Episode 34 Homes Under the Hammer

Hello. Lucy and I find property completely absorbing.

But in order to do well,

you must make sure you buy at the right price.

One way you may be able to do that is to buy your next home under the hammer.

You do need to do your homework before you buy at auction

but once you're sure of what you want,

you could bag yourself a bargain.

I wonder if any of today's properties turned out to be great deals.

Here's what was bought.

There are no complaints from me

about the cleanliness of this house in Warrington, Cheshire.

Look, you could eat your dinner off of there!

Whereas in Workington, Cumbria, it's not food but drink that interests me.

You've got your own bar - fantastic!

Having found the location of this property in Tunbridge Wells in Kent,

all I have to do is try and find a way in.

All of these properties went to auction and we'll find out

who bought them and what they paid for them

when they went under the hammer.

There you go!

I'm in Cheshire today. Warrington, to be exact.

It has a fabulous grade one listed town hall,

the famous River Mersey passes through it

and there are great transport links to Liverpool and Manchester.

It's also home of the rugby league team known as the Warrington Wolves

and I'm here to hunt down a property that was snapped up at auction.

And here it is.

It's a three bedroomed terraced property and the guide - £55,000.

There's a house on this road on the market for just under £85,000.

Money to be made? Hopefully.

Initial signs are promising.

Decent roof, double glazing and a good position.

It could do with a little tidy up but that's fine.

We don't want it perfect, we need to be able to add value.

The first thing that strikes me is the feeling of space.

It's really big in here, but it's terribly dated.

You have polystyrene tiles, old-fashioned wallpaper.

You may want to replace this with something a little more modern.

The good news is, I can't smell damp,

it's clean as a whistle in here.

Look at the size of this kitchen.

Again, look, you could eat your dinner off of there!

It's a fabulous little house but I'd like to think about rearranging it

because I'd like to get a table in here so you could sit down and eat.

I'd probably want to move this doorway along,

get rid of some of this because then you can close the door

and there's enough space in the corner

for a family to sit down and enjoy their meal.

All in all, a fantastic little house for the guide price.

Yes, at what was a £55,000 guide price, this really could be a gem.

Potentially a nice project for someone.

Upstairs, the three bedrooms just need redecorating,

re-carpeting and maybe a bit of plastering here and there.

As for the bathroom, as far as I'm concerned,

it should always be a white suite.

Mind you, I'd like to see a bit more green outside.

If you love the house

but you're a bit disappointed with the concrete paving slabs,

don't be, because the other side of this fence

is a pretty little green garden.

Though it's not a thrilling space, it's pretty low maintenance

and it's always lovely to have somewhere to sit outside and chill.

It was all so tranquil.

TRAIN THUNDERS PAST

That shattered the illusion, didn't it?

Oh no, not so great.

Thank goodness the house has double glazing.

I'm afraid there's another fly in the ointment

and it comes in the form of a flying freehold.

This alleyway is supposed to run to this property's garden

and the neighbouring garden but at the moment,

it only runs to the neighbouring property.

This means that this part of the house is in legal limbo

and worryingly, it can scare mortgage companies off

so I would definitely make sure my solicitor looked into this

before going to the auction.

It's worth making some noise about this issue.

It's not uncommon but it can be a bit of a legal tangle.

What does the local estate agent make of this property?

First impressions of the property are good,

it's a reasonable sized family home.

Definitely needs some work but it's a good solid family home.

What about the flying freehold

and the full-sized train set at the bottom of the garden?

The train line is not going to help but it shouldn't hold up any sale.

There is a flying freehold with the property,

a ginnel that's shared with the next door property.

It does pose some slight drawbacks, when you come to get finance,

but that is something you would factor in with the cost.

So with regard to prices, what kind of value could this achieve

if fully refurbished and put on the rental or resale market?

Once this property is renovated,

I'd look to put this property on the market at around £80,000.

If we were going to rent this property out, once renovated,

I'd expect to achieve £550 per calendar month.

Some will be put off by the train track at the end of the garden

and others will view that flying freehold with suspicion.

Someone wasn't deterred. Let's find out who that was as we go to auction.

Three bedroom, what's this one worth?

Who's going to give me £50,000? That's too high for you.

Start me off at £40,000. We're away.

£40,000, do we see 42? 42,000.

At 44,000 seated. 46?

48,000. Round it up to £50,000.

Yes, that's your bid at 50,000.

52, 54?

53? 52,500.

I'll do the same for you, 53? 53,500.

54. 54,500.

At 54,500, are we done?

No, at 55.

55,500, you're shaking your head.

At £55,000, it's the guide at 55.

55,500, new bid.

56. 56 at the front.

56,500, sir? 56,500.

57? Your choice. 57,500? You're shaking your head.

At £57,000 for the first time, second time

the third and final time at £57,000.

There you go.

At 57,000, just £2,000 over the guide price,

the three-bedroom terrace in Warrington

was bought by local man, Mark.

He's married with three young kids.

After leaving his job as a cabin crew manager for an airline,

he's now looking for a change in career,

back on terra firma.

