0:00:00 > 0:00:03Hello, there! It's difficult to judge exactly
0:00:03 > 0:00:05where the property market is these days
0:00:05 > 0:00:08because you can't always trust what you read or hear.
0:00:08 > 0:00:11The best way is to find out for yourself.
0:00:11 > 0:00:16And one way you can do that is by visiting your local property auction.
0:00:41 > 0:00:45Well, a huge range of properties go under the hammer.
0:00:45 > 0:00:48So why not pop down to your local auction house and see what's on offer?
0:00:48 > 0:00:51You may be pleasantly surprised by some of the prices.
0:00:51 > 0:00:55Here's what got our bidders excited on today's show.
0:00:56 > 0:00:58Hello, hello, hello! What have we here, then?
0:00:58 > 0:01:02An old police station in Kent that's in far from good nick!
0:01:02 > 0:01:04It's in a right old state!
0:01:06 > 0:01:08I'm a positive kind of guy,
0:01:08 > 0:01:12so I'm sure I can say something upbeat to say about this run-down house in Burnley.
0:01:13 > 0:01:15Well, maybe not!
0:01:16 > 0:01:20And I'm in London. Property prices can swing up and down
0:01:20 > 0:01:24but there are always bargains to be bagged at auction.
0:01:24 > 0:01:26I like it.
0:01:27 > 0:01:29All these properties have been sold at auction,
0:01:29 > 0:01:34and we'll find out who bought them and what they paid for them when they went under the hammer.
0:01:34 > 0:01:36Final time!
0:01:41 > 0:01:45I'm in Chartham, Kent. It's about three miles from Canterbury
0:01:45 > 0:01:48and 11 miles from Ashford.
0:01:48 > 0:01:51With its own train station, Chartham is a thriving village
0:01:51 > 0:01:53with local shops and even a paper mill.
0:01:53 > 0:01:58# You see, it's all about the paper
0:01:58 > 0:02:01# You better go get your son
0:02:01 > 0:02:03# Get your son. #
0:02:03 > 0:02:07The property I'm here to see is this.
0:02:07 > 0:02:09It's a link-detached three-bedroomed house.
0:02:09 > 0:02:12Link-detached means it's partially joined to the neighbouring property,
0:02:12 > 0:02:15but it's still pretty much detached.
0:02:15 > 0:02:18This little bit in the middle is what's making them joined together.
0:02:18 > 0:02:23It had a guide price of 180 to £190,000
0:02:23 > 0:02:27and it was originally built in the 1950s to house the local policeman.
0:02:27 > 0:02:30So, is this old police house a fair cop
0:02:30 > 0:02:34or a right stitch-up? Let's take a look inside.
0:02:34 > 0:02:36MUSIC: Theme from The Bill
0:02:37 > 0:02:41That's funny, I always thought the police lived on "Let's Be Avenue"!
0:02:41 > 0:02:44But enough of the puns,
0:02:44 > 0:02:48the auction lot consisted of the old police office and the property to the right,
0:02:48 > 0:02:51which has been left empty for eight years.
0:02:51 > 0:02:54That's a crime in itself!
0:02:54 > 0:02:57So let's see what kind of damage those years have done.
0:02:59 > 0:03:04Do you know what, it really is airy and spacious inside.
0:03:04 > 0:03:07It feels solid, like a big house.
0:03:07 > 0:03:11But it's in a right old state. Look at that!
0:03:11 > 0:03:13A big gaping hole in the ceiling,
0:03:13 > 0:03:15there's sawdust everywhere.
0:03:15 > 0:03:19I think somebody started ripping this house apart and hasn't finished.
0:03:19 > 0:03:23But look, you've got amazing rooms, a reception room here,
0:03:23 > 0:03:25second reception room there.
0:03:25 > 0:03:29Nice big kitchen. Loads of light coming in. Big windows.
0:03:29 > 0:03:32This feels like a big chunky family house.
0:03:32 > 0:03:35And I really like it.
0:03:35 > 0:03:36Hmm.
0:03:40 > 0:03:43Let's investigate this house further.
0:03:44 > 0:03:46It's definitely spacious,
0:03:46 > 0:03:51but maybe that's because there's no evidence of a kitchen in the kitchen, not even a sink.
0:03:52 > 0:03:55And upstairs in the bathroom, there's no bath, just a toilet.
0:03:56 > 0:04:01There are two large bedrooms and a third L-shaped single room.
0:04:01 > 0:04:04But I'd say this house is probably unmortgageable.
0:04:05 > 0:04:08Hello, hello, hello! What's all this then?
0:04:08 > 0:04:10Well, actually,
0:04:10 > 0:04:13this part of the building was used as a police office.
0:04:13 > 0:04:16You can see the old typewriter to write up the police reports with.
0:04:16 > 0:04:17And the police sign here.
0:04:17 > 0:04:19Now, this is the link
0:04:19 > 0:04:23which joins the house with the neighbouring property,
0:04:23 > 0:04:25hence link-detached.
0:04:25 > 0:04:27So what could you use this area for?
0:04:27 > 0:04:31Well, it would be great if you work from home and need a study.
0:04:31 > 0:04:34Or you could incorporate it with the rest of the house.
0:04:34 > 0:04:35So lots of options.
0:04:35 > 0:04:38But I think it's a real bonus room.
0:04:39 > 0:04:42# Cool cops are gonna throw the book at you
0:04:42 > 0:04:45# When they get a look at you
0:04:47 > 0:04:50# Gonna haul you downtown. #
0:04:50 > 0:04:52Before we get hauled away,
0:04:52 > 0:04:54have a look at the size of this garden.
0:04:54 > 0:04:57It's huge. And there's also a garage.
0:04:57 > 0:05:01With so much space, surely there's something to sour this place?
0:05:01 > 0:05:05Well, you'd be right. There's an electricity pylon nearby
0:05:05 > 0:05:07which could put some buyers off.
0:05:07 > 0:05:12As you can see, this house sits on a good plot, 02.8 acres in total.
0:05:12 > 0:05:18You could knock this detached garage down and this, and put a two-storey side extension on.
0:05:18 > 0:05:22But be cautious. You don't want to make this a massive property
0:05:22 > 0:05:24if there isn't the local demand.
0:05:24 > 0:05:27You must think about resale value.
0:05:27 > 0:05:29Think about what would be acceptable to the planners.
0:05:29 > 0:05:34Don't be greedy, and don't be tempted to overdevelop if there isn't the return.
0:05:36 > 0:05:40With a guide price of 180 to £190,000,
0:05:40 > 0:05:42we asked a local estate agent
0:05:42 > 0:05:44to come down to the station for an interview!
0:05:44 > 0:05:48You know, to hear his thoughts on this property.
0:05:49 > 0:05:52This property is large as usually is the case
0:05:52 > 0:05:56with old police houses and also stands on a very impressive plot and garden.
0:05:56 > 0:05:58This house does stand close to power lines.
0:05:58 > 0:06:03You can see them going over and nearby and that will be a deterrent to some buyers.
0:06:05 > 0:06:06So, let's get the facts.
0:06:06 > 0:06:10What kind of resale value could this place achieve once refurbished
0:06:10 > 0:06:12as a three bed?
0:06:12 > 0:06:19It will command a value closer to 240, perhaps £250,000 as a three bedroom.
0:06:19 > 0:06:22What about the rental market?
0:06:22 > 0:06:25It would probably let for £800 per calendar month.
0:06:25 > 0:06:29But with regard to extending and turning this into a four bed,
0:06:29 > 0:06:34the estate agent reckons that would add an extra 20 grand to the sale value.
0:06:34 > 0:06:38And between 50 and £100 a month onto the rental.
0:06:38 > 0:06:40But would he recommend it?
0:06:40 > 0:06:45The Police Authority had planning permission refused here in the past.
0:06:45 > 0:06:48I think it's best to keep this as a three bed.
0:06:48 > 0:06:54If you make it very much larger, it would be out of character with surrounding properties.
0:06:55 > 0:06:59Well, this old police house is more beat up than bobby on the beat,
0:06:59 > 0:07:02and it's not the prettiest of houses I've ever seen.
0:07:02 > 0:07:07But it has potential, there's room to improve, to extend and to add value.
0:07:07 > 0:07:10So who had this old police house bang to rights?
0:07:10 > 0:07:12Let's find out when we head to auction.
0:07:12 > 0:07:15What may I say? 180 to start me?
