0:00:02 > 0:00:03With ups and downs in the property market,
0:00:03 > 0:00:07you need to be able to trust your instincts when you're buying.
0:00:07 > 0:00:10Nowhere is it more true than in the auction room.
0:00:10 > 0:00:14Yes, join us now as we take the lottery out of property.
0:00:14 > 0:00:15Buying under the hammer.
0:00:41 > 0:00:45Buying at auction doesn't have to be a scary experience.
0:00:45 > 0:00:46If you've done your research
0:00:46 > 0:00:50and stick to your budget, you can get yourself a bargain.
0:00:50 > 0:00:54We'll meet three buyers today, who we hope did just that.
0:00:54 > 0:00:59Did they bag a bargain, or did they get more than they bargained for?
0:00:59 > 0:01:00Let's take a look at what they bought.
0:01:01 > 0:01:05In Gateshead, there's a terrace in need of tarting-up.
0:01:05 > 0:01:09I'm not expecting a completely sparkling interior,
0:01:09 > 0:01:10but how bad is it?
0:01:11 > 0:01:17A flat in Shepherd's Bush, London, that needs hard graft and hard cash.
0:01:17 > 0:01:21You've got to be ready with the readies because easy money it is not.
0:01:21 > 0:01:25And in Preston, Lancashire, if you're after a two-bed mid-terrace,
0:01:25 > 0:01:28this place could make you say bingo to the numbers.
0:01:28 > 0:01:31Yep, you heard right, two five, 25.
0:01:32 > 0:01:34All these properties were sold at auction.
0:01:35 > 0:01:39We'll find out who bought them and what they paid for them
0:01:39 > 0:01:41when they went under the hammer.
0:01:41 > 0:01:43Sold!
0:01:55 > 0:01:57Welcome to North East England.
0:01:57 > 0:02:00To be precise, Gateshead, on the banks of the River Tyne.
0:02:02 > 0:02:05The town is becoming famous for its iconic architecture,
0:02:05 > 0:02:09which reflects its industrial past but also its cultural future.
0:02:11 > 0:02:14Today's auction lot is in an area called Felling,
0:02:14 > 0:02:18with good transport links to Newcastle city centre and further afield.
0:02:19 > 0:02:22Well, just off the main road,
0:02:22 > 0:02:24up this little pathway is the property I'm here to see.
0:02:24 > 0:02:28So, really nice and secluded, good residential area.
0:02:28 > 0:02:32Still close to the shops and you've got good schools close by as well.
0:02:32 > 0:02:33The house itself?
0:02:33 > 0:02:39Three-bedroomed, end of terrace, had a guide price of 60,000 quid.
0:02:39 > 0:02:41Doesn't look like it's been that well looked after
0:02:41 > 0:02:44but let's live in hope.
0:02:46 > 0:02:51There are cracks around the windows and damage to the roof and guttering, not a great start.
0:02:53 > 0:02:56My hopes are fading fast as I enter the lion's den.
0:02:59 > 0:03:03Well, clearly I'm not expecting a completely sparkling interior.
0:03:04 > 0:03:06But how bad is it?
0:03:06 > 0:03:09It definitely needs a coat of paint, new wallpaper,
0:03:09 > 0:03:11but a nice-sized room.
0:03:11 > 0:03:14This main living room area, really good.
0:03:14 > 0:03:16I like the open fireplace that's hidden behind there.
0:03:16 > 0:03:20And, yeah, as I said, it definitely needs a bit of tender, loving care for sure.
0:03:20 > 0:03:23But the actual layout is good and the room size is really nice.
0:03:23 > 0:03:26Come through there into the kitchen here.
0:03:26 > 0:03:29And as you can see, enough space for a kitchen table.
0:03:29 > 0:03:32I mean, it's a really useful space.
0:03:32 > 0:03:34And straight away, yeah,
0:03:34 > 0:03:37this is one with a bit of effort, it could be really nice,
0:03:37 > 0:03:40cos you've got a fantastic thing to work on.
0:03:41 > 0:03:43# You'd be so nice
0:03:43 > 0:03:45# To come home to... #
0:03:45 > 0:03:50Yes, upgrade this kitchen and it really could be the warm, cosy heart of this home.
0:03:51 > 0:03:57Tucked away next to the back door is a WC, always handy for a family.
0:03:57 > 0:03:58Let's take a look upstairs.
0:03:58 > 0:04:01There are three bedrooms. Two doubles and a single.
0:04:04 > 0:04:09And the bathroom, which looks like it comes with a new bathroom suite.
0:04:09 > 0:04:12Bonus! The rooms have been stripped back,
0:04:12 > 0:04:16which is also a bonus as you can see the condition of the walls more clearly.
0:04:16 > 0:04:19And, sure enough, I've spotted some worrying cracks
0:04:19 > 0:04:23which could be a sign of subsidence.
0:04:24 > 0:04:28At the rear, a green-fingered gardener could make this a lovely little space.
0:04:29 > 0:04:33But I spy something which warrants closer inspection.
0:04:33 > 0:04:37Now, when it comes to properties, nature has a fantastic way
0:04:37 > 0:04:41of giving you clues as to potential problems.
0:04:41 > 0:04:45Here I am at the corner of the house. While I'm here,
0:04:45 > 0:04:48really nice-sized garden by the way, it is in a bit of a mess.
0:04:48 > 0:04:51But at this corner here, you can see loads and loads of this green stuff,
0:04:51 > 0:04:54kind of algae or whatever it is.
0:04:54 > 0:04:57And that only happens when there's a real issue about damp.
0:04:57 > 0:05:00There's lots of water here It doesn't make sense cos we're outside.
0:05:00 > 0:05:03So, what is going on? Drainpipe comes down in here and you've got this drain.
0:05:03 > 0:05:07Now, if I just root around in here, you can see lots of bits and pieces.
0:05:07 > 0:05:09So, my guess is, what's been happening over time,
0:05:09 > 0:05:11is when it rains a lot, this...
0:05:12 > 0:05:14Yes, this is also a down pipe from the upstairs,
0:05:14 > 0:05:17erm, upstairs sink, that's not helping matters.
0:05:17 > 0:05:20That fills with water, it's flooding down here,
0:05:20 > 0:05:23and my concern is it's getting into the soil
0:05:23 > 0:05:25and that could cause real issues with subsidence,
0:05:25 > 0:05:27so it really needs to be sorted out urgently.
0:05:27 > 0:05:30What you need to do is, for a start, get rid of all the muck that's in here
0:05:30 > 0:05:35and, secondly, just run a new bit of underground drainpipe from there
0:05:35 > 0:05:39to the manhole cover which, handily, is only about three metres away from here.
0:05:39 > 0:05:41Do that, and you could save yourself
0:05:41 > 0:05:44a heck of a lot of trouble in the future.
0:05:44 > 0:05:46Thank you, Mother Nature.
0:05:46 > 0:05:49# God bless Mother Nature
0:05:50 > 0:05:53# She's a single woman too... #
0:05:55 > 0:06:01So, alarm bells ringing here, but this house has plenty of potential.
0:06:01 > 0:06:02It's a good size with a big garden,
0:06:02 > 0:06:06and if it was bought around the guide price of £60,000, I'd call it a bargain.
0:06:10 > 0:06:14We asked a local estate agent to give us her opinion on this property.
0:06:16 > 0:06:18I think this house has vast potential.
0:06:18 > 0:06:21Good if you want to extend, good size as it is.
0:06:21 > 0:06:22Does need refurbishing,
0:06:22 > 0:06:25does need some work to bring it up to standard.
0:06:25 > 0:06:26Really good plot.
0:06:26 > 0:06:29And in its current condition,
0:06:29 > 0:06:33how much does the estate agent believe this property could achieve if sold?
0:06:33 > 0:06:38I think this house at this moment in time is worth £70,000.
0:06:38 > 0:06:41And once renovated?
0:06:41 > 0:06:45If it was renovated, I would bring that price to £95,000.
0:06:45 > 0:06:48And rental valuation?
0:06:48 > 0:06:50I would expect that this property would rent out
0:06:50 > 0:06:53for £550 per calendar month.
0:06:56 > 0:06:59Well, a few issues to sort out with this one,
0:06:59 > 0:07:03but intrinsically, what you've got here is a really nice-sized house
0:07:03 > 0:07:06that would make a good rental opportunity or a family home.
0:07:06 > 0:07:08Let's see who agreed when it went under the hammer.
0:07:09 > 0:07:12Anyone want to start me at 60?
0:07:13 > 0:07:1558.
0:07:15 > 0:07:1856?
0:07:18 > 0:07:2256,000 the bid, left-hand side, 56,000.
0:07:22 > 0:07:26I'll take one anywhere else. 56,000 on the left-hand side.
0:07:26 > 0:07:2857 anyone else?
0:07:29 > 0:07:32Lady at 57. 57 with the lady at 57. 58?
0:07:32 > 0:07:3658 bid. 59? 59 bid.
0:07:36 > 0:07:3960? 60 bid. 61.
0:07:39 > 0:07:43It's against you, it's the gentleman on the left-hand side at 60,000.
0:07:43 > 0:07:45I'll take 500 if it helps.
