Episode 46 Homes Under the Hammer

Hello, now we all know that property prices can fluctuate wildly.

But even so, over the years,

bricks and mortar have proved a solid place to put your money.

So, if you're thinking of investing,

then maybe you should head down to your local auction

and check out what's on offer.

There are hundreds of property auctions all around the country

throughout the year, so you really are spoilt for choice.

So, let's see which properties made our buyers part

with their hard-earned cash on today's show.

'More people are considering self-builds these days

'and this plot in Staffordshire is primed for development.'

This could be an ideal opportunity to give it a try.

'This commercial unit in Kent could be a business opportunity

'for a budding entrepreneur.'

You could really see and feel a business would thrive in here.

'And they say never judge a book by its cover,

'but does this bungalow in West Yorkshire live up to its initial impression?'

First glance, yes, I think it does.

'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.'

I'm in Northwood, less than a mile from the centre of Stoke-on-Trent.

Really popular spot, good schools, local amenities, transport links,

yes, it's looking good so far.

'This is a largely residential area'

'and the houses here all look pretty similar.

'There are terraces,

'some semi-detached and ex-local authority,

'but there isn't a new build that I can see.

'Well, not yet at least.'

The property I'm here to see actually isn't a property at all.

It's a pre-property. What I mean by pre-property?

It's a roundabout way of saying it's a plot of land,

where in the future, a property will probably be.

205 square metres, it's nice and flat, it clearly designed

and defined by these walls.

Yes, good start.

'This plot of land had a guide price at auction of £18,000,

' which seems quite a lot for its size.'

# I sit on the muddy ground

# The muddy ground

# Waiting for you... #

'But dig a little deeper and you'll find out why.'

If this was sold as just a bit of garden,

its value would be just a few thousand quid.

But what that makes this particular plot valuable

is that it comes with outline planning permission

for the creation of a detached dwelling.

So, that could be of interest to a local builder,

or the growing band of people

who fancy having a go at doing a self-build.

But before you take on a project like that,

it's not as easy as it sounds.

You've got to consider getting full planning permission,

you've got building regulations, employing a builder to do the work

and then selling on the final project.

But don't let that put you off. If that's what you fancy,

this could be an ideal opportunity to give it a try.

'It can sometimes be a real gamble to buy a piece of land

'if you have no idea what the planners will allow.

'So, having the outline plans approved

'is at least a very good starting point.

'But to get that full planning permission,

'there's still a lot to consider.'

The plot of land is situated on a road of largely,

probably turn-of-the-century properties.

When it comes to getting planning permission,

the planners are probably going to want you to keep it

something in character with what's around here.

If your idea's a fully glass fronted, half timber, solid oak,

whatever it is, forget it.

And you are also going to have to consider

the thoughts of the neighbours.

Properties here, properties there

and windows overlooking them are not going to go down well.

Top of that, you're going to have to think about connecting services,

but all that's pretty standard fare.

I think this has a lot of potential.

'So, what might the house look like?

'How many bedrooms will it have and will it have any outside space?

'That will all depend on what the new owners want

'and what the planners will approve.

'But in the meantime,

'we can certainly get an idea of what might be to come.'

OK, so these are the plans that provisionally have been passed.

I was talking about how the property itself had to fit in

with the existing properties.

You can see how little architectural details,

like the arches over the doors and windows,

that fits in with the local look.

There's more detailed plans of what the property's going to be.

This is two beds but there is talk of it potentially being three beds.

Fairly simple, downstairs kitchen, sitting room and a bathroom.

Upstairs, basically two bedrooms and a WC.

So, you haven't got a lot of space to play with,

but I think what's been done here

will allow for at least the properties to have

a bit of a garden, which is a nice extra touch.

'For the right person, this could be a great project.

'It's a relatively small build

'and although it would still be a big undertaking,

'I can't see anything here to ring alarm bells.

'The main question is, is there any profit to be made?

'We asked a local property expert

'to come and have a look at the plot

'and give his advice and talk figures.'

'First impressions of the plot is that it is quite small',

also quite narrow, but at the end of the day somebody will end up

with a detached dwelling which will be quite unique to the area.

'So, what kind of numbers are we talking about here then?'

'I would value the plot with outline planning permission

'in the region of 20 to £25,000.

'After the development has taken place',

which would comprise of a two or three bed detached dwelling,

I would anticipate a resale value in the region of £100,000.

'So, selling the finished house could make up to five times

'the value of the land as it is.

'But remember, you have to factor in the building costs

'before calculating any potential profit.

'So there is room to make money here by putting a house up for sale.

'But what about the rental route?'

'After the developments have taken place',

I would anticipate the rental value

in the region of 450 to £500 per calendar month.

Well, I think there's a lot going for this little plot of land.

It's flat, it's at a good location, easy access to the road...

Yes, let's see who went digging for a bargain when it went to auction.

OK, lot number 21, a building plot,

it has outline planning for a detached dwelling.

So, what shall we say for lot 21? 15,000?

A building plot, with planning permission.

15 bid, thank you. At £15,000.

Going to be 16 now. Yes? £16,000.

16,500, you're saying. 16,500.

17,500. 18?

18,000, seated now. got you. 18,500.

19?

19?

