Episode 52 Homes Under the Hammer

-Hello and welcome.

-For many people, buying at auction

gives the chance to buy properties which are in need of renovation.

Yes, people like to put their own stamp and style on a property

and hopefully make a profit along the way.

You might be able to do that by buying your home under the hammer.

We love the buzz and the excitement of the auction room.

You can really sense the hope and frustration in the air.

Yes, and you never know how it's going to go until the final second.

So, what tempted the buyers on today's show?

Who fancied this rather compact Cornish cottage?

Look at this corridor!

It's so narrow and cramped, it's horrible.

This London flat really accentuated the positive,

but it's not all good news.

The big negative for me here is that second bedroom.

While this quirky Yorkshire terrace conceals lots of surprises.

Then here, more storage?

Oh, no...stairs!

All these properties went to auction.

We'll find out who bought them and what they paid for them

when they went under the hammer.

Congratulations.

Today, I'm in Redruth, in Cornwall.

And here, just off the high street, is Murdoch House,

named after William Murdoch, who, around 200 years ago,

pioneered the production and storage of gas.

And in fact,

this was probably the first house ever in the world

to be lit by coal gas -

a shining example of man's ingenuity.

# I see your lamplight

# Shining from your window

# Babe, I see your lamplight... #

Redruth is a busy town with a deep sense of history and lots

of artistic flair.

And who would've thought you could have made

such good use of Welly boots?

Well, it seems that Redruth is quite the place for creative types.

Mick Fleetwood, the drummer from Fleetwood Mac, was born here.

So, will the property I'm here to see inspire Big Love,

will it be a place of my Dreams or full of Little Lies?

Well, this is it. It's a three-bedroom mid-terrace.

Now, the guide price is 70,000 quid.

Let's go inside, or should I say, Go My Own Way.

# You can go your own way

# Go your own way! #

Built in 1899, this stone-built mid-terrace

reflects the history of the area.

Unfortunately, so does that roof, which looks like

it could become an Albatross round a buyer's neck.

Oh, well.

And you could have a Long Way To Go to find your car.

This is a busy road with double yellow lines right outside,

so with no outside parking, that could be an issue.

Look at this corridor!

It's so narrow and cramped, it's horrible. But anyway,

over to the left, a front sitting room.

It's nice it's got an open fire, but it does look to be in a fairly

sort of old and in need of love and attention kind of state.

Rear area here. This actually looks quite nice.

You've got the beams

and it looks like it's been recently decorated,

which is quite good.

The stairs leading to upstairs, we'll explore that in a minute.

But again, it's just really, really cramped.

Through to the rear of the property.

Some kind of extension, single storey here.

This is the kitchen.

And worse than that, this is the bathroom.

Now, your kitchen and your bathroom, your two really important rooms

in a house.

And they're both a little bit...lacking.

# You're no good, good, good You're no good. #

It's all about space.

There's been no lack of effort in some of the cosmetic work

with a brand-new toilet and walk-in shower.

So, it's more like a wet room than a bathroom.

But it can't disguise the fact

that this is a very cramped house

and the layout just does not work.

The kitchen units are fine as far as they go, but there's still

a lot to do to this house that was guided at £70,000 plus.

Well, upstairs,

desperately hoping for some improvements.

And straightaway those hopes are dashed.

This is one of your bedrooms.

It's a nice size, but it has a low ceiling

and it has a bow in it, as well.

And I don't like the fact that on the staircase,

you've got all these little semi-landing areas,

very dangerous.

Come out, step down, don't know what's coming.

In the middle of the night, going to the loo, quite disastrous.

Bedroom over there looks to be all over the place.

This is not looking good.

And this is the final bedroom up here.

And straightaway, again, I mean, just look everywhere.

Look at the ceiling, there's stuff going on there.

It's got a bow in it. And... Oh, wow, what's going on here?

In this corner, the floor looks like it's...

Oh, right.

Tread carefully here,

for there are serious problems.

Look at this crack.

This really is not looking good, dear property lovers.

In fact, I think it's about time I left.

# I think I better leave right now

# Before I fall any deeper

# I think I better leave right now. #

A good clue to the problems of this property lie

in that statue of a miner in the town.

Where there are mines, there will be

the dreaded mining works lurking underneath.

I would seek expert advice and obtain a mining report,

otherwise you could be facing a Landslide.

OK, that's my last Fleetwood Mac reference, I promise!

Out the back, apart from the extension,

the walls look OK and the walled garden is a nice surprise.

We've invited a local estate agent

to come and look around this mid-terrace that was guided

at £70,000 plus to discover a bit more about the potential for it.

Just what are the problems visible here?

It's a downside, really, that the bathroom is downstairs.

Potentially, it would be better to go upstairs.

You know, definitely parking to the front would be a big benefit.

If changes were made to the house

and it was given a full refurbishment,

how much could it achieve on the rental market?

Rental for the property, I would be looking

at between £650 to £700 per calendar month.

And the potential resale figure?

I would like to market it

at approximately £135,000.

Well, not one for the faint hearted, this.

Structural issues and internal layout problems galore.

Still, if you get it at the right price,

it could still be worth taking on.

Let's find out what that price was when it went under the hammer.

So, this is a two-storey, three-bedroom mid-terrace cottage.

Needing improvement.

We start at 70,000 on the phone.

