Episode 44 Homes Under the Hammer

Hello! Have you ever thought of changing career?

Perhaps having a go at something a bit different.

Property developing appeals to many people

looking for a change of lifestyle.

But it's not always as easy as it sounds.

One way to get a really good start is to visit your local auction.

Well, the lure of the auction is very strong.

But what should you spend your hard-earned money on?

You might have your heart set on a particular place

and then somebody else bids on it.

It's best to research several properties and just keep your options open.

Let's see what our buyers set their hearts on on today's programme.

I'm in Cornwall, where this property needs a magic touch.

Whoever designed this absolutely missed a trick!

This place in Margate is beat up and broken down.

But I can see past that to the beauty beneath.

It really is an amazing house. I love it!

And I'm in County Durham, and as you know,

it's the simple pleasures that make me happy!

Joy of joy. The first thing I see. The bathroom and loo is here.

All these properties were sold at auction.

We'll find out who bought them and what they paid for them when they went under the hammer.

Sold!

Cornwall is a beautiful and varied county

with some lovely villages and towns.

Take Liskeard, for example, with independent shops, a mainline train station

and bags of Victorian charm.

Perched above Liskeard is the village of Pensilva and the property I'm here to see.

How's that for a view?

That's the edge of Bodmin Moor.

Loved and feared cos of The Beast, in equal measure!

But imagine waking up to that view every morning.

That could be possible with the property that was up for auction.

It's this two-bedroomed bungalow. It had a guide price of 75,000 quid.

You'd buy it for the view alone, wouldn't you?

-#

-I can see for miles and miles and miles...

-#

OK, so it's not the best day to take in the views, I grant you,

but you get the gist even through the mist.

This two-bedroomed bungalow is on a corner plot with a garden and garage.

So far, so good.

But what about the inside?

What have we got? A little porch area which is always nice.

Keeps the cold out.

The kitchen's there. It looks a little bit in need of updating

but it's a reasonable size and it's on the corner, so you have a dual aspect.

Living room there and then down this little corridor -

bear in mind it's not a huge bungalow, it's only two bedrooms -

a bathroom, again in need of updating.

And a frosted window. Hmm, come back to that in a second.

That's the first of the bedrooms, a reasonable size double,

and then, a nice surprise, the second bedroom, a really good size.

Even big enough to think about putting an en-suite in there.

And the final bit of good news...

..to the side there, a small garden.

But..

I've got this horrible feeling

that whoever designed this absolutely missed a trick.

For me, it's criminal that the only two rooms facing that amazing view

are the kitchen and the bathroom with that frosted glass window.

Now, I'm not suggesting that you parade yourselves to the neighbours when you shower,

nor that a nice outlook when you do the dishes isn't very tempting.

But the sitting room just doesn't make the most of it

and neither does the second bedroom, where I reckon the window is on the wrong wall.

Burst through here...

..and you'd get that broad vista.

Well, that gets us out of dire straits, at least.

So what are we going to do?

Cos that is the view you want to see, isn't it?

And yet the house really does not make the most of it.

So this wall holds the key, doesn't it?

You want to have as much view from this wall as you possibly can.

So what are the options?

You could build out the land a bit and stick some stupendous conservatory

or viewing room, whatever,

full width of the property, panoramic glass.

That would be fantastic. Whether the planners would allow it, I don't know.

Maybe you could try something really modern with glass and stainless steel.

Maybe not. Whatever, you've got to do something about it.

At the moment, it's like owning a fine work of art

and keeping it in a paper bag!

You could look to re-jig the internal layout to take in those views,

but you'd still end up with a smallish two-bed bungalow.

I think this place is crying out for an extension.

Even some decking would be a start to make the most of its prime position.

We asked a local estate agent what he thinks of the bungalow,

that went to auction with a guide price of £70,000.

First impressions of the bungalow, in need of a bit of updating,

but I think when that's complete,

you'd have a very saleable property in a great location.

What could this place sell for with its current two-bed layout?

With a little bit of time and effort,

I certainly would look, in good condition, to sell for £135,000.

And what might it fetch on the rental market?

You should expect to achieve rental in the region of £550 per calendar month.

Well, a nice little bungalow, fantastic view and a pretty impressive guide price.

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

Guiding here £75,000. Anyone want to start me at 70?

£70,000 to start. £70,000 seated here. And one more?

We'll go in ones, nice and simple.

71, now. 71. And one for two.

71 at the back here. 72.

72 with you. 73?

Three. Four?

74. Five?

75 seated. 76.

Seven?

A chance for you to come back.

First time, ladies and gentlemen. Second.

77. 78. 79?

