0:00:02 > 0:00:07Hello. In today's challenging market, could you hack it in the world of property?
0:00:07 > 0:00:11- And if you get it right, it's such an exciting way to earn money.- Yes.
0:00:11 > 0:00:15It can be very rewarding buying your home under the hammer.
0:00:40 > 0:00:45There are tense moments in the auction room. Who will make the right bid at the right price?
0:00:45 > 0:00:50Yes, property can change people's fortune for better and worse.
0:00:50 > 0:00:54So what inspired the people who bought on today's show?
0:00:55 > 0:01:01On a trip to Chatham in Kent, I appear to have stepped back in time.
0:01:01 > 0:01:05It's not been decorated since the '80s.
0:01:05 > 0:01:10Whereas in Staffordshire, it's time to salute the humble building block.
0:01:10 > 0:01:15Thank you, Staffordshire or Stoke-on-Trent bricks.
0:01:15 > 0:01:21And in County Durham there are things inside this house that really aren't great.
0:01:21 > 0:01:25I've got a horrible feeling it's not going to get better outside.
0:01:25 > 0:01:31All these properties have been sold at auctions and we'll find out who bought them and what they paid
0:01:31 > 0:01:36- when they went under the hammer. - Your lot, sir. Well done.
0:01:39 > 0:01:43I've come to the Kent town of Chatham.
0:01:48 > 0:01:53Situated on the River Medway, its naval dockyards date back to the 16th century.
0:01:53 > 0:01:59The refurbishment of the waterfront has transformed the local area and brought it bang up to date.
0:02:01 > 0:02:05I'm here to see a house that was built in the 1950s,
0:02:05 > 0:02:10around the same time as the Queen's Coronation and at the end of food rationing in Britain.
0:02:10 > 0:02:17A time of celebration and when house builders favoured generous proportions and large plots.
0:02:17 > 0:02:19Can you tell I'm a fan of the era?
0:02:19 > 0:02:24So what is the guide for this sizeable three-bedroom property?
0:02:24 > 0:02:27£110,000-£120,000.
0:02:27 > 0:02:31# Lost in the '50s tonight... #
0:02:33 > 0:02:40'On closer examination, this house might be a bit lost. It certainly needs some sprucing up,
0:02:40 > 0:02:44'but has plus points like a garage and double glazing.'
0:02:45 > 0:02:53You know, porches are really good when it's cold. They keep such a lot of the freezing wind out in winter.
0:02:53 > 0:02:58Now this is in dire need of a major facelift here.
0:02:58 > 0:03:02I don't think this place has been decorated since the '80s,
0:03:02 > 0:03:09but I'm looking beyond these very dated brown doors in this sad timewarp of a kitchen
0:03:09 > 0:03:13and I'm imagining a crisp, clean, contemporary home for somebody.
0:03:13 > 0:03:19OK, so you don't get the old architectural features in here, but the trade-off is space.
0:03:19 > 0:03:21And we all want more of that.
0:03:21 > 0:03:27'The conservatory off the kitchen is a bonus, but the layout is rather convoluted.
0:03:27 > 0:03:32'Having to access the living room from the kitchen is not ideal.
0:03:32 > 0:03:36'The downstairs area of this house is begging to be reconfigured.'
0:03:39 > 0:03:44I think you really need to clear this house of its furniture before you can see what it's like.
0:03:44 > 0:03:48You could think about potentially knocking this wall down
0:03:48 > 0:03:53and really opening up the kitchen, using this area as a dining room,
0:03:53 > 0:03:58but you've got the additional space of this little conservatory at the back.
0:03:58 > 0:04:05OK, it's got a flat roof. You always get a few problems with flat-roofed conservatories.
0:04:05 > 0:04:10There may have been a leak. Somebody's been poking around up there to have a look.
0:04:10 > 0:04:16So it's advisable to get somebody in to have a look at the roof, but I look at it as a bonus room.
0:04:16 > 0:04:21It's lovely and spacious with a fantastic view out to the garden,
0:04:21 > 0:04:27but single-glazed windows, I think they're rotten, so I'd take the whole front out.
0:04:27 > 0:04:33You could replace it with some nice bi-folding doors or even big French doors.
0:04:33 > 0:04:36Imagine how nice it would be here in summer. Fantastic.
0:04:36 > 0:04:41'But before you get carried away, the roof required urgent attention.'
0:04:41 > 0:04:45# When the weatherman brings the rain
0:04:45 > 0:04:49# I have found my winter coat again... #
0:04:49 > 0:04:55'But it's not just the flat roof of the conservatory. There are signs of damp at the front as well.'
0:04:55 > 0:05:01Whenever I view a property, I always make it my business to look up.
0:05:01 > 0:05:04Just have a look at the guttering and downpipes.
0:05:04 > 0:05:08If they're cracked or blocked, it can cause no end of problems,
0:05:08 > 0:05:14so factor them into your budget. They're often overlooked, but are so important.
0:05:14 > 0:05:17This house most definitely requires some new guttering.
0:05:17 > 0:05:21If I took this house on, it would be on the top of my "to do" list.