Shaking his head. Another 500 anywhere else?

At £19,000 then.

Back here, 19,500.

20, sir?

20? 20. Another half?

Are you sure?

20,000 on the end of your row then, at £20,000, first time.

At £20,000, second time.

Third and final time, £20,000, all done?

You bought it, sir, on the end, well done.

'That successful bid of £20,000 was made by John.

'He lives locally and has worked in the building industry

'since he was 16.

'For John and his partner Michaela,

'this small piece of land is the start of a big venture.

'I met them back at the plot to hear all about it.'

-John, Michaela...

-Hello.

Lovely to meet you both. Congratulations.

-Thank you.

-Got a plot of land.

-Yes, our first.

-Our first.

So tell me why you wanted to buy it.

Basically, because it looked a simple build.

The land is very small.

It's our first development, I didn't want anything that was too big.

So, first time you've had a go at doing a self build.

-Have you got any experience at all in this sort of field?

-Yes...

I've worked in the construction industry all my life.

So, yes, I've got quite a lot of varied experience.

-What attracted you to the idea of a self build?

-Me.

-You? Oh, tell me.

-Well, yes.

I just kept suggesting that as he's always building,

that maybe he can start building for yourself.

I'm always building for other people, that's what I've done all my life.

You know, for main contractors, stuff like that.

So Michaela's kind of pushed me to say well, you know,

go out there, do it yourself.

'John and Michaela have well and truly taken the plunge.

'They've got the experience and the passion

'and now they've bought the land.

'So, step two is all about finalising those plans.'

I've looked at the plans. Are you going to stick to them?

We've got the plans, obviously.

In the outline planning permission, that's gone off,

in the access statement, it states a three bedroom.

On the plans, it states a two-bedroom,

so we are going to submit two sets of plans.

One for the plans in my hand and another set of plans

to see if we can get a three bedroom house,

which will obviously get us more money at the end of the project,

if we can get three bedrooms.

And have you weighed up the extra cost of the extra bedroom?

-Is it much?

-No, I don't think so. We'll still get it into, in budget.

So, what is the budget?

Well, I'm hoping, we've bought the land for 20,000,

and I'm hoping to build it for 60,000...

-Quite tight, that.

-Yes, but I have got contacts within the industry.

So hopefully we can sell it, maybe for 110, something like that

and make a little bit of a profit there

to obviously move on into our next scheme.

They're so keen to get started that they're doing some digging now

to see if there are any problems lying under the surface.

John's contacts and experience will hopefully mean

he can avoid frustrating delays at both planning and building stages.

That's just as well, because he's set a tight timeframe.

He's hoping to start laying foundations in about four months

and spend another four on the build.

So, Michaela, what's your role going to be in the whole thing?

-Make sure it's looking nice.

-Right.

-The important bits!

-And actually get involved in some of the interior design?

-Yes.

Are you going to be involved in the project?

Yeah, I'll be overseeing the build myself

as a project manager.

And doing which bits of work?

I won't actually get my hands dirty!

I will oversee and I'll bring some men in to do it for me.

But I'll oversee cos I only live not far from here.

I can pop in and make sure it's being built to my high specification.

Well, congratulations. And good luck with it all.

-I look forward to seeing how you get on.

-Yeah, fantastic.

So, John and Michaela realising a dream,

with this, their first self-build project,

but a £60,000 budget is very tight

and John really needs to keep an eye on that.

And in the current market conditions,

will they make any profit when they come to sell?

You can find out later in the show.

This is Queenborough on the Isle of Sheppey in Kent.

Once an important trading post,

it was also the playground of Admiral Nelson,

who is said to have practised his sailing in these waters

and kept a house with his mistress, Lady Hamilton,

in Queenborough itself.

Let's hope the house we're here to see

has a slightly less scandalous past.

Nothing like a little bit of celebrity tittle-tattle,

even if it is 200-odd years old!

And seeing Queenborough today sparkling in the sunshine,

it's easy to see why Nelson kept an eye out for a decent des res.

So, will today's property float my boat?

In fact, the property I'm here to see

has had a particularly sweet history since it was a local sweet shop.

I don't know if business went sour or the previous owners moved on,

but what we're here to see are the empty commercial premises downstairs

and the two-bedroom maisonette above,

all for the guide-price of 80 to 85,000.

In fact, the former sweet shop then became a florist.

So, will everything come up roses on the inside of this property?

Well, this shop has A-1 usage,

so it could be a sandwich bar, a hairdresser's, a florist.

Lots of businesses could stem from here.

But it's really good news it's on the corner plot

because you get two big lovely windows,

double bite of the cherry, if you like, to advertise from.

Lots of space in here.

You could really see and feel that a business would thrive in here.

Some original cornicing up there.

You've got nice high ceilings.

Yeah, I'd quite like to see what's out the back.

The back of the sweet shop leaves a slightly bad taste in the mouth,

with a dingy, dark office, toilet and utility area.

So, some work needed here,

but at least it's not a little shop of horrors.

Out back, there's a useful rear yard that could be handy for parking.

So how does the maisonette compare?

Well, upstairs you've got some spacious accommodation.

There's a bedroom here that's easily a double,

a bathroom with a white suite,

and, I can't believe I'm going to say this,

but in this instance I'd keep this woodchip wallpaper.