No, it's OK. Don't worry. I'd love to take it, but I've got you at 78.

79? No. Done now.

80. Standing.

At £80,000.

£80,000 standing.

There it is. Any advance on that? Against you and you.

£80,000 standing.

Are we sure we're all done here?

£80,000.

Quite sure all done?

Yourself seated, yourself standing.

£80,000 standing here.

Sir, you all done?

Shake of the head. All done. £80,000 to you.

That successful bid of £80,000

came from local man David,

who attended the auction with his girlfriend, Natalie.

David had a sheep farm nearby

and although still involved there, has now diversified into holiday lets

and sees this as a logical progression.

I met the former farmer at the bungalow to find out more.

-David, good to meet you.

-Pleased to meet you.

-Congratulations.

-Thanks very much.

Tell me why you wanted to buy the bungalow.

It's a stepping stone. Something I've always wanted to do

and it does interest me. I come from an agricultural background,

so the work isn't hard for me to do, to get on with.

Hopefully try to improve my quality of life at the same time.

And enjoy it and see what happens.

Why this area?

-Pensilva, I went to the primary school when I was a lad.

-Did you?

-Yes.

-Great.

-So it's a lovely village. I know it's a safe bet.

-Right.

-To buy and sort of work from.

-So why this particular property?

Sunny. Apart from, obviously, today! It's from morning to dusk, the sun is shining here.

'Well, maybe not today, Sonny Jim, but let's pretend for a moment!

'So, what's the plan, David?'

I've done my homework.

I know some people turn up to these auctions

and they haven't viewed it or read the legal packs.

They haven't done no research.

I'm the opposite. Half five in the morning, I'm out with a strong coffee,

going through the legal pack, because it's important.

You can lose money as well as actually gaining money.

-Nothing's guaranteed.

-So what are you going to do to sort it out, then?

Complete refurb right through. New electrics. I'll put in a new gas central heating system.

New bathroom suite. Revamp the kitchen.

Any plans for any changes to the layout?

If the property increased and went silly like it did years ago,

then it would be viable to do an extension.

Short-term, it's purely... I've got a nice gang of people that work for me, really nice,

which is very important in today's market.

The one advice I would give to anybody is people say, "Support your local community."

And it's so important in this line of work.

'Once renovated, David plans to let this place.

'He's got a budget of £10,000 for a basic refurbishment.

'But what's his timescale?'

'I want to turn it round as quick as I can.'

-So realistically, four weeks, five weeks, six weeks.

-Oh!

Straight in here, get out and get it on the rental market.

Yeah, exactly. Yeah.

I want to... It's the time of year, it's wet, it's mucky.

-You know. Hopefully crack on and let's get this job done.

-Great.

-I wish you all the best with it.

-Thank you.

-I look forward to seeing how you get on.

Thank you!

The property seems to tick all the boxes for David.

He knows the area and he's done his research.

Hopefully, this will be the successful start of a new career for him.

I'd love to see that extension on the side to make the most of those views,

but maybe the figures do need to be looked at.

If it's being rented out, it may not generate that much more money.

Either way, exciting times ahead.

Find out what happens later in the show.

I grew up in Kent, not far from Margate.

And I knew the town reasonably well.

I also knew of its reputation.

Faded grandeur, a bit down-at-heel

and a general rough-round-the-edges feel to it.

Now, well, how things have changed.

The much-talked about regeneration is actually here for all to see.

Boutiques and bars and bistros mean visitors to the Turner Gallery

have somewhere to sit and shop.

And I really feel that Margate

has really, very nearly, well, made it!

The Margate Renewal Partnership was set up to spearhead the regeneration of the town

into a creative and cultural hub while embracing and celebrating its traditions.

It seems incredible that just steps from the beach

is a road that is still very ripe for renovation.

The property I'm here to see

is this end of terrace, currently split into two units.

It had a guide price of just 70 to 75,000.

But before we go in, I've got to comment on this.

This is the site of Margate's Dreamland,

which is currently being rebuilt at a cost of over 10 million quid.

It's a great thing for Margate.

But would you want to literally live right next door to it?

Look at it this way. Most people love Disney.

But would you want to move into The Magic Kingdom?

I thought not!

The theme park is a heritage site.

The rollercoaster and other parts are Grade II listed.

But I'm not sure the sights, and more particularly the sounds of the fairground

are conducive to winding down after a hectic day.

# I lost my heart at the fairground

# To the boy on the swing machine

# He caught my eye with his happy smile... #

Certainly much bigger than I expected.

In fact, a rather grand entrance.

Some lovely wide cornicing up there,

a fantastic-sized reception room.

This is not what I was expecting. It's not in bad shape,

you've got central heating here.