0:07:15 > 0:07:17I don't mind, then. 170.
0:07:17 > 0:07:19Here we go.
0:07:19 > 0:07:23170 I'm bid. At 170,000... 175 I'm bid.
0:07:23 > 0:07:26And 180. 180 I have.
0:07:26 > 0:07:28185? 185.
0:07:28 > 0:07:31190 I'm bid. 195?
0:07:31 > 0:07:34195. 198? 198.
0:07:34 > 0:07:38And 200? 200 I'm bid. And 202?
0:07:38 > 0:07:39202.
0:07:39 > 0:07:41And 205?
0:07:41 > 0:07:44205. 208 do I see?
0:07:44 > 0:07:47208 in a fresh place. 210?
0:07:47 > 0:07:51209, if it helps. Another £1,000. You're going to miss it!
0:07:51 > 0:07:54209 is bid. And 210?
0:07:54 > 0:07:55210 I have.
0:07:55 > 0:07:59At £210,000 at the back of the room for the first time.
0:07:59 > 0:08:02211. I think that was a begging one, that one.
0:08:02 > 0:08:04211 I'm bid. 212?
0:08:04 > 0:08:06212 I'm bid.
0:08:06 > 0:08:10That was a definite no, that, wasn't it? Both unanimous at the same time.
0:08:10 > 0:08:13At £212,000 I'm bid, then.
0:08:13 > 0:08:18For the first time at 212,000. For the second time. You've had seconds to decide.
0:08:18 > 0:08:23212,000. Third and final time at 212.
0:08:23 > 0:08:28It was Michelle who made the successful bid of 212,000.
0:08:28 > 0:08:31She purchased the property with her husband Charlie
0:08:31 > 0:08:34who was so nervous, he had to wait outside!
0:08:36 > 0:08:40Michelle is a statistician and Charlie is a helicopter engineer.
0:08:45 > 0:08:48I met them both back at the property for a debrief.
0:08:49 > 0:08:52Guys, congratulations. This is really good news for you.
0:08:52 > 0:08:56Tell me about the auction. How were you feeling, Charlie, on auction day?
0:08:56 > 0:08:59I was pretty petrified, to be absolutely honest with you.
0:08:59 > 0:09:00I'd worked myself up to the day.
0:09:00 > 0:09:03Never done an auction before.
0:09:03 > 0:09:06But having watched Homes Under The Hammer for many years,
0:09:06 > 0:09:09I thought, "I've got the game plan, I know what to do."
0:09:09 > 0:09:15But when it came to it, I thought, "No. I'll let the wife do it!" I stitched her up a little bit!
0:09:17 > 0:09:23So it was Charlie who set Michelle up to take the fall if it all went pear-shaped!
0:09:23 > 0:09:26But interestingly, they have a bit of history with this place.
0:09:26 > 0:09:29Five years ago, this police house was up for grabs.
0:09:29 > 0:09:32But before they had a chance to hammer home a deal,
0:09:32 > 0:09:34it was taken off the market.
0:09:34 > 0:09:37This time, the couple pounced with sirens blazing
0:09:37 > 0:09:39when it popped back up for sale.
0:09:39 > 0:09:41What did you offer five years ago?
0:09:41 > 0:09:45- 250,000 it was on the market for then.- About that.
0:09:45 > 0:09:47Wow! That's incredible!
0:09:47 > 0:09:49We're really pleased.
0:09:49 > 0:09:55Charlie has a new-found passion for property and hopes this will be the start of a new career.
0:09:55 > 0:09:59In the long term, he'd like to build up a portfolio of properties
0:09:59 > 0:10:02and retire at the comfortable age of 55.
0:10:02 > 0:10:05What plans have they got in store for this place?
0:10:05 > 0:10:08I think we can beautify the front somewhat,
0:10:08 > 0:10:12take off the old concrete roof at the front door.
0:10:12 > 0:10:16We could put a pitched roof in, some landscaping as well.
0:10:16 > 0:10:20Possibly knock down this joining wall and have a kitchen diner
0:10:20 > 0:10:22so it would have access out into the back.
0:10:22 > 0:10:26We'd also like to knock down the garage and replace it with a new one
0:10:26 > 0:10:29and extend it out the back for a little workshop area.
0:10:29 > 0:10:30Somewhere to keep my motorbike.
0:10:30 > 0:10:33Guys have got to have toys, haven't they?
0:10:34 > 0:10:38And the reason Charlie is so keen on a workshop for his big boys' toys?
0:10:39 > 0:10:44The couple are planning on living here for a year or two before they sell it on.
0:10:44 > 0:10:49They're also considering adding a two-storey extension to make it a five bedroomed house.
0:10:49 > 0:10:52Remember, this was meant to be an investment property.
0:10:52 > 0:10:57So these ambitious ideas are making me think they're keener to settle in than sell on.
0:10:57 > 0:11:04This is a commercial project for us, so we have to be very mindful of costs
0:11:04 > 0:11:09and not get too personal about what the house deserves, so to speak.
0:11:09 > 0:11:11So we have to be very mindful.
0:11:11 > 0:11:15Michelle and Charlie think the timescale will be around four to six months.
0:11:15 > 0:11:19What kind of budget have they got in place?
0:11:19 > 0:11:21If we were to keep the house as it is now,
0:11:21 > 0:11:24possibly around the 30 to £35,000 mark.
0:11:24 > 0:11:27And what if you do get permission to extend?
0:11:27 > 0:11:30I can only speculate on what an extension would cost.
0:11:30 > 0:11:34It would probably be in the region of 50 to £60,000 for what we'd like.
0:11:39 > 0:11:42There's no stopping Charlie!
0:11:42 > 0:11:44We couldn't finish filming before he got stuck in!
0:11:44 > 0:11:46Bonus points for enthusiasm!
0:11:46 > 0:11:50Charlie, you do seem excited about the prospect of doing this house up.
0:11:50 > 0:11:52I can see a little twinkle in your eye.
0:11:52 > 0:11:55Yeah, I'm a sucker for punishment.
0:11:55 > 0:11:59Every time I do a project in the past, renovating properties we live in,
0:11:59 > 0:12:04afterwards I always say, "Never again! That absolutely broke me that one."
0:12:04 > 0:12:08Then a year later I get bored and I want to get busy with my hands again.
0:12:08 > 0:12:11Charlie, good luck. I know you're excited to get cracking on it.
0:12:11 > 0:12:13I can't wait to see what you do when you finish.
0:12:13 > 0:12:16Lovely to meet you. Thank you very much. Thank you, Michelle.
0:12:16 > 0:12:21So Michelle and Charlie have decided to put their pounds into property.
0:12:21 > 0:12:24A wise decision. But there's a lot of work ahead for them.
0:12:24 > 0:12:28Will they be doing that extension? And, more to the point,
0:12:28 > 0:12:30will they get permission?
0:12:30 > 0:12:33And will they have moved in by the time we come back?
0:12:33 > 0:12:36Find out what happens later in the programme.
0:12:39 > 0:12:43For the next property that went under the hammer, I'm in Lancashire.
0:12:45 > 0:12:47This is Burnley.
0:12:47 > 0:12:51After the collapse of the heavy industries, this has increasingly become a dormitory town
0:12:51 > 0:12:57for nearby Manchester, Leeds, and properties along the M65 corridor.
0:13:05 > 0:13:07With great road and rail links
0:13:07 > 0:13:10and within easy reach of four international airports,
0:13:10 > 0:13:14this is certainly a well-connected place to live.
0:13:14 > 0:13:18That's not all. It's also a popular location for TV and film crews.
0:13:18 > 0:13:24As well as Homes Under The Hammer, of course, it's been the backdrop for documentaries and films
0:13:24 > 0:13:26including The King's Speech.
0:13:30 > 0:13:35Queen Street mill on the outskirts of town had a starring role in the film.
0:13:35 > 0:13:40Built in 1894, this building has certainly stood the test of time.
0:13:40 > 0:13:45I just hope this house on the other side of town can do the same.
0:13:45 > 0:13:51The property I'm here to see is about a mile south-west of the town centre.
0:13:51 > 0:13:57The guide price was ten to £15,000.
0:13:57 > 0:13:59That's 15, not 50!
0:14:00 > 0:14:02So what exactly is going on?
0:14:02 > 0:14:07You don't have to look very far to see the potential issues with the property.
0:14:07 > 0:14:11This is it, a two-bed mid-terrace. As you can probably see,
0:14:11 > 0:14:15the whole of this front wall, like many other properties in this street,
0:14:15 > 0:14:17seems to be bowing out.
