Episode 56 Homes Under the Hammer

Hello. Now, in today's challenging market,

do you think you could hack it in the world of property?

If you get it right, it can be an exciting way to earn money,

but you've got to be aware of the risks.

But if you do decide to take the plunge,

then auctions can be a great way to buy - under the hammer!

There are tense moments in the auction room -

who will make the right bid at the right time?

Yes, properties can change people's fortune for better or worse.

So, what inspired the buyers on today's show? Let's find out.

In Whitehaven, Cumbria, I discovered that it's fairly easy

to get to and from this house.

In terms of those transport links,

well, there's a train station right there!

I take the fast train to Ramsgate,

where this kitchen completely derails me.

Come back in here and have a look at this. How disappointing is that?

And in Stoke, I'm worried planning permission could hit the buffers.

Any changes of use or changes to the building itself

are going to be looked at very carefully by the planners.

These properties were sold at auction. We'll find out who bought them,

and what they paid for them when they went under the hammer.

You bought it, sir, well done.

Now, here's a good pub quiz question for you.

Where in the UK, d'you think,

has more listed buildings per square mile than anywhere else?

London? Edinburgh, perhaps?

Cardiff? York?

Bath? No?

It's Whitehaven in Cumbria. That's got you thinking, hasn't it?

# Tell me if the sky is blue How old are you? #

And if you're on a roll in the pub quiz,

you could also add that Whitehaven's street grid might even have been

the blueprint for New York.

During the 18th and 19th century, Whitehaven was one of Cumbria's major ports,

mainly due to the coal industry, and it's got a lot going for it today.

So, not far from the centre of Whitehaven is the property I'm here to see.

So, you've got good bus routes and railway links,

pretty little seaside town and Carlisle and the Lake District

on your doorstep - what more could you want?

This is the property. It's a three-bedroomed ex-local authority house.

It had a guide price of £50,000-60,000. Let's take a look.

So, let's see what you get for your money.

A bit of double-glazing - a good start, keep the noise and the cold out.

Into this really useful entrance area. Lots of places to store your bits and pieces.

Stairs up to your bedrooms.

And straight away, I'm getting the feeling that it's a solid house.

Ex-local authority, they usually are.

Walls - yeah, no stud partition there. That's solid - I love that.

Through into your, I guess, front lounge area.

Fireplace - an open fire in there would be a nice touch.

Ceiling - not to everyone's taste, this wood-look!

More like a sauna than a house, but not to worry - soon have that down!

Into the rear of the property where you've got this really,

really practical kitchen/dining area.

If's obviously in need of some updating,

but I'm really excited because, just a bit of time and effort

spent on this place, putting a new kitchen in,

sorting it out, painting the walls,

doing something with the ceiling,

and you are going to dramatically change what is intrinsically a really good house.

The house feels roomy and solid but does need a lot of work

to bring it up to standard.

And you'd have to be careful how much you spent on that work.

Ex-local authority houses do usually have a ceiling price

when it comes to the resale market.

Well, upstairs - no great surprises in terms of the layout.

Good landing area, three decent-sized bedrooms,

a really nice family bathroom. Yes, it needs a new suite in there ideally,

although you could probably get away with what there is.

All in all, I'm not seeing anything that worries me.

Yes, in some ways it's a really good first-timer project. Just a bit of paint on the walls,

a bit of tender loving care, and your house would be really improved.

And one fantastic thing about the property - really lovely open views.

# What a beautiful view you are

# Don't change. #

And it's not just the view that's fantastic.

It's the garden space, too. There's loads of room here.

Perfect for kids playing, family barbecues, or just a stroll around.

# Don't change. #

Well, another real advantage of ex-local authority properties

is that more often than not, they have reasonable-sized gardens.

That's certainly the case here.

As you can see, it stretches all the way down. You've got a bit of lawn.

This area at the bottom here

would be ideal for growing your own vegetables, a bit of an allotment.

And then in terms of those transport links,

well there's a train station right there!

It does mean there's a train passing the bottom of the garden every now and then again,

but in terms of convenience, and space - phew, big ticks in the boxes!

# Pardon me, boy, is that the Chattanooga Choo Choo?

# Yes, yes. #

Despite the local railway network being, well, very local,

it's a house full of potential.

So with a huge garden and a guide price of £50,000-60,000,

what's not to like?

Let's find out what a local property expert thinks of it.

There's plenty of room out towards the rear garden,

for further extension, to create a conservatory.

The kitchen itself is, you know, ample size,

but a conservatory would provide another downstairs room as well.

Obviously, if it was a growing family, there's room to move upstairs as well

and extend into a fourth bedroom and perhaps an extra bathroom as well.

Definitely lots of possibilities, then.

But would there be much demand for this place?

Most certainly. Yes, there's a high demand for...

Especially with the first-time buyers,

they're now looking for the extra bedroom space as well,

which a lot of the two-bedrooms are quite compact properties. So, yes.

How much could a renovation add to that £50-60,000 guide price?

Once renovated, we could be looking between £85,000-£90,000.

And if the buyer decided to let it?

Then I would expect to achieve between £400 per calendar month

and £450 per calendar month.

Well, some cosmetic work needed to sort this one out

but intrinsically a great little property.