65,000 here. 65. 66 now. At 66.

67? 67. 68?

68. 69. 70,000 on the phone.

71.

71 here, seated.

And two. 73.

A half? It is a half.

72.5. 73 now.

73. 75? 74, then.

74.5?

I took a half from you, I have to take a half from them. 75. Yes?

75 here. 75.5. And 76.

Right, £76,000 seated.

Half here or no? Are we done? No.

At £76,000.

Final time, the bid is with you. Are we sure we're all done?

Yours at £76,000.

That final bid of 76,000 was made by Peter.

He's been a full-time property developer for the last ten years

and has owned a hotel in the past.

I met up with him to hear about his plans for this place.

-Peter, good to meet you.

-Morning, Martin.

-Congratulations.

-Thank you very much.

-I hope you're a man that likes a challenge, then.

Yeah, I think we're going to have to rise to this one.

There's a bit of work to do.

Which bit of work are you aware of?

Well, we're pretty sure that we're going to have to move the stairs,

which means we're going to have the flight

going in the opposite direction,

so that we can then move

the rec room, which is now in part of the kitchen,

upstairs and still retain the three bedrooms.

And then we need to sort out the kitchen

and get that better organised.

And then we've got to decorate, obviously.

You haven't mentioned the sort of saggy,

subsidence-y, sort of cracky, bitty things.

We'll take down the stud walls on the inside

and we're hoping to raise the roof upstairs

and, at the same time,

get rid of the sagging bit, shall we say.

Wow, Peter's plan sounds like an ambitious project -

to move the staircase, relocate the bathroom and keep three bedrooms.

But he's not as concerned as me about the sagging roof.

According to him, a just needs a lot of attention.

Tell me more about you, then. Are you a builder?

Well, our company is a development company.

-OK.

-But we've, over the last two or three years, with the recession,

gone towards restoration of older properties,

either for a client or we buy it ourselves,

redo it up and resell it,

which is what we're doing in this case.

-OK.

-We always research the property first, that's a must.

We won't buy blind at auction.

You say you do research, have you had a mining report?

-Yes, we have a mining report.

-And?

One says that originally there might have been mine shafts down this road.

Right.

But the other one says they probably weren't under this property,

they were further south or north.

-Huh.

-Now, this property, we know, has been built over 100 years.

-We've already got an original deed from 1899.

-Wow.

In parchment. If it was standing that long,

-there isn't too many issues to worry about.

-Right.

But you have to secure that knowledge,

ready for a mortgage company.

For any investor looking for funds, that's imperative.

Outside, Peter plans to add off-street parking,

but what changes will his builders make to the downstairs layout

of this three-bedroom terrace?

At the front,

we're going to take down all the doors

-that you've come through.

-Right.

-And, obviously,

the stairs will go.

We'll widen the stairs, bring them down into the hallway,

-further up towards the door.

-Right.

Down here, we're hoping to put a pair of French doors in

-behind where you're standing.

-Oh, right.

And then we'll extend the kitchen to the left,

where the wet room is at the moment, and block up the original door.

How much is all that going to cost, then?

-We're budgeting on 30,000.

-Wow.

That's working on the costings that we've already done on the property.

So, we think we're safe on that, but we'll see.

Well, listen, there are a few challenges ahead,

-but good luck.

-Thank you very much.

-We'll see how you get on.

-Nice to meet you.

-You, too.

Well, I'm delighted that Peter is smiling about the whole thing,

because there are some challenges ahead with this one, aren't there?

Not least whether or not it's actually built on a mineshaft.

That would be bad.

In terms of inside, it's going to be a complete rip-out job.

Luckily, he's got the experience,

otherwise that 30-grand budget, no chance.

You can find out how he transforms this place later in the show.

For the next property that's sold under the hammer,

I'm in a London suburb south of the river.

Ten years ago exactly,

there was an article in the Evening Standard

that called Balham

one of the fastest-improving neighbourhoods in the capital.

They weren't wrong.

Balham became popular with London City bankers

who grew out of their bachelor pads in Clapham, became dads

and bought houses here for the growing family.

Now, the high street just transformed and filled

with boutiques, bars and bistros and the prices...

Well, as you can imagine, they skyrocketed.

# Just lift off

# Up, up and away Just lift off! #

And right through the roof of those houses.

They've nearly doubled in value and gone into orbit,

with three- or four-bedroom houses costing nearly a million.

So, could the property I'm here to see be about to shoot up

in value, as well?

A ten-minute walk from the tube station

and I am on a lovely, leafy street,

exactly what young professional Balhamites are after.

Good start!

The property itself is this -

a purpose-built, ground-floor, two-bedroom flat,

which had a guide price of £225,000.

Now, I know that's a huge amount of cash for a smallish home,

but when you consider two beds in Balham can go for double that,

I am entitled to be excited.

# I'm so excited

# I'm a detective I'm all over you. #

This flat looks really smart and inviting from the outside, but

that guide price hints that I may feel a little deflated once inside.

As I expected, very dated. In fact, it's a pale yellow,

woodchip haze everywhere.

So, a lot of stripping back to do, but super proportions in this room.

I mean, what a lovely lounge.

Good-sized bedroom, as well. Sadly, no beautiful features to speak of.

You can see they've all been covered up.

You've got a really long, long corridor here.

Nice storage space under the stairs, I like to see that.