0:14:17 > 0:14:20That's not a good start, really, is it?
0:14:20 > 0:14:23Let's hope it gets better inside!
0:14:33 > 0:14:36The years have not been kind to this house
0:14:36 > 0:14:39and its kerb appeal leaves a lot to be desired.
0:14:39 > 0:14:42Will it improve once I'm through the front door?
0:14:44 > 0:14:48Nope, it's not good, is it?
0:14:48 > 0:14:51Great big hole in the floor the moment you come in.
0:14:51 > 0:14:54Front door obviously not in a very good state.
0:14:54 > 0:14:56And worse than that,
0:14:56 > 0:14:58look at that wall in the corner!
0:14:58 > 0:15:02You can really see the bowing here.
0:15:02 > 0:15:05I was hoping maybe the internal wall would be OK,
0:15:05 > 0:15:08in which case you could do some remedial work to pull the exterior in.
0:15:08 > 0:15:12But it looks like the interior wall is bowing out as well.
0:15:12 > 0:15:17So that is basically curtains to that front wall. There's nothing you can do about that.
0:15:17 > 0:15:19In terms of the room, it's not a bad size.
0:15:27 > 0:15:30It's not often that I'm lost for words,
0:15:30 > 0:15:33but that front wall really is a concern.
0:15:33 > 0:15:37It would be the first thing I'd get checked out before I did anything else.
0:15:37 > 0:15:40If you can see past the mess in here,
0:15:40 > 0:15:42there's a decent-sized living room.
0:15:42 > 0:15:45That leads directly into the kitchen at the back of the house
0:15:45 > 0:15:47which clearly needs replacing!
0:15:47 > 0:15:54From here, there's access to a back yard and also the stairs to the bedrooms and bathroom.
0:15:54 > 0:15:56I'm not sure I'll venture that far!
0:15:56 > 0:16:00Well, I am so excited to explore more of this darling property.
0:16:00 > 0:16:05However, I have been told that upstairs it gets really bad.
0:16:05 > 0:16:06Yes, worse than this!
0:16:06 > 0:16:09All the pipes have been taken, a lot floorboards are up
0:16:09 > 0:16:12and there are things up there that you would not want to step on.
0:16:12 > 0:16:14So I'm not going upstairs.
0:16:14 > 0:16:17And a really important health and safety note here.
0:16:17 > 0:16:20If you are looking round properties that are in this kind of state,
0:16:20 > 0:16:25make sure you wear good footwear, and please, be careful!
0:16:31 > 0:16:34Well, our camera operator did indeed have sturdy boots
0:16:34 > 0:16:37and she was brave enough to venture upstairs.
0:16:39 > 0:16:42And what was up there? More mess, more holes
0:16:42 > 0:16:45and, worryingly, quite a lot of cracks,
0:16:45 > 0:16:48possibly caused by that front wall.
0:16:49 > 0:16:52The bedroom at the front is the larger of the two
0:16:52 > 0:16:57and I'm sure it will feel even bigger once it's cleared of all this stuff.
0:16:57 > 0:17:00Bedroom two at the back of the property is much smaller.
0:17:00 > 0:17:04And, like the rest of the house, has had floorboards taken up.
0:17:04 > 0:17:06The bathroom is a good size,
0:17:06 > 0:17:08but needs to be ripped out and replaced.
0:17:08 > 0:17:11So, a lot of work to be done.
0:17:11 > 0:17:16But with a guide price of ten to £15,000 is it worth it?
0:17:16 > 0:17:19We asked a local property expert for his opinion.
0:17:19 > 0:17:22First impressions of the property, obviously,
0:17:22 > 0:17:27it needs a lot of work. There's structural movement to the front of the property
0:17:27 > 0:17:29and some neighbouring properties.
0:17:29 > 0:17:33So whoever takes it on has got some work to do to it.
0:17:33 > 0:17:35Once those works are completed,
0:17:35 > 0:17:38how much could this place achieve if let?
0:17:38 > 0:17:42From a rental point of view, we're looking somewhere in the region of
0:17:42 > 0:17:43£400 per calendar month.
0:17:43 > 0:17:49And if the buyers decided to do it up and sell it on, how much could it achieve?
0:17:49 > 0:17:54The property as it stands is probably worth somewhere in the region of £10,000.
0:17:54 > 0:17:57Once it's renovated, what we're seeing at the moment
0:17:57 > 0:18:00is that the values are stalling at around 25,000.
0:18:00 > 0:18:03So probably no more than that. There's not a great profit in it.
0:18:03 > 0:18:08I think that's why it would work as a rental, rather than a resale.
0:18:08 > 0:18:11There's an expression round these parts,
0:18:11 > 0:18:13"You don't get owt for nowt."
0:18:13 > 0:18:18And although ten to £15,000 sounds like such a low guide price,
0:18:18 > 0:18:22I think whoever bought this bought themselves a whole heap of trouble.
0:18:22 > 0:18:25Let's find out who that was when it went under the hammer.
0:18:25 > 0:18:28This lot came up for auction later in the day,
0:18:28 > 0:18:30but interest was still high.
0:18:30 > 0:18:33A mid-terraced house in need of refurbishment and I'll start at three.
0:18:34 > 0:18:37Three I've got. Four?
0:18:37 > 0:18:39£4,000. Four I've got here. Five. Got it.
0:18:39 > 0:18:41Six. Seven.
0:18:41 > 0:18:42Eight.
0:18:42 > 0:18:45Nine. Ten. Eleven?
0:18:45 > 0:18:47Go on. I'll take it. Ten and a half.
0:18:47 > 0:18:49Eleven. And a half.
0:18:49 > 0:18:5012.
0:18:50 > 0:18:5312 I've got. And a half? No.
0:18:53 > 0:18:55With you, sir, at £12,000.
0:18:55 > 0:18:57All finished at 12?
0:18:57 > 0:18:59First time at £12,000.
0:18:59 > 0:19:01Second time at £12,000. All finished at 12?
0:19:01 > 0:19:04We are. Sold to you, sir. Well done.
0:19:04 > 0:19:08That successful bid of £12,000
0:19:08 > 0:19:10was made by Damien.
0:19:10 > 0:19:12He's been a builder for 18 years
0:19:12 > 0:19:18and is hoping that this purchase will be the start of a healthy investment portfolio.
0:19:18 > 0:19:23I met him at the house to find out how he plans to tackle that front wall.
0:19:24 > 0:19:28- Damien, lovely to meet you.- And you. - Congratulations.- Thank you.
0:19:28 > 0:19:30- You got a house for not very much money!- I know!
0:19:30 > 0:19:33Tell me why you wanted to buy it.
0:19:33 > 0:19:36As an investment. Make some money, hopefully.
0:19:36 > 0:19:40What was the decision-making process you went through to decide that now is the time?
0:19:40 > 0:19:42My back going, two years ago.
0:19:42 > 0:19:46- Back?- I ruptured two discs in my back.- Ow!
0:19:46 > 0:19:50- I spent nine months off work. - Do you work for yourself?- Yeah.
0:19:50 > 0:19:54- That's not good news, then. - Not at all. I had no money coming in for nine months.
0:19:54 > 0:20:00- Oh.- And my mother's ISAs were coming up. So I had a chat and a business proposal
0:20:00 > 0:20:02and worked it from there.
0:20:02 > 0:20:08So, with his mum on board, Damien's preparing to launch into property developing.
0:20:08 > 0:20:12But what was it about this place that turned his head?
0:20:12 > 0:20:14What did you think of it when you saw it?
0:20:14 > 0:20:17All right. It weren't too bad, bar the wall outside,
0:20:17 > 0:20:21it looked pretty sturdy and pretty all right, to be honest.
0:20:21 > 0:20:25- When did you see it?- I came up last week and had a look round outside.
0:20:25 > 0:20:30I only got the keys yesterday afternoon at three o'clock.
0:20:30 > 0:20:33- You didn't see it before you bought it?- No.- Oh!
0:20:33 > 0:20:35And your reasoning there was?
0:20:35 > 0:20:37I just didn't have time to come and do a viewing.
0:20:37 > 0:20:40I'd been up and looked at the outside before I bought,
0:20:40 > 0:20:44but not on this one. It was on the next street.
0:20:44 > 0:20:47- Right.- Just to look at the outside. Inside doesn't worry me.