A beautiful staircase. Look at this!

Stripped again or painted, that will look lovely.

Now I would have said second reception room,

but it's quite clear that this once was a kitchen.

Lots of pipe work over there, there's a boiler.

But what I do love about this room are these amazing features. Look.

I certainly didn't expect to see anything like this in here.

I really like it. In fact,

I'm quite excited about this property.

There's no denying this property needs a great deal of work.

And yet the character and charm is evident,

even in this dilapidated condition.

There may need to be some thought put into the bathroom layout.

It's on the ground floor, and rather small for a family-sized house.

Upstairs there are three bedrooms, and the master has a beautiful bay window.

This place is like a ride on the waltzers!

One minute I'm dizzy with excitement,

and the next I'm nauseous at the amount of work that will have to be done.

Next door is a single bedroom.

And there's another good-sized double bedroom at the back.

Now, wasn't this property supposed to be split into two units?

Let's take a look at the ground floor.

Now this is where it gets rather confusing

because there's no separation from the property upstairs

to this lower-ground one-bedroomed flat.

Although it does have its own front door, there at the front of the property.

I know it's been used as a one-bed flat.

It's a great space. Look at this. You've got this wonderful large reception room,

OK, it needs loads of work. You've got a kitchen at the back here.

But it could be the most incredible kitchen/ breakfast room.

It really is an amazing house. I love it!

So, the options are,

two units or one house.

The property was unofficially converted into two units previously,

so the new owner will need to apply to the planners for their stamp of approval

if they want it to remain sub-divided.

However, the application could be refused.

The local council are currently resistant to such proposals

as there's an over-abundance of flats in the area.

We asked a local estate agent to give us his opinion on this property,

which had a guide price of between 70 and 75,000.

If you could get permission to keep it as two flats

and then undergo the appropriate conversion works, it's worth it.

You'd get a much better return in the two units than you would if it were put back into one large house.

Let's talk figures. What could this place sell for once done up?

If the property was fully renovated as one house,

in today's market I would expect it to achieve

somewhere between 170 and £175,000.

If the property was split into two with a three-bed maisonette upstairs

and a one-bed garden flat downstairs,

I would expect them to achieve somewhere between 100 and 115,000 for the three-bed property,

and the one-bed I would expect to achieve somewhere between 70 and 75,000.

So if you get the thumbs up from the planners,

you could make more money with it as two units.

Does that go for rental, too?

If the property were to be rented as one unit,

I would expect it to achieve somewhere between 800 and £850 per calendar month.

As a three-bedroom unit it would achieve somewhere around 575 to £600 a month.

And as a one-bedroom unit with the garden,

I would expect it to achieve somewhere around 400, maybe 425, a month.

That means the purchaser could earn approximately £175 per calendar month extra

if the property were sub-divided.

I'm excited about Margate's future.

But slightly less excited about the potential issue that property could create.

It's a lot of house in an improving area, for a low guide price.

With good yields but right next door to the new theme park.

And it could be a bit of a rollercoaster to get it rented.

Let's see who went for it anyway at the auction.

Where do you want to start me? 70 to 75 guide.

Start me at £70,000.

£70,000? £65,000.

65, I'm on the way. 65 I have.

75 I've got in the front. 78 I've got.

At 80. At 80 and two. 82.

84 and six. 86.

88 and 90 now. At 90 and two.

92 and four?

93?

At £92,000 I've got, then, three rows back.

For the first time. It's going to be sold.

At £92,000 I've got for the second time.

£92,000 for the third and final time.

Sure you're all done?

It's yours at 92,000. Well done.

It was Liz who made the successful bid of 92,000.

She attended the auction with her partner, who's a builder.

Liz is a solicitor and part-time property developer.

This house will be her biggest renovation yet.

But she's looking forward to the challenge as she's fallen for the property's undoubted period charms.

-Liz, congratulations.

-Thank you.

-What's the story behind you wanting to buy this place?

Really, it all started just before the auction.

I came along and had three viewings on it.

-I was just blown away by the features, the size of it.

-Yeah.

Some of the period features have been taken out, which is a shame.

But I intend to put some of them back in.

Good. What sort of features do you hope to put back in?

Some period fireplaces with some nice surrounds.

Probably down here and in the main lounge upstairs.

'I like that Liz wants to reinstate this property's period charm.

'And when it comes to the amusement park next door,

'it seems it's a case of fairground attraction rather than fatal attraction!'

Do you think a lot of people are going to be put off by that?

I think some people will be put off, having it right at the back of you.

But they're also going to do landscaping areas and a parkland area,

so at the moment it is just a concrete car park, and a redundant derelict site.