Love the views, good, popular location, close to Whitehaven,

and a great guide price.

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

£50,000-£60,000 in the catalogue.

Last quoted guide, start me off,

top of the guide, shall we say on this, 60?

Kill it dead with one bid, anybody? £60,000. 55, then.

Get me away at 50.

£50,000 seated. At £50,000, then.

I'll take it in ones. And £50,000 I'm bid. At £50,000.

£51, I've got. 52, may I say? 53, sir. 54.

54, I've got. 55. 56.

57. 58.

58, I've got. 59.

58 with you, madam. Can I say 59, sir? Thinking about it.

It's with you, madam, seated at £58,000.

At £58,000. Where's the men to compete with these women?

At £58,000.

Take a half, sir. Half, I've got. 59.

59, I've got. And a half. And 60.

60, I have. 60 and a half. Shake of the head at that. It's with you.

It's £60,000, madam.

At £60,000 are we done? First time... 60 and a half seated.

61, may I say? And a half. 62.

And a half. 63.

63, I've got. And a half.

63 and a half. 64, may I say? 64, I've got. 64,500.

64 and a half, I've got.

65. 65 and a half. A shake of the head at 65,500.

At £65,000...

First time... At 65, second time.

At £65,000, then, third and final time, selling away, all done.

Well done, madam, back row seated. Thank you.

The rather surprised buyer was Karen,

whose bid of £65,000 secured her the property.

She works as a support worker for people with learning difficulties

and bought it with her partner Peter, a scaffolder.

They both have children from previous relationships,

and are looking to this house to bring them

all together in a new family home.

# All together now, all together All together now. #

I met up with them back there to hear about their plans for it.

-Karen, Peter. Lovely to meet you both!

-Nice to meet you, too.

-Congratulations!

-Thank you.

-Tell me why you wanted to buy this place.

I just seen it, and I was wanting to buy a property.

So I just... I fancied this one

because this is where my family and that live

so I wanted to be close to family. When it came up, I just thought, "Oh, I'll just go for this one."

-Luckily enough I got it.

-So how was the auction?

-I was nervous.

It was really nerve-racking, I thought,

cos I'd never been to one before and I thought,

"Oh, I'll have a look and sort of see what the craic is with it."

But then my lot came up second. So I was like, "Oh!"

And it was my turn and I was like, "Oh!" I didn't know what to do.

So I just kept going. And then... I had a set price in my mind I wasn't going past,

but then I didn't know where it was, because I kept sort of doing this!

And in the end I didn't know who got it, and it was me! And then I was shocked then,

and I just thought, "I've just bought a house! Can't believe it!"

I would normally recommend a BIT more preparation for an auction.

But never mind - in this case, it seems to have paid off for Karen.

So what are her plans here?

We're going to get a new kitchen.

-Just strip it right down, really, and just start again.

-Yes.

So any plans for any major structural work,

or knocking walls out, or anything like that?

Just might open up a door behind us, make it a double door.

-A bit more light in there.

-A bit more light,

-and just that little wall in the kitchen. Just give it more space so we can have a breakfast bar.

-Nice.

-And who's going to be doing the work?

-Mainly ourselves really.

-Yeah.

And then obviously professionals to put the kitchen in and stuff,

but most of just the taking down, stripping walls

and decorating ourselves.

Great! And have you got much experience in this kind of stuff?

Not really, no!

Well, you've got to start somewhere getting experience, haven't you?

As Peter's a scaffolder by trade,

he knows a few handy pals who can help him with that work.

He reckons they can get it all done in four months.

But what do they think it will cost?

We've got £10,000 to do it,

but we don't know if we'll need any more or not.

-I think we might need a bit more!

-I don't know.

Depends how much internal structure and stuff...

I would have thought you'd be able to do it for that.

Yes - it's just we've seen a nice kitchen and that was about six.

-Six what?

-Thousand. And...

-Oh, OK(!)

That was a good start.

That was a good start, so we're like, "Oh!"

You'll blow your whole budget on the kitchen!

-I know!

-Does she have expensive tastes in everything?

Yeah, just a bit, like!

But hopefully Karen's expensive tastes won't leave them short

for the rest of the renovation.

# Empty pockets But a heart full of love... #

Because it sounds like she's got grand plans for the bathroom too!

-I will want a Jacuzzi bath.

-THEY LAUGH

Well, they're cheap(!)

And I'm going to knock out the cupboard and put a shower cubicle in.

-I wish you luck with that. Good luck in general.

-Thank you very much.

-And try not to spend too much on the kitchen!

-I won't!

Well, I think Karen and Peter have done well with this property and it'll make them a great family home.

Obviously, I'm a little bit concerned about the over-indulgences

when it comes to doing up the kitchen.

If you were doing this place up just to make a profit,

then spending £6,000 on sorting out your kitchen is probably not the best move.

But if you're going to live in it, well, what the heck!

You can find out how beautiful it looks later in the show.

Ramsgate in Kent is a lovely coastal town with a beautiful marina and bustling community.

It's a great holiday destination and a vibrant place to live.

The house I'm here to see today is on this busy A road, I'm afraid,

so it's not ideal.

But it's not a deal-breaker, I would say.

Now, the guide price was £110,000-£120,000,

so what have we got?