Did you ever think you'd get this on auction day?

I didn't, I was so nervous.

I've done an awful lot of things before

but going along to the auction was like nothing I'd ever experienced.

It really wasn't.

I only actually viewed this property on the morning of the auction

so at 11.00 I was here having a look

and at 1.00, I was bidding on it. Wow!

It almost felt like it was fated

because when I went to the auction, I had paddle number 18

and this was lost 18 and I thought, it has got to happen.

So, when the hammer went down and it was yours, how did you feel?

I was elated and I was little bit nervous beforehand

because I thought, I'm going to have to restrain myself

because as soon as he goes, third and final time, it's yours,

I was going to jump up and go, yes, yes, fantastic!

People have done that and people do do that.

I managed to restrain myself, obviously.

It's great that he's got it

but why was he so excited about buying this particular house?

We only live about ten minutes away from here

so it's nice and easy and convenient for me to get to

and to monitor and keep an eye on.

The actual house itself, it's looking tired, definitely

but it has the cavity walls, the double glazing and the boiler.

It just has everything about it. It needs a tidy up.

The kitchen's looking really tired.

The bathroom, very dated, will need replacing,

but the basics are there and that's what I thought.

What's your budget for the work?

In total, I'm looking at spending around £6,000.

There might not be an enormous amount to do to this place

but £6,000 is still quite tight.

I think it will need a fair amount of input from Mark to keep that budget in check

and he hopes to get it all finished in just 6-8 weeks.

Have you ever done anything like this before and are you handy?

I am quite a handy chap, to be honest.

In this house, I'm looking at doing everything as much as I can,

really, to be honest. If it needs any plastering, I can do that.

I can certainly do all the legwork and the painting, decorating.

I can fit the kitchen, the bathroom, but it's not anything

that I've done before on this type of level, to be perfectly honest.

My background, I used to work for an airline, that's what I did.

-I was a cabin crew manager for an airlines.

-Really, for how many years?

I did that for 12 years in total so it was quite a long time.

Then this year... I've got quite a big birthday coming up this year.

-Ah, have you?

-Turning 40.

-40!

It just felt time

for me to do something different, really, to be honest.

So it's a big change of direction for Mark

but something he's obviously looking forward to.

He plans to let the house, so for the moment,

he's not overly concerned about the flying freehold or the trains,

but he has a young family so does need to make this venture work.

What did the family think of this venture?

My wife hasn't even seen inside the house, to be honest.

It was me that went along and decided to buy it

and I sort of phoned her up while she was at work and said,

"You'll never guess what? "What?" "I've just bought a house."

She didn't know anything about it!

She knew that I'd been looking at it

and she knew that I was thinking about it

but when I actually went along and bought it,

it was a bit of a shock to her, to be honest.

But it's been nice because I've been so focused on my career

and working long hours and everything for the last 12 years or so,

and it's been nice to be able to spend

that little bit more time with the family.

The ideal thing about this is I can work on this during the day,

maybe the odd weekend, but I'm still coming home every night to the family

and to the kids, so it's ideal.

Well, good luck with this venture. I really hope it works out for you

and it's been great meeting you today.

It's really nice meeting you. Thank you.

Ex-cabin crew manager Mark purchased a property

with a flying freehold. What are the chances of that?

I hope he manages to resolve that issue

and I also hope he successfully renovates this house.

Will that modest budget see this house take off

or will it be a series of delays and cancellations?

You can find out how he gets on later in the programme.

22 miles south-west of Carlisle in Cumbria

is the former industrial town of Workington.

It used to be the biggest railway track manufacturer in the world

and it was said that Workington rails held the world together.

So let's hope I'm on the right track to find a property bargain.

Today, I'm in the north side of Workington

in a really close-knit community.

Great local amenities, good school, perfect. What am I here to see?

It's this. A three-bedroom semi-detached.

Great news, it's actually a corner plot so good sized gardens.

Guide price was 40 to 50,000 quid, let's take a look.

MUSIC: "Down On The Corner" by Creedence Clearwater Revival

This three-bed semi-detached

not only benefits from being the corner plot

with front, side and rear gardens, but there's also double glazing.

Considering its guide price of 40 to 50,000,

the signs are encouraging.

So what have we got?

That's a nice surprise, a really nice, big entrance hall area.

Loads of places to hang your coats or put your bikes,

stairs up to the bedrooms.

Through into the lounge.

This has been knocked through to create a really good sized space.

You'd probably want to do something about this fireplace surround.

Get rid of that and you can give yourself even more room

but intrinsically, it's good.

Look at this.

For the Del Boys amongst you, your own bar. Fantastic.

MUSIC: "Have A Drink On Me" by AC/DC

OK, that might be one of the first things to go,

and the next I'd suggest might be the kitchen

which appears to be on its last legs.

But in fact, so far, there's nothing that unduly worries me yet.

Upstairs, lots of light coming into the stairwell

from that nice big window and the landing here.

Small bedroom on that side at the front,

a larger double on the left-hand side at the front.

Good news, your bathroom is upstairs

and it's a good family size, which is great.

