Episode 75 Homes Under the Hammer

Do you want to buy property at an auction

-but don't know where to start?

-Perhaps we can show you

-some tricks of the trade.

-Today we're going to be following buyers

who bought their homes under the hammer.

Auction houses aren't intimidating places.

Anyone can buy there. All you need is the money.

Yes, today we talk to some intrepid buyers who've taken the plunge.

Will they sink or swim? Here's what they bought.

'In sunny Torquay in Devon,

'it might be a bit dated and lacking in a few areas, but...'

I like this house, I do. It's got a really nice feel to it.

'Whereas on a trip to Ramsgate, Kent, I'm less than enamoured with the layout in this house.'

Oh, no! This is the bathroom!

'And I'm remaining positive when I check the lie of the land

'at a site in Stapleford, Nottinghamshire.'

It's flat, which is always a good start.

'All these properties have been sold at auctions

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

-Congratulations.

'Today I'm on the Riviera. The English Riviera, of course,

'in Torquay, South Devon.

'The area gets its glamorous name for a reason.

'It boasts glorious beaches, stunning seascapes

'and a very mild climate. It's even got palm trees!

'The property we're here to see is a mile away from the town centre

'in an area known as Tor.'

Architecture from the 1960s and 1970s

sometimes gets a bit of a bad rap and it's not always justified,

cos on occasion, it just works, and I think that's a case in point today

because this is the property I'm here to see.

It's built on this hill, and as you can see from the front,

lots and lots of glass to make the most of the views.

The guide price was 115,000 to 135,000 quid, three bedrooms, let's take a look.

'Geometric is perhaps the word for this type of design,

'although some might say boxy.'

# I guess it's just because you're so square

# Baby, I don't care #

'But it's a good, practical design

'and gets the most from the land it sits on.

'There's off-road parking and an integrated garage,

'which could possibly be turned into a living space.

'It can be accessed from the ground-floor hallway

'and then the accommodation actually starts on the first floor.'

Then up those stairs into this room here,

your lovely, big, open-plan living area.

Big window at the end. I don't like to see the glass in those lower panels.

To my mind, a bit of a safety hazard for sure, so do something about that.

Also feels a little bit 1970s with the interesting wallpaper.

But it's a nice-size space. And, you know, think about stripping the floorboards back

and it would be a really lovely room.

Maybe you could even bring in a sense of the seaside in there

with a bit of clever decoration.

Then a room which is a problem. This is supposed to be the kitchen and there isn't one.

Why is that a problem? Well, when it comes to getting a mortgage,

most mortgage companies insist that you have a working kitchen and bathroom,

so this means that currently this property is pretty much unmortgageable.

What some people do is put in a temporary kitchen to enable them to get a mortgage

and then rip it out afterwards. That is something you could do, but it's all added money.

But it is a blank canvas at the moment.

Again, lots of light coming in here, views out onto the rear garden.

Maybe some bi-fold doors in here to open that whole thing out.

Can you imagine that, big open gap here looking out into the garden? That would be lovely.

I like this house, I do. It's got a really nice feel to it.

'This whole place is a bit of a building site

'with rooms taken back to the shell.

'But it gives a good idea of what space is here

'and a real opportunity to change things around.

'Upstairs are the three bedrooms, one small bedroom at the front,

'a decent-size double beside it

'and then there's a third large one at the back.

'They all need a complete overhaul, including the electrics,

'heating and plastering. Oh, it's the lot.

'Then there's the family bathroom,

'which seems to have had the utilities dropped in rather than plumbed in.

'It also comes with a handy hole in the floor for talking to people below.

'Hm. Some work needed here, I think.'

So out to the rear of the property and a really nice surprise

because we are in quite a hilly part of Torquay here

and some of the houses do have very steeply-inclined gardens

which makes them quite difficult to maintain.

This one, though, you've got a nice bit of patio

and then a garden which isn't too steep, so usable space,

bit of a sun trap and an added bonus.

# When you think I've loved you

# All I can

# I'm gonna love you a little bit more #

'Well, I think this garden's got great potential,

'though it'll need a fair amount of effort to turn it into an attractive space.

'But overall, I really like this place. Despite its current state, it's got a lovely feel to it.

'What does the auctioneer who sold it make of what's on offer here?'

Complete shell of a property. It needs everything doing to it,

installation of a kitchen, a new bathroom would be required,

and modernisation and updating throughout.

The integral garage, it's quite common in this part to actually integrate that into accommodation

and make that into a further bedroom or utility area, so that's something I would consider.

'Undoubtedly, the house has plenty of room for improvement.

'But it was guided at £115,000 to £135,000.

'So would it be worth it on either the resale or rental markets?'

Once refurbished, it should be worth somewhere in the region of £170,000.

For rental, the property should fetch somewhere in the region of £600 to £650 per calendar month.

'To me, those figures definitely favour rentals as the way to maximise returns here.

'But done up, this house wouldn't just make a good investment,

'it could be a lovely home.'

Well, it's a good house in a very pleasant location,

not far from the sea, close to Torquay town centre and just a nice spot.

And not too complicated a renovation for whoever decided to take this one on.

Yes, bear in mind that it hasn't got a kitchen and the issues that throws up,

but apart from that, a good one to go for.