Well, it's semi-detached, there's three bedrooms,

and it looks good from the outside, so - positive!

There's off-road parking, you've got double-glazing, and a sound-looking roof.

So, so far so good, but will the good-looking outside match the inside?

Only one way to find out!

# I really think that we could make it, girl. #

Oh, well, it certainly wouldn't win first prize in a beauty contest.

It does need renovating.

A little bit tatty,

but you know, you could work wonders with the old paint, new carpet,

got a really nice-sized lounge and an incredibly small kitchen.

Come back in here. Now, have a look at this.

How disappointing is that?

But I think there may be a way to resolve that by simply knocking down this wall.

Then you can have a really nice open plan kitchen there,

diner here, big lovely family table.

I don't know what that is - I think it's some kind of cobbled-together lean-to.

Knock that down, big double doors here leading out to the garden,

then you've got yourselves a really nice family space.

That's what you've got to do to improve this floor plan.

# We all need somebody to lean on Lean on me... #

Mm! This lean-to is definitely for the heave-ho. Cheerio!

But with a bit of rejig, the ground floor here could work so much better.

Upstairs, there are three decent-sized bedrooms.

They could all do with a bit of a freshen-up,

and there's a family bathroom too.

If that's not enough space for you, come with me into the garden, as I have a cunning plan!

It's always worth taking a look at the neighbouring property.

Snooping on them can really pay off! What am I talking about?

Well, extensions!

As you can see, people along here have added extensions.

And so the all-important precedent has been set. Brilliant!

Now, will that involve submitting plans

and waiting weeks for the authorities to make a decision?

Well, you can avoid all that

if you keep within your permitted development rights.

You can extend a dwelling by four metres to the rear

if it's single-storey, or three metres if you do a double storey.

So no need for planning permission, which is great news.

There are height restrictions, of course,

so my advice is check with your local council

to make doubly sure you are within your permitted development rights

before starting any work.

You'd have to weigh up the costs the costs of extending

against the value you'd actually add, and that will come down

to what you're going to do with the place - let, sell, or move in.

But before you make this your forever home,

there's one more thing to consider.

Whenever I buy property, I always like to draw up a little list -

positives on one side of the page, negatives on the other.

Now the positive here is the station.

It's literally - look - just around the corner, so that is brilliant.

But a big negative - you're right opposite a builder's yard!

Handy if you're a roofer by trade.

MUSIC: "Roofing Tiles" by Galliano

The noise from lorries isn't ideal,

but otherwise this place has got plenty going for it.

Will a local property expert agree, though? Let's find out.

At the moment, in the current market,

I don't think it's advisable to extend the property.

What I would do is refurbish the property to a nice standard,

and then rent it out for a period of about a year,

then look at maybe doing some extensions once you've got some money back.

What could it fetch on the rental market?

With this property, it's ideal for rental, and I would expect it

to achieve round about £750-£800 per calendar month.

And if sold on?

I think if you were to modernise this house,

you should get in the region of about £160,000-£170,000.

And so it would seem creating an extension here

isn't really the way to go.

If you're looking to make money on this property,

the advice I would give is to spend as little as possible

and work within the confines of the current floor plan.

Let's see who fancied this one as we go to auction.

Lot 46, semi-detached, three bedrooms,

off-road parking to the front.

And what may I say? We've got a guide of 110 to 120. Start me at 110.

Thank you at £110,000, I have. And £110,000, I'm bid.

112, I'm bid and 14.

115. 115, don't mind. 118.

118, I'm bid. £118,000,

lady's bid. £118,000.

120, I'm bid. 122.

122, I have. 124.

124 is bid and 126. 125.

125 is bid and 126.

126, I have, and 127? No. 126, I am bid. 127, do I see?

127 in a fresh place. 128. And 129.

And 130. 132.

132, 134. 134 is bid. 135?

135. 36, if you're quick.

Selling for the first time at £135,000. You have seconds to decide.

For the second time at £135,000. Third and final... 136.

137. 137.

That's a definite no. I could even feel the vibrations up here!

At £137,000, then, for the first time, £137,000 for the second time.

£137,000. Third and final time. Are you all done? Sold at £137,000.

And your bidder's number, sir?

That successful bid of £137,000 came from Graham and his uncle Vic.

They both live 115 miles away in Berkshire.

Graham's a heating engineer, and his uncle Vic's a builder.

They bought this house along with Graham's wife, Kathy.

So what have they got planned here?

-Graham, congratulations.

-Thank you.

So tell me the story behind you purchasing this at auction.

I went there with myself and my uncle Vic, in partnership, and my wife as well,

sat down, the auction started, 44 properties got by

and on the 44th one we bought a property.

Missed out on one, of course, and bought the 46th property as well.

So hold on a minute - this was number 46 in the auction?

-This was 46, yes.

-But you bought number 44 as well?

-We did, yeah.

-What? Did you plan on buying two properties?

-Not really.

-What happened?

You bought number 44, loved it so much, you thought, "We'll do that again"?

We thought we'd got the hang of it, so we'd have another go, yeah!

So d'you think 137 is a bargain, or about the right price,

or you might have paid too much?

I think it's probably about right.

There's enough in it, I hope, for us to make a little bit of money on it.