Then through into the third bedroom, views out over the garden.

Again, good size, double with some storage.

This is a really good family house, isn't it?

Yes, the bathroom's a tad ropey

and the suite will need replacing but it's a great size.

Along with those three bedrooms, the layout is simple and works well.

This place just shouts family home at me.

So we like the potential for the inside. What about outside?

Thankfully, it's a similar story.

Clearly, this little extension conservatory bit here is not ideal

but render it, stick a new roof on and some new windows

and you might be able to retrieve that.

Similarly, these outbuildings, they're not the prettiest

but they do have an outside loo.

Again, you might want to restore that.

The shed, definitely a coat of paint!

The garden itself, you've got a really good sized plot.

That's one of the benefits of being on the end here.

Flagged at the moment, it needs a bit of work

but in terms of potential, just a big tick.

This really has so many plus points.

It's a decent size but could be made bigger if desired.

It could be a family home but also work as a rental,

so what's not to like?

This house benefits from this most wonderful corner plot.

Look at the garden and this is just at the front!

The first thing you might think is a perfect spot for a garage.

Unfortunately, the plot is less than 12 metres away

from a major junction, so the planners,

if you ask them for a garage here, would say no.

So that's definitely one box that doesn't get a tick

but you could create some off-street parking at the front.

Overall, this three-bed semi-detached house

with what was a 40 to £50,000 guide price looks pretty enticing to me.

What does the auctioneer who sold it think?

I think it's a good, sound, well-built property.

Probably needs decoration, new kitchen, new bathroom.

It's a generous plot, generous sized rooms, a good family home.

Remembering that 40 to £50,000 guide price,

once it was renovated, what sort of resale price could this place get?

On this existing footprint, I think you would achieve

in the region of £80,000.

That's not bad. What about rental values?

If this property was renovated, it would probably achieve

a rental income of approximately £400 per calendar month.

Well, you know what, I reckon this is a perfect auction purchase.

Yes, it's in need of some sorting out but nothing too major.

What you've got here is a house in a good location

with nice gardens and lots of accommodation

at a really good guide price.

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

Moving on to lot number four, it's a three-bedroom end link property

on the corner plot that is in need of some upgrading throughout.

35 start? 35 we've got, back of the room. At £35,000, I'm bid.

I'll take it in ones, nice and easy.

36, anyone? 36 I have. Can I see 37?

Madam, just beat you. 38 at the back, sir. 38 I've got, 39.

39 and a half, 40. Shake of the head, 40 with you then, sir.

40 I've got. 41 may I see, madam? 42, 43.

44, 5, 6, 7, 8, 9.

50, 1, 2, 3, 4, 5.

Shake of the head at 55.

At £54,000, you've been with me all the way.

At £54,000, are we done? All out.

55, thought there might have been a bit more. 56, and seven. Eight, 59.

60. 60 I've got. One? Shake of the head at one.

£60,000 with the gentleman stood to the rear.

Take a half. Half I've got.

61. Shake of the head. 60,500 then, first time.

60,500 second time.

60,500, selling this, here she goes. First, second, third time.

Sold seated, well done.

So, for £60,500, it was Cathy who bought the three-bed semi.

She's a youth and community worker

and she joined me back at the property

with eldest daughter Carla to tell me why she really wanted it.

MUSIC: "I've Been Wanting You" by Vagabond

-Cathy, Carla, lovely to meet you both.

-Lovely to meet you too.

Congratulations. Tell me why you wanted to buy the house.

Wanted to buy the house for Carla

because she's in a two-bedroom house now.

She's got a little boy, she's having a little girl

and just thought it'd be nice to give her a family home.

-Wow, so when's the baby due?

-Six weeks.

-Fantastic.

So, is it all a scramble to get it all sorted out by then?

No, I think it's going to take a bit longer

because we're off on holiday on Friday for a couple of weeks

so it's going to be delayed a little bit.

Right, but the idea is it's somewhere for you to live?

-So what you think about that?

-Yeah, I'm dead excited, dead nervous.

Can't wait to get stuck into it.

-So how was the auction?

-Terrifying.

-Why?

We got into trouble, didn't we?

-First of all, I spent more than I should have.

-Tell me.

I was given a budget of 50,000.

50? And you spent?

60,500, because we desperately wanted it.

I still thought it was a bargain.

Let's hope it is a bargain because it's been bought as an investment

as well as a new home for Carla,

her partner Jay, son Jamil and the new baby.

Carla will pay rent though and some of the refurbishment costs too,

but when it comes to the hard graft,

dad Peter who's in the building trade with his own roofing business

will definitely be roped in.

-Tell me what you're going to do to it.

-We are going

to replace the bathroom, replace the kitchen,

strip all the walls back.

Have it all plastered, new skirting boards, new door casings,

then sort the garden out as well.

So what about the cocktail bar?

Well, my partner actually wanted to keep it!

-I don't think it's our cup of tea.

-It's going to be gone.

What about this extension at the back because it's obviously a bit unsightly.

I think we're going to keep it, aren't we?

-My dad's going to put a new roof on it.