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

Lot number 123. So we're down to sunny Torquay,

three-bedroom mid-terrace, needs a bit of cheering up,

refurbishment, modernisation. OK, 120 I'll look for.

120 anywhere? At 120. 110.

Two hands at 110. I'll take you on the left, sir. At 112.

At 112. 114. 116. 116.

I'll take one, 117.

117 against you. 118. You're in at 118,000.

119. 119.

At 119,000 for the first time.

Serious stuff. At 119,000 for the second time.

At 199,000, third and final time.

Selling at 119 to your maiden bid. Congratulations, sir.

'So, for £119,000,

'the successful bidder, hidden behind the pillar, was David, who's based in the South West.

'He has previously owned and run hotels in the area as well as a coach company

'and while he's dabbled in property developing in the past,

'he's now looking at it as a full-time venture.

'I met him at the house to find out more.'

-David, good to meet you.

-Pleased to meet you.

-Congratulations.

-Thank you very much.

-I think you've done quite well, actually.

-So do I.

So, apart from the potential gains, tell me why you wanted to buy this place.

Rentals. That's the route I'm going for.

-What do you mean by that?

-Well, I've come out of the hotel business

over the last 12, 18 months

and now I think, for the rest of my life, building and rentals is the up and coming thing.

OK. What were you doing in the hotel trade?

Erm, that's where I started my life.

From the age of 13, I've been involved in it.

Then myself and my ex-wife bought hotels

and then we just expanded

and now I'm divorced, I've got to do something with my life.

-So a life change in lots of ways.

-Yeah.

-But you owned a hotel?

-Four.

-Four?

-Blimey!

-Newquay, Torquay, Bournemouth and the Isle of Wight.

-Right. What kind of hotels?

-All over 130 people, over 75 beds.

And we owned a very large coach company, as well.

-Gosh, you were kept busy, then.

-Very.

# Hotel

'David's clearly a man who likes to keep busy.

'He doesn't do things by half.

'He's already bought 13 other properties in the last year.'

-So why this particular house?

-Three bedrooms, lovely area.

The space, it's got plenty of space, and a garden.

-So you'd seen it, then, had you?

-Yes.

-You'd read the legal pack?

-No.

-Oh, come on!

-I've read enough legal packs in my life...

-Yeah, but they're all different!

-But there isn't a risk!

-What do you mean?

-It's a no-brainer!

-No, not necessarily! It could say all sorts of things!

No, it was all right. It was always going to be all right.

It's not a major risk and it's ended up as a good deal.

-Did you take such risks when you were running your hotels?

-Yes!

My solicitor's always told me not to buy things or not to do things.

But I always did. And I always came out right.

'Well, it does look as though David's emerged unscathed from this purchase,

'but I would always recommend you read the legal pack,

'otherwise you really don't know what kind of problems you could be letting yourself in for.

'So, having added property 14 to his portfolio, what's David's plan here?'

Well, as there is no kitchen, it's a new kitchen, so it's a blank canvas.

The bathroom, as you will see, is sat on the floor,

so the bathroom will be just completely refurbished top to bottom, tiled, everything.

The whole house will be completely rewired, re-plumbed, new boiler,

redecorated, made look tidy, made look good, garden, and that'll be it.

So what's the budget?

The budget was originally £130,000 done.

So as the house came in at 119, there's £11,000 there.

-So who does the work?

-I've had a group of builders around me

for many, many years.

I've got them all turning up, starting this afternoon.

-Oh, really?

-We're hoping to be in and out inside three weeks.

-Three weeks?

-Yeah.

-Kitchen, bathroom, total re...

Well, we have another project in Brixton, two more houses in Brixton,

doing an even bigger job than this

that will start in three week and one day.

MARTIN GULPS

And in terms of ambition for the portfolio,

-how many properties would you like to have?

-Well, this is number 14, I think.

-Right.

-I'm not trying to brag,

but I do like to think that by the end of next year,

-it'll be up to 30-plus.

-Really?

-And then I'll stop at that.

-And you obviously enjoy it.

-Oh, I love it. I mean, it's...

It's like, you start with a blank canvas and then afterwards you think, "Yeah."

Doing it this way, it's a very quick thing.

Doing it on a hotel, it could take five years, so you never get...

This one's a quick fix, we'll get the buzz of making something look really good.

-Listen, congratulations. Good luck with it.

-Thank you.

-Look forward to seeing how you get on.

-Thank you.

Well, despite breaking a few cardinal rules,

it looks like risk-taker Dave will come out on top again this time.

He's got a good property here. However, that £10,000 to £11,000 budget?

In three weeks? It could be tight. You can find out how he gets on later in the show.

'I'm on the Kent coast today in Ramsgate.'

Ramsgate started as a small fishing and farming hamlet.

The town now has one of the largest marinas on the English south coast.

And although fishing still goes on,

tourism is now the dominant local industry.

The property I'm here to see is just over half a mile away.

'So with the marina just a short walk away,

'a good range of shops, plus road and rail links,

'the property is in a pretty decent location.

'But the lack of parking and double yellow lines right outside

'might put some buyers off.'

Well, here it is, a terraced house.

Now, it may not seem that big on the outside,

but inside there's apparently four bedrooms arranged over four floors.

The guide price at auction was £75,000 to £80,000.

Let's go inside and take a closer look.