We're not looking to make a big killing, because as you can see the property's...

there's not that much in it, but there's enough, I think.

But that said, Graham is still thinking about an extension.

On top of a new kitchen, bathroom, central heating system

and new double glazing, that's quite a lot to take on.

How are you going to improve the kitchen?

That is a bit of a negative. It's very small, very boxy.

How can you really make something of that?

We hope to make this room and the kitchen, take the wall out,

a kitchen diner.

It'll be so much nicer, and then you'll have a lot more light. What about the little conservatory?

If you don't extend, d'you think you'll just knock that down?

We might knock it down and open the doors up

to a nice sort of French doors going into the garden.

Uncle Vic will do the building work and Graham the plumbing.

What kind of budget do they have in mind for the whole renovation?

Well, we're sort of thinking of around, sort of like 20,

maybe 25 tops, on the budget for it.

So, should be OK, I think, yes.

So you think you'll be able to get an extension, and a new kitchen

and a new bathroom and the new windows and a new boiler, all for £20,000?

-I think, with my contacts, yes.

-Really?

So you think you can come in under 20 grand?

-20, 25.

-OK. 20, 25, 30!

-Maybe not.

This could be the right house just to come in, do a fantastic job,

structurally, leave it as it is, you know, tidy it up,

maybe just take a wall out, and I think maybe that might be sufficient for a property like this.

That might be exactly what we'll do. Could well be exactly what we'll do.

And like you say, maybe just a general tidy-up, decorate,

outside as well, tidy the gardens a little bit.

I mean, my boys do gardening, so I'm all right on that.

What d'you mean, your boys do gardening?

I've got three sons. Two are landscape gardeners.

Fantastic! Gosh, you know everyone! Everyone's going to be helping you out!

When you were saying about could we do it at that budget,

that's what I mean - I've got contacts. So we're very lucky.

So what about your timescale?

How long d'you think it's going to take you guys to really turn it around?

-In honesty, you're looking probably 6-8 weeks for this job.

-6-8 weeks!

I thought you was going to say months!

I'm in the building game myself. I do plumbing, heating and gas fitting.

Vic does everything else, probably.

And what we don't do ourselves, we just get people in, like the electrician.

And basically, that's why we thought this property will be

a nice little project for us.

Graham, good luck with this project.

I cannot wait to see what you do here. I hope it all goes really well.

-Thank you.

-Thank you.

To extend or not to extend - that is the question!

And it's a question even Graham isn't prepared to answer!

A 6-8 week timescale and a £20,000-£25,000 budget?

He's really going to be calling in some favours to achieve that!

But he seems confident.

Join me later in the programme to find out what happened.

Coming up - I'll be in Stoke getting into a spin over this staircase.

And boy, oh, boy! What a staircase it is.

Back in Ramsgate, there's been some friendly family rivalry.

Graham did this all on his own. No help from me.

-You can tell, can't you?

-HE LAUGHS

And in Whitehaven, has Karen's spending been kept under control?

I tried my best, but when she wants something, she really wants it, so I couldn't stop her getting it!

Let's return to Whitehaven in Cumbria

where this 3-bedroom house sold at auction for £65,000.

# Happy family... #

It was bought by Karen and her partner Peter who intended to make it their new family home.

# One big happy family, family... #

The house needed a lot of work

and Karen was already planning a high-end transformation.

-We've seen a nice kitchen and that was about six.

-Six what?

-Thousand.

-Oh, OK(!)

-That wasn't a good start!

That wasn't a good start so, we're like, "Oh!"

-You're going to blow your whole budget on the blooming kitchen!

-I know.

-Does she have expensive taste in everything?

-Just a bit, like!

Karen and Peter each have a child from previous relationships,

so they hoped this place, with its well-sized rooms

and fantastic garden, would make a child-friendly home.

But what have they done to it since we last saw them?

We caught up with them six months later to find out.

Although not quite finished, Karen's wish list has come good.

First, that budget-busting kitchen is looking very smart.

They've laid laminate flooring and opened up the door

between the lounge and the kitchen creating a bright and open space.

The bedroom walls have been replastered and painted

and there's just the carpeting to lay.

And Karen's wish list is complete with that whirlpool bath.

I've changed it around and took a cupboard out

and replaced it with a shower cubicle. I got the Jacuzzi bath I wanted.

A new toilet and sink that I wanted as well. Just redecorated it.

I'm pretty pleased with the outcome of the bathroom. I've happy I've got my bath that I wanted.

Of course, there are finishing touches in here to be done as well,

but it's already looking fresher and more modern.

As is the kitchen downstairs.

We've ripped all the ceilings down, ripped all the kitchen out.

We've basically just started from scratch, really,

and in the new kitchen the laminate flooring's down now,

and really happy with the result that we've got, to be honest.

This was the best kitchen that we could find.

It was Karen's choice, to be fair, like,

That's what she wanted, and I'm pleased with the effect of it

and how it looks now, so I'm very happy with it.

It will look even better down here when the final touches are added.

So will the new door through to the lounge, which is benefiting

from the extra space now that they've removed the fire and the shelves.

# Open up the door And let the good times in... #

Karen and Peter have used professional tradesmen for the electrics and plumbing.

But it's been all-hands-on-deck for them, their friends and family.