It will take for ever to take off and then you've got to replaster,

so you've got all those cost implications to think about.

The kitchen, I'm happy to say you could easily get a table in, which I love.

An eat-in kitchen, nothing better than that.

The units are salvageable

so you could turn that into quite a good space.

And, look, there's a certain amount of character to this living-room.

You've got double glazing, because you have got a fairly

noisy road out there, lovely period fireplace.

You know, overall, I think this could be a really nice maisonette.

Yes, these are good-sized rooms,

ready and ripe for some freshening up,

but it doesn't end there, because upstairs

there's a lovely second bedroom, which is dual aspect and spacious.

And close by, a flat terraced roof,

which could prove handy for some outside space.

With the front door

on the side street, this place feels more like a home,

rather than just some rooms above a shop, but while the setup is looking

practically perfect, is the location the right place to invest your cash?

Just because a town has history and a harbour,

it doesn't mean it's not hard up.

Queenborough, in common with the rest of the Isle of Sheppey

has struggled with the lack of trade,

poor employment opportunities, and inadequate transport links.

But there is a master plan, with millions of pounds behind it,

it could change things, with a new marina, new homes,

and a better infrastructure for the town.

Regeneration can sometimes be all talk, and it's as well to be wary.

Big promises, well, they take time,

but I think Queenborough could really have a brighter future.

So, with the possibility that things

are on the way up for Queenborough, maybe this spacious setup,

guided at 80 to 85,000 could prove a good purchase.

But for a second opinion, we asked a local estate agent

for his thoughts on this shop and maisonette.

First impressions of the properties, I think it needs quite a bit of work.

The main things out there, the central heating, the double glazing.

I think if you spent a couple of thousand on it,

you've probably got quite a nice little place here.

So, how would the returns look?

How much could the units make if put on the resale market?

First, the maisonette.

I think you're probably looking at about 65 to 70,000.

It is a good size, and as I say,

there's not a large amount of

lower-priced properties available in the area.

So, I think that would be an achievable price.

-And the commercial unit?

-But I think the value wise,

you're probably looking at about 40 to possibly £50,000.

That's a combined value for the two properties

of between 105 and 120,000.

Not too bad, if purchased for the guide price of 80 to 85 grand.

Now, what about rental?

I think if you was to rent the maisonette out separately,

you'd be looking at about £625-£650 per calendar month.

I think you're probably looking per calendar month, with the shop,

possibly around the £400 mark.

This is a big property for the cash,

in an area that could see some improvement in its fortunes.

But taking on a new small business in these tricky times, well,

that's a bit of a gamble, and you'd want to buy for the right price.

Let's see who put up their hand at the auction.

This one came up towards the end of the auction,

that didn't prevent a bidding battle.

80, 85 is the guide. Where do you want to start?

Start me at 80, £80,000. 80, straight in, I'm obliged. And two.

82,000. 82.

And four. 84 and six. And eight. And 90.

90. And two. And four. 94. And six.

96. And eight.

98. And 100.

And two. And four.

He shakes his head. I'll take three, if it helps you. 103?

103. And four.

And five. Another shake there. He did that before, as well.

For the first time then, at £104,000.

104. Do you want one last chance? No. I think he means it.

104, for the third and final time, if you are sure you are all done.

It is going to be sold, £104,000.

HE BANGS THE GAVEL Well done.

The successful bidder was property developer, Colin.

But the happy ladies celebrating getting the lot for 104,000,

where Tina, on the left, and Becky.

Tina's married to Colin,

and runs her own hair salon in nearby Sittingbourne.

# Going back to my roots (Yeah)... #

She has now teamed up with her friend and colleague, Becky,

to start a new venture. Ladies, congratulations.

You seem really happy to have got this?

-Really happy. Really excited.

-Tell me about auction day.

How excited were you when that hammer went down?

Firstly, really nervous.

Really excited, and then when you realise, you think,

"oh, gosh, this is real."

So, Becky, what is your involvement with this?

-I'm going to create this into a hair and beauty salon.

-Really?

-Yes.

-And how do you two know each other?

-Long story.

Becky was my student when I was teaching. She was my star student.

We worked together at the previous salon where Becky's working now.

I now own a salon and she works for me one day a week

and this come up and I knew she was looking for a salon

so this was perfect for Becky.

So, you've bought this.

This is going to be your business but Becky's going to run it?

Yes. Me and my husband are just the landlords. This is her domain.

We're going to look after the upstairs.

-So, you're going to turn this into a hairdressers?

-Yes.

-How exciting.

-Have you ever done anything like this before?

-No.

So, you're going to be creating a business from scratch here?

-Exactly. Yeah.

-So, Becky, how much are you loving your boss Tina?

I mean, what a lovely person. She's bought you a business.

She's one of my best friends and, yeah, she's been fantastic.

What a great gesture to help her star student out

with her first salon.

But, for a place that would deal in makeovers,

what sort of makeover for the place does Becky have in mind?

I'm going to have some self-employed stylists

and I'm also going to have a beautician.

We are, sort of, going to go with the theme of golds and blacks

and bring some wood effect into it.

So, we are just, sort of,

really working with different ideas at the moment.