So if they're going to improve the landscaping round it, hopefully that will still have appeal.

Let's talk about the moratorium they have in Margate.

They're not keen on turning any more of these buildings into separate dwellings and more flats.

How's it going to work, because this hasn't been legally separated, has it?

No. I know what you're saying.

I think that's a difficult one. I think that's for a lot of new flats.

There is some argument to say that, if I can show that there has been a change of use

before the date that these rules came in,

that there was actually a use here as a couple of flats.

Liz hopes to have the work complete in four months.

Her partner will do the majority of the work, bringing in specialist trades as required,

which should keep her costs down.

What sort of budget have you in mind to do the work?

Hopefully, I'm looking at a maximum of £15,000.

£15,000?! That has blown me away

because this could be an incredible house but I'd think you'd need to spend more than that

if you want to take it back to a beautiful period home with cornicing and fireplaces, a beautiful kitchen.

That's what I'm hoping. I've budgeted about 15.

That includes the fireplaces. The windows will be kept as they are.

They'll just be refurbished. A local joiner is going to come in and restore them for me.

He came the other day and said he'd put new glass in, new sash cords

and plane them, then they just need to be painted.

Liz, I love this house. It's got a great feeling. I can't wait to see what you do with it.

-Well done.

-Thank you.

-Thank you.

This is an incredible house.

It would make a wonderful family home

or great flats if that planning allows.

Liz has really put her faith in Margate and her partner, who'll be doing the work.

But all this work, for £15,000?!

Is Liz being careful and cautious,

or is she living in her own dreamland?

You can find out later on in the show.

Coming up: in County Durham, this property has a place for everything and everything has its place!

This house, the layout, it just works!

We return to Margate to find out how Liz got on with her renovation.

To put back all the features and to restore it into someone's home, I'm really happy with.

But first, in Cornwall, is David pleased with the transformation of his bungalow?

I look back at it and have a glass of wine and think, "Well done, David!"

Back now to Pensilva in Cornwall

and this two-bedroom bungalow with amazing views.

It was bought at auction for £80,000 by former farmer, David.

He had already diversified into holiday lets

and was planning to do the bungalow up and put it on the rental market proper.

And it seemed he'd done his homework.

Some people turn up to auctions and they haven't viewed it, or read the legal packs.

They haven't done no research.

I'm the opposite. Half five in the morning I'm out with a strong coffee

going through the legal pack because it's important.

You can lose money as well as gaining money. Nothing's guaranteed.

David planned to spend between four and six weeks and around £10,000

renovating the property before letting it out.

Four and a half months after our first visit, we're back

to see how David has got on.

And boy, has David been busy here!

He's done a lot of the work himself

and has really thrown everything into this renovation.

The reason why we've gone to town is, from experience,

if you start something, it's really hard to patch, to bodge

and it never really looks nice when you finish.

So my personal view is, if you're going to do it, do it properly.

David's replastered, redecorated and re-floored the bungalow.

He's replaced the old warm air central heating with a combi boiler system,

rejuvenated the bathroom, re-jigged the garage to make it a utility room

and reconfigured the kitchen, too.

There was an electric air system here in a cupboard, really dated,

so we ripped that out which meant I could put a doorway here.

Blocked that area and put an L-shaped kitchen in.

That released space for a table and chairs in this room.

I think it flows better now, and looks better now.

So I'm really pleased with it.

Remember that second bedroom with the window on the wrong wall?

Well, good for David. He's gone and done just what I hoped he would.

Because the views are so good here,

it's one of the selling points for the property,

I've added an extra window

so it can be a little lounge, obviously bedroom.

It creates more options for the bungalow

and to maximise the lovely views.

It certainly does that!

And take a look at the new patio area outside the front door.

Perfect for kicking back and soaking up the rays. Bliss!

It has taken a lot longer than anticipated,

but then again, he really did go to town on the renovation

and did a superb job to boot.

But has he kept to his budget? David estimated around ten grand to refurbish the property,

but with such a high quality finish here, has he managed it?

Because I've done it a higher spec, I wasn't worried about spending a bit more

because it's going to add value to the property.

So it's definitely up around the 15, 20,000.

I've still got small bills coming in because it's in the process of being finished.

So the final tally will be in due course.

Let's be generous and say that David's spend here is £20,000.

That takes his total outlay on the property, including purchase price,

to 100,000.

So, is David sticking to his plan of putting it on the rental market?

Yeah, obviously, when I bought it, I was going to rent it.

But now I've done so much work to the property, and the spec's quite high,

I'm going to look into all avenues and take it all on board.

Will the opinions of two local estate agents swing David one way or the other?