Well, to be honest, Peter's mam and stepdad's done most of it.

Yes, they have really, but we've done a lot of the painting, haven't we?

And our friends have helped.

-Our friends have come down and give us a hand painting.

-And helped Peter's family.

They've got a few weeks' work left before it's complete,

but it's still taken six months - two months longer than they originally thought.

The delay was caused by a plasterer letting them down.

That left us back a long time to get somebody else to finish the job really, to be fair.

We couldn't really do anything until that was done,

because we'd moved everything out to get it all done,

then that why we're just at this level now but since

we've got it finished plastered, it's come along a long way.

We haven't obviously managed to finish it but we're hoping in the next couple of weeks it will be.

We should be in really, to be honest.

-So we need to get moved in, don't we?

-Yeah!

So they didn't stick to their schedule, but what about the budget?

Originally they planned to spend £10,000 on all the work.

# Don't say that it's over... #

I'd say I've spent... I don't know!

-A bit over.

-About four grand over the budget.

-And I've still got a bit to spend, but...

-We're getting there.

-We'll get there!

Karen did warn us that she has expensive taste.

They've put a real effort into making this their perfect home,

even if all the little extras cost a bit more.

But did Peter ever try to keep her under control?

I tried my best, but when she wants something,

she really wants it, so I couldn't really stop her getting it.

What will two local property experts make of it? Let's find out!

I think the changes have been made to this property are very, very good

and very effective.

It's been modernised throughout now to a very good standard.

Work in progress, of course but I think so far, so good.

I think when they've finished the property,

it will be quite nice and done to quite a high standard.

There's good quality bathroom and kitchen fittings

and it's also ideally located for Whitehaven town centre.

The open-plan layout is very much in at the moment

for both houses and flats in the Whitehaven area.

These buyers are obviously doing it to live in

because the spec is much higher than perhaps an investor would...

the work an investor would carry out if he was buying it

to expose it to the rental market

so it's fairly obvious it's a home owner that's bought it.

Once the work's been finished in the house, what kind of price

do the experts think this property would resell for?

Remember, they bought it for £65,000

and will spend around 14,000 on the renovation.

So that's a total outlay here of approximately £79,000.

I think it would probably achieve a sales figure

in the region of £95,000.

Once the property is finished to a high standard,

I think they could achieve between £90,000-£95,000.

-Yeah, happy with that.

-Very happy with that.

-Yeah, I am, are you?

-Yeah, definitely.

-Yeah.

No wonder they're pleased. That would give them a fabulous profit

of £16,000, minus any fees and taxes, of course.

This may be a family home but would the success of this project

tempt them into buying, renovating and selling other properties?

-Yeah, it would tempt you.

-Possibly tempting, yes.

-Very tempting in fact.

-BOTH CHUCKLE

We'll get this one off the ground first I think before we do it.

Chill out a few years before I think of anything else like that.

Stoke-on-Trent is often simply known as Stoke

but its full name derives from an Old English word used to describe

a location for a meeting and sometimes worship.

So "Stoke-on-Trent" means "meeting place on the River Trent."

It's quite appropriate that I'm at that first place of meeting

and worship here.

This was where the first church in the area was built

by missionaries from Lindisfarne in 670.

That was originally built from wood.

In more recent times, this stone church was built in its place.

It's so significant that actually it's been made a minster.

Well, the property I'm here to see couldn't be much closer, really.

Literally just over there.

CHORAL SINGING

And this is it.

A three-storey office and retail premises right next to

the minster and in a great spot in the town centre.

So will this property ring my bell?

Well, it is certainly a substantial building.

And right in the centre of Stoke.

The guide price for the whole of this was just 50,000 quid,

so what have we got and why was it so cheap?

Well, here are the issues.

It's a commercial and office building at the moment

and we are in a conservation area which means that it has been

designated of significant historical or architectural interest.

Therefore any change of use or changes to the building itself

are going to be looked at very carefully by the planners.

So on the face of it, a great opportunity.

There might be some caveats to that but let's take a look round anyway.

Big, main area here. Obviously this was the main shop.

Let's look around the rest of the building.

Aside from this impressive, bright shop front downstairs,

there's also a kitchen and a large storeroom.

And remember there are also another two storeys above this one.

Let's hope you don't suffer from vertigo

because there's this amazing staircase to climb to get up there.

# Spiral staircase going down

# Paint your body red and brown. #

Well, by far the most exciting opportunity for me is found

when you go upstairs and boy, oh, boy, what a staircase it is.

This incredible spiral staircase right through the building here

linking the ground with the first and the second floors.

Now, this obviously throws up the opportunity of potentially

converting the whole building into flats.

If you could get the planning permission for that

and the conservation area approval and that kind of stuff,

would it be worth doing?

Well, you've certainly got the AREA to do it in terms of space.

They would be spectacular. But it's not cheap. These days,

building regulations, things like fireproofing,

soundproofing between the different flats...

It's an expensive process and before you even embark on it,

you need to do market research.

Is it worth it in this area? Is there a demand for it?

Figure those things out and then decide whether you'll do it or not

but in terms of space to do it in, fantastic.

There's obviously plenty of potential.

But is it as flats, offices or as a shop?

Let's see what the top floor has to offer.