0:07:45 > 0:07:50No? I'm selling at £60,000. I'll take 500.
0:07:50 > 0:07:53I'm going to sell, at 60,000. I'm selling it once at 60.
0:07:53 > 0:07:57I'm selling for the second time at £60,000.
0:07:59 > 0:08:01The hammer fell on a bid of £60,000,
0:08:01 > 0:08:05bang on the guide price. And the successful bidder was Andy.
0:08:08 > 0:08:13He has purchased the property to be his and his wife, Emma's, new home.
0:08:14 > 0:08:18They have a one-year-old son and are in need of extra space.
0:08:22 > 0:08:23Andy works as an arborist
0:08:23 > 0:08:26and, so you're up to speed for your next pub quiz,
0:08:26 > 0:08:28that means he's a tree surgeon.
0:08:30 > 0:08:33# I talk to the trees
0:08:35 > 0:08:39# But they don't listen to me... #
0:08:40 > 0:08:43- Andy, good to meet you. Congratulations.- You, too.
0:08:43 > 0:08:46- Tell me why you wanted to buy the house.- We've just had our first child, and so,
0:08:46 > 0:08:51at the minute we're living in a flat that me and my wife have been living in for the last five years.
0:08:51 > 0:08:54And really now we need to find ourselves a larger property just for,
0:08:54 > 0:08:56obviously, for our child to have a run about.
0:08:56 > 0:09:00What was it that you and your wife liked about it so much?
0:09:00 > 0:09:01We've had a look at a couple of properties
0:09:01 > 0:09:04and, really, it's the space in the living room itself
0:09:04 > 0:09:06and the space in the gardens.
0:09:06 > 0:09:08We like to be outdoors as much as possible,
0:09:08 > 0:09:13so to be able to let our child go outside and play is fantastic for us.
0:09:13 > 0:09:15From that point of view then, the fact that there's not a road leading to it,
0:09:15 > 0:09:18there's just this, sort of, pathway, must be ideal?
0:09:18 > 0:09:21Obviously, when you come into the property, as you can see, it's...
0:09:21 > 0:09:24You just walk down. It's quiet, there's not many people around this area.
0:09:24 > 0:09:26What was the auction like?
0:09:26 > 0:09:29My wife, what we did was, she didn't want to put her hand up,
0:09:29 > 0:09:31and I said, "Well, but, when do you want me to put my hand up?"
0:09:31 > 0:09:34She said, "I'll nod, you put your hand up". I said, "Right, OK".
0:09:34 > 0:09:37So, she gave me the nod, I put my hand up, and we just kept going from there
0:09:37 > 0:09:41until, luckily, it went at 60, which was, kind of, as far as we were going to go.
0:09:41 > 0:09:44And we managed to keep it there, so.
0:09:44 > 0:09:46Wow, so you got it for your last bid
0:09:46 > 0:09:49That was our last bid, yeah. If it had gone any higher, if it had gone to 61 or anything.
0:09:49 > 0:09:53I was praying that the auctioneer, cos he kept going, "I'll take 100".
0:09:53 > 0:09:56No, don't take 100 on it, that's enough. Please stop.
0:09:56 > 0:09:58But it was enjoyable to be there.
0:09:58 > 0:10:01It wasn't as bad as I thought it was going to be, it wasn't too much pressure or anything,
0:10:01 > 0:10:03I was just standing at the back, it was OK.
0:10:06 > 0:10:10I get the impression Andy is a take it in his stride kind of guy.
0:10:10 > 0:10:15And, certainly, this little house will provide his little lad, Logan,
0:10:15 > 0:10:17with plenty of room to run around in.
0:10:17 > 0:10:21And I'm sure Emma, his wife, is equally happy with their new home.
0:10:23 > 0:10:25So, how long have you two been together?
0:10:25 > 0:10:28Seven years together. We've been married for,
0:10:28 > 0:10:30it's a hard question ,isn't it? I think we've been married now for five years,
0:10:30 > 0:10:32coming up to six this year.
0:10:32 > 0:10:35So, but yeah, it's been fantastic, really been enjoying it.
0:10:35 > 0:10:40- Got married in Vegas by Elvis. - You got married in Vegas by Elvis?
0:10:40 > 0:10:43Had all the family there as well. If you're going to do it, you may as well do it right,
0:10:43 > 0:10:46so went across, had a great time. Really good place.
0:10:46 > 0:10:50# I'm in love, I'm all shook up... #
0:10:50 > 0:10:52Viva Las Gateshead doesn't have quite the same ring
0:10:52 > 0:10:58but I'm sure Andy will not be getting all shook up with the challenges of this renovation.
0:11:00 > 0:11:02He has a £4,000 budget to make it homely enough
0:11:03 > 0:11:05for his family to move into in three months.
0:11:07 > 0:11:10So who's going to be doing the work here?
0:11:10 > 0:11:12Mainly it's going to be myself and my father-in-law.
0:11:12 > 0:11:16And any friends that we can get to come along and help, kind of thing.
0:11:16 > 0:11:19If we can get it done with just ourselves, all the better.
0:11:19 > 0:11:21Now, a couple of structural things,
0:11:21 > 0:11:24the stuff above the windows upstairs,
0:11:24 > 0:11:27the brickwork is all cracked, that doesn't look too good. Any idea what's going on there?
0:11:27 > 0:11:31Not too sure, no. So we are going to have to get some structural engineers in,
0:11:31 > 0:11:34I think, to have a look at that. It is worrying but, for the price of the property,
0:11:34 > 0:11:38we thought it was a risk we were willing to take really on it.
0:11:38 > 0:11:42And the only other thing is the bit of drainage round the corner of the property at the back.
0:11:42 > 0:11:44We need to see what damage is actually done there,
0:11:44 > 0:11:46whether it is just superficial on the outside of it,
0:11:46 > 0:11:49and then get someone in, see what they say.
0:11:49 > 0:11:53- Well listen, congratulations. Good luck in your new family home. - Thank you very much.
0:11:53 > 0:11:55- I look forward to seeing how you get on sorting it out.- Yes.
0:11:55 > 0:11:56# I'm all shook up... #
0:11:56 > 0:12:00Well, that's great, this really is a perfect property
0:12:00 > 0:12:02for Andy and his family.
0:12:02 > 0:12:05How will they get on sorting it out? Well, something tells me,
0:12:05 > 0:12:09when we return, for sure these trees will be gone,
0:12:09 > 0:12:11but what else will we find?
0:12:11 > 0:12:12You can find out later in the show.
0:12:17 > 0:12:18If location is the key factor for a property,
0:12:19 > 0:12:23then the lot I've come to see in Shepherd's Bush, West London,
0:12:23 > 0:12:25should attract a lot of interest.
0:12:27 > 0:12:30If every property description could start with
0:12:30 > 0:12:34"Leafy tree-lined road and well-kept period property,"
0:12:34 > 0:12:37then estate agents would be in seventh heaven.
0:12:37 > 0:12:41Because, in London, roads like this are what people are really after.
0:12:41 > 0:12:44And they continue to sell very well,
0:12:44 > 0:12:47which is good news, because this is the lot I'm here to see.
0:12:47 > 0:12:50Sadly not the whole house, just the first floor,
0:12:50 > 0:12:56which had a guide price of £225,000.
0:12:58 > 0:13:02So, the location's good. And the flat?
0:13:02 > 0:13:06Well, the outside could do with some tidying up, and it's single-glazed,
0:13:06 > 0:13:09but it's nothing that couldn't be easily sorted out.
0:13:09 > 0:13:12There is a covenant attached to the sale by the local borough,
0:13:12 > 0:13:14who are the vendors, and that states
0:13:14 > 0:13:16that they can't sell to anyone who intends to live here.
0:13:17 > 0:13:20So, investors only, please.
0:13:20 > 0:13:24What a lovely, light and airy space. So nice to walk into.
0:13:24 > 0:13:28You've got a skylight here, letting all this gorgeous daylight through.
0:13:28 > 0:13:30I'm not even going to look at the woodchip,
0:13:30 > 0:13:33I'm not going to mention it, because you know how I feel about that.
0:13:33 > 0:13:37But it's almost like there's too much space on this landing.
0:13:37 > 0:13:41What's in here? Got a loo, a bathroom,
0:13:41 > 0:13:45not a bad-sized kitchen there,
0:13:45 > 0:13:47but I'm just wondering, I mean, look, stud partitioning everywhere.
0:13:47 > 0:13:52I'm just wondering whether or not it might be worth thinking about
0:13:52 > 0:13:57knocking a few walls down to make that kitchen bigger.
0:13:57 > 0:14:00That would really work. You could then have a nice table and chairs in there,
0:14:00 > 0:14:02so you could eat in that space.
0:14:02 > 0:14:06How about taking this wall down, bringing it out to here?
0:14:06 > 0:14:07Then, make the bathroom a little smaller,
0:14:07 > 0:14:12but if you then knocked this stud partition through to here
0:14:12 > 0:14:14and had one toilet and bathroom,
0:14:14 > 0:14:16knock them together, you'd have a bit of space.
0:14:16 > 0:14:19Corridor here, door into the kitchen.