-Needs rendered and stuff.

Looks like it's got a bit of damp in it.

So what kind of budget is there for that?

We're looking, I think, between five and 10,000.

Depends how much Carla decides to spend.

So what could blow the budget?

I don't think my dad knows but I've been thinking new patio doors

and things like that.

Just nice bits. Bits that look good.

Let's hope that's not just wishful thinking on Carla's part

because it's going to be quite a challenge to carry out

all the hoped-for plans on a budget of just five to 10,000.

So who's going to be doing the work?

My brother-in-law will be tiling,

he'll be doing the kitchen and the bathroom.

Got a lot of family help, haven't we?

Mostly her dad, he'll be coming in and banging about.

He'll be looking at the roof. He's a roofer, so mostly him and his crew.

OK, so you two are going on holiday

and leaving him at home to get on with the work.

-Is he happy with that?

-Yeah, he is.

-Sounds like it's a great family purchase.

-It is, it's an investment.

We look forward to seeing how you get on.

Good luck. Hope the birth and everything goes well.

-Thank you very much.

-Have a nice holiday.

-We will see you in a few months' time.

-All right then, thank you.

Well, Carla's got herself a great property here

for her expanding family and her and her mum are off on holiday

leaving dad to sort it out. Fantastic.

How will he and the rest of the family get on with the renovation,

you can find out later in the show.

We might even get to see the baby.

Coming up - in Tunbridge Wells, Kent,

there's a property that looks small from the outside

but strangely enough, when you walk in, it's massive!

Back in Workington, we check on progress at Carla's new family home.

It's gone a bit slow, hasn't it? It could have been quicker.

But first, we return to Warrington

to find out how Mark is getting on with his new venture.

I have loved every single second of it. I would do it again.

Back in the Cheshire town of Warrington, we came across

a three-bed terraced property which was just starting to show its age.

It needed a thorough update and refurbishment, but seemed fundamentally sound.

So, for first-time developer and local man Mark,

it appeared an excellent place

to get his fledgling property career off the ground.

Have you ever done anything like this before?

It's not anything that I've done before on this type of level, really.

I used to work for an airline. I was a cabin crew manager for an airline.

-Really, how many years?

-I did that for 12 years in total.

It felt time for me to do something different really, to be honest.

This change of direction didn't come cheap

as Mark paid 57,000 for the house.

He was hoping to find a new career path

but also had a family to support meanwhile

so couldn't afford for this to go wrong.

His property came with some potential pitfalls.

A train line at the end of the garden

and an area of flying freehold,

all of which could potentially affect the end value.

With a budget of £6,000 set aside,

he hoped to turn it around as soon as possible.

Just seven weeks have flown by and we're back with Mark

and his six year-old daughter Ellie to catch up on progress.

The outside - it's been given a lick of paint

and the door has gone from white to black.

But it's inside where the refurbishment has really taken off.

In the front reception room, there's now laminate flooring,

those polystyrene tiles have now gone

and the ceiling's been replastered.

There's a modern gas fireplace and that old kitchen,

that's now a thing of the past.

In this particular room,

I think it's changed an absolutely massive amount.

The kitchen units have all been replaced,

we've put new flooring down, all of the walls have been painted.

The ceiling's been skinned and repainted as well.

The kitchen I bought off an internet auction site so it came second hand

and it came with all the units and the hob and everything else.

It's got a built-in dishwasher. I think it's come out really well.

Not only has Mark improved the kitchen but he did it

with his property developer's hat on and kept the costs down.

Upstairs, the three bedrooms are also finished

and ready for a tenant who's moving in in just a couple of days' time.

However, work on the main bedroom wasn't trouble-free.

This room and the upstairs probably caused me the most problems of all,

to be perfectly honest.

We started knocking out for the electrical socket boxes

and the entire wall fell down.

We ended up replacing and rebuilding the entire wall.

Things got rather messier than he'd hoped

but with a full refurbishment of the bathroom, apart from some small snagging jobs,

the house is just about ready to go.

Mark did use professional tradesmen where required, but even so,

to get to this stage in just six weeks is some going.

I've done virtually all of the work myself

with help from friends and family really, to be honest.

My dad has come up from South Wales, he's helped me a few times.

My wife has painted virtually of upstairs.

Even my young daughter Ellie,

she's been stripping wallpaper off and painting walls.

Ah, yes. Six-year-old Ellie.

How did she find the refurbishment work?

-Any top tips?

-I've been stripping wallpaper by getting this tool.

It's sharp and put it where I could

as I lifted it up like that

and then quite a lot comes off and then peel it.

That definitely sounds like a top tip to me

but what's been the bestest bit?

The best thing is how good it's turned out to look now.

Does that mean she's keen to follow dad along his new career path?

I'd like to have quite a quiet job like an author.

That's what I want to be.

Hmm. In this house, things could get a bit noisy

with those trains running past.

Perhaps it's not quite the right career for her at present,

but for dad Mark, to become a big noise in the property world,

it's vital to keep expenditure under control.