What do they make of the revamped bungalow?

Since the property's been purchased, it's undergone a complete transformation.

The current owner has used some very high quality materials

to bring it up to a first-class standard.

My first impression of the property is that they've completed it to a very high standard.

Well, I can't argue with that!

What do they think the property could fetch on the resale market?

If we were to put the property up for sale in the current market,

we'd be looking at a guide price of between 135 and £140,000.

I would recommend putting the property on the market for between £135,000 and £140,000

to achieve in the region of £135,000.

I'm extremely disappointed in those valuations.

I've had independent valuations and they're all in excess of 150.

Based on the quality of the property.

He may be disappointed, but a sale at 135 or 140,000

would mean a pre-tax profit of between 35 and £40,000,

which is a pretty good reward for his efforts.

What about the rental potential here?

If we were to put the property up for rent,

we would expect between 550 and £575 per calendar month.

The rental market is really buoyant.

There aren't enough properties out there.

So you could put it on in the region of 550 and £575 per calendar month.

I'm lucky enough that people in the area have shown interest

and they've offered me, if I do want to rent,

a much higher level than that.

Let's look on the bright side.

The two estate agents' valuations would give David a yield

of between six and seven per cent.

If he can get more, so much the better!

But in the grand scheme of things, what does he think of what he's achieved here?

The quality and finish of the property, I'll look back at it in a few months' time

and have a glass of wine and think, "Well done, David!"

Yes. Very well done, indeed!

Like so many towns in this part of the north-east,

Ferryhill in County Durham has a history based on coalmining.

That's no longer, but bang up to date and there's new investment in this area.

Loads of new-build detached houses are springing up

and a recent one-million-pound grant was secured to improve local sports

and youth facilities.

So hopefully, it's looking like good news for Ferryhill's future.

Well, it may once have been coal,

but the only thing coming out of the ground in Ferryhill these days

is the fruit and vegetables from these lovely allotments.

How great to see them so well tended.

And even better news. The property I'm here to see is just down here.

How great to have that or trees or whatever as an outlook,

rather than another property.

And it gets better, because the guide price - wait for it -

for this two-bedroomed mid-terrace

was just ten to £20,000.

Yes, ten to 20.

Let's see if it's a fertile ground for investment.

So, not only could that 10 to £20,000

possibly secure you a rather handsome-looking house,

at least from the outside,

but you could also get a slice of the good life thrown into the mix.

But with a price that low, and surroundings this attractive,

surely there are some issues inside.

So, for that kind of money, you're probably thinking you won't get very much. But you'd be wrong.

It's just a thing of geography of the UK, I guess, and property prices.

Stick this in some parts of London and you'd pay upwards of half a million quid for something similar.

It's extraordinary, but that's the way it is.

So what have we got? A lounge here, decent-enough size.

Useful storage under the stairs.

Then through to the rear of the property. There isn't a lot.

But what there is, I like.

There's a kitchen, a good size.

You could definitely have a kitchen/ family play area or dining table there.

Obviously needs complete refurbishment and I'm a bit concerned

about signs of water ingress both in the roof and down here.

But in the whole scheme of things, fairly trifling.

A little patio/ courtyard area out there,

so maybe you'd want to stick some patio doors in.

Lots to play with. But as a starting point,

what a lot of house for your money.

Yes, it's a bit tired-looking, and that damp needs investigating.

But I'm heartened by the absence of a bathroom downstairs,

because if it's not here, it must be elsewhere.

So, upstairs, and joy of joy, the first thing I see,

the bathroom and loo is here, upstairs where it should be.

Great. It could be at the expense of a bedroom.

but to my mind, it really doesn't matter.

You've still got two really nice-sized bedrooms

and as it stands, simple though it is, this house,

the layout, it just works.

OK, so it's not spacious,

but there is space for a small family or a couple of renters.

And if you keep the costs down, it's the returns that really work for me.

Well, if you've got the cash or can raise the finance,

there are definitely some bargains to be had in the property world at the moment.

But, of course, it's a big if.

However, once you start looking at properties at this kind of level,

ten to £20,000, maybe that's something you could lay your hands on

in terms of savings that you might have.

In terms of returns on investment,

a property like this would rent out for £350 a month.

So if you get it for £10,000, spend £10,000 doing it up,

that's £20,000 investment.

That's almost a 20% yield.

It's staggering!

The figures are really impressive for this place.

And it seems that in these tricky, sticky financial times,

it may well be that these smaller freehold investments are the way to go.

So, with a guide price of ten to 20,000,

I invited along a local property expert

to see if he agrees.

The house itself obviously needs a lot of updating.

We're talking heating system, windows, wiring, et cetera.