But, hopefully, it'll all come together in the end

and it'll be a salon at the end of it.

Have you thought about budget or spent any money yet?

I've spent some money.

My budget is 15,000 to get this looking into a salon.

So, hopefully, we'll be under budget but we'll see.

So, have involved are you going to be with the business

or is this totally, you know, down to you?

Basically, it is down to Becky.

We are doing what they call a first fix.

So, the floors, the plastering, ceilings, the lights.

Getting the plumbing ready for Becky's basins to go in

and the rest is down to Becky.

Down to me.

So, you're both going to be involved in this lovely joint venture.

The business hopefully thriving downstairs

and you're going to be landlady upstairs.

So, what plans and ideas have you got for the flat above

because it's a great property. It's very spacious.

Yes, it's really good condition.

It really just needs looking after, decorating.

There's no major structural things to be done.

There's double glazing in the windows. There's heating.

So, it's really going to be quite easy

to make it look really beautiful.

In theory, it should be straightforward

except that Tina's also planning to remove that woodchip.

I can't guarantee that can and will be difficult.

She has a budget of 17,000. Not only to renovate the maisonette

but also for the first fix on the salon.

Then, Becky has £15,000 to decorate and kit out the salon.

The pair plan a six to eight week turnaround.

It will be tight but what will be tougher for Tina

is how she'll cope with losing her star stylist.

I don't know how. I don't honestly know how.

But she deserves this break and I know she'll do really well at it.

So, how do you feel about that, Becky?

I mean, how fabulous that you've met someone like Tina

that's prepared to, you know, propel your career.

I can't explain it. She's just been brilliant.

She's been fantastic to me

and she's supported me through the years of training

and getting onto the shop floor and now to opening my own business.

I couldn't ask for more.

Girls, good luck with this project. Tina, good luck upstairs.

-Becky, good luck downstairs. I hope it goes really well.

-Thank you.

-Thank you.

-Thank you very much.

-Thanks very much.

So, star student Becky has been given an amazing chance

by mentor Tina, who has got herself a great rental into the bargain.

Join us later in the show

to see if they manage this in six to eight weeks

and how these fab investments are going.

Coming up, it's rare on this program that I visited property

as spick-and-span is this bungalow in West Yorkshire.

This is great.

We return to this commercial unit in Kent

to see if Becky's dream of her own beauty salon has come true.

Everything's turned out just how I imagined it.

But first, let's find out if John and Michaela's

new-build in Staffordshire has impressed the experts.

I think they've built a very good property here.

Back now to Northwood, Stoke-on-Trent where,

earlier in the programme,

John and his partner Michaela paid £20,000 for this building plot.

It had outline planning permission for a two-bedroom property.

John's worked in the construction industry for many years

and has his own company

but this was the first place he was going to build as an investment.

-What attracted you to the idea of doing a self build?

-Me.

-You?

-I tell people that.

-Yes.

I just kept suggesting that he's always building,

that maybe you could start building for yourself.

I'm always building for other people. That's what I've done all my life.

You know, for main contractors, stuff like that.

So, Michaela's kind of pushed me to say,

"Well, you know, call out there, do it yourself."

John intended to submit revised plans to include a third bedroom

and, as his office was just round the corner,

he planned to project manage the build on a daily basis.

Well, ten months have passed

and the plot of land now houses this detached property.

It continues the line of the terraced houses on the street.

It has the added benefit of off-street parking

plus a covered carport.

Handy on a wet day.

Inside, the living room that runs the width of the house

is surprisingly large.

And beyond the staircase, the kitchen diner

extends to the side behind the covered parking area.

Well, this is the kitchen diner.

We are quite over the moon with this cos it's lovely spacious area.

We've also got a downstairs toilet here.

We added some green tiles just to add a bit of wow factor.

And then the double doors there, that go out into the garden.

The outline plans for the house had the bathroom on the ground floor

between the kitchen and living room.

That's rather unusual and one of the first things

John and Michaela decided to change.

Initially, it was supposed to be a replica of a terraced house,

which we felt was a little bit strange.

So, John saw an opportunity to add an upstairs bathroom.

There was no objection to John's extension

at the side of the house

as he designed it to be within the accepted line of sight regulations

for the neighbouring properties.

It meant that the bathroom could be built up on the first floor

above the carport.

Oh, this is our favourite room. This is the bathroom. Huge room.

We are really pleased with this.

Double ended bath. Skylight windows.

We imagine lying in the bath, looking at the stars.

Really, really pleased.

I think it's turned out much better than even we expected.

In the end, John decided against adding a third bedroom,

preferring to stick with two good-sized doubles.

So, how hard was it to change the original plans for the house?

Not at all, really, because we only had outline planning permission

anyway so when we submit proper plans,

we added that on and we got the planning without any hiccups.

The only restriction to John's plans was that his proposed garage

under the bathroom couldn't have a door so that's why it's a carport.

The planning permission stipulated block paving

and arched brickwork which looks very smart.

And John's been on hand to track the progress from day one

so how much has the build cost?

The budget has gone over.

I costed it on the old plans which was 60,000.

It's actually turned out at 70,300

so, in total, with the land, it's cost us 90,300 to build.