You've got a bathroom.

A little bit on the small side, but you could work with that.

Oh! Bedroom number two, really disappointing.

Small. Not only that, it's a rather odd shape,

so I'm not quite sure how you would even fit a bed in there.

A bit awkward. And at the back of the property...

Now, I really like this. You've got a nice dining area and a kitchen.

Now, this is absolutely fantastic.

The big negative for me here is that second bedroom.

It's an odd shape, it's small.

What I have seen other people do is convert the front room,

the lounge, into a bedroom, but I think that would be a waste

and I don't think you need to do that here.

I would concentrate on that second bedroom,

probably pinch a bit of space from the bathroom to make it

a bit bigger, and then I think it would work.

That's what you'll need to do with this property.

# Sweet like chocolate

# You bring me so much joy

# You're sweet like chocolate. #

Well, this full-fat chocolate suite might have been the sweetest thing

in the '70s, but it's time it melted away

into something a little more up-to-date.

Talking of sweets,

let's have some pastel colours in here.

I reckon the loo could go over to the other wall

and this space could go to the bedroom.

There's a challenge in the teeny-weeny kitchen, as well.

You'd need new units, definitely, and to lose the panelling.

That's a no-brainer.

And also get the boiler moved

and a large window installed to enjoy the view at the back.

Why should this fox family have all the fun?

And I've got another question.

When is a garden not a garden?

When it's a communal space, of course.

I come across this time and time again in London.

You assume the ground-floor flat has the garden,

but actually it's shared with upstairs.

So, do you leave it all open and risk having

your upstairs neighbour sitting with you on a sunny weekend?

Do you fence it off so you have half each?

Then, you have to work out who gets which side.

There is never an easy answer here.

But like any property, people want to know what they own

and where it starts and ends.

So, personally, I would take advice from a local agent,

chat to your neighbour and see if you can come to a compromise.

So, what does a local property expert think of this two-bedroom

flat with its 125-year lease

and auction guide price of £225,000?

My first impression of this property is that it is

one of the most popular sort of flats, a garden flat.

It's got the two bedrooms, which is great,

but the second bedroom is not a great double.

Needs a lot of work, but it will be lovely when it's finished.

What about the garden? How should that be divided up?

In this case, I would advise it being split horizontally,

with the upstairs flat having the rear part of the garden.

They'd come down their stairs, have a little path at the side.

And it means the people on the ground floor

would be able to open their kitchen door

straight out onto their own section of garden.

That seems a good idea.

How much could the flat achieve in resale or rental

after a full refurbishment?

When it's finished, these properties

go for 450,000 to 460,000.

I would expect it to achieve between 1,500 and 1,600 per calendar month.

A cracking flat in a fantastic area with a staggering guide price.

Let's see who snapped this one up at the auction.

Right, lot one is a good-sized

four-room, purpose-built flat.

Obviously, Balham, hot area. 250?

Well done, 250. 255?

255. 260.

265. 270. 275. 280.

285. 290. 295.

300. 305.

Well, this was a very popular lot which attracted several bidders.

We rejoin the auction a little later.

337, don't be shy. 337. 338?

338. 339? Yeah?

340? Yeah? 340. 341?

342.

343.

343, another spot. 344.

It's a good lot, yeah?

345. 346.

347. 348.

349. 350.

351, sir. 352.

351, standing up. Anyone else?

351, first time. Second time.

Third and last time. Are we all done?

Sold, 351. Well done.

Clearly, I wasn't the only one to be excited.

A thumbs-up from Dirk.

He must be pleased with the 351,000 he paid.

Dirk's originally from Berlin and is a climate change consultant.

# Let me be your wet-weather man. #

Although he's currently on a career break.

He's bought investment properties in the past, but this

is his first purchase since the recession.

I met up with him back at the flat

to hear about his plans.

-Dirk, congratulations.

-Hi, thanks.

This is a super flat. Tell me why you wanted to buy it.

Well, I was very attracted to this flat.

I lived in the area

when I moved to the UK, so I know it very well.

I did some property development in the past when I came to the UK,

and was straightaway infected by the property bug

that's going on here.

So, yeah, I was keen to invest in London.

You've bought this obviously not to live in.

No, no, it is a pure investment, basically, to do it up

and either rent it out, get some equity out of it,

or just sell it on.

So, it's timed quite nicely for you that you happen to be

on a career break and this has come up just at the right time.

Yes.

Well, you know, things don't happen just by chance,

so end of last year, personal life took a little bit of a dip,

so I thought I have to re-inject a bit of passion into my life.

So, I decided to do a bit of property development and travelling.

So, I asked my management

for a career break and they were very supportive.

-So, what is it that you do?

-I'm a meteorologist, originally,

and I'm working for a big consultancy in the Midlands

as a climate change analyst and environmental consultant.

Well, maybe meteorologist Dirk will be able

to predict where the sunny side of the garden will be.

# I want to be your wet-weather man. #

But he's going to leave that for the new owners to negotiate

with the upstairs neighbours.

I definitely don't want to rain on his parade,

but he has quite a challenge on his hands to bring

this ground-floor, two-bedroom flat into the present.

What are you going to do to turn this space around?

First of all, some basic renovation,

so really take down these PVC tiles, which are pretty ugly,

skim the walls.

There are nice floorboards, actually, below these carpets,

so sand that, lacquer it.