Was initially £6,000. I've gone a little bit over that

and I think that was mainly due to the extra plastering

and the full electrical rewire, so in total,

it's been about £6,500 now.

That pretty impressive 6,500 spend

on top of Mark's £57,000 purchase price for the house

will take his total outlay to around £63,500.

So, has his first property development got off to a flying start?

What do two local estate agents think?

First impressions are that it's got three good-sized bedrooms.

Downstairs combination is particularly light.

Finished to a good standard throughout and will be of interest to a lot of people.

Property is in good condition.

There's still some finishing off work to complete

but overall, there's a new floor and coverings, all the walls are smooth.

The kitchen's had some improvements as well

so generally a result.

This property was always meant for the rental market

and Mark's already got a tenant confirmed,

but what sort of rental income should he get?

Sensible rental value for a property of this style would be somewhere

between £525 per calendar month and £575 per calendar month.

This property would bring around 500 to £525 per calendar month.

I've already got a tenant lined up and the tenant moves in in two days.

I've rented it for £500 a month so I'm delighted by that.

Absolutely delighted.

That's fantastic.

A six week turnaround and he's already let it for £500 a month,

representing a yield of around 9.5%,

but has he also added value to his £63,500 investment?

I would suggest a sale price of between £80-85,000.

We would expect it to be worth in the region of £80-85,000.

That is fantastic. That is really amazing.

It's been a big gamble

and that's a potential £21,000.

Ka-ching! Fantastic.

Even after tax and fees,

there's still potentially a decent profit here

but most importantly for Mark, it shows him he's on the right track

in could have a future as a property developer.

I have loved every single second of it.

I would do it again so if at all possible,

if I can find the finance,

I'm going back to the auction hopefully next week

and see if I can pick up anything else.

That might mean daughter Ellie

will have to put that writing career on hold a little longer

and pick up that wallpaper stripper instead

so the family can continue working together.

Music: "You And Me Song" by The Wannadies

Tunbridge Wells deserves its royal moniker.

It's extremely charming and really rather posh.

The former spa town is attractive, affluent

and with a much lower crime rate than the national average

so it's no wonder that property around here

costs rather more than your average detached home.

In fact, they go for over half a million quid!

A short stroll around the centre and you can see

why Tunbridge Wells is so desirable,

but that is a rather large wodge of cash for a family house

and well out of many people's reach.

But I have something up my sleeve that may be rather more affordable.

Typically, the property I'm here to see has dragged me

to the slightly less posh part of the high street

but I really can't complain. It's not exactly far

to drag all those lovely boutique shopping bags now, is it?

You might be expecting me to pitch up at a commercial premises

but you would be wrong. In fact, the lot I'm here to see,

it's a three-bedroom maisonette above this shop.

It had a guide price of 120-125,000.

All I have to do is try and find a way in.

At that guide price, it's certainly worth the slight difficulty

of finding the access which is round the side of the property.

Well, hurrah! I have found it!

This is what you call a roof terrace. Wow!

Not exactly private, and the property I'm here to see

is that little maisonette squashed over in the corner.

I'm going to have a look around.

So, sitting on top and around the back of a commercial premises

is the three-bed Victorian maisonette

with a large flat roof in front.

It's worth remembering that being above a commercial unit

can make it difficult to get a mortgage

but the terrace is well tucked away from the traffic here.

Gosh, you feel so squashed in the corner here,

but strangely enough, when you walk in, it's massive!

This is a really fantastic welcoming hallway with beautiful...

Look at these floors!

They may look hideous at the moment, they're absolutely trashed,

but I know for a fact that once these have been sanded and treated,

they will look fabulous. Herringbone hardwood floors.

They are going to come up a treat.

Gosh, you can see that there's so much work to do.

We'll come back to that ceiling a little bit later on

but there's just loads of character in here.

Beautiful old little '20s tiles in the kitchen. That's really spacious.

Through into the lounge. Wow!

Now it is an odd shape but I like to think it's quirky.

It's definitely the sort of place I think I'd like to live.

I'm now thinking, what about taking this wall out

and really opening the hallway and this room up,

because you'd get that instant wow factor.

You'd be able to see both windows in here.

You've got this little fireplace.

I'm not sure that this really goes with the character of the property

but you could definitely do something with this

to give it a bit of oomph.

I really, really like it. In fact, I can't wait to see what's upstairs.

Upstairs are the bedrooms, a rather elongated single

and two good-sized doubles.

The larger double has oddly angled walls which could be seen as quirky

or irritating, depending on whether you're fitting wardrobes, I guess!

The bathroom is a fair size but needs some attention.

The landing really adds to the feeling of open space.

Talking of big open spaces, let's return to that ceiling.

Now, you know I said I would get back to you about the ceiling, well,

having a good old look at this, my guess is dry rot.

You can really tell by that feathery pattern that's left on the ceiling.

I'm just hoping that the dry rot has now gone, it's been removed.

It looks as though it has but whoever takes this on,

I would get somebody round ASAP to have a look

and to check that it has been treated because if it hasn't been,

oh, boy, that can be a nightmare.

So, who is this pad going to suit?