0:14:19 > 0:14:23I think that would work, and really add a bit of value to this property.
0:14:23 > 0:14:28# Come on, pretty baby # Let's move it and groove it... #
0:14:30 > 0:14:33Kitchens increasingly are the key rooms in a property
0:14:33 > 0:14:36and anything that can enhance this space would be a bonus.
0:14:36 > 0:14:39With parts of the flat adapted to make it more accessible,
0:14:39 > 0:14:42the bathroom space will need some changes anyway.
0:14:44 > 0:14:47The layout of the rest of the flat is fine,
0:14:47 > 0:14:50with a decent double bedroom and a good size lounge.
0:14:50 > 0:14:54But I think I've found something that could completely transform the space here.
0:14:57 > 0:15:01When you're viewing property and you're on the first floor, look up,
0:15:01 > 0:15:03and see if you can spot an opportunity.
0:15:03 > 0:15:07Because roof space equals potential loft conversion.
0:15:07 > 0:15:11Which means extra bedroom and extra profit. Bingo!
0:15:11 > 0:15:13But hold your horses.
0:15:13 > 0:15:16Now, just because you own the first floor of a property, well,
0:15:16 > 0:15:19it doesn't mean you own the bricks and tiles above it.
0:15:19 > 0:15:24In this case, the freeholder has retained ownership of the roof space and, to buy that off them,
0:15:24 > 0:15:28well, it could cost you thousands. A lot of thousands.
0:15:28 > 0:15:33In fact, a similar case recently not far away from here, just up the road,
0:15:33 > 0:15:36it cost them around £25,000.
0:15:36 > 0:15:40Now, that expenditure could easily bring you more profit in return,
0:15:40 > 0:15:42but you've got to be ready with the readies
0:15:42 > 0:15:44if you plan to go down this route,
0:15:44 > 0:15:46because easy money it is not.
0:15:48 > 0:15:52That £25,000 was just to own the loft space.
0:15:52 > 0:15:54It could cost the same again to convert it
0:15:54 > 0:15:56and there's planning to go through, too.
0:15:56 > 0:15:59So, for the best chance of making sure bigger is better,
0:15:59 > 0:16:02keep a very keen eye on your budget.
0:16:06 > 0:16:07OK, let's get a second opinion.
0:16:07 > 0:16:10What does the local estate agent make of the potential
0:16:10 > 0:16:14of this one-bed flat guided at 225,000?
0:16:17 > 0:16:21First impressions of this flat, nice, light, good-sized rooms.
0:16:21 > 0:16:24Needs a little bit of modernisation but it's a good space
0:16:24 > 0:16:28and the location is pretty near spot on.
0:16:28 > 0:16:31So, just a little bit of tenderness and you've got a very nice flat here.
0:16:31 > 0:16:33So, as it stands, it's fine.
0:16:33 > 0:16:37But what would be the best way to enhance what's already here?
0:16:37 > 0:16:41The biggest opportunity to make money in this flat would be to access the roof space.
0:16:41 > 0:16:43So, if you can have access to that, you can put another
0:16:43 > 0:16:45very good sized bedroom in
0:16:45 > 0:16:48and the flat will increase in value significantly.
0:16:48 > 0:16:51Very good news, but how significantly?
0:16:52 > 0:16:55What's the difference between the values refurbished as it is,
0:16:55 > 0:16:58and with an extra bedroom in the loft?
0:16:59 > 0:17:01If you were to refurbish,
0:17:01 > 0:17:04285 I think would be the top in its present format.
0:17:04 > 0:17:06I would value the property with a second bedroom
0:17:06 > 0:17:10in the region of £325,000.
0:17:10 > 0:17:13So, that's a price hike of around 40 grand,
0:17:13 > 0:17:17which certainly gives you something to think about.
0:17:17 > 0:17:19It could cost as much to do
0:17:19 > 0:17:22but how much would the loft conversion affect the rental values?
0:17:22 > 0:17:25As a one bedroom flat, I would suggest it would rent for
0:17:25 > 0:17:28in the region of £1,200 per calendar month.
0:17:28 > 0:17:33As a two bedroom, as much as £1,450 per calendar month.
0:17:33 > 0:17:36This is an extremely popular area,
0:17:36 > 0:17:40a lovely road, and a potentially gorgeous period property.
0:17:40 > 0:17:42Although, do the flat up well,
0:17:42 > 0:17:45and I don't think there's a huge profit in it.
0:17:45 > 0:17:48But it would rent out or sell in a flash.
0:17:48 > 0:17:52So, it's the low-risk, reasonable return approach on this one.
0:17:52 > 0:17:55Let's see who that appealed to at the auction.
0:17:57 > 0:17:59Lot three now.
0:17:59 > 0:18:04A one-bedroom, first floor flat, 200, 200 sitting down.
0:18:04 > 0:18:05205.
0:18:07 > 0:18:08205. 210.
0:18:10 > 0:18:12215. 220.
0:18:13 > 0:18:15225. 230.
0:18:16 > 0:18:19230 in the front. 235.
0:18:19 > 0:18:22240. 245.
0:18:23 > 0:18:25250. 255.
0:18:25 > 0:18:29260. 265. 265. Anyone else?
0:18:29 > 0:18:33266. New spot 267. 268.
0:18:33 > 0:18:35269.
0:18:37 > 0:18:38270. 271.
0:18:40 > 0:18:43272. 273.
0:18:44 > 0:18:46Have a think. 272, back to you.
0:18:46 > 0:18:51273. 273 back in. 274.
0:18:51 > 0:18:55Where am I? 273 with you, sir, standing up.
0:18:55 > 0:18:56First time, second time.
0:18:56 > 0:18:59Third and last time, have we all done?
0:18:59 > 0:19:03Sold, well bid, well done, you got there. Sold 273.
0:19:03 > 0:19:08And for 273,000, nearly 50 grand over the guide price,
0:19:08 > 0:19:10the new owner is Pierre.
0:19:11 > 0:19:14Pierre works now in PR
0:19:14 > 0:19:17but previously worked as an estate agent in this part of London.
0:19:18 > 0:19:20So, he's hoping that that experience
0:19:20 > 0:19:24will stand him in good stead with his property purchase.
0:19:24 > 0:19:27- Pierre, congratulations. - Thank you, thank you. - Lovely to meet you today.
0:19:27 > 0:19:30What's all the story behind you wanting to buy this flat at auction?
0:19:30 > 0:19:33Well, I think I've tried to cover all bases.
0:19:33 > 0:19:35I really concentrated primarily on...
0:19:35 > 0:19:37Do I know the area? Yes, I do.
0:19:37 > 0:19:41Is it a good spot, is it a good location? Yes it is, it's West London,
0:19:41 > 0:19:45it's reasonably central, it's a Victorian terrace,
0:19:45 > 0:19:48and it doesn't need all that much work, which I'm quite pleased about.
0:19:48 > 0:19:50All the property-speak, all the agent talk's coming back. How does it feel?
0:19:50 > 0:19:56- Well, it feels quite natural, really. - Does it really? So, what do you do now?
0:19:56 > 0:20:00Well, I work in PR, but I've always been in the construction and housing sector.
0:20:00 > 0:20:04So, yeah, I suppose I should be considered an expert in it,
0:20:04 > 0:20:07but sometimes when you make these sort of decisions
0:20:07 > 0:20:10and the hammer comes down, you start wondering if you are an expert.
0:20:10 > 0:20:11But I'm still fairly happy with it.
0:20:11 > 0:20:15Yes, and it's one thing being an expert in assessing properties
0:20:15 > 0:20:17and another when it's your own project
0:20:17 > 0:20:20and you've actually got to do the work.
0:20:20 > 0:20:23And this is quite an incredible flat because you could put tenants in tomorrow,
0:20:23 > 0:20:26or you can take it a stage further and you can start doing a bit of work,
0:20:26 > 0:20:28knocking a few walls down, et cetera.
0:20:28 > 0:20:31What route are you going to take here?
0:20:31 > 0:20:34Well, I think what I'm going to do first of all is just freshen it up a bit.
0:20:34 > 0:20:38And that's what I'm going to do initially, I'll let it for the first six months,
0:20:38 > 0:20:41and I'll just get a flavour of then what to do with it.
0:20:41 > 0:20:44# Just you wait and see... #
0:20:45 > 0:20:47And, for his wait-and-see approach,
0:20:47 > 0:20:50Pierre has earmarked a budget of around 3,000,
0:20:50 > 0:20:54while he decides whether he'll make any more significant changes.
0:20:54 > 0:20:57So, do you have any ideas of how you could improve it?
0:20:57 > 0:21:01Well, what I'd like ultimately is to have a kitchen which you can eat in.
0:21:01 > 0:21:05I'll probably have to move the whole wall of the kitchen further into the hallway.
0:21:05 > 0:21:07But I need more time to think on that one.
0:21:07 > 0:21:09- But what about the freeholder? - The freehold is the council,
0:21:09 > 0:21:13Hammersmith and Fulham Homes, and the good thing is that
0:21:13 > 0:21:17the downstairs tenant also has a very long lease,
0:21:17 > 0:21:20and that means that we've got a right to buy the freehold.