Rip down this wall here and open that up to a big kitchen-diner.

Double doors here and make that very desirable and a nice family flat.

I think that would look great. It's wonderful

to walk into a space and be able to see that beautiful garden.

-Exactly.

-Now, all you see is an ugly boiler

hanging off the wall, and it definitely needs

-some rearrangement in here.

-Yeah.

Also, a negative for me is the second bedroom.

-It's incredibly small. It's just a bit too small.

-That's right.

It's not really a bedroom at the moment.

So, what we're going to do is to actually take

that corner that is there,

which belongs to the bathroom,

take that out and then move the toilet.

That should all fit quite nicely.

Well, I'm going to give Dirk the thumbs up now.

I reckon he's made the right call to leave

the lounge as it is and concentrate on maximising the potential

of the second bedroom.

And I'm getting all excited again about the prospects

for that kitchen.

I can't wait to see how that one turns out.

How much has he set aside to spend here?

I hope to come in within 20K for the whole project.

So, the whole project, £20,000?

£20,000 in six weeks, yeah.

I would like to think you could do it for £20,000. In fact,

if you could do it for £20,000,

-you could add a lot of value to this property.

-I agree.

-Good luck.

-It'll be really exciting seeing how you turn this place around.

-Yeah.

-Congratulations.

-I can't wait.

-Thank you.

-Thanks.

So, our English property obsession has infected native German Dirk.

It's inevitable, I'm afraid.

And what a great property to reignite the passion in his life.

But six weeks and 20 grand? I hope he manages it.

You can see if he does later in the show.

Coming up, there are so many options in this Yorkshire terrace

and so much space.

Why not think about actually bringing the kitchen down here?

We return to Balham

to see if Dirk's plans have gone off the straight and narrow.

It's a great learning curve,

and I'm going to use that knowledge to do my next project.

And talking of narrow,

how did Peter get so many builders in a cramped Cornish cottage?

We have a team... Probably about 20 guys in total.

# You can go your own way

# Go your own way! #

Back now to Redruth, in Cornwall,

a town with a rich seam of mining history

and some well-heeled modern sculptures.

It's where earlier in the programme we met Peter,

a full-time property developer.

He paid £76,000 for this stone cottage.

He wasn't looking to let it, but before he could sell it,

he and his builders had a lot of work to do.

I hope you're a man that likes a challenge, then.

Yeah, I think we're going to have to rise to this one.

There's a bit of work to do.

Mm, yeah, just a bit.

I love a developer who doesn't get fazed.

Peter planned to move the stairs,

relocate the bathroom upstairs and keep the three bedrooms.

Three and a half months later, we met Peter back at the cottage.

The sagging roof has lost its chimney.

And the garden has lost the wall, so there's now space for a car.

The staircase has been turned around - 180 degrees, in fact.

And the narrow corridor is gone.

So, I'm delighted.

Look at this corridor!

It's so narrow and cramped, it's horrible!

The ground floor has really been opened up.

Just look what a difference it's made to the former dining room

at the back.

Peter's created an archway in the thick rear wall

of the house, straight out into the refurbished extension,

where a stunning new kitchen has been installed with extra

space gained by removing the wall to the former wet room.

And there's been an added benefit to losing the original entrance,

as Peter explains.

Well, in the kitchen area, it used to have a door to the right,

which led you into a partly finished kitchen.

There was then a stud wall across and you had a wet room downstairs.

We've ripped all of that out to give us a utility room

for the boiler, dishwasher and tumble dryer

and a downstairs toilet for the people that are living here.

On top of that, we've got the kitchen finished.

It is now ready for somebody to move in

and add their own freezer and fridge.

What an incredible effect just relocating the stairs

has had on this property.

The ground floor now flows seamlessly from one room to another.

The front living room is just as impressive.

Well, this room wasn't quite as big as it is now.

There was a narrow hallway here, which we've totally got rid of.

And, of course, you've got the stairs this side,

whereas before they were the other side.

Upstairs has a new layout, too.

Removing the corridor between the small front bedroom

and the larger double has created extra space.

And with the stairs moved,

Peter was able to relocate the bathroom upstairs, as promised.

It's small and there's only a shower, but, hey, it is upstairs.

And there are still three bedrooms.

The back bedroom lost some space to the bathroom,

but it's still a decent size.

How involved has Peter been here?

I was on site every day.

We have a team... Probably about 20 guys in total.

And we've replaced all of the plumbing.

We've replaced all of the electrics.

And, obviously, we've had to replace the floors and the ceilings.

Peter's team have only just started to tackle outside,

but the sagging roof has been sorted

and Peter got two further mining reports,

which stated the house was safe.

Phew! So, those original deeds were a good omen.

How much has it all cost? Did he keep to the 30 grand he budgeted?

We are, at this point, and we still have some bills to come in,

around 42 to 45,000.

Well, if it does top out at 45,000, added to the £76,000 he paid,

that will take Peter's total investment to £121,000.

What will two local estate agents think of the place?

It's time to find out.

My first impression of the property

is it's been well refurbished

to a quite high standard. The kitchen works really well

and it's in keeping with the age of the property.

And also that they've put the shower room upstairs.

I think the developer has done an excellent job on the renovation.

I think there's three

real benefits that he's brought into the property.

Firstly, removing the wet room from the ground floor,

installing a shower room upstairs.