'I'm going in at first-floor level because this house goes down

'as well as up.'

So, what do we have on the inside? Well, lots of shades of brown.

It really does need a modern update. It's incredibly tired.

Bit of a dated fireplace. No central heating.

The floorboards are all a bit rickety.

Hm. And that's just the beginning.

'And it's the beginning of a rather odd layout

'with the back rooms reached by going along a corridor

'then stepping a few steps down.'

So this is the second reception room at the back of the property.

Fairly spacious with quite a small kitchen.

Now, this is just a little extension at the back.

I think I'd be inclined to think about taking this out

and opening this space up to have one large kitchen-diner.

Oh, no! This is the bathroom! There's no toilet.

If you can't fit it in upstairs,

I'm just thinking, it might be a possibility to put a wall here,

move the door along and potentially have an entrance into the bathroom round there on the stairs

so you don't have to come through the kitchen to get to the bathroom.

I think that's what I would try and do.

'Hm, it's not ideal, but it might be the best compromise.

'So onwards and upwards.

'And on a half-landing is that missing toilet.

'Further up on what I'd say is the second floor

'are two decent-sized double bedrooms.

'Then it's a climb to the top...'

# Be running up that hill

# Be running up that building

'..where there are two smaller bedrooms.

'Then finally a zoom back down to earth.'

Yes, this house is on many levels.

Now, this is the basement and in most cases,

basements are dark, damp and stinky.

And, yes, this totally fits all three.

You can even see through here the damp all coming in.

But the good news with this room is that it has its own independent access.

There's a doorway there so you could think about renting this out

to an independent person, they come down the stairs and through this little door here.

You've got quite a good space, although a bit of a low ceiling.

And it certainly needs a bit of decoration. I don't actually know what that says,

but I think it's some sort of Egyptian hieroglyphics. I'll leave that with you.

# Walk like a Egyptian #

'What to make of the signs? Are they good or bad?

'I'm not sure! Although there's certainly a lot of property

'for what was a £75,000 to £80,000 guide price.

'But it's like a series of rooms stacked one on top of another

'and there are an awful lot of stairs.

'But is there perhaps a hidden gem to be uncovered here?

'What does a local estate agent make of this four-storey terraced house?'

With this property, I think it really depends on

what you're looking to do with it. If you're looking to rent it out

then I wouldn't really change too much of the layout,

I'd just modernise it. If you're looking to sell it on,

then perhaps you'd want to change the layout considerably,

consider moving the bathroom upstairs,

maybe just changing the living room areas,

so there would be quite a lot to do.

'Whether to prepare it for the rental market or sell on

'will depend a lot on the potential returns.'

Very popular to rent and I would be expecting to achieve

£650 per calendar month.

With this property refurbished, we would be looking to put it on the market

at around about £130,000,

looking to achieve around about £125,000.

'To me, those figures suggest get it as a buy-to-let

'and you could be onto a winner.'

Well, this terrace may be tired and rundown

but it does offer a lot of space.

Four bedrooms and four floors, to be precise.

So who was tempted by this particular property?

Let's find out who bid and then bought it at auction.

Moving straight on, then, without any delay to lot 67.

Four-storey house. It says it needs some improvement.

Does somebody want to start me at 75,000? Jump in at 75?

75 sitting. 75. And 80. At 80.

And 5. 85.

85 with you standing.

90. 90 I have. 91.

92. 92.

And 3? 93. And 4?

94. 94,000. And 5. 95.

And 6. And 7. And 8.

Can I get 100? Get there first? 99?

99? Shaking his head.

At £98,000 I'm bid, then. 100 I'm looking for.

Are we all done at £98,000?

100 I've got. It's back with you, sir, sitting behind.

If we're all done at £100,000, I'm going to be selling.

For the first time at £100,000.

£100,000 for the second time.

If you're sure you're all done, for the third and final time at 100,000

-sitting down on the left.

-HAMMER BANGS

-It's yours, sir, for 100,000.

'So, for £100,000, 20 grand over the upper guide price,

'the successful bidder was London-based Roy.

'He bought the Ramsgate house along with his wife, Lynette.

'Roy's an electrician by trade, while Lynette's a nurse.

'I met them back at the property to find out more.'

Roy and Lynette, lovely to meet you. Congratulations.

So what spurred you on to want to buy this on auction day, Roy?

We've looked at a few largish properties.

This one seemed to suit the bill.

Lynette, did you know Roy was going to buy this that day?

No. No. I hadn't even seen this one,

cos he went off and saw some by himself,

and then he went off on the day and I just said,

"It's up to you, if you see something, go for it." I trust his judgement. So he did.

-Now you have seen it, are you happy?

-Yes, I think so.

It's certainly unusual. The layout's unusual, to say the least.

But I think it'll be good. There's lots to do and it's going to be a good project to get our teeth into.

And why have you done this? Is it to rent out? Is it to live in yourselves?

It's to rent out.

'They plan to keep this tall, skinny property as one house.

'They're going to renovate it completely, including, I'm glad to say,

'changing the entrance to the bathroom and adding a bathroom/toilet.'

Have you ever done anything like this before?

Yes, we've got a place across the road from us we done up and that was rented out.

But we said it was going to take a few weeks to do it up

and it took us about three months. LUCY LAUGHS

So, OK, how long do you think it's going to take you to renovate this place?