Roof terrace, centre of town, steps from bars and restaurants,

you guessed it! It's young professionals.

You can forget families, this place is crying out

for a young people or some sharers

who want to walk to work or the train station

and not worry about a garden or a car, which is just as well

because there's no parking space with this property.

Your market may not be a wide one but there are plenty of people

who do fit the bill and would rent this place in a flash.

Music: "Flash's Theme" by Queen

With three good-sized bedrooms, a well-proportioned lounge

and a very central location,

I don't think you'd have any trouble finding tenants for this property.

Does a local estate agent agree?

We invited one along to get all the gen on this maisonette

guided at 120-125,000.

First impressions of the flat, fantastic.

Loads of potential, lots you could do

either as a three bedroom or as splitting it into two flats.

Interesting.

Let's compare what the resale value difference would be

between renovating as a three-bed or converting into two one-bed flats.

I put a value of around about £135-140,000.

If I had it fully renovated already as a three-bedroom maisonette,

we'd be looking at towards £190-195,000.

Splitting it into two separate one-bedroom flats,

I think you'd get around about £115,000 each.

Could be more money in a conversion then.

Let's test the waters as a buy to let.

If you're renting as a three-bedroom maisonette,

you're looking at around about £850 per calendar month.

If you split it into two one-bedroom flats,

interestingly, you're getting around about 550 per calendar month, each.

This flat is not exactly pretty

but it's perfect for a landlord's portfolio.

It needs dolling up, but once you've done that, I think it's destined

for young renters who aren't interested in suburban living and front lawns.

Right now, they want bars and boutiques and busy town life.

Let's see who thought it was worth a go at the auction.

Three-bedroom maisonette for improvement.

It's at the centre of Royal Tunbridge Wells, no less.

Give me 95 because I'm not going below 95.

95, I'm obliged. In Tunbridge Wells, I would think so too.

95,000 I have, 100,000 I'm looking for.

Are we all done at £95,000?

100 I've got, 105, 110, thank you.

115, 115, do I see? 115, and 20.

120 and 5, 122.

124, and 6, 126.

And 8, 128 can I say? 128 in a fresh place.

130, 130 and 2.

132, may I say? If not, at £130,000 on my right for the first time.

£130,000 for the second time,

third and final time,

at £130,000, all of you are out of it and we're all done.

Yours at 130, sir.

That successful bid of 130,000 came from David.

He lives 15 miles away in the village of Osham

and ran his own computer company for 20 years.

Since retiring a year ago, he's dipped his toe into developing

and has bought this one as a joint investment with a friend.

I met him back at the property to find out more.

-David, it's really nice to meet you.

-Hi, there.

Tell me about this flat, why did you want to buy this?

Well, a friend of mine from our village, we're both retired

and we're playing golf a lot but we thought we'd have another interest.

We're starting with this one.

What was it about this flat you liked enough to want to bid for it?

Location clearly is a part of it. Tunbridge Wells is a good area.

It's not completely recession-proof but it's not bad. It rents very well.

David's right.

At the moment, rental does look like the key to unlocking the best value

in this property and, of course, there is even more potential here.

So what are his plans?

Plan A and plan B.

-Plan A is to convert it into two one-bedroom flats.

-Wow.

Out in the hallway, it's quite easy to have a communal area

and have two doors and two one-bedroom flats.

Upstairs is already laid out for that, then down here,

we'll just move one of the doorways and put a wall in here

so this will be a living room then a bedroom.

That's plan A and plan B is just we do a straightforward renovation

and leave it as a nice three-bedroom flat.

Put another bathroom in so one of the bedrooms will have an en-suite

and a family bathroom and two other rooms.

How much budget are you going to have if it's a three-bedder?

We've got a maximum budget of 20.

Have you still got 20 grand if you convert it?

-No, we'd then probably look at 35-40.

-OK, so you could up your budget.

Oh, quite considerably.

With a flexible budget and a time scale of three to six months,

depending on whether he converts or not,

it all seems well worked out but what's the long-term intention here?

We'll probably rent to start with

and then sit on it for a couple of years and see what happens.

David, it's been lovely to meet you.

I can't wait to find out what the option is, A or B? Good luck.

We'll soon see, won't we?

David's plan A isn't a lavish restoration

but two flats could be a great way to make money.

I have to admit, my heart is with plan B but my developer's head

so hopes he gets the result he wants.

Find out how it all goes later in the programme.

Many months have gone by since we last saw those properties.

Will we recognise them? Will it have been time and money well spent?

Let's find out.

In the Cumbrian town of Workington,

this three-bed semi-detached house was sold at auction.

-Local lady Cathy bought it for 60,500.

-Sold seated, well done.

Cathy was so determined to get it that she paid £10,500

over the agreed bidding limit set by her partner

but then this wasn't bought as an out-and-out property development

but as a family home for her daughter, Carla.

MUSIC: "Venus" by Bananarama

Wanted to buy the house for Carla

because she's in a two-bedroom house just now.

She's got a little boy, she's having a little girl

and just thought it'd be nice to give her a family home.

-What do you think about that?