0:21:20 > 0:21:24And I've spoken to him and he wants to go ahead.
0:21:24 > 0:21:27I'm not particularly interested in dealing with the roof at the moment
0:21:27 > 0:21:31but I do want the freehold, so we'll go down that route,
0:21:31 > 0:21:36and we'll have to see what the council says about the roof.
0:21:36 > 0:21:39So how much time have you got to invest in the renovation of this property?
0:21:39 > 0:21:43Quite a lot really. I've got, well, I'll spend all my weekends on it,
0:21:43 > 0:21:45it will keep me out of the pub.
0:21:45 > 0:21:47I always like a project, I think most people do.
0:21:47 > 0:21:50And it's a project that I think
0:21:50 > 0:21:53is within my capabilities, if you like,
0:21:53 > 0:21:55so, I'm eager to crack on.
0:21:55 > 0:22:00Pierre, good luck. I am really looking forward to seeing this flat without the woodchip.
0:22:00 > 0:22:03- OK.- Well done, congratulations. Thank you.- Thanks, thanks.
0:22:05 > 0:22:08So, expert or not, Pierre has got a great flat here,
0:22:08 > 0:22:10and I think he's right to hold off from the loft conversion
0:22:10 > 0:22:13for the time being, considering what he paid for this.
0:22:13 > 0:22:18But I would love to see the layout changed and that kitchen extended.
0:22:18 > 0:22:23Find out what Pierre's perfect pad looks like later on in the show.
0:22:24 > 0:22:28Coming up. The stairs of this Preston property give me altitude sickness.
0:22:28 > 0:22:31PANTING
0:22:31 > 0:22:33I need oxygen.
0:22:34 > 0:22:38In Shepherd's Bush, London, it's decisions, decisions for Pierre.
0:22:38 > 0:22:41I think what's important is to get the work done,
0:22:41 > 0:22:43and then I'll be able to decide what to do with it.
0:22:45 > 0:22:48But first, in Gateshead, did Andy make a cracking job
0:22:48 > 0:22:50of turning this place into a family home?
0:22:51 > 0:22:53It's just happy times.
0:22:59 > 0:23:03It's time to return to Gateshead in County Durham,
0:23:03 > 0:23:07where I viewed this three-bedroom end-of-terrace
0:23:07 > 0:23:08which had a lovely big garden,
0:23:08 > 0:23:13but I was concerned about the cracks on the outside and the inside.
0:23:16 > 0:23:19I feared that the broken drainpipes in the garden
0:23:19 > 0:23:22had possibly caused subsidence.
0:23:28 > 0:23:31The property was purchased at an auction for £60,000,
0:23:31 > 0:23:33bang on the guide price, by tree surgeon, Andy.
0:23:36 > 0:23:38He planned to renovate this house
0:23:38 > 0:23:39as a new home for himself, his wife, Emma,
0:23:39 > 0:23:43and their one-year-old lucky lad, Logan.
0:23:46 > 0:23:47Tell me why you wanted to buy the house.
0:23:47 > 0:23:49We've just had our first child and, so,
0:23:49 > 0:23:53to be able to let our child go outside and play is fantastic for us.
0:23:54 > 0:23:59So, let's find out if Andy has made this house their home sweet home.
0:24:01 > 0:24:04Six months later, we're back.
0:24:04 > 0:24:07# Oh, baby, it's home sweet home... #
0:24:14 > 0:24:16# Home sweet home... #
0:24:21 > 0:24:25Well, there's certainly loads of room for Logan to run around in.
0:24:25 > 0:24:28And that, it would appear, is exactly what he's been up to.
0:24:28 > 0:24:30Shhh, don't wake baby.
0:24:30 > 0:24:32# Don't wake me up... #
0:24:35 > 0:24:39Andy and his wife, Emma, moved into the house before their renovation began.
0:24:39 > 0:24:43So, top of the to-do list was a bedroom for Logan.
0:24:47 > 0:24:50This was one of the first rooms that we had to do when we moved into the property.
0:24:50 > 0:24:52Logan, obviously, was our main priority,
0:24:52 > 0:24:55so we decided that we would get his room set up
0:24:55 > 0:24:58so that even if nothing else, he had somewhere to sleep.
0:24:58 > 0:25:02And we could sleep on the floor, which we did end up doing.
0:25:02 > 0:25:05But, obviously, we needed somewhere that Logan could just have himself
0:25:05 > 0:25:09a little room to enjoy himself, have a run around.
0:25:09 > 0:25:12And to see Logan's face when he first came into his bedroom.
0:25:12 > 0:25:14He'd been living in such a small, little room,
0:25:14 > 0:25:18and then here he came running in, he could roll around on the floor,
0:25:18 > 0:25:20he'll just crawl onto his bed, jump off his bed,
0:25:20 > 0:25:23which we'd never had the chance for him to do before.
0:25:23 > 0:25:25And that just made it worthwhile,
0:25:25 > 0:25:26all the time and effort that we'd put into it.
0:25:26 > 0:25:28Just, it was great seeing
0:25:28 > 0:25:30your first child running around, having a great time.
0:25:34 > 0:25:38Their renovation was carried out by Andy and Emma and both their dads,
0:25:38 > 0:25:41while little Logan was looked after by the grans.
0:25:44 > 0:25:48Everyone working together to ensure that this building was transformed
0:25:48 > 0:25:51from a cold and grumbling house
0:25:51 > 0:25:53into a warm and welcoming family home.
0:25:54 > 0:25:57It's really nice now that we actually have the house.
0:25:57 > 0:26:01It's possible to have everybody round, all together, the family's together.
0:26:01 > 0:26:03Before when we lived in the flat, that wasn't really possible.
0:26:03 > 0:26:06But now it's possible to have everyone in the house.
0:26:06 > 0:26:08But, hopefully, with the summer coming,
0:26:08 > 0:26:12we're going to have ourselves some barbecues outside.
0:26:12 > 0:26:14Really looking forward to the families getting together.
0:26:17 > 0:26:19Outside, Andy has fixed the drainpipes,
0:26:19 > 0:26:23but you can still see cracks above the windows.
0:26:23 > 0:26:28We decided to get some engineers just to come out and have a quick look at it for us
0:26:28 > 0:26:31and they said that there's no subsidence in the building,
0:26:31 > 0:26:33that it seems to have settled whatever had happened.
0:26:33 > 0:26:37So, what they recommended was just getting the cracks filled in.
0:26:37 > 0:26:41We haven't actually done that yet, but it's something we'll look at over the summer.
0:26:41 > 0:26:43Andy has begun landscaping the garden
0:26:43 > 0:26:47and, for this, his job as a tree surgeon came in handy.
0:26:51 > 0:26:55Well, in the garden, we decided that we wanted to try to get a place,
0:26:55 > 0:26:58a nice, safe place for Logan to play as quickly as we possibly could.
0:26:58 > 0:27:00So one of the guys at work recommended to me
0:27:00 > 0:27:03a local turf company that could supply the turf.
0:27:03 > 0:27:06And then all that was required was for us to dig up all of the lawn.
0:27:06 > 0:27:10And then we laid all this down, nice and straightforward really.
0:27:10 > 0:27:13We've got a bit of woodchip down. We've got so much woodchip in my job,
0:27:13 > 0:27:16may as well get rid of it any way we can.
0:27:20 > 0:27:22There is still work to be done inside, too.
0:27:22 > 0:27:24The kitchen remains the same.
0:27:27 > 0:27:29Andy and Emma are working with a tight budget.
0:27:29 > 0:27:34And they will be carrying out further works as and when finances allow.
0:27:36 > 0:27:41So far, they've spent just under £5,000, including fees and expenses,
0:27:41 > 0:27:45which gives them a total spend of nearly 65,000.
0:27:46 > 0:27:49We haven't spent a huge amount of money on the house,
0:27:49 > 0:27:52but I think that's been an important bit for us, buying a house at auction.
0:27:52 > 0:27:54Able to buy ourselves a nice house
0:27:54 > 0:27:58and then we didn't have to get into loans and get into lots of debt
0:27:58 > 0:28:02to try and make it look beautiful. It's just how we want it.
0:28:04 > 0:28:09Andy can be proud that he and Emma, with the help of their parents,
0:28:09 > 0:28:11have created a lovely home for their family,
0:28:11 > 0:28:14and look who's finally up an at 'em.
0:28:16 > 0:28:19# I wanna play with you
0:28:19 > 0:28:23# I wanna swing in the swing
0:28:23 > 0:28:27# Run in the park Play in the sand... #
0:28:32 > 0:28:34We invited two local estate agents
0:28:34 > 0:28:38to give us their opinion on this property.
0:28:39 > 0:28:41The thing for me is the actual location.
0:28:41 > 0:28:45The garden's going to be a particular feature, without a shadow of a doubt.
0:28:45 > 0:28:48The opportunity to have a fully enclosed garden
0:28:48 > 0:28:49where your kids can just run and play in safety,
0:28:49 > 0:28:50nowhere near a main road,
0:28:50 > 0:28:53I think, is going to be a particular feature.
0:28:53 > 0:28:55I think that this property has been made into a lovely family home.
0:28:55 > 0:28:58Lovely colour schemes, really good.