Secondly, he's provided an off-road parking area to the front.

And lastly, really removing the inner hallway has brought

a lot more light and space to the living accommodation.

Peter says he'll sell,

but I wonder how much the rental income could be.

It might persuade him to keep it.

I would suggest marketing it at £650 per calendar month.

I think the rental income we could possibly achieve

on this property would be in the region of £650

per calendar month.

So, there could be a yield here of over 6.5%.

Could Peter be tempted by that?

That's interesting, but we tend to steer away from the rental market,

purely because of the amount of management costs involved.

OK, so what's the house worth?

More than the £121,000 that Peter's invested here?

I would suggest a marketing price of £135,000.

I'd estimate a sale in the region of £140,000 to £145,000.

That's £14,000 to £24,000 gross profit

before expenses and taxes.

Is that the sort of margin he had in mind?

We know that probably the market is around 140,

but with the amount of work we've done, we would hope to get 150.

Well, fingers crossed, because Peter and his team have invested

a lot of time and effort in turning this house around.

And the results are cracking.

So, what's next for Peter, a new build or a renovation?

Well, one we're about to start next week, which is a new build.

And then we're looking at another renovation project

to follow on from that.

This mid-terrace certainly presented a challenge or two,

so did Peter rise to it?

I think we can safely say he did.

This is Sowerby Bridge,

in West Yorkshire, close to Halifax.

Before the Industrial Revolution, this was just a marshy hamlet,

but the arrival of the water mills changed that

and Sowerby Bridge became a centre for the textile industry.

Well, throw in the arrival of the canals and railways,

and what you've got yourself here is a thriving Victorian town.

The prosperity of the town continued long into the 20th century,

although the canals are now just used for pleasure.

So, will I find a prosperous property market or

one that's out for a duck?

# It's a kind of magic Magic, magic! #

Now, I'm no conjuror,

but I am going to show you something a little bit magic.

How, dear viewer, do you squeeze four bedrooms into what,

on the outside, looks like a pretty standard two-bedroom terrace?

Follow me and find out.

It's not a trick of the light, it's not two houses knocked into one

and, no, it's not a typo in the auction catalogue either.

This house had a guide price of £70,000

to £80,000 and looks in pretty good condition.

Like the neighbouring properties, it's on a very steep hill,

with an interesting elevation,

so maybe that explains the number of bedrooms.

Through the front door, stairs up to the bedrooms there,

and then down this corridor to a front sitting room,

really nicely decorated.

It's got a gas fire. You may want to take that away and see

if there's an opportunity to have a real fire there.

And then, joy of joys, towards the rear of the property,

in fact, out the back, this amazing kitchen, a really nice-sized space.

Not particularly well laid out here,

with just this one long line of cupboards and stuff,

but a really big window with views out cross the hills. We like that.

And here, more storage?

Oh, no...stairs!

# I'm going deeper underground. #

Down here, a kind of cellar/basement.

Pretty much underutilised at the moment, I think.

You've got some of these features, like this flagstone floor there.

At the moment, it's a bit of a sort of utility area.

You've got the boiler, a fridge, but you've got an open fire there

which you could work with.

But I'm thinking about something more dramatic.

Out through that door, you've got a patio, so why not think about

bringing in the kitchen down here,

putting in some lovely patio doors there, opening out onto the patio?

And that would be a really great use of this space.

So far, we've seen two floors of this house,

but don't forget there are four bedrooms still to find.

This place is starting to remind me of a certain time traveller's

phone box.

How on earth can all those rooms fit in this space?

So, up here maybe the mystery will be revealed.

A bathroom there. It is quite small for this size of property.

So, not ideal, but it's

in good condition. Big double bedroom there.

Another big double bedroom there.

And then up these stairs to a third double bedroom

and, finally, that fourth bedroom, how is it squeezed in?

Well, it's here.

It is small, though.

A single, or possibly bordering on a box, room.

Now, it is a lot of bedrooms for this size of property,

so what are your options?

Well, I'm a bit concerned about that bathroom, so maybe

one option is actually to get rid of this bedroom

and to turn this into a big family bathroom.

It would then leave you with three nice-sized double bedrooms

and two bathrooms.

That might make this place more saleable,

but if you're renting it out, maybe four bedrooms is worth having.

It all comes down to what you're planning to do with the place.

There is plenty of room to play with here, and of course, there is

the added bonus of lots of exercise going up and down all those stairs.

If you make it up to the top bedroom without the aid of an oxygen mask,

you'll need to watch you don't bump your head on the eaves.

But the mad angles are hardly a surprise

when you look at the crazy roof.

With a guide price of £70,000 to £80,000,

this is a property well worth

getting exercised about.

What does a local estate agent make of it?

When I got inside,

I thought, "Yeah, it's a good size."

A little bit tatty and neglected,

but, basically, it looks sound. So, it should just be

a case of doing a little bit of a refurb to make it pleasant

to occupy again.

What's the best use of that cellar space?

If you were going to live in it,

you would tank it out and make it

into a dining kitchen, without a doubt.

But tanking is expensive.

So, as an investment property or to do a quick return,

it probably isn't an option.

Tanking, in this case, might mean laying membranes or a cement-based

waterproof coating to prevent damp and water penetration.

On top of the re-plumbing and electrics and patio windows,

moving the kitchen wouldn't come cheap, that's for sure.