-Yeah, I'm dead excited, dead nervous.

Can't wait to get stuck into it.

-Wow, so when's the baby due?

-Six weeks.

-Fantastic!

And though Carla didn't need to move

from her current rental accommodation immediately,

the sooner the house could be finished, the better.

Having given her roofer dad Peter a long list of tasks,

she jetted off with mum Cathy on holiday

leaving him with the proposed £5-10,000 budget to do the work.

With a new kitchen and bathroom plus a complete overhaul

both inside and out on the to-do list,

Carla's dad was going to be a busy man.

Well, just over nine months later,

we're back and the first bit of good news is the safe arrival

of Carla's baby daughter, Cassie,

a little sister for Jamil and now eight months old.

But is their new home ready for them?

Well, not quite.

The outside is still looking a little spartan and bare

and inside...

Well, they are getting there

but it's just reached the first fix stage

so it looks like Carla and her family may have to wait

a little bit longer before they can move into their new home.

It's gone a bit slow, hasn't it? It could have been quicker

but we're pleased with the result we've got so far.

Carla's dad was hoping to do this in between jobs, but recently,

he's been really busy and wasn't able to spend as much time here

as he would have liked.

MUSIC: "Give Me Just A Little More Time" by Kylie Minogue

So, baby Cassie we'll have to hold out a little longer

to move into her nursery.

It will also be some time before her mum, dad and big brother

have their own finished rooms.

But it is all taking shape and it certainly looks as though

Carla's definitely going to get the new bathroom and kitchen she was hoping for.

We've knocked this wall down, made it all open-plan

so we can fit a nice open-plan kitchen.

There was a great big boiler over there that wasn't in use

and pipes all on show.

We've integrated all the pipes, put in new central heating

and just made it all nice and flush

so we can have the nice kitchen fitted.

This looks like it's going to be a great family kitchen.

They really seem to be making the most of the space they have here.

This extension, it was a bit of a lean-to in the beginning.

We were going to knock it down but then Carla decided that she needed

more space for the children to play so we put a roof on,

took the windows out and put patio doors in

so it'd be easy to come out and the kids can play in the garden.

Those patio doors provide access to what will be a large family garden

but there are certainly still a few more jobs to do.

The patio doors still need fixed and then obviously,

the roof finished off and then in there can be finished.

I'm waiting for the new fire to be fitted and that can be finished.

-The kitchen's coming tomorrow.

-Then really it can be painted.

The bathroom finished, front door on and then that can be finished,

plastered and then flooring throughout.

-Hopefully then it will be finished, won't it?

-Not too much then!

That's just the inside, what about the outside?

We are going to have set bricks on as a drive,

a nice big drive on the front and up the side.

Carry them round to make a nice patio area.

A nice bit of grass for the kids

and maybe a nice bit of decking at the back if I'm allowed.

I'll probably pay for that myself.

I think you might have to pay for that, Carla.

Let's hope the budget isn't rather more than they'd hoped for.

The budget was originally 10,000 but we have gone over that.

We've gone up to 15,000 and I think it will cost about another 5,000

by the time the flooring's down and for the outside as well.

So, if their budget does reach 20,000,

that would bring their total outlay including the purchase price

to £80,500 plus all their costs and fees.

It's been bought as a home for Carla but it's still an investment

so let's hope they haven't smashed through

the ceiling price for the area.

What do two local property experts reckon?

First impressions, yes, there's ongoing work on this property.

Looking inside, most of it has been finished to a very high standard.

What has surprised me the most is the garden.

Those outbuildings, obviously they've taken them all down

and there's still work to continue

but it's really a good size family garden.

My first impression of the property

is it provides good sized family accommodation

although it is work in progress at the moment,

but it does offer potential for extension of either

extra accommodation or a garage on the side of the property.

Obviously, this house has some way to go before completion

but they hope to have it all done and dusted for a total expenditure

of 80,500. Will that be money well spent?

My selling figure for this on the open-market would be 75,000.

Once the property has been completed,

I would value this property at £70,000.

That sounds about right to me.

-It's more of an investment, isn't it?

-It is, yeah.

We're not wanting to sell, it's a place for Carla to live

so, future home.

So if sold on, they could be looking at a loss of around £5-10,000,

but as they say, Cathy bought this Carla's family home

and a long-term investment.

Carla will be paying rent so what might she expect to pay?

The rental on this property when it's finished

would be £375 per calendar month.

Once the works have been completed, I would advertise this property

on the rental market at £400 per calendar month.

Yeah, that sounds good. It sounds fair to me.

On the open market,

the house could then achieve an annual yield of between 5 and 6%,

so as a rental investment, they haven't done too badly.

But what are they looking forward to most of all?

Most looking forward to getting some time back, for Carla to be settled

in a nice three-bedroom house where I know she's going to be happy.

Well, they may still have a little way to go

but they're certainly transforming this house for the better.

We wish Carla and family all the best in their lovely new home

when it's finally finished.

MUSIC: "Sultans of Swing" by Dire Straits

It was in Royal Tunbridge Wells in Kent set among the rooftops

that we came across a rather quirky three-bed maisonette.