0:28:58 > 0:29:00Kitchen still needs a bit of work, obviously,
0:29:00 > 0:29:02but it's absolutely fantastic, I love it.
0:29:02 > 0:29:06Both estate agents believe that the property could achieve
0:29:06 > 0:29:10£550 per calendar month on the rental market,
0:29:10 > 0:29:13which would give Andy and Emma a potential yield of just over 10%.
0:29:15 > 0:29:18Remember, this property is not a financial investment per se,
0:29:18 > 0:29:22but an investment in the family's future happiness.
0:29:24 > 0:29:27But how much do the estate agents believe this property could achieve if sold,
0:29:27 > 0:29:32bearing in mind Andy and Emma's total spend so far of almost 65,000?
0:29:33 > 0:29:36I think, if I was putting this property on the market in its current condition,
0:29:36 > 0:29:41I would perhaps market it between 75,000 up to £80,000.
0:29:41 > 0:29:47If the kitchen was put in and redone and the gardens were remodelled,
0:29:47 > 0:29:52then I would push that up to maybe £85,000 as an asking price, maybe a little bit more.
0:29:52 > 0:29:57I think if I was putting it on the market, I would certainly be asking a price of around about £70,000.
0:29:57 > 0:30:01And I think if they carry on, it has the potential to be worth around £80,000.
0:30:03 > 0:30:07Even unfinished, the couple have potentially added between
0:30:07 > 0:30:125 and £15,000 to the value of this bright and beautiful family home.
0:30:12 > 0:30:14And it's all thanks to the combined efforts
0:30:14 > 0:30:16of Andy, Emma and their parents.
0:30:16 > 0:30:20It's been hard work but, now that we've finally got here,
0:30:20 > 0:30:22it's just happy times.
0:30:23 > 0:30:27And I'm happy to see this family enjoying their new home.
0:30:27 > 0:30:29# Baby, happy times
0:30:29 > 0:30:31# Are here to stay... #
0:30:32 > 0:30:35Are you ready for your close-up now, Logan?
0:30:43 > 0:30:47# Shine, shine, shine on
0:30:49 > 0:30:50# Yes
0:30:51 > 0:30:54# Won't you shine, shine on... #
0:30:55 > 0:30:57This is Preston in Lancashire.
0:30:57 > 0:31:02It's not the industrial view perhaps you'd be expecting,
0:31:02 > 0:31:04but a forward-looking, well-located university town
0:31:04 > 0:31:08that seems to offer more for your money than you might think.
0:31:08 > 0:31:12Well, the property I'm here to see has one of those guide prices
0:31:12 > 0:31:15that still take your breath away.
0:31:15 > 0:31:19£25,000. Yep, you heard right,
0:31:19 > 0:31:21two five, 25,
0:31:21 > 0:31:24for a two-bedroomed mid-terrace.
0:31:24 > 0:31:26# Take a look, take a look
0:31:29 > 0:31:33# Want to take a look, take a look... #
0:31:33 > 0:31:36Well, it might have no garden to speak of, only a yard,
0:31:36 > 0:31:41but a two-bedroomed house for £25,000, close to the university,
0:31:41 > 0:31:44well it's got to be worth looking at, hasn't it?
0:31:44 > 0:31:46Nice little porch, always like to see that,
0:31:46 > 0:31:49keeps the cold and the noise out.
0:31:49 > 0:31:51And then through into your front lounge,
0:31:51 > 0:31:53fairly standard layout as you might have expected.
0:31:53 > 0:31:55But it doesn't smell damp, which is always good.
0:31:55 > 0:31:58Nice, high ceilings, it's a bit dated,
0:31:58 > 0:32:02but pretty much as you, as I said, would have expected.
0:32:02 > 0:32:08Through to the kitchen and not a bad sized space, slightly old units,
0:32:08 > 0:32:10but maybe serviceable perhaps.
0:32:10 > 0:32:14What on Earth is going on with these stairs?
0:32:14 > 0:32:18They are the steepest you could possibly imagine.
0:32:18 > 0:32:21Luckily I brought my ropes and my karabiners,
0:32:21 > 0:32:24so I'm off to the first floor,
0:32:24 > 0:32:25or shall we call it the Eiger?
0:32:25 > 0:32:28# Ain't no mountain high enough
0:32:28 > 0:32:30# Ain't no valley low enough
0:32:30 > 0:32:33# Ain't no river wide enough
0:32:33 > 0:32:34# To keep me from you... #
0:32:37 > 0:32:39I need oxygen.
0:32:40 > 0:32:43Once you make it upstairs though,
0:32:43 > 0:32:47what do you find? Well, joy of joys,
0:32:47 > 0:32:51a flag at the top saying, "Well done to the summit".
0:32:51 > 0:32:54No, you actually get yourself a bathroom, which is great.
0:32:54 > 0:32:56It's obviously been moved upstairs
0:32:56 > 0:32:58from what would traditionally be the location downstairs.
0:32:58 > 0:33:02Probably at the expense of a bedroom, though, because it's just left two bedrooms.
0:33:02 > 0:33:04But two really nice-sized bedrooms,
0:33:04 > 0:33:08which is good, and I think is a very sensible way to go,
0:33:08 > 0:33:11makes it a very liveable-in kind of house.
0:33:11 > 0:33:15And not too much structural work to do, apart from up those stairs.
0:33:15 > 0:33:21Having said that, there is a slight angle to this floor, which I think needs investigating though,
0:33:21 > 0:33:24I do understand a bit of history of subsidence in the area.
0:33:24 > 0:33:27Hopefully, though, nothing too dramatic.
0:33:27 > 0:33:31All in all, once you do make it up here, it's good news.
0:33:32 > 0:33:36Generally, it is all positive with reasonable-sized rooms
0:33:36 > 0:33:39that really just need refurbishment.
0:33:39 > 0:33:43There is double glazing, but I think it will need new central heating.
0:33:43 > 0:33:44But, apart from those stairs,
0:33:44 > 0:33:47which you might want to make more user-friendly,
0:33:47 > 0:33:49there's nothing so steep here
0:33:49 > 0:33:53that's going to make the costs rise dramatically.
0:33:53 > 0:33:57Now, you may well be thinking this is all pretty easy-peasy, isn't it?
0:33:57 > 0:33:59Simple two up, two down terrace.
0:33:59 > 0:34:00Buy it, do it up, sell it on for a profit.
0:34:00 > 0:34:03Well, unfortunately, it's not quite that simple
0:34:03 > 0:34:06because there is a clause in the legal pack which says
0:34:06 > 0:34:10that whoever buys this has to either be an owner-occupier
0:34:10 > 0:34:14or an accredited landlord with Preston County Council.
0:34:14 > 0:34:16The idea is to stop people buying it, doing it up
0:34:16 > 0:34:20and doing exactly as I said before, selling it on for a profit.
0:34:20 > 0:34:23And, at the same time, improving the area
0:34:23 > 0:34:25by encouraging people to live here,
0:34:25 > 0:34:28or making sure that landlords who rent these kind of properties out
0:34:28 > 0:34:30do adhere to certain standards.
0:34:30 > 0:34:34Either way, it's improving the area, and that can only be a good thing.
0:34:34 > 0:34:38# Good thing... #
0:34:38 > 0:34:40The clause is well meaning
0:34:40 > 0:34:44but it does emphasise the importance of reading the legal pack
0:34:44 > 0:34:46before buying a property at auction.
0:34:46 > 0:34:49Because, if you didn't, and bought this to do up and sell on quickly,
0:34:49 > 0:34:52then you'd be scuppered from the off.
0:34:56 > 0:34:59But what does a local estate agent think of the property's potential?
0:35:03 > 0:35:06The property's a fairly typical Victorian street-fronted terrace.
0:35:06 > 0:35:12It has the usual arrangement of rooms and overall is in fair condition.
0:35:12 > 0:35:15It's a little bit small for the normal student accommodation,
0:35:15 > 0:35:17but certainly it is a property,
0:35:17 > 0:35:20because of the proximity to the university, that would suit students.
0:35:20 > 0:35:23Student lets would have the advantage of room-by-room lets,
0:35:23 > 0:35:25but, with this relatively small house,
0:35:25 > 0:35:30would that actually generate a larger rental income?
0:35:30 > 0:35:31This property, as it has two bedrooms,
0:35:31 > 0:35:35would normally achieve approximately £50 per week per room.
0:35:35 > 0:35:38As a whole property we would expect, per calendar month, this property
0:35:38 > 0:35:41to achieve somewhere in the region of £450.
0:35:41 > 0:35:45So, rental-wise, a similar income whatever approach you take.
0:35:45 > 0:35:50But, either way, it's a good yield, maybe up to 20% on a house
0:35:50 > 0:35:52that was guided at 25,000.
0:35:52 > 0:35:55I think this sort of property in this condition, we'd expect it to achieve
0:35:55 > 0:35:59somewhere in the region of 50 to £55,000.
0:35:59 > 0:36:00And, once the work's been done,
0:36:00 > 0:36:03it's probably going to be somewhere in the region of £75,000.
0:36:05 > 0:36:08Well, quite a potential profit to be made on this one,
0:36:08 > 0:36:13but not that you can get your hands on it that quickly, due to that special clause.