0:20:47 > 0:20:51It could need a full everything on the inside and it wouldn't bother me.
0:20:51 > 0:20:57It's the outside that concerns. If that's not solid and stood up, it's more of a cost.
0:20:57 > 0:21:02- Well, it isn't solid and stood up, is it?- No, not going off the front wall, no!
0:21:02 > 0:21:06No. It's not falling down, but it's not exactly straight.
0:21:06 > 0:21:09- You're going to have to knock down the front wall.- Yep.- And rebuild it.
0:21:13 > 0:21:16That's a massive job.
0:21:16 > 0:21:21These are party walls, so Damien has to give notice of his intentions
0:21:21 > 0:21:23To the owners of the other houses.
0:21:23 > 0:21:27Not an impossible task, but a difficult and potentially lengthy one.
0:21:27 > 0:21:30Does he still think he's got a bargain?
0:21:30 > 0:21:33Is that why it was so cheap, do you think?
0:21:33 > 0:21:37I think that's why no-one started bidding on it, cos they'd seen the walls.
0:21:37 > 0:21:40But saying that, they'd bidden on the street next
0:21:40 > 0:21:42and the walls look the same.
0:21:42 > 0:21:45But to me, 12 grand is a buy it.
0:21:45 > 0:21:49I'm not going to spend, even if I have to do the wall at the front,
0:21:49 > 0:21:51ten, 12 grand max.
0:21:51 > 0:21:54- Including doing the wall?- Yes. - To do it up?- Yeah.
0:21:54 > 0:21:58- New kitchen, new bathroom, central heating?- Yep.- New floors?- Yep.
0:21:58 > 0:22:01- Skimming ceilings, all that? - Yeah.- Really?
0:22:01 > 0:22:06£12,000 is an ambitious budget for the amount of work needed.
0:22:06 > 0:22:10As is his eight-week schedule.
0:22:10 > 0:22:13And he's planning to do the majority of the work himself.
0:22:14 > 0:22:18How much involvement is your mum going to have?
0:22:18 > 0:22:21- Uh, none.- Does she know what you've bought with her money?
0:22:21 > 0:22:23Yes, she's already cried!
0:22:25 > 0:22:29- Why do I not think you're joking? - I'm not joking. She has cried.
0:22:29 > 0:22:31- She cried?- She's been in tears. - What?
0:22:31 > 0:22:37She's, um... She doesn't know anything about building or anything like that.
0:22:37 > 0:22:39So she's just seen the outside and that made her cry.
0:22:39 > 0:22:43- No.- She'll be all right when it's finished and she comes in. She'll be fine.
0:22:43 > 0:22:46- So you brought your mum here she cried...- She's not been inside.
0:22:46 > 0:22:50- We've only been outside.- Fine(!) Bring her inside and she'll feel much better(!)
0:22:50 > 0:22:53No, I can't bring her inside. I definitely cannot bring her inside.
0:22:53 > 0:22:56If I brought her inside, then she would be devastated.
0:22:56 > 0:22:59Listen, a bit of weight on your shoulders, I feel!
0:22:59 > 0:23:04- But good luck with it.- Thank you. - I look forward to seeing how you get on.- Thank you.
0:23:04 > 0:23:09Well, let's hope his mum will be smiling and not in tears
0:23:09 > 0:23:13when we return to find out what happens, later in the show.
0:23:14 > 0:23:20Coming up, I'm in London and there are two essential items required to renovate this flat.
0:23:20 > 0:23:23A bucket of hot water and some sponges and you're away.
0:23:24 > 0:23:28Find out how Damien got on with the crumbling exterior
0:23:28 > 0:23:30of this property in Burnley.
0:23:30 > 0:23:34The wall cost me a lot more than I expected it to cost me, but it was worth it in the end.
0:23:35 > 0:23:40But first, in Kent. Are the experts impressed with Michelle and Charlie's renovation?
0:23:40 > 0:23:42This property is completely transformed.
0:23:42 > 0:23:44It's a very top-end specification.
0:23:48 > 0:23:51This link-detached house in Canterbury, Kent,
0:23:51 > 0:23:54was built to house police officers,
0:23:54 > 0:23:57but had become derelict and was in dire need of an emergency service!
0:24:00 > 0:24:04Rushing to the rescue came Michelle and her husband, Charlie.
0:24:04 > 0:24:08They purchased it at auction for 212,000.
0:24:10 > 0:24:13Charlie is a helicopter engineer.
0:24:13 > 0:24:17But with this purchase was pondering becoming a property developer.
0:24:18 > 0:24:22However, I began to suspect, during their interrogation,
0:24:22 > 0:24:26that Charlie may be tempted to make this investment his new home.
0:24:26 > 0:24:30We'd like to knock down the garage and replace it with a new one
0:24:30 > 0:24:33and extend it out the back for a little workshop area.
0:24:33 > 0:24:35Somewhere to keep my motorbike.
0:24:35 > 0:24:38Guys have got to have toys, haven't they? But, um...
0:24:38 > 0:24:42Charlie, you do seem quite excited about the prospect of doing this up.
0:24:42 > 0:24:44I can definitely see a little twinkle in your eye!
0:24:45 > 0:24:51Somewhere to store the motorbike and big boys' toys is not usually so high on a developer's priority list.
0:24:54 > 0:24:58So we're back after a whopping one year and nine months
0:24:58 > 0:25:01to find out if Charlie is guilty as charged!
0:25:03 > 0:25:06Yes, that is the same house!
0:25:06 > 0:25:09Now there's a garage and just cop a load of that!
0:25:09 > 0:25:14A two-storey extension has been added as well. Let's look inside.
0:25:16 > 0:25:18Wow!
0:25:18 > 0:25:21What a wonderful transformation!
0:25:25 > 0:25:27There's no need for sirens to make this property stand out!
0:25:30 > 0:25:32We can see all the evidence.
0:25:32 > 0:25:36The cost of the construction work, and the high spec, high scale finish
0:25:36 > 0:25:40is above and beyond what a developer would dare to invest in this property.
0:25:40 > 0:25:43Come on, Charlie, the game's up. 'Fess up!
0:25:43 > 0:25:47In the beginning, it was going to be a development property,
0:25:47 > 0:25:53but a few months later on, we decided that it would be a house that we'd like to live in.
0:25:53 > 0:25:58- So we're looking at living here for at least 15 to 20 years.- Mm.- Yeah.
0:26:00 > 0:26:03We decided that it could be potentially a lovely house
0:26:03 > 0:26:06and that we'd prefer to make this our home
0:26:06 > 0:26:09and rent our property down the road that we were going to originally stay in.
0:26:11 > 0:26:16This house is unrecognisable. It has a fabulous and funky style.
0:26:16 > 0:26:21Charlie gave up his job to work on this renovation full time.
0:26:21 > 0:26:24He stripped all the walls back to the brick,
0:26:24 > 0:26:28replaced the plumbing and commissioned this beautiful staircase.
0:26:30 > 0:26:33I love the idea of having a bespoke house,
0:26:33 > 0:26:36having lights where you like, fittings, everything.
0:26:36 > 0:26:40Because it's difficult to fit to a home and it's nice to have a home that fits to you.
0:26:43 > 0:26:47Planning permission was granted to build the two-storey extension.
0:26:48 > 0:26:51On the ground floor, there's a guest bedroom with en-suite bathroom.
0:26:52 > 0:26:55To the rear, situated just off the kitchen,
0:26:55 > 0:27:00is the living room with fantastic floor to ceiling windows and patio doors.
0:27:02 > 0:27:05With extensive remodelling work done to the exterior
0:27:05 > 0:27:07and even solar panels fitted,
0:27:07 > 0:27:11would it not have been easier for them to build a new house?
0:27:11 > 0:27:17The cost of demolishing and removing the material is very expensive.
0:27:17 > 0:27:21So it was cheaper working with the existing property.
0:27:21 > 0:27:23But I was tempted!
0:27:25 > 0:27:28In the extension upstairs, there's a new master bedroom...
0:27:32 > 0:27:34..with an en-suite shower room.
0:27:37 > 0:27:42The main bathroom is also in the extension, finished to a high specification
0:27:42 > 0:27:46with fabulous features that add star quality.
0:27:50 > 0:27:52In the original body of the property,
0:27:52 > 0:27:55there were three bedrooms and a bathroom upstairs.
0:28:01 > 0:28:05Charlie and Michelle have remodelled extensively,
0:28:05 > 0:28:08knocking down walls and rebuilding rooms to their own requirements.