John and Michaela have an open day planned

to show prospective buyers or tenants around.

Have they got a preference between selling or letting?

At the moment, possibly on the renting side

because it's an asset to my company.

Because we've got this, we can go to the bank and he will give us

money for our next development.

Time to get some expert property advice from two local estate agents.

I particularly like the size of the kitchen. I think,

at the moment, people do prefer good-sized living areas/kitchens

and that's exactly what you get.

I think they've built a very good property here.

Modern throughout, good-sized and it'll appeal to all.

But, do the experts see a rental opportunity here?

I think this property would rent extremely easily.

I would expect an income in the region of £500 per calendar month.

If the owners opt to lease this property,

I'd put it on the market for £575 per calendar month.

So, could those figures,

which would give an annual rental yield of around 6.5 to 7.5%,

work out for the couple?

Yes, that sounds good.

I was hoping between 500 and 600 a month, so, yeah.

That's what I thought.

What about the resale value?

Is the house now worth more than the £90,300

John and Michaela have invested?

I would estimate a resale value in the region of

£110,000 to 115,000.

I would put this property on the market for £124,950.

That valuation range of between 110 and nearly 125,000

would produce a gross profit before fees and expenses

of around £19,500 and £35,000.

So, is John more tempted by the resale or rental value?

I'm open to both but certainly, you know, if we got 120 on the table,

we'd have to seriously consider it because it's, you know,

it's a £30,000 profit.

Over the years, John has built many properties for clients

but this is the first one he's built as an investment for himself

so, after all the hard work, is it hard to part with it?

I'd be a bit disappointed, yeah,

because it's our first development and its very near to home.

So, you know, it is a little bit of our baby, I suppose.

Welcome to west Yorkshire were, today, I'm in the town of Ossett.

Its fortunes were founded and not only on mining coal

but also in the shoddy industry.

Yes, you heard me right, the shoddy industry.

That is part of the process

of extracting valuable wool from old rags.

So, I wonder, will the property I'm here to see be shoddy

and can it be transformed into a thing of value?

MUSIC: "Rags to Riches" by Tony Bennett

So, what do you value more,

peace and quiet or easy access to a property?

Well, you might have to make a decision in this case

because the bungalow I'm here to see is literally up this little pathway.

If you want to park your car, it's down there.

But that does mean, as I said, it's quite quiet which is good.

And this is it. From the outside it looks absolutely lovely.

Two bedrooms and a guide price of 90 to 100,000 quid.

The front garden is trim, tidy and a good size

as is the back garden where there's a garage

so you won't have to struggle with your shopping bags

when you come home from the supermarket.

As for the bungalow, it looks trim and tidy too.

I can see double glazing and there's no visible damage.

So far, so good.

I always think that if a garden has been well maintained

then the inside should be also.

So, does it hold true in this instance?

Well, first glance, yeah, I think it does.

Really nice condition the moment you walk through the door.

Clean paintwork, nice choice of, sort of, creams and whites

which always gives a sort of elegant feel.

So, in through the front door,

you've got this little corridor area here. Bathroom there.

Again, maybe the units could do with replacing

but perfectly serviceable as they are.

Living room over that way.

Again, some nice features. The dado rail, the...

It's just, it's lovely.

And then through into the kitchen. You know, 100% brilliant.

I mean, perfectly serviceable as it is.

Units - maybe they're not 2012 but who cares. Nice cooker.

It just has a really nice feel to it. Central heating.

Through this way, then.

Bedroom there.

It kind of gets a bit weird when you come into this room

because, I guess, this is where you might expect a second bedroom to be.

Instead, you got stairs up to...

Well, we'll explore that in a minute.

And then, through to this absolutely glorious conservatory

on the rear of the property.

Lots of light flooding in here. Doors to the garden.

The only thing I'd say you might want to consider is -

it doesn't work particularly well for me -

this window here which is actually the bedroom.

I'd swap the property around. Maybe put the bedroom on the front,

put the living room on the back. Then have a nice set of

French doors here, leading into the garden and then it works perfectly.

But, I mean, for starters, this is great.

It's rare that I visit an auction property in better condition

than many put up for sale in the normal way.

This bungalow has been well cared for.

It's just a matter of taste and budget

whether you'd want to update the decor or not.

The conservatory is a big bonus.

Upstairs is a dormer bedroom.

As I am a glass half-full kind of guy,

I'm going to say that the second bedroom is a small double

rather than a large single.

But there's a possibility of adding another bedroom up here.

An added bonus is over this side of the upstairs.

Somebody's obviously thought about what I'm going to suggest already

because there's a door here which leads to this large,

basically, boarded loft area.

But, obviously, you might want to consider

putting another dormer in this side, creating a pretty large bedroom.

Possibly with an ensuite.

That would all come down to economics -

how much it would cost to do it, whether or not it's worth it.

I mean, if you're looking to live in it, maybe, as a family home,

that extra space could definitely come in handy.

In terms of value, it might add to the property.

Again, talk to estate agents,

find out costs versus return on investment

and then make your decision.

And here's the very man to help.

We asked the local estate agent for his opinion on this bungalow

which had a guide price of £90,000 to £100,000.

I think upstairs has great potential to create further bedrooms

which would enhance the saleability

and profitability of the property.