So, how much is this house worth in its current condition

and what could it achieve after a refurbishment?

The value today I consider in the region of £75,000.

And when refurbished, I would say in the region

of £90,000 to £95,000.

What about the rental potential?

The property, in good condition, would rent out

at £450 to £495 per calendar month.

Well, deceptively spacious, yes, but lots of work to be done.

Yes, lots of room, so it stacks up from a rental point of view,

but all those stairs?

Well, who fancied it? Let's find out when it went under the hammer.

So, moving on to lot 21.

Four-storey property, this one.

Four bedrooms, two receptions, £70,000, ladies and gentlemen.

60 then.

Thank you. 60, we're in.

At 60,000. Looking for 61 now. 61.

62? 62. 63?

63. 64?

64 here. 65 now? 65. 66.

It's going to be difficult, you're in line. 67.

67, sir. 68. 69.

At 69,000 with you.

69.5. And 70.

And 70.5.

Shake of the head. £70,000 standing up.

At £70,000. I'm going to sell for the first time. At 70,

for the second time. At £70,000,

third and final time.

Congratulations, well done, sir.

That final successful bid of £70,000, at the bottom end

of the guide price range, was made by Malcolm, who lives in Halifax.

He's worked in the motor trade for 20 years, but last year

decided on a change of career.

He's now started up as a property developer,

and this is his second investment.

# A change

# A change will do you good

# Will do you good... #

I met up with him back at the house to hear about his plans.

-Malcolm, great to meet you. Congratulations.

-Thank you.

£70,000, sounds like a bit of a deal for this place.

Yeah, that's the first thing that attracted me to it,

it seems like a lot of house for the money.

And why did you want to buy it?

Well, I wanted to have a go at returning the property

to the market after redeveloping it, make some profit on it.

If that doesn't work, send it out to rent,

move onto the next project.

-Right. Is this something you do?

-It is. About 12 months ago,

-I fancied a change in my career, so I gave up work.

-Oh, wow.

Started looking for my first project. Got one last year.

Bought it, modernised it, put it back on the market, made a small profit.

But learned a lot about the job.

-But this is my first house I bought at auction.

-Right.

So, this was new ground for me.

Tell me more about this lifestyle change, what happened?

I just got bored of being in the motor industry all my life.

What were you doing?

I worked my way through from dealerships to manufacturers.

I worked for some fancy car companies.

And it was all the same game, really, so I just wanted a big change.

Right. Have you got family, dependants?

I've got a partner,

-she's about a month and a half due on our first child.

-Congratulations!

Thank you very much. So, I've got a bit of pressure on, really.

So, I've got to get it all done in eight weeks.

-Gosh.

-That's what I'm gunning for, really.

Well, I admire Malcolm for being brave enough

to make a complete career change.

He clearly learnt a lot from his first project.

I'm assuming he's gone into this

because he's used to doing up his own houses and likes DIY.

-Have you got skills which you can utilise?

-No.

-No?

-None.

-None at all?

-None at all.

Well, banging things and taking things out?

Yeah, I can just about do that as long as somebody

keeps their eye on me.

-So, you don't get involved in any of the DIY kind of bit?

-Not really.

I mean, I'll do a bit of the labour side of things because

I need to know more about the job if I'm going to value houses better,

-but I have no skills.

-So, why this house in particular then?

Well, four-bedroom. It looked like a big house for the money.

I came and had a look at it, blown away by the size of it

and the condition of it.

And found that I could make some money out of it.

Under £110,000 there isn't another four-bedroom house

-on the market.

-Oh, wow.

-So, that's why

I want to develop it to a certain level

and get it on the market with no competition whatsoever.

Right. So, what are the plans for it?

Starting in the living room, I'm going to do a new fireplace.

A full new kitchen in here, new flooring.

Upstairs, in the bathroom, I'll re-tile,

keep the original suite that's in there.

And then go downstairs, make it more into a utility room.

There's a limit to what this house is worth.

# Take it to the limit

# One more time. #

Malcolm is sure he knows the top limit on this house,

so he's determined to keep to his budget of £7,500,

with a 10% contingency.

He does appear to have this sorted.

You seem, without being patronising,

extraordinarily well switched on and, bang, on the button with this,

-considering you just started out.

-You keep listening

and you learn from your mistakes. You know, paying £70,000

for a house is very small compared to the cars I was selling.

You were selling cars more expensive than the house?

-Oh, three, four times that.

-Really?

-Yeah, yeah. Three or four times that.

So, again, it doesn't really faze me.

I've bought and sold cars for far more than this.

-Listen, congratulations. Good luck.

-Thank you very much.

-We look forward to seeing how you get on.

-Absolutely.

Well, how funny that Malcolm's less fazed about buying a house

than he was about buying and selling cars.

It's not normally like that.

But the clock is now ticking for him with a new arrival on the way.

How will he get on sorting this place out on budget

and within that eight-week timeframe?

You can find out later in the show.

Finding good tradesmen is often the key to getting a project done up

on time and on budget, but sometimes people

take on the work themselves to maximise their profit.

So, have our buyers been getting stuck in or just stuck?

Let's find out.

There's a variety of reasons why people buy at auction.

But for meteorologist Dirk, who's originally from Berlin,

this ground-floor,

two-bedroom garden flat in Balham, south London, hit the mark,

for several reasons.

