

There is a much improved kitchen,

a modern bathroom suite,

painted a nice plain white throughout with the garden reappointed.

I think they've done the right things to get it

attractive in the rental market.

The estate agents reckon the house is right for letting

so what could the couple expect in rental?

I would hope to achieve a minimum £375 per calendar month,

maybe as much as £400 per calendar month.

I believe you would comfortably achieve £350 per calendar month.

I'm quite happy with that.

We haven't really considered renting, to be honest, but it is a good price.

-Good for the area.

-Yeah, good for the area.

More than I expected for rental, yeah.

Those two figures could give them

a very healthy annual yield of between 11% and 12.5%.

Would a resale make any profit on their £38,000 spend?

I would put this property on the market at between £45,000

and £50,000.

I would put this property on the market for £45,000.

Those figures would mean a possible pre-tax profit

of between £7,000 and £12,000.

I think that is quite a good price.

-I mean, we've definitely made a profit on it.

-Yeah.

-It's money made, so it's profit, so I would be happy with that.

-Yeah.

Although this property does seem better suited to the rental market,

Adele and Alex have put it up for sale for 52,000

to see how that pans out over the next few months.

Despite the tough renovation,

it hasn't put them off any future investments.

Yeah, I would go back to auction. I really enjoyed the process

and you can get a great deal on a house.

Although it took a lot of work,

we're going to make money on it, even in the state it was.

That's the way to do it.

I'm happy to go back to auction and do it all over again.

Well, join Lucy and I next time when we meet more brave auction buyers

trying to make a killing on property or just find a place to live.

-Look forward to seeing you then.

-BOTH: Goodbye.

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