The walls need re-plastering throughout the property.

New kitchen, new bathroom, so it's basically a shell.

So once all the modernisation has been done,

how much could this property let for?

The property would rent, in good condition, for in the region of 350 to £400 per calendar month.

And in the current climate, what could this house sell for

once renovated?

With improvements made to the property,

I feel it could be worth £50,000, up to a maximum of £60,000.

I think this is a super, solid little investment

that might not make you rich quick,

but will provide steady income over the years and help build up the bank balance.

Or provide a great place to live.

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

It would be nice to start off on the guide. Get me straight in at ten?

£10,000.

12, do I see? I've got ten.

12 at the back. And 14?

15 and 16. And 17 and 18?

18 and a half. 19?

19 and a half. 20.

20 and a half? 20 and a half.

21. 21 and a half.

22. 22 and a half.

22 and a half. 23.

23 and a half. 24.

24 and a half? 25.

At £25,000. Standing in the middle at 25,000.

25 and a half. 26?

Shake of the head this time.

25,500.

At 25,500. Take 250 from you, sir?

25,750?

25,750.

26. Shake of the head now.

At £25,750, then.

For the first time. For the second time.

At £25,750 for the third and final time.

Sold. Thank you. Gentleman standing in the middle.

The successful bid of £25,750

was placed by husband and wife Mike and Hilary,

who live just outside Newcastle.

They recently retired from their family-run butcher's business.

Mike, Hilary, good to meet you both.

-And you.

-Congratulations.

-Thank you.

-Thank you!

-Tell me why you wanted to buy this little place.

Really, I think it was more a question of my having to get out from under her feet!

We retired a couple of years ago

and at a bit of a loose end,

-so a project was maybe what was required.

-Oh, really?

Hilary, is that the case?

Yes!

I've got lots of hobbies, and Mike's not got quite so many.

He was always interested in property,

so we thought now's a good time to do it.

-How was the auction?

-Quick!

-It was very quick.

My arm just kept going up!

And I kept saying no!

-Were you trying to stop him?

-She did.

-Really?

-I think when we hit the 20,000, I was trying to say, "No!"

And he just kept doing it!

-You paid a bit more than the guide price.

-Yes.

-We did, indeed.

-But at that level, it's still not a lot, is it?

-No.

Even though this property went for close to £6,000 over the maximum guide price,

it's still a great deal.

But other than the tempting price, why did Mike and Hilary buy here?

-Do you know this area?

-Not really. No, not really.

But we just kept seeing houses here in the paper,

and we thought they were a bit more affordable than the Newcastle area.

So Mike came down and started looking round Ferryhill a bit,

and talking to the agents.

He decided right, let's go for it.

So he'd seen the house inside before, but I hadn't seen it till after the auction.

-Right. OK.

-And it was just as he described it.

I described it well, obviously.

-How did you describe it?

-"Absolute tip"!

You haven't been around enough properties, mate, I'll tell you!

Compared to some of the ones we see,

this is quite nice!

-Oh, well, we've done all right, then!

-Yes!

-It's got ceilings, and floorboards in most places.

-Most places!

'Don't get me wrong. This house does need work.

'But as a blank canvas, it's in pretty good shape.

'Mike and Hilary have ten to £12,000 as a budget for refurbishment.

'How do they plan to tackle this job?'

Talk me through exactly what you're going to do to it.

Well, I need to replace the back gate, the front door, the back door,

just to make the place secure.

Then it's a question of getting the roof done, then the ceilings,

plastering, then plumbing, electrics and so forth.

What kind of timescale?

I think it's a good six months, to be honest.

The more I do, the more time it takes. It's as simple as that.

But we're not desperate, you know. I know time is money,

but in the case of this sort of amount of money you've spent,

it's not too detrimental.

-It isn't all about the money, anyway.

-No, it isn't.

-If you finish too quickly...

-I'm back home.

-He'll have to have another one!

'I have no doubt that once this property's finished,

'Hilary will be marching Mike back to an auction for another project to keep him busy!

'But as far as this one's concerned, will she get her hands dirty?'

What will your involvement in it be?

Normally, I'd be there as the chief labourer.

But because it's his project and I've got things that I want to do,

I think he'll be left more on his own to do it himself.

-Having said that, we will discuss kitchens and bathrooms.

-Yes.

And where things go! I'll not be able to keep out of it that much!

-Great. Well, congratulations.

-Thank you.

-Thank you.

-Look forward to seeing how you get on.

-Lovely. Thanks, Martin.

-Thank you very much, Martin!

Well, this is the first go-slow restoration that I've come across.

But let's hope Mike enjoys his new hobby for his and Hilary's sake.