I think attention should be given to that area to maybe look at

expanding the accommodation.

So, this local property expert believes it would be

financially beneficial to add an extra bedroom.

How much could this place achieve with its current layout, if sold on?

If you put the property on the market to sell in today's market,

I'd suggest an asking price of £125,000.

And if you added accommodation upstairs?

If you added an extra bedroom and an ensuite to the loft space,

you're adding between £15,000 and £25,000

on to the value of the property,

depending, obviously, on quality and condition.

And rental valuations?

If the property was to be put on the rental market,

we'd expect £500 per calendar month in its present condition.

With the addition of an extra bedroom and ensuite,

that price would increase to £550 to £575 per calendar month.

Well, this is a really lovely little bungalow

and I can't find anything wrong with it.

It just goes to show, if you keep your eyes peeled,

there really are some fantastic opportunities at the auction.

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

£80,000, ladies and gentlemen. It must be worth 80.

Thank you very much. We are in at £80,000.

Got you at eight. At £80,000.

And I'll take it in twos, if I may. At £80,000.

82, 84. At 86, 88, 90.

Shake of the head. £88,000. Looking for 90 now.

89. And 90. No?

At 89,000.

89,000. On the wall at 89, looking for 90 now.

90. £90,000.

It's against you now.

£90,000. I'm going to sell. Take half from anywhere?

No? So, £90,000 then, for the first time. 90,000 for the second.

Congratulations, sir, £90,000.

It was Danny who made the successful bid of £90,000.

That was bang on the low end of the guide price. Fantastic.

Danny has renovated and sold on six properties previously

and is financing the purchase of this bungalow

with the profits from his past projects.

So, I reckon he'll be overjoyed with the low purchase price here.

He also works as a singer

so you might say he bought this place for a song.

-Danny, great to meet you.

-Thank you.

-Congratulations.

-Thanks very much.

-Great little bungalow.

-Yeah, it's not bad.

-Not bad?

Some people would walk in here and think, "This is amazing."

-Yeah, if you're in your 80s.

-Oh, come on. No.

It's dated. But it's tidy.

-Why did you want to buy it?

-I'm from the area.

I was, basically, told about it.

My brother-in-law walked past it and saw a sign

and just really fancied it.

-Right. Is it something you do?

-Yeah. This is my sixth project now.

It's not what I do full-time but it's just a part-time ambition.

So, what to you do when you're not doing this?

Well, my job, my actual job is I'm a singer.

Oh, great.

Yeah. So, nothing glamorous.

I work on the club circuit.

Really? What kind of stuff do you sing?

It's just general middle-of-the-road stuff.

If you ever try to sing what you really want to sing,

they just look at you.

What would you like to sing?

I'd like to sing jazz songs - Jamie Cullum, Michael Buble.

But, you know, it's not really the done thing.

So, what are the aspirations on the singing front?

None now, to be honest with you. I've got to the time

-where I hit mid-30s and I had all the aspirations...

-Past it then(!)

-..when I as younger.

-As a singer, you are.

-No.

I tried it when I was younger. I went to stage school etc.

Now I realise that just to get paid a little bit of money

for doing that, you know, on the side, it's quite enjoyable

but this is really where I find myself drawn to now.

You can find me singing while I'm painting and that's about it, really.

-Do you?

-Yeah.

-Do you really sing as you paint?

-Yeah.

-Fantastic.

I've heard of whistling while you work but I wonder if I'll be

singing Danny's praises when he's finished with this renovation.

So, what's the kind of budget for what you're going to do here?

For here to start off with,

I think my budget is going to be between £2,000 to £5,000.

After that, it could rise to 15,000,

which would be an extra bedroom upstairs,

French doors into the conservatory,

there's obviously artex and stuff like that

that would really like to come down.

There is an option just to sell it on,

because you got a great price, didn't you?

Yes, I did. And to be honest with you, it is very tempting.

But for saleability, I think to spend the extra few thousand pounds

is probably going to help it sell a lot quicker

and it will take me a matter of weeks.

'Danny plans to do up and sell on this property.

'Updating the decor may not add significant value,

'but in a slow market could help it sell faster.

'However, I think it could be worth considering simply leaving it

'as it is and putting it back up for sale on the open market.'

So, the future for you then?

The next one I want to do is build, so I've worked my way up now

where I've got quite a big pot of funds from when I've renovated.

I've not, this is the only property that I've not had to lend money for,

which obviously I'm quite happy about.

It's all just sheer profit now and I'll go to the next project,

I'd like to get some land and build.

-Oh wow. From scratch?

-From scratch.

-Digging foundations and building bricks?

-I won't be doing that!

I'll be doing the bits inside, but obviously, you know,

I would like to build my next one.

Listen, congratulations, Danny. Great to meet you.

-Cheers.

-Good luck with it.

-Thanks.

-We look forward to seeing how you get on.

-Great.

Well, it seems Danny has chosen really well with this property.

Whatever he decides to do in terms of renovations,

I think he'll make money.

But is it really worth making the song and dance

and doing the whole kit and caboodle,

or would a lick of paint hit the right note?

You can find out later in the show.

Well, work should be well underway on our properties by now

-because there's certainly been lots of time to do it.