# And I'm running up a spiral staircase

# I can't reach the top

# And there's nothing anybody can do

# To stop the staircase Like a giant corkscrew

# From spinning around

# And around and around. #

I still can't get over this staircase, it really is spectacular.

It'd make such a wonderful feature in any development

but it brings me to the top floor here.

Again, loads and loads of space.

I'd say enough for at least another two apartments here.

Not quite as good in terms of head height up here so there's probably

a bit more structural stuff you'll have to do

but really nice aspect. Probably put double glazing in

because there's going to be lots of noise from the road.

But, yeah, in terms of square footage, bangs for your buck.

£50,000 plus. A lot of property.

'What does a local property expert think?

'We asked one along to give us his opinion.'

It's a well located property,

in as much as it's on a very busy main road, it's a prominent location.

It has got versatility,

and can be used for a different number of commercial uses.

It's going to need, obviously, some reconfiguration of

the first and second floor,

but there is potential, certainly,

to create one or two bedroom apartments within the building.

'If the owner did convert the two upper stories into flats,

'and left the ground floor shop-front as is,

'what kind of rental return could they yield?'

The upper parts, where they've been converted into one or two bedroom

apartments, probably somewhere in the region between

£350-£375 per calendar month, something in that region.

'So, those are the rental prices.

'But what if the owner decided to sell it on, once the work was done?'

If it was all fully let,

and generating an income that was probably something in the region of

about £15,000 per year,

it should command a sale price of about £150,000 to £160,000.

Well, this place certainly has potential,

but a lot of effort to get it sorted out.

Is it going to be commercial, is it going to be flats? Who knows?

Well, it depends who bought it, let's find out who that was

when it went under the hammer.

What's this? 40 on this one.

35 then. 35 bid, thank you.

£35,000.

40, going to say now.

40, at £40,000.

45? At 40,000. 45.

Here go, 46. Yep, 46.

New bidder. £47,000.

48. 49.

At £49,000, seated.

49 and a half. 50.

Half.

At £50,000, and seated on the second row.

£50,000 seated, first time.

At £50,000, second time.

£50,000, third and final time.

Are we all done?

You bought it, sir. Well done.

'That final bid of £50,000 was made by Khaleem,

'on behalf of himself and his friend, Khurram.'

# It's just a little street

# Where old friends meet... #

'Khaleem owns and runs his own pharmacy.

'While Khurram is an estate agent.

'This is their first property venture together.

'I met up with them, to hear what they've got planned.'

-Khaleem, Khurram, lovely to meet you both.

-And yourself.

-Congratulations.

-Thank you very much.

Tell me why you wanted to buy this place.

The opportunity came up.

We've seen the guide price at £50,000,

done a bit of due diligence, and I thought,

"Well, it's got a huge amount of potential."

So, have you got experience of this kind of project?

Nothing to this scale. Done a couple of conversions already.

Luckily, my brother's an architect,

so we've got the right people to help guide me along the way.

Erm, we've done a couple of properties whereby

we've converted the houses into flats itself,

so this is the same sort of thing, just on a grander scale.

Right. OK.

So, what was it really that appealed about this building, then?

It was the opportunity of utilising both the office space,

so we've got some commercial there,

but we've also got the opportunity to convert three apartments.

Effectively gives us a nice little rental income really.

We're not looking to sell. More of a long-term investment for us.

So, tell me what you're going to do to the place.

On the ground floor, we're looking to,

obviously subject to planning permission,

looking to convert that into a one-bedroom apartment,

and retain the office space.

And on the first and second floor, two bed apartments.

Right, great, great size, they'll be at two beds, won't they?

-Yeah.

-Fantastic space.

And you talk about planning there, in passing,

but obviously that's going to be a big thing.

Yes, it is.

Have you made some preliminary enquiries?

-We are actually in the planning process at the moment.

-Oh, wow.

We should get a decision hopefully within the next 2-3 weeks.

Fingers crossed, that should go through.

Then hopefully within the next six months

this project should be completed.

'The friends have been quick off the mark to get

'the planning application in,

'so let's hope they don't have any trouble with it.

'They think the work will cost 35,000,

'which doesn't sound a lot,

'given that there are three flats to build here.'

Tell me exactly what you're going to get for your £35,000?

-You're looking at three kitchens, three bathrooms.

-Right.

You're looking at electrics, to be fair,

most of the electrics are up to regs.

-What about the staircase?

-It's a nice staircase, isn't it?

In all fairness, we're not sure if that's protected at the moment.

-You wouldn't want to change it anyway?

-Not really, no.

In all fairness.

-Our only concern is the fire regs.

-Ah.

That's our only issue. Other than that, it should be fine.

What kind of a look and feel are you going for the flats?

Relatively modern.

The kitchen, bathrooms, going to be nice and tidily...

We're going to be utilising the space, shall we say.

So what kind of involvement do you have sort of on an ongoing basis?

I am possibly going to be doing the day-to-day management,

getting all the tradespeople in, and so forth.

Making sure we drive the budget down as much as possible,

it would be nice to get down to 20,000 from that 35!

Pffff!

But we can try. We can try.

But no, I'll be doing the day-to-day management on the property.

What will your involvement be?

I'll just make sure he does the job properly!

-Congratulations to you. Good luck with it.