0:28:10 > 0:28:13In total, they now have five bedrooms...
0:28:14 > 0:28:16..three with en-suite.
0:28:18 > 0:28:22The couple had originally planned to spend up to £60,000,
0:28:22 > 0:28:26but I doubt even Michelle, who works from home as a statistician,
0:28:26 > 0:28:29could make the original stack up on this renovation!
0:28:32 > 0:28:34We are going to be poor for a bit.
0:28:34 > 0:28:36No holidays, or beer!
0:28:37 > 0:28:40Well, I'll have the beer, but skip the holidays!
0:28:42 > 0:28:47Charlie believes they'll have spent £115,000 on the renovation
0:28:47 > 0:28:48once completed.
0:28:48 > 0:28:51Added to the purchase price of £212,000
0:28:51 > 0:28:57that means a total outlay of 327,000.
0:28:57 > 0:28:58Certainly a pretty penny!
0:29:01 > 0:29:06And a new home isn't the only change in Charlie and Michelle's life.
0:29:07 > 0:29:10I'm happy to say Michelle is expecting our first child.
0:29:10 > 0:29:13So that will have its own set of challenges.
0:29:13 > 0:29:15I think that's going to be harder than doing this build.
0:29:15 > 0:29:19So... I'll give it a go!
0:29:19 > 0:29:22- It's too late now!- It is, yeah. Never mind!
0:29:22 > 0:29:25# Hey it's a real good day
0:29:26 > 0:29:29# Cos baby's on the way. #
0:29:30 > 0:29:34Congratulations to mum and dad-to-be.
0:29:34 > 0:29:37I'm sure they'll all be very happy in their new home.
0:29:39 > 0:29:41We invited two local estate agents
0:29:41 > 0:29:43to give us their opinion on it.
0:29:43 > 0:29:46What I particularly like about this house
0:29:46 > 0:29:49is that it's relatively unassuming from the outside
0:29:49 > 0:29:51but you come in, it's light, it's airy,
0:29:51 > 0:29:55good use of quality materials,
0:29:55 > 0:29:59fixtures and fittings, the handles, the kitchens, bathrooms. It's been done really well.
0:29:59 > 0:30:01This property is completely transformed.
0:30:01 > 0:30:05It's a very top end specification and a very good standard of finish.
0:30:05 > 0:30:08This house was purchased as a financial investment,
0:30:08 > 0:30:12but quickly became an investment in Charlie and Michelle's future happiness.
0:30:14 > 0:30:16The estate agents believe this property could achieve
0:30:16 > 0:30:20£1,250 per calendar month if let,
0:30:20 > 0:30:24giving the couple a rental yield of about four to five per cent.
0:30:26 > 0:30:28Bearing in mind their total outlay
0:30:28 > 0:30:30of 327,000,
0:30:30 > 0:30:32what could this place sell for?
0:30:34 > 0:30:38We're still in a quite volatile market, so it's difficult to gauge.
0:30:38 > 0:30:41I would normally say £450,000.
0:30:41 > 0:30:45I think I'd probably come down to about £420,000.
0:30:45 > 0:30:48There's landscaping to be finished and final snagging to be done,
0:30:48 > 0:30:54but I think this would be about 450 to £475,000.
0:30:54 > 0:30:58Those figures would give Charlie and Michelle a pre-tax profit
0:30:58 > 0:31:01of between 93 and 148,000,
0:31:01 > 0:31:04minus the usual selling expenses.
0:31:12 > 0:31:18Michelle and Charlie have worked hard to create a home for them and their soon-to-be-born baby.
0:31:19 > 0:31:23Are they pleased to hear that their new home is also a wise investment?
0:31:24 > 0:31:27- I'm pleased with that price. - I'm absolutely over the moon.
0:31:27 > 0:31:30But as we're going to be living here for 15 to 20 years,
0:31:30 > 0:31:36it's not such a big deal, knowing the value,
0:31:36 > 0:31:40- but it's...- It's still nice! - It's still nice, yeah!
0:31:43 > 0:31:48It's funny how one street can take you on an architectural tour through the ages. Here,
0:31:48 > 0:31:51we have examples of Victorian housing.
0:31:51 > 0:31:56A sidestep to the left and we are transported into the swinging '60s.
0:31:56 > 0:31:59One more turn and look, we're in the '80s.
0:31:59 > 0:32:05Whoever said time travel was impossible, they obviously haven't been to Poplar in East London!
0:32:08 > 0:32:12But from which era is the property I'm here to visit?
0:32:15 > 0:32:19The auction lot I'm here to see is in this block.
0:32:19 > 0:32:22It's a one-bedroomed flat and it had a guide price
0:32:22 > 0:32:23of £110,000.
0:32:23 > 0:32:26Fantastic value for this part of East London.
0:32:26 > 0:32:29Thankfully, it's on the ground floor.
0:32:30 > 0:32:35One-bedroomed flats in this building sell for around £150,000.
0:32:35 > 0:32:39These flats are less than two miles from Canary Wharf,
0:32:39 > 0:32:43where a one-bed flat can cost around 250 grand.
0:32:43 > 0:32:49So Poplar can be popular for those who work in the financial district
0:32:49 > 0:32:50but can't afford to live there.
0:32:51 > 0:32:56It's always good to have an intercom system. I like that if you've got a flat,
0:32:56 > 0:32:59especially if you're on the ground floor.
0:32:59 > 0:33:04And if you look past all the newspapers and letters scattered and a bit of the mess,
0:33:04 > 0:33:08you've actually got a really solid flat here.
0:33:08 > 0:33:11Paint, new carpet, new curtains,
0:33:11 > 0:33:15a bucket of hot water and some sponges and you're away.
0:33:15 > 0:33:18So far, so good. This is a really good space. You could have this as a bedroom
0:33:18 > 0:33:20or a lounge.
0:33:20 > 0:33:22I like it.
0:33:30 > 0:33:33At the end of the hall is another good-sized room.
0:33:33 > 0:33:37Again, looking past the mess it's in a reasonable state.
0:33:37 > 0:33:40All it needs is new flooring and a lick of paint.
0:33:43 > 0:33:45The kitchen is perfectly serviceable.
0:33:45 > 0:33:48While the units and worktops would not win any style awards,
0:33:48 > 0:33:51they are in good order.
0:33:51 > 0:33:56It also needs new flooring, but this flat is a perfect example of a fast in-and-out job.
0:33:59 > 0:34:02If a developer picked this up for around the guide price,
0:34:02 > 0:34:05got started quickly, did it up and let it out,
0:34:05 > 0:34:10there is money to be made here. And that's the name of the game in property development.
0:34:12 > 0:34:15But there are other expenses to take into consideration.
0:34:18 > 0:34:20This flat comes with a really long lease.
0:34:20 > 0:34:24There's 121 years left, so that's fantastic news.
0:34:24 > 0:34:29However, the bad news is, this flat has a very high service charge.
0:34:29 > 0:34:32It's £1,100 per year
0:34:32 > 0:34:37and there's also a £250 ground rent which is payable each year.
0:34:37 > 0:34:38This will undoubtedly put some people off,
0:34:38 > 0:34:40so when you buy a leasehold property,
0:34:40 > 0:34:45make sure you're aware of all the additional costs before you buy.
0:34:45 > 0:34:50At the rear, there's parking, always a bonus in London.
0:34:50 > 0:34:52And a kids' play park.
0:34:52 > 0:34:56As we all know, property prices can swing up and down.
0:34:56 > 0:34:58The recent economic climate
0:34:58 > 0:35:03has seen prices slide, but the market is slowly beginning to pick up.
0:35:04 > 0:35:09And Poplar has an advantage when it comes to property sales shining bright.
0:35:12 > 0:35:14This flat is located in a part of London
0:35:14 > 0:35:19which has been designated as a disadvantaged and regeneration area.
0:35:19 > 0:35:21This means the stamp duty threshold
0:35:21 > 0:35:25doesn't kick in until £150,000
0:35:25 > 0:35:29as opposed to the usual £125,000 mark.
0:35:29 > 0:35:31This encourages investment in the area
0:35:31 > 0:35:35and it's an incentive to tempt first-time buyers onto the market.
0:35:35 > 0:35:38It's also incredible news for new owners.
0:35:38 > 0:35:41The lower stamp duty could have capped the price here
0:35:41 > 0:35:46and now it's been upped, hopefully the sales price will go in the same direction.