-There has.

But Martin, will there be brick dust all over the place,

ladders everywhere, or will the properties be looking fantastic?

Let's find out.

'We head back to Queensbury now on the Isle of Sheppey in Kent

'and this corner property with a ground floor commercial unit

'and two bed maisonette above.

'It was bought at auction for £104,000 by Tina

'and her husband, Colin, as an investment.

'For Tina, this was going to be her first step in property development,

'but for her friend, and star student Becky,

'this was also an opportunity to step out on her own.'

So, you've bought this.

This is going to be your business but Becky's going to run it.

Me and my husband are just the landlord. This is her domain.

We're going to look after the upstairs.

Becky, what's your involvement with this?

-I'm going to create this into a hair and beauty salon.

-Really?

-Yes.

'What a great chance for Becky to get her own business going

'and a lovely gesture from Tina to help start it up.

'We return just over two months later

'to see if Tina and Becky

'had got their places looking beautiful.'

'Well, the shop front looks great,

'but will the interior be a cut above the rest?'

'What a difference!

'Wow, the new salon is now up and running,

'looking stylish and smart.

'At the rear, a stud wall has split the old office space

'to create a beauty room with a new kitchen also installed.

'But back in the salon, well, I'll leave it to Becky

'to do the waxing lyrical on the beauty of the beauty parlour.'

I started the salon with a lovely chandelier,

which was my main inspiration just to begin with.

I then worked over to the mirrors and obviously the sign positions,

which have an important part to play in the salon.

We then got a lovely seating area for clientele to wait

before their treatment.

We've then got our basins, for shampooing and removing colour

and then I'm going to finish the salon with the lovely nail bar.

I feel that the actual colour scheme of the salon's worked really well.

We started with one little bit of leopard print and that's

evolved into the golds, blacks and everything that you see before you.

'Becky has certainly nailed down the style of the salon,

'but the attraction of this beauty parlour isn't just skin deep.

'I love that the ground floor has been replastered,

'it's had a full rewire, a new boiler and plumbing system installed

'to cope with the demands of the salon

'and the floor has been re-tiled.

# That's what makes it beautiful! #

'I'm really pleased. It's just as I imagined it.

'There's a few things we've had to change',

but it's turned out as I imagined it.

'Well done to Becky for getting her finish.

'But let's not forget Tina's maisonette.

'The main room is now a lovely living space.

'And they've kept the same units in the kitchen,

'but with new tiling and appliances, it just feels brand-new.

'Which is exactly what the bathroom suite is,

'modern and beautifully finished off.

'The bedrooms are also beautifully renovated

'and Tina's already got a tenant in.

'But despite no structural changes needed here,

'the renovation wasn't straightforward for Tina.'

'It needed rewiring, all the flooring.'

The wood chip took three weeks to take off. That was major.

'An added bonus is the rooftop terrace...

'..which overlooks the beauty salon's lovely new yard.

'And while Tina may have struggled with the woodchip,

'Becky's biggest task was staffing her new salon.'

'It's very hard to find good, reliable staff.'

But I think I've chosen well now.

'And with the salon having been open for only one day so far,

'it seems the staff already have their hands full.

# Lipstick, powder and paint

# Lipstick, powder and paint

# Lipstick, powder and paint

# Is you is, or is you 'aint? #

'Becky is renting the salon from Tina

'but while this is a business arrangement,

'there's still a strong bond of friendship between the two.'

I might be working with Tina again.

I'm going to miss her dearly but hopefully I'll be able

to take on her skills and her experience that I've gained

and my business will be as successful as her business.

It's a brilliant start for Becky. It's all what she needed and wanted.

And I think with the shop and the flat above,

it's been a good buy all round.

'The salon and maisonette renovations were completed

'within their two-month schedule

'and Becky managed to kit out the salon on her 15 grand budget.

'How did Tina's £17,000 budget hold-up?'

'The budget went slightly over.

'We spent 24,000 in total.'

But for both, for the salon, first fixing

and for the maisonette, we did 24,000.

'Well, add that to Tina's and Colin's £104,000 purchase price

'and their total outlay is 128 grand.

'Time to find out from two local estate agents

'if it's money well spent.'

First impressions coming back today since last time,

the property's really turn round.

'They've done absolutely amazing with it.

Refurbed it from top to bottom.

Both the flat and the commercial premises look absolutely stunning.

They've really make good use of all the space,

the garden outside is fantastic.

And I think it will be really successful in this position.

'Tina and Colin have spent 128,000 on the property.

'That's not including Becky's 15 grand shop refit.

'So what could it sell on value be?'

I would look at a value on the property

of between £140,000 and £155,000.

I would value the property at around £150,000

in the current market.

'Those valuations could give Tina a gross profit

'of between 12 and 27,000.'

That's actually more than what I thought, actually.

-Yes.

-Really, really good.

-Yes, it is good.

-Yes.

'The estate agents reckon the combined rental value

'of the flat and salon together could reach approximately

'£1,200, to £1,300 per calendar month.

'That's a whopping yield of between 11 and 12%.

'In fact, Tina and her husband Colin are getting £390 per calendar month

'from Becky in the salon and £575 per month for the maisonette.'