I know they paid a bit more than the guide price,

but I still think they've got a cracking property for the money.

Find out how they got on, whenever they get it sorted out,

later in the show.

We hope our buyers have been working away on their investments

and making themselves a nice profit.

But have they been busy or have they encountered unexpected delays?

It's the moment of truth. Time to go back and find out.

'Let's make our way back to Margate.

'I viewed this three-storey property slap-bang next door to a historic amusement park.

'I'd be far from amused if I was living next door to a rollicky rollercoaster

'and crashing bumper cars,

'but for solicitor and part-time property developer Liz,

'that was part of the attraction.

'She'd fallen for the property's period charm and paid £92,000 for it at auction.

'She knew that the amusement park and surrounding area were undergoing a multi-million pound regeneration,

'making this an ideal long-term investment opportunity.'

What's the story behind you wanting to buy this place?

I was just blown away. The features, the size of it.

Some of the period features have been taken out, which is a shame,

but I intend to put some of them back in.

'So Liz was intent on restoring the period charm and character

'to bring this run-down dilapidated property back to life.'

Just over four months later, we're back.

The property was renovated from top to bottom

in only three months by Liz and her partner, who's a builder.

They've already let it.

When I purchased the house, I purchased it because I fell in love with the features.

So it was never an option that I was going to sell it.

We were lucky because we had somebody that was looking to rent a house

and they offered us a good rental return and they're a nice family.

So we took the option and rented it to them.

The property had been unofficially converted into two units,

but by renting the whole house to one family,

Liz has avoided the complication of applying for planning permission.

Let's begin our viewing of this property on the lower ground floor.

Liz and her partner have worked wonders down here.

It's been turned around pretty quickly for the new tenants

considering the amount of hard graft that was needed.

Quite a lot has happened to the house.

It's had a full refurbishment, new flooring, been re-plastered.

Gas central heating, the electrics. We got people in to certify them,

so most of the work has been done by my partner, which is good.

Onwards and upwards to the ground floor,

where, once again, the quality craftsmanship is plain to see.

The two rooms on this level are currently being used as bedrooms.

Liz has been true to her word,

reinstating features such as the fireplaces in keeping with the style and character of the house.

They add a lovely focal point to the rooms

and provide the perfect display mantel for your favourite toy cars!

She's also had a helping hand in restoring the staircase.

I've been so lucky in the help I've had with this house.

My grandfather even made all the spindles. We were missing quite a few here

and he went to the trouble of making them.

He took a spindle and wanted to make them for me.

So he actually went out and made them with his lathe.

And then fitted them for me. So that was great.

On the top floor, there were three derelict and dilapidated bedrooms.

Again, careful attention has been paid to reinstating features

to blend in with the overall style of this lovely house.

Liz shocked me when she said she hoped to complete the work for just 15,000.

So, how much has she spent?

Initially, I thought we were going to spend 15,000.

We've actually come in at about 12, so that's really good. We're very pleased with that.

And so she should be!

Liz's £12,000 spend, added to the £92,000 purchase price,

makes a total investment of £104,000 here.

I'm really happy with the house as it is.

To put back all the features and put it back to what it was originally

and to restore it into someone's home, I'm really happy with.

We invited two local estate agents

to give us their opinion on the place.

Coming back for the second time,

I'm impressed with the way they've made all the changes.

I love the fact they've retained a lot of features, but added to them as well.

Fantastic. Really, really good.

They've done a really good job on the property.

The finish is top quality as well.

If the estate agents were marketing this property for rental,

they believe it could achieve 800 to £850 per calendar month.

Liz is actually letting the house for £800 per calendar month,

giving her a terrific yield of just over nine per cent.

Bearing in mind Liz's total outlay of 104,000,

what's it now worth on the resale market?

I would expect it to sell for somewhere between 170 and £175,000.

We could sell this at £175,000.

Those figures would give Liz a potential pre-tax profit

of between 66 and 71,000.

What does she make of that?

I'm really happy with that cos that's way over above what I would have estimated.

That's absolutely great.

This property has proved to be a sound financial investment

as well as a passion project for Liz.

So will she be returning to an auction room?

I'll definitely, definitely go to auction again.

I really enjoyed it. I think if the price is right, the auction is the best place to be.

It's time to return to Ferryhill in County Durham,

where, across the road from these lovely allotments...

..was this two-bedroomed terrace

which had a guide price of only ten to £20,000.

It was run down and in dire need of a little tender loving care.

Hilary and her husband Mike

paid £25,750 for the property at auction.

Tell me why you wanted to buy this little place.

It was more a question of my having to get out from under her feet.