0:35:46 > 0:35:48Result!
0:35:49 > 0:35:53We invited a local estate agent to give us his opinion
0:35:53 > 0:35:57on this property, which had a guide price of 110,000.
0:35:59 > 0:36:01The property itself is very spacious
0:36:01 > 0:36:04and it does have some modern cons.
0:36:04 > 0:36:08However, it will require quite a bit of aesthetics work to put back together.
0:36:10 > 0:36:14How much could this place achieve on the rental market once renovated?
0:36:16 > 0:36:21If the property was to be refurbished and done to a reasonable standard and furnished,
0:36:21 > 0:36:25I imagine it would rent for between 900 and £1,000 per calendar month.
0:36:25 > 0:36:29Wow. That is a very impressive rental valuation
0:36:29 > 0:36:32which could result in an excellent yield.
0:36:32 > 0:36:34What if it was sold on?
0:36:36 > 0:36:39Once the property has had some renovation work done,
0:36:39 > 0:36:43I would imagine it would sell for £150,000.
0:36:46 > 0:36:49This really is a fantastic one to go for, in my opinion.
0:36:49 > 0:36:53And with such a high yield, I know what I would do.
0:36:53 > 0:36:56Lightly renovate the place and get it on the rental market.
0:36:56 > 0:37:00There's also some money to be made if you wanted to sell this on.
0:37:00 > 0:37:03But I would be inclined to take the long-term view with this property
0:37:03 > 0:37:07especially as there's so many signs of regeneration going on in the area.
0:37:07 > 0:37:10Let's see who went for this as we go to auction.
0:37:11 > 0:37:13Start at 100.
0:37:13 > 0:37:17I'm not going below 100. 100 on my right, sitting here. 100,000.
0:37:17 > 0:37:19102.
0:37:19 > 0:37:21104. 106.
0:37:21 > 0:37:23108.
0:37:23 > 0:37:25110.
0:37:25 > 0:37:26112.
0:37:26 > 0:37:28114.
0:37:28 > 0:37:30115. 116.
0:37:30 > 0:37:33With you. 116. 117?
0:37:33 > 0:37:36116. First time.
0:37:36 > 0:37:38117 with you.
0:37:38 > 0:37:40Saw you first. 118?
0:37:40 > 0:37:41119.
0:37:41 > 0:37:42120.
0:37:42 > 0:37:44121?
0:37:44 > 0:37:47120 with you. 121? Someone else coming in?
0:37:47 > 0:37:49If not, 120.
0:37:49 > 0:37:51First time. Second time.
0:37:51 > 0:37:53Third and last time. Have you all done?
0:37:54 > 0:37:56Sold 120.
0:37:56 > 0:38:00And it was Shafi who made the successful bid
0:38:00 > 0:38:02of £120,000.
0:38:05 > 0:38:10Shafi works in IT support for a large department store.
0:38:10 > 0:38:14But property is where his passion lies and he currently has a small portfolio of buy-to-lets.
0:38:16 > 0:38:19Shafi, great to meet you. So how was the auction?
0:38:19 > 0:38:21The auction was great, actually.
0:38:21 > 0:38:25Early morning. That was the only part that I had to wake up early to go there!
0:38:25 > 0:38:30I'm used to auctions. I go quite regularly to auctions.
0:38:30 > 0:38:34- I was waiting for the hammer to go down.- You wanted this, did you?
0:38:34 > 0:38:40I was expecting a bit higher than what I got it, actually.
0:38:40 > 0:38:42But I'm lucky to get it on this price, I think.
0:38:42 > 0:38:45So you paid £120,000. The hammer went down.
0:38:45 > 0:38:48- How much did you expect to pay realistically?- 130.
0:38:48 > 0:38:49I would go up to 130.
0:38:49 > 0:38:53- So you're ten grand in.- Ten grand in. That's a good start.
0:38:53 > 0:38:58- Good start to your very early morning!- It was worth me getting up from bed!
0:39:07 > 0:39:10The early riser has reaped his reward.
0:39:10 > 0:39:13Shafi's already ten grand under budget.
0:39:13 > 0:39:17Will he invest that saving by renovating this place to a higher standard
0:39:17 > 0:39:20than he originally planned?
0:39:20 > 0:39:22What are you going to do to upgrade it?
0:39:22 > 0:39:25I'm going to make it a bit more fancy to the flat.
0:39:25 > 0:39:30Maybe change the floorings, a bit more cosmetic work, painting.
0:39:30 > 0:39:33There isn't much more to do. Reorganise the kitchen,
0:39:33 > 0:39:38try to put a dining table there, so if somebody wants to use it as two-room, they can,
0:39:38 > 0:39:40because of shortage of properties.
0:39:40 > 0:39:42So you'll try to convert it to a two-bed flat?
0:39:42 > 0:39:45Not convert, but just give the option to people
0:39:45 > 0:39:48if two friends want two separate rooms, they've got that option.
0:39:48 > 0:39:50Rather than using the living room.
0:39:50 > 0:39:53If they've got a dining space they can use in the kitchen, that's great,
0:39:53 > 0:39:55so they can use it as two rooms.
0:39:55 > 0:39:57Do you do this full time?
0:39:57 > 0:40:01I do part and part. I work in the computer field as well,
0:40:01 > 0:40:03looking after computers.
0:40:03 > 0:40:08So I do half and half. I'll work three days at the other place and then here.
0:40:08 > 0:40:11- So it's IT and property.- Property. - You prefer?
0:40:11 > 0:40:14- I prefer property! - You make more money from?
0:40:14 > 0:40:16It's not more money, it's what I enjoy.
0:40:20 > 0:40:24'I'm happy to hear Shafi's property development puts a smile on his face.
0:40:26 > 0:40:28'But will his budget put a smile on mine?'
0:40:29 > 0:40:31What's your budget for the work?
0:40:31 > 0:40:34When I actually saw it, I had a very low budget.
0:40:34 > 0:40:38But when I saw the heating system, I'm not sure if the boiler's working
0:40:38 > 0:40:41and there's a lot of piping needing to be done.
0:40:41 > 0:40:45So I would say between five and £7,000 maximum I would spend to make it up and running.
0:40:45 > 0:40:48Five to £7,000.
0:40:48 > 0:40:51- I'm presuming you're not going to be changing the bathroom suite. - Maybe flooring.
0:40:51 > 0:40:54How quickly will you be able to turn this place around?
0:40:54 > 0:40:57Refurbish I would say is a weekend job.
0:40:57 > 0:40:59- So I'm hoping by... - What?! Whoa, whoa, whoa!
0:40:59 > 0:41:02- A weekend job?- Yes, that's what I'm expecting.
0:41:02 > 0:41:05- You can turn this place round in a weekend?- Hopefully.
0:41:05 > 0:41:08- Well, that's mighty ambitious, I have to say!- Thank you.
0:41:08 > 0:41:11What has encouraged you to be so motivated?
0:41:11 > 0:41:13It actually was Homes Under The Hammer.
0:41:13 > 0:41:17That's why. That's the only programme maybe I watch on telly!
0:41:17 > 0:41:19- Yes!- In my busy life.- Really?
0:41:19 > 0:41:22- Yes.- What is it about Homes Under The Hammer?
0:41:22 > 0:41:26It's all about people's passion, people creating new things
0:41:26 > 0:41:30and when they see the difference, they enjoy looking at that
0:41:30 > 0:41:34and most people I see are happy so I thought, "Let me get in there. I'll be happy."
0:41:34 > 0:41:38- Shafi, I'm really excited for you. Congratulations. Well done. - Thank you very much.
0:41:40 > 0:41:44That is the quickest turnaround I have ever heard of.
0:41:44 > 0:41:46Especially if Shafi wants to sell this on.
0:41:46 > 0:41:51I don't think a weekend will be enough and he certainly won't achieve the top price that way.
0:41:51 > 0:41:54What will he decide to do? Rent or sell?
0:41:54 > 0:41:58You can find out which way he goes later in the programme.
0:42:01 > 0:42:03Now, the seasons have changed,
0:42:03 > 0:42:05but have the properties changed as well?
0:42:05 > 0:42:08Or have they stayed exactly the same?
0:42:08 > 0:42:11It's the moment of truth. Let's go back and find out.
0:42:13 > 0:42:18Let's make our way back to Burnley where I viewed this two-bed terrace
0:42:18 > 0:42:21which had a guide price of between ten and £15,000.