'Well, that's a yield of 9%, which they're more than happy with,

'not least because they're helping Becky

'with her first business venture.'

It's such an achievement, such an achievement.

-It's lovely.

-It feels really, really good.

I can almost feel your bubbly energy

when you're down there, buzzing around and it's just lovely.

-I feel on cloud nine.

-Yes.

'Let's make our way back to West Yorkshire and the town of Ossett.

'When I viewed this bungalow,

'it had a guide price of between 90 and 100,000.

'The interior was in very good condition indeed.

'Decor may have been dated,

'but there was central heating, double glazing

'and both the kitchen and bathroom were in absolutely tip top shape.

'There was also the potential to add a third bedroom

'in the upstairs conversion.

'The property was purchased by property developer

'and professional singer, Danny for £90,000.

'He was happy with that price,

'so you might say he picked it up for a song.'

# And I'm feeling...

# ..Good. #

-Great little bungalow.

-Yes, it's not bad...

-Not bad?

Lots of people would walk in here and think, this is amazing!

-Yes, if you were in your 80s...

-Oh, come on! No!

It's dated, but it's tidy.

'Danny planned a modern makeover for the property.

'I thought he should simply sell it on as it was,

bearing in mind his low purchase price.

'So, as far as this renovation is concerned,

'will I be singing Danny's praises or booing him offstage?

'Well, just over two months later, we're back.

'The exterior is looking nice and bright, with a fresh lick of paint.

'The bungalow's certainly looking more attractive from the outside,

'but what about the inside?

'A once dated decoration is now...

'Well, still dated, but perfectly presentable.

'Let's find out what's been happening, or not,

'as the case may be from Danny.'

'In the first instance, the idea was to make it more modern.'

But to be honest with you, I've not really done much on this one.

I sought some advice from some agents and they advised me just to give it

a little bit of a tidy up and get it straight back on the market.

'That estate agent's advice must have been music to Danny's ears,

'as putting it on the resale market is exactly what he's done.'

'The bungalow's been on the market two weeks

'and I've had two viewings already. Both seemed quite interested',

but unfortunately aren't in a position to move as yet

because they have properties to sell.

'Danny financed the purchase of this bungalow

'with profits from his previous six projects.

'So he does not have mortgage payments to meet,

'meaning he's in no rush to sell.

'However, while the name of the game

'in property developing is to make money,

'which I believe this bungalow will do for Danny,

'he does miss the satisfaction that comes from renovating a place.'

'The last ones that I've done',

the first week has been completely ripping out kitchens, bathrooms.

Everything's been completely gutted

and this one... didn't even need to hoover.

# Woo! My love is like a vacuum cleaner

# Would you believe it keeps coming in... #

'If Danny sells the bungalow at the price he is asking,

'he'll have cleaned up without even having to clean up.

'Brilliant.'

'The only effort at renovation has been a lick of paint outside

'and a tidy up of the garden.

'So, with baited breath, let's find out

'if he's got his budget licked too.'

My budget so far is £90.

MARTIN LAUGHS

'So, add that £90 to Danny's purchase price of 90,000

'and that gives him a total investment of £90,090.'

'We asked two local estate agents for their opinion

'on Danny's decision not to renovate this bungalow.'

I think the decision not to do anything,

why do something that doesn't need to be done?

The property's clean, it's tidy, it's well presented,

why spend money for the sake of it when it doesn't need to be spent?

The property's perfectly acceptable as it is,

and perfectly acceptable to back on the market to sell.

I think for the market we're in at the moment,

I think it gives it the perspective purchaser the opportunity

to put their own individual stamp on the property, but I think from...

a resale point, the condition of the property's fine.

'If the property were to be put on the rental market,

'how much do the agents believe it could achieve?'

I think we should be able to achieve £595, to £625 per calendar month.

A rental figure would be £550 per calendar month.

'Those valuations would give Danny a yield

'of between seven and 8.5%.

'But he's already put the house up for sale.

'So what figure should he aim for,

'bearing in mind his total investment of just over £90,000?'

'I would suggest an asking price of £119,950',

to achieve somewhere in the region of £117,000.

If it was put on the market for sale,

I'd recommend an asking price of £124,950, just short of £125,000,

which I feel is a realistic asking price for the property,

given the current market conditions.

'If Danny got those sort of amounts,

'it would mean he makes a potential profit of between 27 and £35,000.

'He's actually put the bungalow up for sale now at 124,000.

'With all those figures in mind, is rental an option AT ALL?'

My plans now are it's going to stay on the market for about eight weeks

and then if it doesn't sell, it's going to go rented for 12 months

and then back onto the market again.

'Well, it's far from our traditional type of return visit.

'But I think this is a prime example of how money

'can be made at auctions, even in the current market conditions,

'if you buy the right property at the right price.

'So, what's next for Danny?'

'I've already found my next property',

so I'm hoping to move for that one very shortly.

'Since filming, Danny's reduced the asking price to £119,950

'and if he sells at that price, that would give him a pre-tax profit

'of nearly £30,000 and that really would be something to sing about.

Join us for more Homes Under The Hammer next time.

Yes, Lucy and I will have lots more intriguing properties

and enthusiastic buyers for you then.

-See you.

-Bye.

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