We retired a couple of years ago,

and I'm at a bit of a loose end.

-So a project was maybe what was required.

-Really?

-Yes.

-Hilary, is that the case?

-Yes!

I've got lots of hobbies and Mike's not got quite so many.

And he was always interested in property,

so we thought now's a good time to do it.

So, rather than put his feet up,

Mike was under orders to get out from under Hilary's.

Well, the big question is, has he got this property back on its feet?

Ten months later, we're back to find out.

It looks to me like Mike has been busier than ever in his retirement.

But has he enjoyed the renovation?

It's been quite a slog, actually, I think.

Quite satisfying at the end,

but it was rather a bit of a drudgery.

And I wasn't much help!

All I've done is a little bit of painting at the end.

Every little bit helps. Hilary also lent a hand with the interior design.

There weren't very many original features,

so we wondered if we could do something with the fireplace.

When Mike took all the plaster off, we realised there was a nice archway up here,

full of rubble in here, cleared all that out.

But then when we stood back and looked at it,

the archway was a bit lopsided,

and we thought it looked a bit dark.

So we decided to go with a more modern look

and make a little feature

and use some of the old bricks to make a bit of a hearth, just as a nod to the original house.

Mike began the renovation by knocking all the plaster off the walls

and taking it back to the brick.

A messy business indeed.

We went to the tip twice a day

with stuff that came off.

It was dreadful!

Two trips to the tip per day is no easy task,

especially when, like Mike, you're a Mini driver!

Sometimes I got to the tip and thought, "I've got loads in my Mini

"and you've got a couple of bags in the back of your big car!"

I said, "I'm doing really well."

Let's take a look at the bedrooms.

Mike did the majority of the work by himself,

fixing the floorboards, timber-framing and plaster-boarding all the walls,

hanging new doors, skirting and architraves,

and laying the new carpet.

He also fitted the new kitchen, and, always with an eye for detail,

created a recess for the fridge freezer.

But you can't please all the people all the time.

I feel it's compromised the table area a little bit.

But we agreed to differ about it in the end.

-And he got his way.

-Makes a change!

I knew he would say that!

Mike had hoped to complete the renovation in six months,

but it took between nine and ten months.

The couple had a £12,000 budget

and he's done the work for just under 10,000.

But living in Northumberland added another unbudgeted expense.

Being 30 miles from home and taking about ten months to do it,

the expenses of travelling are a good two grand on top of that.

That's still bang on the budget of 12,000, so well done, Mike.

Added to the purchase price of 25,750,

that gives the couple a total outlay of £37,750.

This property was purchased to keep Mike busy in his retirement,

and it's certainly done that!

It was good knowing he was busy and not bored.

Otherwise, it's like having a three-year-old, trying to think of something to entertain them

while you get on with your jobs!

It's definitely been time well spent,

but has it been money well spent?

We invited two estate agents to give their opinions on this property.

They've done an excellent job of the property. Attention to detail

is exceptional.

The finishings in the bathroom and kitchen are high standard.

Overall, very well done to them.

I think the owner's done a very good job of the refurbishment.

He's thought of everything from windows,

central heating. He's chosen modern fixtures and fittings which should appeal to a variety of people.

The experts are impressed with Mike's handiwork.

How much do they think the place could achieve on the rental market?

To put the property on the rental market,

I would anticipate a return of around £375 per calendar month.

I would anticipate the rental value of this property

to be between 350 and £375 per calendar month.

Maybe slightly less than we thought, but it's in the ballpark.

-And there are a lot of houses for rent.

-Yes.

-So people have been dropping their price.

Yeah, so round about what we thought.

Mike and Hilary plan to let the property.

Those figures, if achieved,

would give them a rental yield of between 11 and 12%.

Bearing in mind their total outlay of £37,750,

how much do the estate agents believe it could sell for?

I would anticipate a marketing value of £49,950

to hopefully achieve £45,000.

If I put the property on the market for sale,

I would anticipate to receive offers in the region of £55,000.

I think probably the first one is more realistic.

-Or somewhere between the two.

-Between the two.

-I don't think we'd get 55.

No, you won't get 55.

Since filming, Mike and Hilary have a tenant lined up who will pay

£395 per calendar month.

That is a super yield of around 12 to 13%.

So, now the renovation is complete,

is it finally time for Mike to put up his feet?

I'm not quite sure what he'll do tomorrow!

-There we go!

-Have a rest!

-Yes, he can have a little rest!

-Thank you!

And a well-earned one, at that!

That's it for now. We'll have more properties and more enthusiastic buyers for you next time.

So make sure you join us then for more Homes Under The Hammer.

-See you then.

-Goodbye!

-Bye!

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