0:36:13 > 0:36:15But, for a landlord looking for a great buy to let investment,
0:36:15 > 0:36:18or for somebody looking for a nice home
0:36:18 > 0:36:20it's a great one to go for. Let's see who agreed.
0:36:20 > 0:36:24This lot came up towards the end of the day at the auction,
0:36:24 > 0:36:26but it didn't stop a bidding battle.
0:36:27 > 0:36:30Moving onto the Preston lot, can anyone give me 25?
0:36:30 > 0:36:3325 straight away. 26?
0:36:33 > 0:36:3526 in the aisle.
0:36:35 > 0:36:3727? 28.
0:36:38 > 0:36:4129. 30. 31. 32.
0:36:41 > 0:36:4533. 34. 35. 36. 37.
0:36:45 > 0:36:4838. 39. 40. 41.
0:36:50 > 0:36:5441. 42. 43.
0:36:54 > 0:36:5644. 45?
0:36:57 > 0:37:0045. 46. 47? 47.
0:37:00 > 0:37:0248. 49.
0:37:05 > 0:37:0848,000, been there all along, the lady at the back.
0:37:08 > 0:37:1148,000. Going once,
0:37:11 > 0:37:15going twice, going three times.
0:37:15 > 0:37:18Sold to the lady in the aisle at the back. Good buy, that.
0:37:18 > 0:37:24And that final bid of £48,000 came from Janet and her son, Alex.
0:37:24 > 0:37:28Alex is being helped by Mum and Dad with the purchase of the mid-terrace,
0:37:28 > 0:37:30but he is the new owner.
0:37:30 > 0:37:33This 22-year-old is a heating engineer,
0:37:33 > 0:37:36working in the family plumbing and heating business,
0:37:36 > 0:37:38and I met him back at the property.
0:37:38 > 0:37:41- Alex, great to meet you. Congratulations. - Thank you very much.
0:37:41 > 0:37:44Tell me why you wanted to buy this place.
0:37:44 > 0:37:47Decided to invest my money into property.
0:37:47 > 0:37:50A year ago, me and my friend bought a house together.
0:37:52 > 0:37:56We fully renovated it and sold it on, made a good sum of money.
0:37:56 > 0:37:59- Oh, great.- And he's moved on and bought a house with his girlfriend,
0:37:59 > 0:38:02so I thought I'd go and buy a house of my own.
0:38:02 > 0:38:07- Wow.- So, here we are.- Everything go OK with that first one? - Yeah. Well, actually no.
0:38:07 > 0:38:11Halfway through I ended up breaking my leg.
0:38:11 > 0:38:14- I know, so.- Nothing to do with the restoration?
0:38:14 > 0:38:15No, no, no, it's a sports injury.
0:38:15 > 0:38:18- Right.- I had a bit of a set-back
0:38:18 > 0:38:22but recovered and, luckily, we were most of the way through by then.
0:38:22 > 0:38:25So, we got a lot of the hard work out of the way.
0:38:25 > 0:38:28So, Alex's first break into property developing
0:38:28 > 0:38:32might have been a painful but profitable one.
0:38:32 > 0:38:35And now he's flying solo and hoping to take the experience learnt
0:38:35 > 0:38:38into this two-bed Victorian house.
0:38:39 > 0:38:42So, why this particular house, then?
0:38:42 > 0:38:46We were looking on websites at auctions, it was my mother that spotted it, actually.
0:38:46 > 0:38:50On Sunday night, she was looking at the auctions on the Monday.
0:38:50 > 0:38:52Sunday night and then Monday you were down at the auctions?
0:38:52 > 0:38:55Yeah. We'd not actually viewed the house.
0:38:55 > 0:38:56- So, you didn't come to see it? - No, no.
0:38:56 > 0:39:01But we knew... I've done work in these houses before in this area,
0:39:01 > 0:39:05and this isn't actually the house that we were going to bid for.
0:39:05 > 0:39:08It was two streets along but this one came up first in the auctions
0:39:08 > 0:39:10and we thought no one was bidding on it
0:39:10 > 0:39:13so, we thought, we knew our reserve,
0:39:13 > 0:39:16so we thought we'd bid on it and luckily it came in.
0:39:16 > 0:39:19What did you think when you saw it inside for the first time, having bought it?
0:39:19 > 0:39:21Walked through the doors with my fingers crossed,
0:39:21 > 0:39:23thinking, "What have we done? We've not seen it",
0:39:23 > 0:39:27and, luckily, I think it's paid off so far.
0:39:27 > 0:39:31We won't know fully until we start going to renovate it,
0:39:31 > 0:39:32but there's not much to do, I don't think.
0:39:32 > 0:39:37- Right.- On first inspection so, thankfully, I think we've got a good buy there.
0:39:37 > 0:39:40Yes, it does look like they've bought a good buy,
0:39:40 > 0:39:44although it's never great to buy site unseen.
0:39:44 > 0:39:47But they did read the legal pack and were aware of the clause
0:39:47 > 0:39:50about the buyer being an owner-occupier
0:39:50 > 0:39:52or an accredited landlord.
0:39:52 > 0:39:56So, the plan is for Alex to be an owner-occupier at first
0:39:56 > 0:39:59and then get accreditation at a later date.
0:39:59 > 0:40:04It might have been a rush buy, but it's certainly not a rash one.
0:40:04 > 0:40:06Tell me what you're going to do to sort it out.
0:40:06 > 0:40:07New central heating system.
0:40:07 > 0:40:11New front door, new back door. Full decoration.
0:40:11 > 0:40:14I'm hoping to implement solar thermal.
0:40:14 > 0:40:17Basically, it's solar panels on your roof filled with water,
0:40:17 > 0:40:22and it basically heats a cylinder up, which provides your hot water.
0:40:22 > 0:40:24- So, who's going to do the work? - Me mostly.
0:40:24 > 0:40:28I'll do most of the graft and, obviously, I'll be putting the central heating system in.
0:40:28 > 0:40:31We're in the trade, so I know the builders
0:40:31 > 0:40:35and plasterers and things like that, so it's all quite handy, really.
0:40:35 > 0:40:37Completely. So, what have you set aside to do the work?
0:40:37 > 0:40:41£7,000, that's what we've set aside, so, hopefully...
0:40:41 > 0:40:44- And what kind of timescale? - I'm thinking two months,
0:40:44 > 0:40:46obviously, because I'm full-time working myself.
0:40:46 > 0:40:49So, most of the work by me is going to have to be done at weekends
0:40:49 > 0:40:51and week nights and things,
0:40:51 > 0:40:53so bearing that in mind it's two months, I think.
0:40:53 > 0:40:56So then, on the rental market or on a resale?
0:40:56 > 0:41:00- As soon as I'm accredited, rental. - Rental.- Definitely.
0:41:00 > 0:41:02And then what's the plans for the future?
0:41:02 > 0:41:06Save up for the next one, I think, so, carry on from there.
0:41:06 > 0:41:07Build up a bit of a portfolio.
0:41:07 > 0:41:11I enjoy doing it, so, it's bricks and mortar,
0:41:11 > 0:41:14I've always been told, put your money on bricks and mortar.
0:41:14 > 0:41:16- Congratulations. - Thank you very much.
0:41:16 > 0:41:19- And we look forward to seeing how you get on.- Excellent. Cheers.
0:41:21 > 0:41:23Well, there you go. This property offers Alex
0:41:23 > 0:41:27the opportunity to continue with his investment plans
0:41:27 > 0:41:30and also turn this terraced house
0:41:30 > 0:41:34into a bit of an eco-friendly place, How fascinating.
0:41:34 > 0:41:36You can find out how he gets on later in the show.
0:41:39 > 0:41:43So, time has flown since we last saw our brave buyers.
0:41:43 > 0:41:47So, have they been firing on all cylinders,
0:41:47 > 0:41:50- or have they run into problems? - Let's find out.
0:41:52 > 0:41:57A major factor in property buying is no doubt the location.
0:41:57 > 0:42:01And, earlier, we were in this desirable part of West London, Shepherd's Bush,
0:42:01 > 0:42:05where this top-floor, one-bedroom flat was sold at auction
0:42:05 > 0:42:08for a whopping 273,000.
0:42:09 > 0:42:12It was bought by Pierre, who now works in public relations,
0:42:12 > 0:42:15but, in a former life, was an estate agent,
0:42:15 > 0:42:17and he obviously saw the potential of this flat
0:42:17 > 0:42:22that needed little work to get it returning on his hefty investment.
0:42:22 > 0:42:24What route are you going to take here?
0:42:24 > 0:42:28Well, I think what I'm going to do first of all is just, basically, do it up,
0:42:28 > 0:42:32freshen it up a bit, and then it should really be ready to go.
0:42:32 > 0:42:36That's what do, initially. I'll let it for the first six months,
0:42:36 > 0:42:38and I'll just get a flavour of then what to do with it.
0:42:38 > 0:42:42Pierre had a £3,000 budget
0:42:42 > 0:42:46and a one-month turnaround plan for the initial cosmetic makeover.