He knew the area, having worked in Balham

before moving to Nottingham to work

as a climate change analyst

and he is currently taking some time off from the office.

It's timed quite nicely for you that you happen to be

on a career break and this has come up just at the right time.

Yes. Well, you know, things don't happen just by chance.

So, end of last year, personal life took a little bit of a dip,

so I thought I had to re-inject a bit of passion into my life.

So, I'm on a career break.

It's now seven weeks later and back in Balham, it's not

just the climate that's changed.

Dirk has kicked up a storm with this previously rather dated flat.

Removing the wall to the kitchen

and adding an RSJ has created a fabulous L-shaped kitchen-diner.

There's still units to fit,

but this is a really impressive makeover already,

as Dirk explains.

Yeah, basically, this is obviously the space with the most changes.

We took out the dividing wall here.

And, yeah, put in...

The kitchen, was kind of the question

if we put it there or if the builder puts it in that corner.

So, we ended up putting it actually here in this corner

and to build additional units here, which makes it nice, open.

And, you know, you do your washing up, which nobody likes to do,

but at least you have a nice view to the garden, which is a nice asset.

So, it works quite nicely, I think.

You bet.

To save money, Dirk decided against bifold doors,

but this large window and separate door show off the garden just fine.

In the master bedroom, Dirk has opened up the chimney breast,

he sanded the floorboards and it's going to be a lovely room.

What I'm most excited about is that poky second bedroom.

Has he managed to change that?

Well, the answer is yes.

Stealing some space from the bathroom to make this room

a better shape has really worked well.

The lighter floorboards show where the loo was.

Amazingly, he's managed to get more bathroom into a smaller space.

He is a magician, because that can't have been easy.

Yes, the bathroom was a tricky decision because we didn't want

to lose the bath and there was no proper shower in it.

So, we really thought about a lot of layout options

before we then finally found this kind of layout to integrate

the shower and all the pipework and that dividing wall.

And that's the perfect bathroom for this kind of confined space

that you deal with here.

He's fitted more into this bathroom

than you'd think possible.

I'm really impressed with the whole flat. Retaining many

of the original features has resulted in

a really grand feel to the place.

I'm curious to know how much Dirk has managed to do

himself or who else has been involved.

Well, I had a couple of builders on-site.

My builders worked seven weeks straight

and sometimes on weekends, as well. Me included.

I was pretty much on-site every day, just to make decisions

or sand the floorboards myself to save some money.

But did his £20,000 budget lead him into stormy weather?

# Let me be your wet-weather man. #

How much has he had to splash out?

As things stand, I spent 23,300,

which, you know,

I had to fight hard to keep it within that budget, to keep it that way.

Dirk paid 351,000 at auction.

So, with his increased spend, that means he has

£374,300 invested here.

It seems being involved in this project

has helped him rediscover that passion he was looking for.

He's now thinking of making his career break more permanent.

Chances are that I fly solo and I'm probably not going back,

do a bit more of property development or start my own company once I

hopefully turn this around at a good price

and make enough money to actually afford my own career and my business.

Time to find out what two local estate agents

think of this two-bedroom flat.

Will Dirk's £374,300 investment get the thumbs up?

I like the kitchen.

It's very fresh, very contemporary feel,

with the integrated appliances. I particularly like the bathroom.

I think that the bathroom is a very good finish

and he's found a very good solution to where to put the shower.

It fits very well and it's got a good look, that bathroom.

I like the garden, although it's shared.

Perhaps there's the opportunity to petition

it off and make a private area.

I think that's quite a drawback,

and I think it's a great shame he didn't split it.

I wonder what effect that might have on the rental potential here.

I think we could rent the property out per calendar month for a figure

of between approximately £1,700 and £1,800.

You could put this on the rental market in the region

of £1,750 to £1,850 per calendar month.

I'm happy with that but obviously that's not the aim of this project.

This project, the aim is to actually sell it on.

Time now for the all-important sale valuations.

Is the flat now worth more than the £374,300

that Dirk has invested here?

Well, prices have moved a little bit since I first saw this property

and I would now recommend putting it on the market

in the region of £475,000.

I think we can put the property on the market for a figure of £475,000.

Wow, that could produce a gross profit of £100,700

before the usual selling expenses and taxes.

So, it sounds like it's all been worthwhile, Dirk.

You work very hard for it, so you want to achieve the highest price,

but, I mean, 475 is pretty much something I'm very happy about.

Dirk took this career break to try and re-ignite his passion.

He's certainly been bitten by the British property bug

and is already looking forward to doing up his next property.

It's a great learning curve

and I can use that knowledge to do my next project in Streatham

and I'm going to kick it even harder then and I will be bang on budget

this time around. Hopefully.

Back now to Sowerby Bridge, in West Yorkshire,

a pretty place with water and walks,

where earlier in the programme, this deceptive mid-terrace had a lot

more on offer inside than you'd guess from the street.

Four bedrooms to start with, but how did

all those rooms fit in this quirky terrace?

Up top there was a bedroom in the attic conversion.

And down below, there was a cellar.

And in the middle, three further bedrooms on the first floor.

Malcolm bought it for £70,000.

After 20 years in the motor trade, he decided that managing an Italian

supercar showroom wasn't driving him enough.

So, he'd taken a pit stop and moved into property developing.