I'm guessing about three to four months.

And are you two going to be hands-on and doing a lot of the work?

-Yes.

-Yes.

-Have you got any helpers?

Yes. Our eldest son is a gas fitter and plumber

so he's going to come down and give us a hand.

And my eldest daughter's already volunteered our younger grandson.

So you've got lots of friends and family, that's fantastic news.

You want to get it done in three to four months.

The big question here is the budget.

Yes. I think about £15,000.

-I think.

-Could be more.

When he said £15,000, you sort of shook your head.

It'll be at least 20. Cos the biggest charges will be labour,

so that's where our greatest saving will come,

but I think you're looking probably at least 20.

'Well, I do agree with Lynette. £15,000 doesn't seem much

'when you take in the size of the property,

'even given the amount of family help they'll get.

'It seems to me that although this might be a joint venture,

'Lynette is really the project manager.'

-What's Lynette like to work with?

-She's a taskmaster.

SHE LAUGHS

Not at all. Not at all. As long as it's tidy.

-Is he not allowed to cut corners? Has he got to do it all properly?

-Hopefully.

I think he'll do it properly. He's very good at knocking things down and rebuilding things,

but it's the finish that I have to keep him up to standard with.

You can't just quickly do it, you've got to do it properly.

I can't wait to hear the grand total

and how much you do actually spend on it.

-Yeah.

-I've already got a folder and I've started putting the receipts in.

Good luck with the project. Take care. Thank you.

-Nice to meet you.

-Thank you, Lucy.

-Well done.

Well, Roy and Lynette sound like they've got it all sorted.

They're planning to rope in the kids and the grandkids

to help with the refurbishment work.

And then they can rent it out.

But will this family project go smoothly

or will there be a few problems along the way?

You can find out later on in the programme.

'Coming up, this plot of land in Stapleford, Nottinghamshire

'doesn't just offer an exciting opportunity.'

If you keep a tight rein on the budget, there's money to be made here, too.

'Back in the coastal port of Ramsgate, Kent,

'has Lynette found her inner artist?'

I love painting.

'But first, in Torquay, Devon,

'we find out what cost David dearly.'

The budget went clean out of the window.

'It was on the outskirts of Torquay in Devon

'that we came across this three-storey, three-bedroom mid-terraced townhouse.

'It lacked a few essential fittings, such as a kitchen and properly installed bathroom suite,

'plus there were signs throughout of work started but not finished.

'But it was light and airy and came with off-street parking

'and an integral garage.

'There were indications that, buried beneath the undergrowth, there was actually a good-size garden,

'so it looked as though it might make a promising purchase.

'It was snapped up for £119,000 by ex-hotelier turned developer David

'as property number 14 in his ever-growing portfolio.

'He didn't plan to hang around on this one.'

We're hoping to be in and out inside three weeks.

-Three weeks?

-Yeah.

-Kitchen, bathroom, total re...

Well, we have another project in Brixton,

which is two more houses in Brixton, doing an even bigger job than this,

that will start in three weeks and one day. MARTIN GULPS

'So, the race was on to get this house ready for the rental market.

'Armed with an £11,000 budget,

'his team of builders set about the task of refurbishing it.

'Now, just five weeks later, we're back with David

'to see if his team of builders beat the clock.

'Well, there's a much improved front drive

'with paving slabs jet-wash cleaned.

'But what about inside?

'Well, the entrance hall is now redecorated

'and the open-tread stairs have been re-carpeted.

'The lounge is a great improvement

'and I'm glad to see the low-level glass panes have gone.

'There's now central heating throughout.

'In the kitchen, or should I say kitchen space,

'well, that's now actually got a fully-fitted kitchen

'with integrated appliances. So far, so good.'

On day one, we started by trying to strip the wallpaper,

which was pretty simple, but that's not as simple as it sounds.

All the plaster in the whole house blew off the walls.

So it meant that every wall in this house

had to be stripped and then replastered.

'That wasn't what David was hoping for,

'but it doesn't seem to have held up his team much, judging by upstairs.

'With all three bedrooms undergoing complete refurbishment.

'That 70s decor is now definitely a thing of the past.

'And as for that bathroom where nothing was plumbed in,

'now it has a functioning suite and is tiled throughout.

'So, after the difficult start, inside seems to have progressed well.

'But then there was the garden.'

# Wild thing

'It's gone from wildly overgrown

'to much more manageable now.'

# Wild thing, I think I love you

# But I wanna know for sure #

The garden was a nightmare.

From the very beginning, you couldn't get past the bottom of the steps.

The plan was that at the end of the first day, we'd get most of it off. That didn't happen.

We didn't even get to the first tier. Then the next few days,

we left two people on it.

Eventually, decided to go the next level, which was the decking

and then the stone chips on the next tier and then turf on the top tier.

But there is still another 12 foot past the steps,

where the steps are at the top of the garden that one day,

when I've got a lorry and a digger driving past, I will have it cleared.

'The garden may have taken some taming,

'but it was certainly worth it.

'It gives the place that extra wow factor.

'But with all those unforeseen problems,

'surely the three-week timescale bit the dust.'

We had to be at the next project by three weeks exactly

and three weeks exactly it was.

We lost time with all the plastering and we lost time with the garden,

so it was still within and everybody was on the next job on the day that was expected.