0:42:46 > 0:42:48Now, 11 months later,
0:42:48 > 0:42:52has it all been as straightforward as he hoped?
0:42:54 > 0:42:58It seems not, as Pierre has had a big change of plan,
0:42:58 > 0:43:01and we find ourselves in the midst of a full-scale renovation.
0:43:03 > 0:43:07In fact, this started after we last met Pierre.
0:43:07 > 0:43:12He decided not to rent it out in the end, but to press ahead and start a renovation
0:43:12 > 0:43:16while simultaneously trying to purchase the loft space
0:43:16 > 0:43:19and the freehold in order to extend upwards.
0:43:19 > 0:43:22So, what have we got so far, then?
0:43:23 > 0:43:27Well, the living room and bedroom have been stripped back,
0:43:27 > 0:43:28replastered and whitewashed.
0:43:28 > 0:43:32And, towards the rear, the old toilet and bathroom
0:43:32 > 0:43:35have been joined to create a new shower room.
0:43:35 > 0:43:38And, though it doesn't look like it at the moment,
0:43:38 > 0:43:43those changes have led to an increase in the size of the kitchen as I'd hoped.
0:43:43 > 0:43:47What I've done in the hallway and the kitchen is to remove the door
0:43:47 > 0:43:51that was originally just here, which made for a small kitchen.
0:43:51 > 0:43:56I've removed the doorway. I've moved this wall, it's a stud partition wall,
0:43:56 > 0:43:59outwards into the hallway and made it open plan.
0:43:59 > 0:44:01I've kept the skylight,
0:44:01 > 0:44:05so that the hallway itself will be nice and bright,
0:44:05 > 0:44:07albeit slightly smaller than it was.
0:44:07 > 0:44:11The idea of that is to have kitchen units running along this wall,
0:44:11 > 0:44:15running underneath the window, and here, in this area here,
0:44:15 > 0:44:18now that it's bigger, there'll be space for a table with four chairs.
0:44:18 > 0:44:23So it will be an eating kitchen, which is very important in a flat of this size.
0:44:23 > 0:44:26I'll be putting a doorway just here,
0:44:26 > 0:44:30and then we've got the doorway to the shower room, which is a little smaller
0:44:30 > 0:44:33because, of course, I've used some of the space for the kitchen,
0:44:33 > 0:44:36but at the same time, because I've moved the shower tray
0:44:36 > 0:44:38and made it width-wise rather than length-wise,
0:44:38 > 0:44:41I've used some of the width of the hallway
0:44:41 > 0:44:43and it will still be of a decent size.
0:44:43 > 0:44:46In fact, it will be very difficult to tell
0:44:46 > 0:44:50that it's actually reduced in size, the shower room, but the kitchen benefits.
0:44:50 > 0:44:55Increasing the kitchen size is a wise move for Pierre.
0:44:55 > 0:44:58But, after 11 months, why isn't it finished?
0:44:58 > 0:45:01Well, the work's all been put on hold
0:45:01 > 0:45:03because the purchase of freehold and loft space
0:45:03 > 0:45:05still hasn't been signed off.
0:45:05 > 0:45:10It's taken a long time, but the loft space is ideal for conversion.
0:45:10 > 0:45:12I've had to negotiate with the freeholder
0:45:12 > 0:45:14over the purchase of the freehold,
0:45:14 > 0:45:17and including the loft space.
0:45:17 > 0:45:20Once that's done, we'll need planning permission
0:45:20 > 0:45:22to convert the loft space
0:45:22 > 0:45:25into a big double bedroom with an en suite.
0:45:25 > 0:45:27And that will be the master bedroom.
0:45:27 > 0:45:32So it looks like Pierre is taking matters onto another level, literally.
0:45:32 > 0:45:36Adding a loft conversion could cost approximately 25,000.
0:45:36 > 0:45:39But he's hoping it's a small outlay
0:45:39 > 0:45:42compared to the potential returns on the property.
0:45:42 > 0:45:45And, if all goes to plan,
0:45:45 > 0:45:48it seems that the work already carried out on the first floor
0:45:48 > 0:45:50could change dramatically again.
0:45:50 > 0:45:54I might well be converting the living room and the existing bedroom
0:45:54 > 0:45:58into a big, L-shaped, open-plan kitchen-diner-living.
0:45:58 > 0:46:03And then the existing kitchen could be converted into a smaller double bedroom.
0:46:03 > 0:46:08But, if that does come off, then this could be an exceptional property.
0:46:08 > 0:46:11# You better make your mind up
0:46:13 > 0:46:17# You know sometimes you can think too much... #
0:46:18 > 0:46:22And one of its big attractions was the long lease of 125 years,
0:46:22 > 0:46:24which was a big bonus for Pierre
0:46:24 > 0:46:27when it came to paying for this project.
0:46:27 > 0:46:29Well, the freehold itself was quite reasonable
0:46:29 > 0:46:32because both flats were in very long leases,
0:46:32 > 0:46:34the freehold was about 3,500.
0:46:34 > 0:46:37But the roof space itself was kept separate in the sale,
0:46:37 > 0:46:41and I've had to negotiate on that, and that's come in at about 20,000.
0:46:42 > 0:46:48Getting the freehold and roof space is costing Pierre 23,500.
0:46:48 > 0:46:50He reckons, once the loft has been converted
0:46:50 > 0:46:52and the first floor finished off,
0:46:52 > 0:46:58his projected total spend will be 327,000.
0:46:59 > 0:47:01But at the moment he is undecided
0:47:01 > 0:47:05whether to let or sell the finished product.
0:47:05 > 0:47:08So, it's time to find out, from two local estate agents,
0:47:08 > 0:47:12their thoughts on this first floor flat in Shepherd's Bush.
0:47:12 > 0:47:15My first impression of the flat is it's a work in progress,
0:47:15 > 0:47:17I think they're doing a very good job.
0:47:17 > 0:47:19I like the layout. It works really well.
0:47:19 > 0:47:22Brilliant-sized kitchen-breakfast room, which is highly desirable.
0:47:22 > 0:47:24My first impression of the property,
0:47:24 > 0:47:27seems as if the work is going very well.
0:47:27 > 0:47:30It has a good-sized living room with good, high ceilings
0:47:30 > 0:47:32and a good-sized double bedroom.
0:47:32 > 0:47:36But should Pierre press ahead with his plans for the loft?
0:47:36 > 0:47:39I, without a doubt would, go into the loft space.
0:47:39 > 0:47:42It adds huge value to the property
0:47:42 > 0:47:45and opens up a completely larger market.
0:47:45 > 0:47:48Putting a bedroom in the loft would be an absolutely great idea,
0:47:48 > 0:47:51purely because it would bring a lot more rental income
0:47:51 > 0:47:53and, of course, when it comes to selling the flat,
0:47:53 > 0:47:55it will add value to the flat.
0:47:55 > 0:47:59And adding value is the name of the game here.
0:47:59 > 0:48:04These two estate agents reckon that renovated as a one-bed,
0:48:04 > 0:48:07it would be worth 330 to 360,000.
0:48:07 > 0:48:12Bearing in mind Pierre's estimated total spend of 327 grand
0:48:12 > 0:48:14for the bigger two-bed flat,
0:48:14 > 0:48:16what resale figure could he achieve?
0:48:16 > 0:48:21We could be looking to market this, I think, between 450, 475.
0:48:21 > 0:48:27As a two-bedroom flat, I would value this at 450 to £460,000.
0:48:27 > 0:48:32Well, those valuations could give a possible pre-tax profit
0:48:32 > 0:48:35of between 123 to 148,000.
0:48:35 > 0:48:37Incredible!
0:48:37 > 0:48:40But would Pierre be better off holding on to this property
0:48:40 > 0:48:43as a long-term investment?
0:48:43 > 0:48:45What sort of rentals could he achieve?
0:48:45 > 0:48:49As a two-bedroom property, I would expect to obtain around,
0:48:49 > 0:48:52roundabout 1,500 a month, maybe a touch more.
0:48:52 > 0:48:53A two-bedroom flat
0:48:53 > 0:48:57would achieve anything from 15 to £1,600 a month.
0:48:57 > 0:49:01Well, those rental figures could give Pierre an annual rental yield
0:49:01 > 0:49:04of between 5 and a half to just under 6%.
0:49:04 > 0:49:08So, at the moment, it seems the resale values are the best way forward.
0:49:08 > 0:49:12But neither of these sorts of returns will be possible
0:49:12 > 0:49:15until the loft conversion is complete.
0:49:15 > 0:49:18So has Pierre got any idea what he'll do with the flat
0:49:18 > 0:49:21- once the renovation is finished? - With regards to what I do to it,
0:49:21 > 0:49:25whether or not I keep it, live in it, sell it, rent it, they're all very much open.
0:49:25 > 0:49:28I think what's important is to get the work done,
0:49:28 > 0:49:30have a look at it as a completed project,
0:49:30 > 0:49:33and then I'll be able to decide what to do with it.
0:49:35 > 0:49:37In Preston, Lancashire,
0:49:37 > 0:49:41a two-bedroomed Victorian house went up for auction
0:49:41 > 0:49:44situated close to the university
0:49:44 > 0:49:46and in a tired but reasonable condition.