-Thank you very much.

Good luck with it. And in six months' time we will be back.

-Fingers crossed.

-Yeah, we should be done and dusted

and then hopefully got some tenants in place. That would be good.

-Something tells me you'll be successful. Well done.

-Thank you.

Well, it looks like the staircase is safe

as Khaleem and Khurrum start their plans,

or even continue their plans that have already started

to convert this place into flats with that shop at the front.

Still, can they really do this for just £35,000?

And will they get that all-important planning permission

and change of use? You can find out later in the show.

Well, if you want to profit from property, timing is crucial.

And you have to be flexible with your plans.

And not let time pass you by. Let's see how today's buyers got on.

Welcome back to Kent. Ramsgate, to be precise.

Earlier we saw Graham and his uncle Vic snap up this three-bedroom house at auction for 137,000.

# And no matter if we win or lose

# Gonna keep the family groove. #

'The pair both work in the building trade.

'But this was their first property venture together.

'They were certainly packing a lot into it.'

So you think you'd be able to get an extension and a new kitchen,

and a new bathroom, and the new windows and the new boiler, all for 20,000?

I think, eh, with my contacts, yeah, yeah.

Really? So you think you can come in under 20 grand?

-I'd...20, 25.

-OK.

-Yeah.

'And if keeping within that budget wasn't pressure enough,

'they gave themselves just eight weeks to do all the work.

'In fact, it's taken almost a year.'

# If you take your time

# You'll get what you want

# If you take your time

# Honey, you'll get just what you want

# So don't a-hurry me, worry me,

# Hurry me, take it easy, baby. #

Starting off, obviously we've redecorated.

We took the kitchen wall down, opened it up, made it open space.

Fitted a new kitchen. Re-tiled the bathroom.

And just generally tidied up everywhere.

New doors, lights, fittings and things like that.

# Take it easy, honey. #

OK, so the renovation is fairly standard,

but it's a clean, fresh makeover. Simple yet effective.

They've also given the garden a makeover.

Hm. But something seems to be missing out here.

Where's that extension they were going to build?

We had advice from an estate agent locally,

and, eh, basically we would have put it on and got no profit out of it at all. So we left that.

We just tidied up the little lean-to that's there now, basically.

New bits of glass, a coat of paint and a bit of a roof.

A wise move, then. Why spend money on an extension

that won't add any value to the property?

This is a business venture, after all.

And talking of money, how did they get on with that 20 grand budget?

Oh, yeah, the budget. Well, we would have gone up to about 20,000.

But we're scraping around the 16 mark at the moment,

which we're very happy with. You could spend 20.

You good put in better fitments, kitchens and things like that.

You know, there's not the money there for a conservatory,

so we doctored - I hate to say it, doctored - the old thing out there.

Not having to build that extension certainly helped to keep the budget under control.

But this uncle and nephew team also managed

to keep the labour costs to an absolute minimum.

Myself and Vic done all the work apart from fitting the new PC board.

We're not qualified electricians,

so we had a qualified electrician in to do that part.

A local guy, very good. Erm...

The rest of it we did ourselves, yeah.

I love doing kitchens as well, but Graham fitted all this on his own. No help from me.

You can tell, can't you?!

So, under budget.

But what happened to that eight-week timescale?

It sounds as though the 230-mile round trip from here

back to their homes in Berkshire, took its toll.

It's killed us a bit, like. You know, the time we get here,

er, do the day's work and then travel home,

er, it's a long day. That's probably why we've had quite a lot of holidays in between doing the work!

It is just an hour and three quarters, you know, minimum.

And that's leaving at...

..seven in the morning and getting here sort of quarter to nine.

You know, you're ready to eat by then. It is not good. Not good.

The time spent travelling between the house, their families

and other work commitments, may have prevented them

from being as full on with the work as they'd originally hoped.

But Graham reckons they weren't far off their original target.

Actual working time, yes, we have sort of done it.

I'd say two and a half months, three months, I suppose,

if you're going to count the actual days, yeah.

Now all that hard graft's done and the long drives are over,

does Vic think it's been worth it?

We reckon we will make a profit.

It won't be... There won't be no Rolls-Royces outside or anything

but I do think we could come out of it with a reasonable profit.

So let's find out whether two local property experts agree with him.

Wow, it's quite a transformation.

The chaps who were doing it

have obviously spent a lot of time and money

really bringing it up to a good standard.

They've put in really neutral decor which is excellent,

and of course, the new kitchens and bathrooms,

which are really both very good quality.

First impressions -

it's been refurbished to a good standard.

I like the downstairs,

the way the accommodation flows.

I would imagine it would be

of great interest to those that are looking in this area.

Good schools locally, good range of shops,

grammar school's particularly strong

so I'd think there'd be quite a lot of interest in the property.

I think this property's going to appeal to a family,

perhaps with two children.

It's got a nice garden with it

and it's close to all the local conveniences and all the local shops

so it's good for a family, I think.

Now it's all finished, how much could it be worth?

Remember,

they've spent £16,000 on the work

so including the £137,000 they paid for it at auction,

that's a total outlay of £153,000.

I think this property in current condition,

the way the market is at the moment,

you're probably going to be looking at around about £170,000.