Although dated and tired,

it had bags of charm along with a town centre location.

It certainly wasn't short of potential

and retired computer company owner David bought it for 130,000

in partnership with another retired friend, Paul.

After chatting on a golf course,

they thought it might be fun to have a go at property developing.

They thought this would be the ideal property

to get into the swing of things.

The only question was, what to do with it?

There's plan A and Plan B.

Plan A is to convert it to two one-bedroom flats.

Plan B is we do a straightforward renovation

and leave it as a nice three-bedroom flat.

So David and business partner Paul had a tricky decision to make.

The two flat option needed planning permission and a proposed budget

of 35 to 40,000,

or there could be a more straightforward refurbishment

to keep it as a single maisonette which would cost around 20,000.

So, what was it to be? A full 13 months later we're back.

At last, the scaffolding has gone from the adjacent building

and there are new windows and doors.

Stepping inside...

..I only see one entrance.

It looks like they've retained it as a maisonette.

Yes, the large lounge is a giveaway. Not a bed in sight.

Instead, a fabulous refurbishment

with revived parquet flooring and rooms with ceilings.

There's a novelty!

There's also a more contemporary look to the fireplace,

and the kitchen space...

Wow, that's almost unrecognisable!

When we bought the property, the kitchen had a big larder,

brick-built, here. The units were grim

so we took the larder down

and we went to go for a white and black finish

so black floor, white and black units, metro tiles.

We put plinth lighting in, undercover lighting.

We're really pleased with the finish of the kitchen.

They have opted for a refurbishment instead of the flat conversion

but they've not only gone for high-spec fittings but have also

made the most of all the space they had here.

The wall between the two bedrooms upstairs,

we took that out and put a new one and with a dog leg

so we now have three double bedrooms as well.

That neat solution has improved the middle bedroom

without unduly affecting the second bedroom.

The master bedroom's also got a little bit extra.

We put an en-suite in the main bedroom.

That was a challenge as we didn't want to be too intrusive in the room

so we put a slight angle on the front

and we put a smaller shower in but it's still perfectly adequate.

I've tried it so you can shower and dry in there.

That en-suite shower room is complemented

by a fully refurbished bathroom suite.

All in all, I think this is a pretty impressive change throughout

but why did they decide to choose plan B over plan A?

We did apply for planning permission. It took us a while to get it

but we actually got full planning for the conversion.

The development we had next door had been very intrusive

and it became clear that we wouldn't be able to sell or rent the property

until the development next door was finished

so we put the whole development on hold

and we also bought another one in Maidstone.

We concentrated on that development

and then it became just too expensive and too difficult, really,

to do the conversion here so we decided to opt

for just a straight renovation to do three bedrooms.

So the delays with the next door made them feel

they had no option but to go with plan B.

However, despite it being over a year since we first saw it,

the work was carried out over just three months.

The builder did the bulk of it

and David and his business partner Paul finished off the cosmetic bits

hoping that would keep their budget in check.

We originally planned about 20,000 for the renovation

of the property but we decided to put an en-suite in

and we put some extra features in.

Also, because we applied for planning permission with drawings

and everything else, that put it up,

so we probably spent a fraction over 22.

A £22,000 spend on top of the £130,000 purchase price

will take their total outlay without costs and fees to £152,000.

So, has opting to keep this as a single dwelling paid off?

What do two local estate agents think?

My first impressions of this property are

it has been exceptionally well renovated to a very high standard.

I think the standard is excellent.

Little touches like the nickel on the switches.

I loved the parquet floor. What he's done with the bedrooms

with the dog leg in the second bedroom is clever.

Creating a third double bedroom rather than a third single,

that should improve his marketability.

David and business partner Paul haven't decided

whether to let or sell so hopefully some numbers might help.

Rental market, I think it will achieve

approximately £1,000 per calendar month.

If I put it up for rent,

it would achieve between 850 and £900 per calendar month.

I think that's fine, it's about what we would have expected.

I think we've already got interest at 900,

so if we get 1,000, that would be great.

The experts' valuation range would give them a rental yield

of between 6.5 to 8%, but how might their £152,000 investment fare

if put up for sale?

If we were marketing this I would expect it to achieve

in the region of £200,000.

If it were to come to the market today,

I would see it achieving in the region of £200-210,000.

That would be fantastic because our view was about 180.

If we can get anything in excess of that, that would be fantastic.

Well, certainly the resale values are impressive

with a potential pre-tax profit of between 48 and 58,000.

With those possible returns, plan A now is to sell,

but if they don't sell it within a couple of months,

plan B for rental will be invoked.

So has David enjoyed this change from the golf course?

Yes, it's great fun.

We started this because we both retired and we wanted some projects

so we've done this one, we've done a property in Maidstone

and we've had great fun with it. It's been good.

Well, we hope you enjoyed watching the show

and perhaps learned a few hints and tips along the way.

Make sure you join us next time for more Homes Under The Hammer.

-See you then.

-Goodbye.

Subtitles by Red Bee Media Ltd