They did work 12-hour days and they did work seven days a week.

But they had three days off rest and recuperation and a weekend in Newquay after it.

And then they were back on the Monday morning to the next job.

'That's pretty impressive.

'David clearly has a dedicated workforce.

'But there were surely some more man hours here and higher costs

'than he allowed for in his £11,000 budget.'

The budget went clean out of the window, as you can imagine.

There is change from £19,000, but not a lot.

A big lump of that was the garden

and everything that's been done has now been done to last.

There isn't anything in here that's been just papered over the cracks, it's properly done.

'A £19,000 spend on top of his £119,000 purchase price

'take David's total outlay to £138,000 without costs or fees.

'He may have done it on time, but will it meet the property market's requirements?'

Walking in here for the first time since it's been refurbished

is an amazing transformation. I love what he's done to it.

They've done a very good job. It's nice and neutral.

Big, spacious living area. The kitchen's nice and modern.

And also the garden, it's a nice, easily-maintained garden.

The garden is amazing. It's a bit of a secret garden. I never knew that amount of it existed

but he's opened it up and it's really friendly.

'David had always planned this as a rental property to add to his ever-increasing portfolio.

'But how would his £138,000 investment fare if sold?'

Putting the property up for sale, I would place it on the market

at somewhere in the region of £160,000.

If I was to put the property onto the market at the moment,

I'd probably be looking for a marketing price of between £145,000 and £150,000.

'That's a potential pre-tax profit of between £7,000 and £22,000.

'But it was rental that was always David's target market.'

On the rental market, you could achieve somewhere in the region of £700 per calendar month.

If we were to put it onto the rental market at the moment,

we'd be looking to achieve about £700 per calendar month.

It has been rented and it's going out tomorrow at £750,

and that was a local agent who's given a price and I said fine.

'Whoa! That's pretty impressive, to refurbish this property

'and rent it out in under five weeks.

'With £750 per calendar month income,

'David will see a decent yield of 6.5 percent.

'So is he pleased with the outcome of property number 14?'

It's just one of many. I mean, there's three more on the cards now.

So we've just got to keep going.

'With David's dogged determination to succeed,

'I've no doubt that he'll continue to lead a successful property-developing career.'

'Today I'm in Stapleford in Nottinghamshire.

'It's one of around 17 Staplefords in England.

'It's not just a popular name but a popular place to live,

'with easy access to nearby Nottingham, Derby and the M1 motorway network.

'You can trace the town's history back to before Norman times

'towards the end of the Dark Ages.

'But as we're about to find out, the future for property developing here certainly looks bright.'

Well, I'm pretty much in the centre of Stapleford,

but not to see a property.

Up for auction was a plot of land.

Had a guide price of 150,000 quid and this is it.

Well, you certainly can't knock the location. And at first view,

it's flat, which is always a good start. Let's have a look round.

'Flat, level, if a bit overgrown,

'this was previously the car park for a pub and now it's ripe for development.'

# Once there were parking lots

# Now it's all covered with flowers

# If this is paradise, I wish I had a lawnmower #

Now, if this was just a plot of land, it'd be worth, I don't know, just a few thousand pounds.

What made the guide price £150,000 was that the plot comes with planning permission.

So, what are they planning to put here?

Well, I, as if by magic, have some plans for the plot.

So here's the road in that I walked up

and we've got one pair of semi-detached properties

and then three linked properties here. So five properties in total.

I think, looking round the plot, there's certainly enough space here for that.

What's the design that they're going for?

Quite pleasant, as you can see. So, these are the linked properties and these are the semis.

All in all, some really interesting plans,

and I think if you keep a tight rein on the budget, there's money to be made here, too.

'All five houses will have three bedrooms and come with plenty of parking.

'And in case you're wondering, a linked property is essentially a detached house

'but joined to the next one by something like a garage.'

# Gonna get myself, I'm gonna get myself

# I'm gonna get myself connected #

'So, this site would have two semis and three linked detached houses.

'So far, so good.

'However, even when the plot is supposedly vacant land,

'it's always worth checking it out, and here the plot thickens.'

# Something ain't right #

Well, there's lots of things about this plot which are really ideal.

It's flat, it's got easy access to services and good road access.

However, I've just spotted a couple of flies in the ointment.

For a start, this is a garage. This isn't in with the lot that was sold,

so whatever you do here, you're going to have to give the owner to this garage a right of access.

So that's going to certainly limit your designs.

And if you come over this way, I've just also noticed

that there is a massive drop-off on this side of the site.

Now, I've got no idea what condition this bit of land is in,

and if it's crumbling away then this bit of land could equally crumble away in time,

so that wall there or whatever's underneath

is going to really have to be checked out by a structural engineer

and possibly shored up to provide good stability to the rest of this plot.

So a couple of problems.

Not insurmountable, but definitely need to be considered.

'So, although this bit of land isn't part of the plot,

'it is uncomfortably close and may affect the foundations needed for the new builds.

'Despite that, I still think this plot offers a great opportunity for the right developer.

'We asked a local property expert to look around

'and see if she thinks a residential development in this area

'is a good idea.'

Good plot, good sizeable plot,

should do well with some residential properties,

certainly three to four-bedrooms there's a limited amount of properties available.

'How much could these houses command on the resale market?'