I would think that we would be looking to achieve

offers in the region of £160,000-£165,000,

and I would suggest probably marketing just under the 170,000.

Well, I think that's low myself.

I think it's low. We've had somebody else.

They're...5,000, 10,000 higher than that.

-Yeah.

-And they're pretty confident, so we're quite happy with that.

The boys are hoping to get around 180,000 for the property

when they resell. They've already got another one lined up

for their next project

but this time round, they've made sure it's closer to home.

Now we travel back to Stoke-on-Trent,

where in the shadow of Stoke Minster

lay this three-storey office and retail premises.

It sold at auction for just £50,000 to Khurram and Khaleem,

two friends teaming up together for their first property venture.

# You and me, we are friends

# Friends right up till the end... #

What was it really that appealed about this building, then?

It was the opportunity of utilising both the office space,

so we've got some commercial there,

but also the opportunity to convert three apartments

effectively gives us a nice little rental income.

We're not looking to sell. It's more of a long-term investment for us.

This duo certainly had a clear plan in mind

but had challenges to face.

The front of the building was listed, so they knew

that any changes to the shop would be subject to planning approval

and of course, the £35,000 budget

for the three flats over the three storeys

was always going to be a challenge.

Let's catch up with them and see how they've fared.

A lot has happened since you were last here.

We've converted this commercial building

into three self-contained flats

and we're still going to retain the office space.

It's a simple but bright and modern conversion,

making great use of the floors

to create stylish living spaces.

But don't worry - even though that is a new staircase,

they haven't got rid of the beautiful old one.

It's still curling its way through the property.

So it looks like planning permission wasn't much of a problem, then -

or was it?

Planning was a slight issue.

There were a number of objections, mainly around the ground-floor flat.

We wanted to create, like, a studio apartment

but the planning wanted a bedroom on this

so Khurram decided in talks with the architect

to create a bedroom upstairs.

They didn't want to eat into the retail space on the ground floor,

so with some clever rejigging,

they managed to give the flat a bedroom.

We managed to form a creative solution

by creating this little stairway which leads upstairs. Basically,

we took a bedroom from the first-floor flat

and gave it to the ground-floor flat, which satisfies the planners' needs

and it's turned out quite well, in all honesty.

They've given it a fairly simple finish

but that's because they intend to let it all out

so they want to leave a blank canvas.

In fact, it won't be very long until the rooms are full.

As soon as the work started

we advertised the property available to let,

and we've already got two professionals

ready to occupy the top flat and the ground-floor flat.

There's still a lot of work to complete here,

especially on the ground-floor retail space.

It's still a bit of a building site at the moment,

but they hope to get this occupied soon too.

The intention is either for myself to come in

and utilise it as an estate agency

or second to that, we have had an offer

for a third party to come and use it.

They'd set aside 35 grand for all the work

but that still wasn't enough.

We've slightly gone over the budget

but that's mainly due to the building regulation side of things

and the way we've had to amend our initial plans

for planning permission.

However, we will be approximately £5,000 or £7,000 above budget.

# Hey, big spender... #

That's a total spend of around £40,000-£42,000

so bearing in mind that the place cost them 50,000,

that's quite a lot. Mind you,

there was a great deal to do here.

So to help decide whether it's been worth it,

we asked two local property experts

to take a look and give us their thoughts.

It's a very big place.

The owner's definitely had his work cut out refurbishing this property

and the finishes are OK.

'Each property has really good-sized rooms

'and this will help when trying to market an apartment

'because a lot of apartments have small rooms.

'The layout's quite good. It works.'

There's a central stairwell for all three apartments

and it does its job.

There's been quite a bit of work that's been done,

but there's obviously quite a bit of work left to do.

The standard of finish

is what I would expect for a property of this calibre

and this type of location.

The ground-floor shop obviously still needs a considerable amount of work

before that's going to be ready to be put on the open market to let.

Let's talk figures.

Once all the work's complete, what rental could they achieve?

First, for the two one-bedroom flats...

The one-bedroom apartments would rent at £350 per calendar month.

I would expect the one-bedroom apartment to be offered

for about £375 per calendar month.

And what about the one two-bedroom apartment upstairs?

The two-bedroom apartment would rent out for £395 per calendar month.

I would expect the two-bedroom apartment to be offered to the market

for somewhere between £395 per calendar month

to £425 per calendar month.

They're a lot lower than what we've actually achieved.

We've achieved a ceiling price of 425 on the top-floor flat,

which is the two-bedroom,

and the ground-floor flat, we're at 410,

so we've done well there.

And finally, what could they get for the retail space?

Having looked at the space, the location and what it can be used for,

I would expect that to be offered at around about £4,000 per annum.

The commercial premises would rent out at £5,000 per annum.

Basically, having done our sums beforehand, it's what we'd expected,

between the figure of 4,000, 5,000,

so we're happy with that.

Based on the experts' top figures,

that's an annual income of £19,700 -

an impressive yield of around 15%.

So a great return for the boys.

But have they enjoyed working on this project together?

It's been great, in all fairness. We've learned lots. We've enjoyed it.

Bit of a challenge here and there, but overall, I'd love to do it again.

Well, we'll have lots more great stories for you next time

here on Homes Under The Hammer.

-So join us then.

-Goodbye.

-Goodbye.

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