This was his second property, but his first auction purchase.

-Have you got skills you can utilise?

-No.

-No?

-None.

-None at all?

-None at all.

Well, banging things and taking things out?

Yeah, I can just about do that

as long as somebody keeps their eye on me.

Well, that could come in handy, but Malcolm had done his homework,

so he knew this four-bedroom house had great potential.

Under £110,000,

there isn't another four-bedroom house on the market.

-Oh, wow.

-That's why I want to develop it to a certain level

and get it on the market with no competition whatsoever.

But he was going to need a fast lap to get it finished,

because he and his partner, Jo,

were expecting their first baby in just six and a half weeks.

# Fast car, slow traffic Fast car, slow traffic. #

Well, it's now three months later and back at the property,

all four of the floors have been refurbished.

But let's start in the kitchen, at the back of the ground floor.

Malcolm kept the floor plan the same, but replaced the units

and appliances.

Just practical mid-range equipment,

but I like how it looks

and Malcolm is pleased with the finish.

So, what we did is we took it back, re-skimmed,

put a new kitchen in using the same format, cos it's very functional.

New appliances went in. New flooring went down across.

And we painted.

And we've been left with a nice, bright, open, usable family kitchen.

Malcolm has kept his business head on here and not let

his heart overrule it.

Keeping reins on that tight budget meant he opted to keep

the kitchen layout the same.

And another thing that hasn't changed

is the great view across the hills.

But he's maintained a high finish throughout.

Just look at the living room.

Again, similar to the kitchen, we took this back to the brickwork,

replastered. We've decorated.

We've put new carpets in and we've replaced

the tired, old fireplace with an energy-efficient fire.

Kept it fresh. Nice, usable living room.

Up the two flights of stairs, at the very top of the house,

Malcolm has changed the formerly vibrant colours.

# Blue is the colour of the sky. #

These neutral shades will appeal to the widest market possible -

fresh and clean.

# Green is the colour of the sparkling corn. #

He's gone for a similar look in the three first-floor bedrooms.

As Lucy and I know - neutral, magnolia

and beige carpets can really open up a place.

Although I had reservations the bathroom was quite small,

using lighter tiles has definitely made it feel more spacious.

Ever conscious of his budget,

Malcolm has kept the original suite, which was good quality.

So, how did the timescale pan out for him and his partner, Jo?

Did they hit her delivery dates?

It went very well.

We sort of started at the top of the house

and worked our way down into finishing the property.

And we got as far as the door to the cellar,

when my beautiful, little daughter turned up.

I had three and a bit weeks off.

It was very difficult to peel myself away. So, we got back.

Although we said eight weeks, I think we've run over by about ten days.

When Malcolm returned, work on the cellar continued

and it's now a large utility and storage area.

Painting the wall and floor has made such a difference.

And to save money, he decided against putting in a patio door.

We didn't want to go to the extent of tanking out.

I had to resist the temptation to overdevelop this property,

as the price I would end up putting it on the market for would then be

into the competition.

Getting the right price point has been the main consideration

for Malcolm, and there have been some structural issues to deal with.

The joists in the kitchen and the hall needed replacing

and there has been some woodworm to treat.

But outside, there's been very little change.

The house had been recently rewired, so that was one saving.

But Malcolm decided to skim all the walls. So, did he stick

to his £7,500 budget?

I ended up over budget, about £850 over budget,

but I'm relatively pleased that it's come in within the 10% area.

With the £70,000 he paid at auction,

and his £8,350 spend,

that'll take his total outlay to £78,350.

We invited two local estate agents to come and tell us

what they think of the prospects for this property.

The property is good,

it's a traditional turn-of-the-century terraced house.

The bathroom is small, but the fittings are good.

The kitchen is bigger.

The changes to the property have been remarkable.

It's bright, modern, fresh and clean.

And the bathroom, again, is immaculate and fully tiled.

And the basement is going to be really useful.

Malcolm's already renting out his first investment property,

but he intends to sell this house.

So, do the estate agents think it will be worth more than

the £78,350 he's invested here?

We would estimate the sale value at approximately £100,000,

with a suggested asking price of 99,995.

I would value this property at £95,000.

Those valuations would mean a gross profit for Malcolm

of between £16,650

and £21,650 before taxes and expenses.

A little bit disappointed with it, a slightly lower figure.

I think I'll stick to my game plan, which is put it on the market at 110.

And if after 90 days it hasn't gone through,

we'll move it out into the rental market

and get a return on our investment that way.

What rental income could the house generate?

It makes a good rental property

and we would expect around about £500 per calendar month.

Renting for this, you are looking about £495 per calendar month.

Based on those valuations, that's a yield of over 7.5%.

Yeah, I think they're reasonable figures.

We're currently getting 495 on our two-bedroom property down the road.

I've certainly got interest from people paying

slightly more than that.

But it's in the ballpark, so I'm pretty happy with that.

Since filming, he's sold it for £108,500,

a pre-tax profit of over 30,000.

But which was more fun, cars or property?

Definitely houses, most evidently houses.

Although I was a bit disappointed in the figures, there's a good margin

in it for me, I'm my own boss and I keep...bar the tax,

I keep all the profit.

Well, that's it for now.

Join us next time for more properties

-that sold under the hammer.

-See you then.

-Goodbye.

-Goodbye.

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