I would imagine the semi-detached properties would fetch

in the region of £160,000

and the detached properties in the region of £175,000.

'That's a potential resale value for the whole site of £845,000.

'But what about rental?'

From a rental, semi-detached properties would fetch

somewhere in the region of £650 per calendar month.

The detached would probably fetch in the region of £700 to £750 per calendar month.

So, a sizable plot, this one. Probably not for a first-time developer.

But stick to the budget, be very careful on what you build,

as in, will it sell in this locality?

And I think there's money to be made.

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

Lot 64 is a residential redevelopment site

with detailed consent for five houses.

Who's got 150 to start on guide?

150? 150,000. Thank you.

151 somewhere? 151 I have.

152. 153 is bid. 153.

154. 155.

156. 157.

157,000. 58.

159. 160.

161. 161.

162? 162. 163?

163.

163,000. 164.

165.

166. 167.

168. 169.

170. 71.

72. 173.

174.

175. 76?

At £175,000, we're selling it.

For the first time at 175.

For the second time at 175.

-Third and last chance.

-HAMMER BANGS

It's yours, sir. Thank you. £175,000.

The successful bid of £175,000,

'£25,000 over the guide price,

'was made by David and Diana.

'This developing duo have properties in the UK, Spain and Florida.

'Although technically retired,

'they just can't help getting involved in new projects.'

# Can't help myself #

'They bought this development site in partnership with local builder Mick.

'I met them at their new purchase to find out more.'

-David, Diana, lovely to meet you. Congratulations.

-Thank you.

-Nice bit of scrub land you've bought yourself here.

-Yes, we like a nice brush.

So talk me through the plans for the plot, then.

OK, it came with planning permission, but they were five linked houses.

We'd like to think that on a site like this,

we can get a little bit more return on it by making them detached.

We've now come up with a plan where there are a pair of semis

and three four-bed detached, which should raise another £30,000 to £40,000 income off the plot

-compared to the other plans.

-So just show me the plans and talk me through it.

-OK.

-There's the basic plans.

-So that's orientated like we're standing.

This is correct. Now, behind us, we've got the pair of semis, directly behind us,

there is a four-bed in the corner, a four-bed over there detached

and a four-bed there detached with a large turn-in/parking area in front

-with the access road coming up there.

-Let's talk about profit.

-OK.

-What are you going to sell them for?

-Right.

The profit line, when all are sold, is around about the £300,000 mark.

Right. So taking in the build costs and the cost of the land,

-having done it all, you walk away with 300 grand.

-Correct.

The project that we've just done, that's the figure we walked away with.

-Right. So there's money in development still.

-I think there is.

'They'll only see that level of profit

'if they sell all five properties they build here

'and stick to their proposed budget

'of £455,000 to £475,000 to build them all.

'Of course, this is a partnership with their builder, Mick, so the profit will be split.'

-Who does the work then, Diana?

-Our partner, Michael,

is the project manager.

Dave's very busy on the finance side,

keeping Mick in check with what he's paying out, et cetera.

So, you know, they both contribute.

50/50, I would say.

Right. And the whole thing is a joint venture.

Yeah, that's the way we've gone, 50/50. I finance it,

Mick project-manages it, and it's as simple as that.

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

-Sitting in the sun.

-Do you?

We've got a place in Spain and we spend a lot of time there now,

more time than probably here.

-We've also got villas in America that we go five, six weeks of the year to.

-Great.

And then you come back in the summer months, presumably,

-to do the building?

-No, because Michael does the building work

and as long as I'm on the internet, I can do the accounting side of it.

So let me get this right, you are in Florida or in Spain,

-in the sunshine, by the pool, connected to the wireless internet...

-Correct.

-..while Michael is here...

-Working hard.

-..digging and plastering and painting

-and shouting at people.

-Yes.

-Right. You've got this well sussed.

Yes. But I can't do it without him

and he can't do it without me. It's as simple as that.

'Well, that's true. Mick needs David's financial input to get the project off the ground.

'But with the plots now bought, it's very much down to him to deliver,

'so I thought I'd catch up with the man who's actually going to get the five houses built.'

Hi! Good to see you! All right?

So, it's your job to make all this happen, then.

Yes. I'm here, the technical guy, as you'd like to put it,

and project-managing, I'll sort the whole job out.

Right. So what do you think about the plot?

Erm, it's not a bad plot. It's nice and flat, nice and level.

We've got a little bit of a problem behind us

where we've got to construct quite a considerable retaining wall,

but can't see any major problems.

At what point do you get involved in the design for what's going to come on here?

I come in straight at day one.

I'm already talking to the architect.

You know, tweaking plots here and there,

trying to get the best out of the site.

While you're slaving away, Dave and Diana are by the pool.

They are, yeah. Yes, that's the cross I have to bear.

You seem remarkably OK about that.

-I have to be. I have to be.

-MARTIN LAUGHS

Although, he's a great guy

-and, you know, we get on well.

-Right.

-We're not just partners, we're big mates.

-Great. Good. That's what you need.

-Good luck. Congratulations.

-OK.

-I'll leave you to get on!

-Thank you.

Well, times are still tough in the property-developing world,

but it just goes to show, if you get the numbers right,

you buy the land for the right amount of money

and you're very careful with your budget, there is still money to be made.

How will they get on with this exciting development project?