0:42:21 > 0:42:24And what a state it was in.
0:42:24 > 0:42:29The exterior wall looked as though a mild sneeze might blow it over
0:42:29 > 0:42:33and bless me, the interior was just as bad.
0:42:33 > 0:42:39So who was up for tackling the unenviable task of this renovation?
0:42:39 > 0:42:41Well, the man for the job was builder Damien.
0:42:42 > 0:42:46He hadn't viewed the exterior or the interior before the auction.
0:42:46 > 0:42:52But even once he had, Damien was still hopeful this purchase
0:42:52 > 0:42:55would be the beginning of his property developing career.
0:42:55 > 0:43:00With financial help from his mum, he paid £12,000 at auction for this terraced house.
0:43:01 > 0:43:04What did his mum make of that?
0:43:04 > 0:43:08How much involvement is your mum going to have?
0:43:08 > 0:43:10- None.- Does she know what you've bought with her money?
0:43:10 > 0:43:12Yes, she's already cried.
0:43:13 > 0:43:18- Why do I not think you're joking? - I'm not joking. She has already cried.
0:43:19 > 0:43:21Oh, poor Mum!
0:43:21 > 0:43:25So, have her tears of sorrow been replaced by tears of joy?
0:43:25 > 0:43:29Eleven months later, we're back to find out.
0:43:30 > 0:43:33- #- So mama don't cry cos I know
0:43:33 > 0:43:36- #- I'm gonna make your bitter turn sweet
0:43:36 > 0:43:39- #- Mama don't cry no more
0:43:39 > 0:43:42- #- Oh, better days are there for sure
0:43:42 > 0:43:44- #- Mama don't cry...- #
0:43:44 > 0:43:46Fantastic!
0:43:46 > 0:43:50I think Damien will have made his mother very proud
0:43:50 > 0:43:52with this terrific transformation.
0:43:56 > 0:44:00He has rebuilt the front wall from the ground up.
0:44:00 > 0:44:03It must have been a monumental task.
0:44:08 > 0:44:12If you can remember before, the floor was all rotten,
0:44:12 > 0:44:15there was no vestibule. So I put a solid concrete floor in
0:44:15 > 0:44:17and a vestibule so you don't lose any heat.
0:44:19 > 0:44:23He has certainly not cut any corners.
0:44:24 > 0:44:28If you can remember, this wall was totally bellied out, unsafe.
0:44:28 > 0:44:30So I rebuilt the whole wall, reinsulated it all,
0:44:30 > 0:44:32so it's all solid and totally insulated now.
0:44:32 > 0:44:35The wall cost me a lot more than I expected it to cost,
0:44:35 > 0:44:37but it was worth it in the end.
0:44:37 > 0:44:40I know it's solid now for at least 25 years
0:44:40 > 0:44:42and it'll not be going anywhere! So I'm happy with it.
0:44:45 > 0:44:46And so he should be.
0:44:47 > 0:44:49Let's take a look upstairs,
0:44:49 > 0:44:52which was, to put it simply, a great big mess.
0:44:55 > 0:45:00As you might expect, Damien has continued his good work.
0:45:00 > 0:45:04Just like downstairs, all the walls have been repaired and replastered.
0:45:04 > 0:45:08The floorboards have been fixed and new carpets fitted
0:45:08 > 0:45:11as well as skirting and architraves.
0:45:11 > 0:45:15He has also replaced the windows when beyond repair.
0:45:16 > 0:45:21This house has been renovated top to bottom with all new electrics and plumbing.
0:45:24 > 0:45:27Damien has even been busy in the back yard.
0:45:29 > 0:45:32We had to dig up the drains. The drains had been smashed.
0:45:32 > 0:45:36As regards the roof, we've re-done the chimney, re-done the lead round the chimney
0:45:36 > 0:45:37and repaired any broken slates.
0:45:37 > 0:45:39So that's all sorted now.
0:45:39 > 0:45:43My goodness, I'm exhausted at even contemplating all this effort.
0:45:43 > 0:45:47Damien still has a few finishing touches to do,
0:45:47 > 0:45:52but he's waiting till the property is occupied before fitting the boiler and radiators
0:45:52 > 0:45:53to ensure their safe-keeping.
0:45:54 > 0:45:58He had hoped to have his house ready to let in eight weeks.
0:45:58 > 0:46:02But it's taken him 22 weeks in total,
0:46:02 > 0:46:05fitting the renovation in around other building work.
0:46:07 > 0:46:12So, over-schedule. But what about his 12 grand budget?
0:46:14 > 0:46:17Budget-wise, it's gone well over. The wall cost more to build.
0:46:17 > 0:46:19The concrete floor cost more than I expected.
0:46:19 > 0:46:22As you're ripping things out, you find more things to do.
0:46:22 > 0:46:26So the budget never sticks to, really, but it was OK.
0:46:27 > 0:46:32David has, in fact, spent £22,000 on the renovation.
0:46:33 > 0:46:36Adding that to the £12,000 purchase price
0:46:36 > 0:46:39means he's spent £34,000.
0:46:39 > 0:46:41There is a ceiling price in this area,
0:46:41 > 0:46:43so let's hope he hasn't exceeded it.
0:46:49 > 0:46:52We invited two local estate agents to give us their opinion.
0:46:54 > 0:46:57'The market is for rental at the moment.'
0:46:57 > 0:47:02So a good, clean, straightforward property, no frills, it'll rent out all day long.
0:47:02 > 0:47:07The features I'm most impressed by is that it's a nice clean and tidy finish that's been done here.
0:47:07 > 0:47:10The kitchen and bathroom are nice and modern.
0:47:10 > 0:47:14So it will look very appealing to someone who comes in and wants to live here.
0:47:14 > 0:47:19The estate agents believe this to be a prime rental property.
0:47:19 > 0:47:22How much do they think it could achieve?
0:47:22 > 0:47:27I think the rental value will be in the region of £300 per calendar month.
0:47:27 > 0:47:32It will rent quite readily at 375 to £400 per calendar month, tops.
0:47:32 > 0:47:35I think that's OK. I was expecting 350 a month.
0:47:35 > 0:47:39So it lands slap bang in the middle. I'm fine with that.
0:47:39 > 0:47:45Those figures give Damien a yield of between 10.5 and 14.5 per cent.
0:47:45 > 0:47:49Even at the lower end, that's a fantastic return.
0:47:50 > 0:47:54Bearing in mind his total outlay of £34,000,
0:47:54 > 0:47:57how much might it achieve if sold?
0:47:57 > 0:48:00The property isn't in the highest value area.
0:48:00 > 0:48:03I'd expect to be asking, if he goes in the current market, £30,000.
0:48:03 > 0:48:07I would think you'd be looking somewhere in the region of £30,000.
0:48:07 > 0:48:08Ooh.
0:48:09 > 0:48:12That is a definite shocker.
0:48:12 > 0:48:14A definite shocker.
0:48:14 > 0:48:18That was a lot less, a lot less than I was hoping for.
0:48:19 > 0:48:22In order to get a buy-to-let mortgage on this place
0:48:22 > 0:48:26which would have allowed him to pay back his mother's investment
0:48:26 > 0:48:30and provide working capital for his fledgling property development business,
0:48:30 > 0:48:34Damien really needed a higher valuation.
0:48:36 > 0:48:38To continue the business any further,
0:48:38 > 0:48:41it needed to be valued at more than that.
0:48:41 > 0:48:43I've put far too much money into this house.
0:48:43 > 0:48:45Far too much.
0:48:48 > 0:48:52This property has been reborn because of Damien's hard graft
0:48:52 > 0:48:55and that is an achievement to be proud of.
0:48:55 > 0:48:59He has learned a hard lesson on his first project.
0:48:59 > 0:49:05A developer needs to know the current market values and spend accordingly.
0:49:05 > 0:49:08But this house will do well on the rental market
0:49:08 > 0:49:11and make someone a very comfortable home.
0:49:12 > 0:49:14So what's next for Damien?
0:49:15 > 0:49:18Plan in the future is to keep my building business going.
0:49:18 > 0:49:20Make some more money
0:49:20 > 0:49:24and recoup what I can through rent and so forth.
0:49:24 > 0:49:28Hopefully the climate will change, the banks will get better
0:49:28 > 0:49:30and the housing valuations will go up.
0:49:42 > 0:49:45Let's pop back to Poplar in East London
0:49:45 > 0:49:50where part-time property developer Shafi purchased at auction this one-bedroomed flat
0:49:50 > 0:49:52for £120,000.