0:49:46 > 0:49:50This house seemed an ideal project for someone to come in and refurbish.
0:49:50 > 0:49:53However, there was a catch with this house,
0:49:53 > 0:49:57as it was part of the Preston Council's Landlord Accreditation Scheme,
0:49:57 > 0:50:01which meant it could only be bought by an accredited landlord
0:50:01 > 0:50:02or an owner-occupier.
0:50:02 > 0:50:06But this didn't put off local heating engineer, Alex,
0:50:06 > 0:50:10who bought it with the help of his mum, Janet, for £48,000 at auction.
0:50:10 > 0:50:14Sold to the lady in the aisle at the back. Good buy, that.
0:50:14 > 0:50:15Tell me why you wanted to buy this place.
0:50:15 > 0:50:19I decided to invest my money into property.
0:50:19 > 0:50:24A year ago, me and my friend bought a house together.
0:50:24 > 0:50:27We fully renovated it and sold it on.
0:50:27 > 0:50:30- We made a good sum of money. - Oh, great.
0:50:30 > 0:50:33And he's moved on and bought a house with his girlfriend,
0:50:33 > 0:50:35so I thought, I'll go out and buy a house of my own.
0:50:35 > 0:50:37- Wow.- So, here we are.
0:50:37 > 0:50:39# All by myself
0:50:40 > 0:50:41# All by myself... #
0:50:47 > 0:50:50And with this, his first solo project,
0:50:50 > 0:50:53Alex not only wanted to refurbish it,
0:50:53 > 0:50:55but had some ambitious plans
0:50:55 > 0:50:58with hopes to install solar panels on the roof to heat the water.
0:50:58 > 0:51:02And he hoped to complete the refurbishment in just three months
0:51:02 > 0:51:05on a budget of around £7,000.
0:51:05 > 0:51:08Well, just over two months later, we're back.
0:51:11 > 0:51:15And along with a new front door,
0:51:15 > 0:51:17the hoped-for solar panel is in place.
0:51:24 > 0:51:28Inside, the dated decor and the gas fire have been removed,
0:51:28 > 0:51:32to be replaced by much simpler lines.
0:51:32 > 0:51:37And the kitchen's been spruced up and a new back door installed.
0:51:41 > 0:51:45And, as for that Eiger of a staircase, well that's still the same,
0:51:45 > 0:51:49but the new white paint gives it a brighter feel.
0:51:49 > 0:51:53So, what's it been like for Alex, tackling this project?
0:51:54 > 0:51:58A lot of late nights and a lot of weekends taken up.
0:51:58 > 0:52:00But well worth it, in the end.
0:52:01 > 0:52:05Yes, with a full-time job as a heating engineer in the family firm,
0:52:05 > 0:52:09it's always tricky finding the time to do up a property as well.
0:52:15 > 0:52:18But now both the bedrooms are completely refurbished.
0:52:20 > 0:52:24And there's a great new bathroom suite.
0:52:24 > 0:52:27So, in the bathroom, we've completely modernised it.
0:52:27 > 0:52:31We've lowered the ceiling and put some new spotlights in.
0:52:31 > 0:52:35We've completely changed the layout of the bathroom.
0:52:35 > 0:52:40We've moved the bath from this back wall here, there over here.
0:52:40 > 0:52:41That was to incorporate the shower.
0:52:41 > 0:52:44We've moved the toilet from over there, in the old bath's position,
0:52:44 > 0:52:46just to create more space.
0:52:46 > 0:52:48I think it looks really well.
0:52:50 > 0:52:53And, of course, the hot water for the new shower and bath
0:52:53 > 0:52:55will be supplemented by the solar panel,
0:52:55 > 0:52:58heated by the balmy Preston sunshine.
0:52:59 > 0:53:01# Sun is shining in the sky
0:53:03 > 0:53:05# There ain't a cloud in sight
0:53:06 > 0:53:09# It's stopped raining Everybody's in a play
0:53:09 > 0:53:10# And don't you know
0:53:10 > 0:53:14# It's a beautiful new day... #
0:53:14 > 0:53:16We're certainly green.
0:53:17 > 0:53:21We receive a one-off payment off the government for installing it.
0:53:21 > 0:53:24It will contribute massively to the hot water,
0:53:24 > 0:53:25and, yeah, more green, basically.
0:53:25 > 0:53:29Alex plans this to be a long-term rental property,
0:53:29 > 0:53:31so he hopes the solar technology
0:53:31 > 0:53:34will eventually pay back the £3,000 he invested in it.
0:53:34 > 0:53:38So, he's achieved his goal of putting on a solar panel,
0:53:38 > 0:53:41but did he manage the goal of doing most of the work himself?
0:53:41 > 0:53:43I obviously put the heating system in,
0:53:43 > 0:53:47the bathroom, the solar panels, the boiler.
0:53:48 > 0:53:51Didn't really help much with the decoration, cos I didn't have time,
0:53:51 > 0:53:53so we had to get a painter in.
0:53:53 > 0:53:56That's affected the budget a bit.
0:53:56 > 0:53:58I also helped the electrician and in the yard, as well,
0:53:58 > 0:54:02I put the shuttering up, the willow shuttering,
0:54:02 > 0:54:04and did a bit of work on the ground with the flags
0:54:04 > 0:54:07and painted the outside as well.
0:54:07 > 0:54:09OK. So, predominantly, the work has been down to him,
0:54:09 > 0:54:12but his parents also helped out,
0:54:12 > 0:54:15particularly with the administration side of things.
0:54:15 > 0:54:18And now the house is finished, what's next?
0:54:18 > 0:54:21We're going to get accredited by Preston City Council.
0:54:21 > 0:54:23And then we can get it rented out.
0:54:24 > 0:54:28But how much has it cost to get this three-bedroomed terraced house up to what he hopes
0:54:28 > 0:54:32is the standard necessary to secure accreditation?
0:54:32 > 0:54:35I think the budget was about £7,000.
0:54:35 > 0:54:38We've gone slightly over with £9,000.
0:54:38 > 0:54:41And that was to do with the solar ,really.
0:54:41 > 0:54:44But it will pay back in time, so I'm quite happy to do so.
0:54:45 > 0:54:50£9,000 budget, on top of a £48,000 purchase price at auction,
0:54:50 > 0:54:54would take Alex's total spend to £57,000, without costs and fees.
0:54:54 > 0:54:59So, has giving the property a little extra on top
0:54:59 > 0:55:02pushed the house above the area ceiling price?
0:55:02 > 0:55:05What do two local estate agents think?
0:55:05 > 0:55:08I mean overall, the development of the property is very similar
0:55:08 > 0:55:10to what we'd expect to see in a terraced house
0:55:10 > 0:55:11in this area of Preston.
0:55:11 > 0:55:14However, obviously the modern technology of the solar panel
0:55:14 > 0:55:18is a little bit unusual, certainly for a property of this size.
0:55:18 > 0:55:21I think it's extremely good. It's been done to a very high standard,
0:55:21 > 0:55:23nice and neutral throughout.
0:55:23 > 0:55:25Nice kitchen, nice bathroom.
0:55:25 > 0:55:27Yep, done to a really good standard,
0:55:27 > 0:55:29so it should either sell or let really quickly.
0:55:29 > 0:55:33Alex isn't looking to sell this house on any time soon,
0:55:33 > 0:55:39but how is his 57,000 investment faring in the current resale market?
0:55:39 > 0:55:43I think in the current market a property like this would achieve in the region of £85,000.
0:55:43 > 0:55:46I believe in the current sales market, the property would be worth
0:55:46 > 0:55:49between £85,000 and £95,000.
0:55:49 > 0:55:53That's above what we expected, yeah, what we expected.
0:55:53 > 0:55:57I expected around 70, 75 at the moment,
0:55:57 > 0:55:59so, yeah, I'm pretty chuffed with that.
0:55:59 > 0:56:06So a potential pre-tax uplift in value between 28 and £38,000.
0:56:06 > 0:56:09But how would it do on the all-important rental market?
0:56:11 > 0:56:14This property could achieve £495 per calendar month.
0:56:14 > 0:56:16I believe, in the current rental market,
0:56:16 > 0:56:18the property should bring between £450 per calendar month
0:56:18 > 0:56:20to £500 per calendar month.
0:56:20 > 0:56:25I expected 450 to 475, so that's spot on there.
0:56:25 > 0:56:29So, once Alex achieves accreditation from Preston City Council,
0:56:29 > 0:56:34he could see a very healthy yield of between 9.5-10.5%
0:56:34 > 0:56:36certainly making this a good, solid investment,
0:56:36 > 0:56:41and a decent start to his solo property developing sideline.
0:56:41 > 0:56:45So, would he be tempted to do it again?
0:56:45 > 0:56:47Definitely. I would recommend it as well.
0:56:47 > 0:56:49It's been a really good project.
0:56:52 > 0:56:54Well, that's it for now. Join us next time
0:56:54 > 0:56:58as more bold bidders brave the auction rooms here on Homes Under the Hammer.
0:56:58 > 0:57:00- See you then.- Goodbye.- Goodbye.
0:57:21 > 0:57:24Subtitles by Red Bee Media Ltd