You can find out later in the show.

It's been many months now since we last saw those properties.

So have the renovations been plain sailing or bumpy rides?

Let's go back and find out.

'Ramsgate in Kent was where we found a rather interesting mid-terraced house.

'Just a short distance from the town centre,

'this property was a bit of a muddle.

'Spread over four floors, it had four bedrooms,

'a basement, a front reception room on the first floor,

'and at the back, a dining area, kitchen and bathroom without a toilet,

'all in a higgledy-piggledy layout.

'With signs of damp and no available parking, this wasn't going to be everyone's cup of tea.

'But London-based couple Roy and Lynette

'saw more ups than downs here

'and bought it at auction for £100,000 as a buy-to-let.

'Lynette's a nurse while Roy's an electrician.

'This was to be their third renovation project.'

It's certainly unusual. The layout's unusual, to say the least.

But I think it'll be good. There's lots to do and it's going to be a good project to get our teeth into.

The big question here is the budget.

Yes, I think about £15,000.

-When he said £15,000, you sort of shook your head.

-It'll be at least 20.

'Well, a slight difference of opinion.

'They were hoping that with additional help from family members,

'they could turn this around in three to four months.

'Now, four and a half months later, we return to see how Lynette and Roy got on.

'Encouraging signs from the outside with fresh paintwork on the house

'and the railings. What about inside?

'Well, the first floor front reception room is still a work in progress,

'but the stairs and access to the kitchen have now been redecorated and carpeted.

'And that confusing back room area?

'Well, that's better!

'Now there's a great kitchen-diner

'and the entrance to the bathroom has been moved at right-angles

'to fit in a much-improved bathroom.

'Complete with toilet! So how did they manage to get all this in?'

Well, the major thing was knocking this room through,

this was like a little dining area,

and this lean-to was originally the kitchen.

Knocked all that through, put a reinforced beam in up above to take the weight.

'The bathroom's extended and we now have a three-piece suite in the bathroom, which is much better.

You've got room to have a little table in here if you want to have family meals in here.

And it flows better as a unit, rather than cramping through a little door in the back area.

'Well, they've certainly maximised the space they had here.

'Upstairs, and on the landing, the now additional toilet and basin area

'have been upgraded.

'The two bedrooms on the second floor have had a total makeover,

'with new carpets, paintwork and central heating.

'Of course, as a qualified electrician, Roy's put new electrics in throughout.

'On the top floor, the other two bedrooms are also finished

'and there's not a patch of magnolia in sight. Hurray!

'But what about the basement room with its unusual Egyptian hieroglyphics?

'Well, they've definitely been consigned to the past

'and the room's been sealed with damp-resistant plaster and paint.

'But how did they get on with unearthing this four-storey residence?'

It's been stressful, but it's also been fun. I love painting.

I'm quite happy to put the radio on, Radio 2, and paint.

I'm not very good at it, but I can paint and I enjoy that

and my husband does all bricks and mortar and the nitty-gritty of it.

And my daughter and the family came down and helped strip wallpaper.

My son did the central heating, a friend of his did the kitchen and fitting.

'So with their son, a qualified plumber, and Roy, an electrician,

'along with the help from family and friends and the radio,

'the couple have nearly finished refurbishing from top to bottom.

'They hope to complete the remaining jobs in under two weeks

'and that's not a moment too soon.'

Well, within days of buying the property,

my daughter said her daughter, my granddaughter,

had a friend who was thinking of relocating to this area,

and once she'd been down and seen the property,

decided it was exactly what she wanted and she couldn't wait to get in.

So within days of buying it, before we even started work, I think, we got a tenant.

'Well, that's a fantastic incentive to start any property project.

'In fact, the soon-to-be tenants helped with the decoration work

'and had a say on the colours. But they have overrun a bit.

'So with Lynette saying it would cost £20,000

'and Roy £15,000 to do the work, who was right on the money?'

Roy was actually right about the money, I think.

I sat and did the calculations.

We haven't quite finished yet, there's a few more incidental prices to come in,

like there's a minor roof repair that needs doing.

I think it's around about 15. 14,000, 15,000 total, so it's not bad.

'A £15,000 spend

'on top of their £100,000 purchase price

'will take their total to £115,000 without tax and fees.

'So have they got the most out of this property?

'What do two local estate agents think?'

I think the quirky layout is very appealing.

I think it suits the house.

People will either love it or hate it.

It's been very well modernised throughout.

Also, looking at the position of the property,

walking distance into the high street,

and you've also got the speed link at Ramsgate,

so you've got the high-speed train link into London, it's a very good area to invest in.

'Well, this was always intended as a buy-to-let.

'But would the couple make any money

'if they sold their £115,000 investment?'

I would expect the property to achieve around £160,000 to £165,000.

If we were to put the property up for sale today,

we'd look at putting it on for £150,000 to £155,000.

I think, for the area, it's not too bad.

-It's higher than I expected.

-It'd be nice to be a bit more, but that's not bad.

'That's a potential pre-tax profit of between £35,000 and £50,000. Not bad.

'But this property has already been rented out. Did they get the best possible rental return?'

I would expect it to achieve around £750 per calendar month.

If we were looking at putting the property onto the rental market,

it would be in the region of £700 to £750 per calendar month.

Well, we've beaten that, so we're all right.