0:49:53 > 0:49:55Looking past the rubbish-strewn floor,
0:49:55 > 0:49:58I thought Shafi had made a wise investment.
0:50:01 > 0:50:04Poplar is a prime rental area
0:50:04 > 0:50:08where one-bedroomed properties can rent out for as much as £1,000 a month.
0:50:10 > 0:50:12And this flat was in good order.
0:50:12 > 0:50:14With a lick of paint and new flooring,
0:50:14 > 0:50:17it could be ready to let or sell in double-quick time.
0:50:18 > 0:50:22But I was surprised by Shafi's super-speedy schedule.
0:50:26 > 0:50:28How quickly will you be able to turn it around?
0:50:28 > 0:50:33- Refurbish I would say is a weekend job. So I'm hoping... - What?! Whoa, whoa, whoa!
0:50:33 > 0:50:36- A weekend job?- Yes, that's what I'm expecting.
0:50:36 > 0:50:42- You think you can turn this place around in a weekend?- Hopefully. - That's mighty ambitious!- Thank you.
0:50:44 > 0:50:48A mere 17 days after we last saw Shafi, we're back.
0:50:49 > 0:50:52While I admire his ambition to renovate this property in a weekend,
0:50:52 > 0:50:55I'm going weak-kneed at the thought!
0:50:58 > 0:51:00# Can't you see
0:51:00 > 0:51:02# All I need
0:51:02 > 0:51:06# Is that 48 hours with you
0:51:06 > 0:51:10- # Over the weekend - Over the weekend
0:51:10 > 0:51:14# Can't you see it's all I need? #
0:51:14 > 0:51:19It did finish by a weekend. Monday it was finished.
0:51:19 > 0:51:23So Friday, Saturday, Sunday and Monday, all was done.
0:51:26 > 0:51:28Hmm. Sounds like a long weekend to me!
0:51:28 > 0:51:32But I've got to hand it to him and his team of trades people.
0:51:32 > 0:51:34That's impressive.
0:51:34 > 0:51:39It's ready to rock'n'roll and Shafi can start reaping the rewards.
0:51:40 > 0:51:45I've done all the flooring, revamped the walls,
0:51:45 > 0:51:49done a lot of tidying on the floors, the bathroom, changed all the radiators
0:51:49 > 0:51:54and getting everything in good order.
0:51:57 > 0:52:00In the kitchen, Shafi has saved time and money
0:52:00 > 0:52:02by keeping the serviceable units and worktops
0:52:02 > 0:52:04but has laid new flooring.
0:52:09 > 0:52:12He removed a corner unit to allow space for a table
0:52:12 > 0:52:17so the property could be rented out as a two-bedroom with a dining kitchen.
0:52:19 > 0:52:22Let's see what Shafi has done with the bathroom.
0:52:26 > 0:52:30I've done a little bit of rearrangement on the bathroom.
0:52:30 > 0:52:32I've moved the sink away to give a bit more space.
0:52:32 > 0:52:35In a bathroom, people like to have a bit of space.
0:52:35 > 0:52:39And I've put a heating system so it stays warm,
0:52:39 > 0:52:41or if someone wants to dry something, they can do it.
0:52:41 > 0:52:46And the main thing I can see people need is a shower. Every day people are in a rush,
0:52:46 > 0:52:52so I've installed an electric shower and tenants will be pleased with that.
0:52:52 > 0:52:57And cleaned and repainted the whole place to make it a better bathroom.
0:52:58 > 0:53:02Shafi has a regular team of tradesmen he employs on his projects.
0:53:04 > 0:53:07Despite the tight timescale on this renovation, was it trouble-free?
0:53:09 > 0:53:13The biggest job was, actually, to get the central heating.
0:53:13 > 0:53:15I didn't like them going round the walls.
0:53:15 > 0:53:21I wanted them underfloor because I didn't want to see any pipes exposed in a flat.
0:53:21 > 0:53:23So they had to dig the floor up.
0:53:23 > 0:53:27When they started digging, there was a lot of original pipe being exposed,
0:53:27 > 0:53:30so they had to change the direction a few times.
0:53:30 > 0:53:34So that was, when I saw it, hard work for them.
0:53:34 > 0:53:38But this is what I wanted and that's what they did.
0:53:38 > 0:53:40So that's how the flat looks much nicer.
0:53:42 > 0:53:45Budget-wise, did Shafi spend more than he planned?
0:53:46 > 0:53:51My budget, I thought it was going to be between five and seven thousand.
0:53:51 > 0:53:53The reason being the boiler had to be changed.
0:53:53 > 0:53:58But actually, I ended up below 2,000 because the boiler was working.
0:53:58 > 0:54:01I had to re-service the boiler. The electricity was fine.
0:54:01 > 0:54:03I got the electrical certificate.
0:54:03 > 0:54:06So that's why my budget was under 2,000.
0:54:06 > 0:54:07I'm pleased with it.
0:54:08 > 0:54:10And he has every right to be.
0:54:10 > 0:54:16That puts Shafi's total outlay on this property at below £122,000.
0:54:18 > 0:54:22Now all he has to do is let it or sell up.
0:54:23 > 0:54:28The good news is I've got a buyer and I've got a rent, a tenant as well.
0:54:28 > 0:54:31So I just need to make my mind up which direction I should go.
0:54:33 > 0:54:36Let's see if two local property experts
0:54:36 > 0:54:38can help Shafi make up his mind.
0:54:41 > 0:54:45I believe the property does present itself to the rentals market.
0:54:45 > 0:54:49Whilst that will allow the owner to rent the property easily,
0:54:49 > 0:54:52I think it will have an adverse effect when he comes to sell it.
0:54:52 > 0:54:55There are many properties like this one on the market
0:54:55 > 0:54:59and there is nothing here to have this one stick in your mind.
0:54:59 > 0:55:02I'd say that the finish is of an average condition, really.
0:55:02 > 0:55:03Ideal for the rental market.
0:55:03 > 0:55:07The market is really buoyant at the moment
0:55:07 > 0:55:09so I don't see any problem finding people quite quickly.
0:55:09 > 0:55:14The estate agents appear to regard rental as the best option.
0:55:15 > 0:55:18How much do they believe this property could be let for?
0:55:20 > 0:55:24The property would very likely rent between 900 and £1,000 per calendar month.
0:55:24 > 0:55:29In my opinion, the property should be marketed for rental at £900 per calendar month.
0:55:29 > 0:55:34Those figures would give Shafi a yield between nine and ten per cent.
0:55:35 > 0:55:39Bearing in mind his investment of just under 122,000,
0:55:39 > 0:55:43what do the estate agents believe this property could sell for?
0:55:43 > 0:55:46We would put the property on the market for £150,000
0:55:46 > 0:55:49and we would look to invite offers of around that figure.
0:55:49 > 0:55:51In my opinion, the property should be marketed
0:55:51 > 0:55:53at £150,000
0:55:53 > 0:55:57and we'd look to achieve in excess of 140.
0:55:58 > 0:56:02Shafi has a firm offer on the flat of £150,000.
0:56:02 > 0:56:07That would give him a pre-tax profit of around 28 grand,
0:56:07 > 0:56:09minus the usual selling expenses, of course.
0:56:10 > 0:56:13So, has that helped him reach a decision?
0:56:14 > 0:56:19I just need to think about it, because the rental income is great as well.
0:56:19 > 0:56:23But it will take me six or seven years to pay off the whole amount,
0:56:23 > 0:56:25and the rest is the only profit.
0:56:25 > 0:56:28So that's the only thing putting me off not selling it.
0:56:31 > 0:56:36Since filming, Shafi has accepted the £150,000 offer
0:56:36 > 0:56:37to purchase the property.
0:56:37 > 0:56:40The deal will be finalised in three months,
0:56:40 > 0:56:42and so Shafi, ever the entrepreneur,
0:56:42 > 0:56:45has arranged a short let meanwhile
0:56:45 > 0:56:46to cover that period.
0:56:46 > 0:56:49Well done indeed!
0:56:51 > 0:56:54Well, that's it for today's show.
0:56:54 > 0:56:58We'll have more news from the auction rooms around the country for you next time.
0:56:58 > 0:57:01- Yes. Make sure you join us then. Goodbye!- Goodbye!
0:57:22 > 0:57:25Subtitles by Red Bee Media Ltd