We've got more than that already, so, yeah, we're happy.

'Result! With rent in excess of £750 per calendar month,

'that would generate a healthy yield of over eight percent.

'Are they pleased with that?'

-Yes.

-Very much, yeah. Been good fun.

'In the small town of Stapleford, just outside Nottingham,

'we came across a very interesting development opportunity.

'A plot of land with planning permission to build five three-bedroom houses.

'Although the new-build market has had a difficult time in recent years,

'experienced developers David and Diana,

'along with business partner Mick,

'thought they could make this one work for them with a little tweaking of the plans.'

The original plan was five linked houses

and what we wanted to do was to get more out of the plot than we could with those profit-wise,

so what we've intended doing is very similar

but we want to put a pair of semis

and three four-bed detached on the site so it should bring in more income.

'Having bought the site for £175,000,

'they hoped to construct the five houses in about a year

'on a budget of £455,000 to £475,000.

'When I say they, in fact, it was going to be down to Mick to oversee the construction

'while David and Diana soaked up the sun

'at one of their properties in Spain or Florida.'

While you're slaving away, Dave and Diana are by the pool.

They are, yeah. Yes, that's the cross I have to bear.

You seem remarkably OK about that.

I have to be. I have to be.

'So, while the pool beckoned for David and Diana,

'Mick waited for the green light from the planners

'so he could crack on with the revised build plans.

'Well, 13 months later, we're back.

'Where once there was just scrub land,

'a small housing development has sprung up and it's just as they planned.

'With five houses consisting of two three-bed semi-detached properties

'and three detached four-bed houses.

'They look pretty good from the outside, but what about inside?'

OK, this is one of the semis.

We've fitted nice kitchens in all of them.

The semis are identical. And we have all the fittings.

We've got dishwasher, fridge-freezer, obviously hob and the extractors.

And all nice fittings.

And we've got carpets coming in this area.

And in actual fact, the good thing is,

we've sold one of the two already.

'Apart from a different colour scheme in the kitchen,

'the two semi-detached houses have the same layout

'with three bedrooms upstairs.

'There's a master bedroom with an en suite

'and two smaller doubles.

'There's also a family bathroom and a reasonable garden plot to the rear.

'What about the three larger four-bed detached properties?'

We're now in one of the three detached.

Every one is a different style.

In the kitchen, we've got it all tiled and it's all laid out nicely.

We've got a downstairs toilet,

laminate flooring going down in the hall,

nice stairs going up there and a massive big lounge.

And once again, this is the biggest and this is sold.

'Although slightly different, all the detached properties have,

'like this one, a large kitchen.

'And four bedrooms, a master bedroom with en suite shower room...

'..and three other bedrooms.

'Plus a family bathroom.

'Although they're six weeks away from completing the houses,

'they've managed to sell two already

'with a third one in negotiation.

'How did they divide their time working on this development?'

Michael has been on site all the time

whilst me and my darling wife have been in Spain or other parts of the country.

And we've been working over there, because I've been doing all the financial side,

paying the account and actually financing the project, so it's worked out well.

Oh, I think the partnership works quite well.

Dave keeps out of my way and I keep out of his,

which has obviously got to be, you know, a perfect partnership.

# Hey, you

# Get off of my cloud #

'It seems they've found a working relationship that maximises all their skills.

'That's just as well, as it's not just the five houses they've ended up building in this location.'

Whilst we've been building on here, we bought this land from the owners of the pub directly behind this,

and what we've done is we've approached them,

we've actually bought the pub from them and we've got planning for ten apartments

which we've actually started, it's in the process

and we should, within the next 12 months, have completed that.

'Goodness! They have been busy.

'But this level of development takes some investment

'and at present, David reckons the total cost

'of building the five houses, including the purchase of the land,

'is £640,000.

'But have they built the right type of houses for the area?

'What do two local estate agents think?'

Obviously, they're all individually designed,

so not one of them is the same, which is great, you've got a choice.

It's great how they've all been set out.

Lovely quiet cul-de-sac location.

It's going to be really popular. No through roads, lots of parking.

Allocated parking around here is particularly of a shortage,

so that'll be a benefit for any buyers.

'This has always been a resale project for the trio.

'They want to get their money out so they can move onto other opportunities.

'So, with a total of £640,000 invested here,

'could they see a healthy return for over 13 months' work?'

I'd value this four-bed detached at £230,000

and I'd value the three-bedroom semi at £150,000.

The four-bed detached I would value at £210,000 to £220,000

and the three-bed semi I would value at £130,000 to £150,000.

'Those figures could see a pre-tax profit of between £270,000 and £350,000

'if they manage to sell all the houses.

'So what do they think of those valuations?'

-Spot on.

-We're happy with the valuations.

-Yeah.

-Definitely.

'In fact, they sold one of the detached houses

'for just over £227,000

'and one of the semis for £148,000.

'So they're well on their way to making this development pay.

'Of course, they're already onto the next one,

'so is this business partnership here to stay?'

-I hope so.

-Yep.

-Exactly the same, it's working well up to now.

-Two years, it's the second project and we're going onto the third.

-Yeah, definitely.

We'll be back next time with more thrills and spills from the auction room.

-Yes, make sure you join us then for more Homes Under The Hammer.

-Goodbye.

-Goodbye.

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