0:05:27 > 0:05:31'Thankfully, there doesn't seem much to add to that list upstairs.
0:05:31 > 0:05:37'The layout of this semi is fairly standard for its era and type,
0:05:37 > 0:05:40'with two double bedrooms
0:05:42 > 0:05:49'and a single bedroom. Even with all this furniture and wardrobes, there's plenty of room.
0:05:49 > 0:05:53'It is going to need redecorating, but you would expect that.
0:05:53 > 0:05:58'Of course, you wouldn't normally expect to have to clear out furniture.
0:05:58 > 0:06:03'And something else for that "to do" list is the bathroom.
0:06:04 > 0:06:07'That needs a total overhaul.
0:06:09 > 0:06:16'With major reconfiguration, roofing, guttering, a new kitchen and bathroom, that list gets long.
0:06:16 > 0:06:21'With all that to think about, did the guide price of £110,000-£120,000
0:06:21 > 0:06:26'make this house from the Fabulous Fifties nifty? Or not?
0:06:26 > 0:06:29'What does a local estate agent make of it?'
0:06:29 > 0:06:32It's predominantly a residential area
0:06:32 > 0:06:37with fantastic links to the M2 and M20 motorways.
0:06:37 > 0:06:41I like that it's a corner plot with the garage to the side.
0:06:41 > 0:06:46They are good-sized rooms with a conservatory off the back.
0:06:46 > 0:06:53- It would appeal to a family.- 'Let's discuss figures. Once done up, how much could a buy-to-let investor
0:06:53 > 0:06:55'achieve here?'
0:06:55 > 0:06:57The rental market is very buoyant.
0:06:57 > 0:07:02I do believe that we would achieve approximately £800 per calendar month.
0:07:02 > 0:07:06'And what could it be worth after a full makeover?'
0:07:06 > 0:07:13In the current marker conditions, I do believe the property will achieve approximately £160,000.
0:07:13 > 0:07:18I'm worried this could turn into a bit of a money pit,
0:07:18 > 0:07:22but the bones are here, so jus keep to a strict budget
0:07:22 > 0:07:27and then somebody could make a healthy profit. Who wanted this at auction?
0:07:27 > 0:07:32Lot 30 we go to now, which is a three-bedroom semi for improvement.
0:07:32 > 0:07:36I'll take 100 to start me. £100,000. I'm on the way.
0:07:36 > 0:07:41And 10 now do I see? We all know it's worth it. 110 at the back.
0:07:41 > 0:07:46115 do I see? 115 I have. 118 against you now at the back.
0:07:46 > 0:07:48118 bid I've got. 120?
0:07:48 > 0:07:53120 can I say? 120, I'm obliged. 122 now. It's against you.
0:07:53 > 0:07:56120,000 in the middle of the room.
0:07:56 > 0:08:00122 I'm looking for. 122. 124?
0:08:00 > 0:08:03123. 124.
0:08:03 > 0:08:07124, can I say? Yes, 125. And 5.
0:08:07 > 0:08:11125. And 6. 126? No?
0:08:11 > 0:08:17At 125,000, standing again, I will sell for the first time. £125,000 for the second time.
0:08:17 > 0:08:22Third and final time at £125,000. Are we all done?
0:08:22 > 0:08:28'While the successful bidder Bob kept his cool, his wife Christine is a lot more excited.
0:08:28 > 0:08:35'They live 25 miles away. Bob owns a printing business where his son, Nigel,
0:08:35 > 0:08:39'started his printing career before being headhunted by another company.
0:08:39 > 0:08:44'I met Bob and Nigel at the property to hear about their plans.'
0:08:45 > 0:08:51- Guys, congratulations. I bet you are so happy you got this. - Yes, we certainly are.
0:08:51 > 0:08:57- Bob, you were at the auction.- I was. - What was that like for you? - It was very good, very exciting.
0:08:57 > 0:09:01I was there with my wife, Christine. We've viewed the house before.
0:09:01 > 0:09:07Unfortunately, we didn't have time to view inside, but now we have actually purchased it,
0:09:07 > 0:09:15- we are pleased.- So, Nigel, what did you think when your dad spent that amount and he'd not seen inside?
0:09:15 > 0:09:21I was a little bit surprised. They've always bought commercial properties.
0:09:21 > 0:09:26I've been inspired by your programme and I've always wanted to have a go.
0:09:26 > 0:09:33Dad's had an accident in the past and I've taken over looking after the commercial side
0:09:33 > 0:09:38- of his portfolio, in a way. - Bob, what happened to your leg?
0:09:38 > 0:09:40I had an industrial accident.
0:09:40 > 0:09:48And there were a few complications afterwards and so I needed several operations to correct it,
0:09:48 > 0:09:51particularly the alignment of the lower part.
0:09:51 > 0:09:58Bob was out of action for quite some time and relied on his son, Nigel, heavily during that period.
0:09:59 > 0:10:04A few months ago, I had a frame around my leg. At 5 o'clock in the morning,
0:10:04 > 0:10:11before he set off for work in London, he was tapping on the door to alter it to straighten the leg.
0:10:11 > 0:10:17And at ten o'clock at night, he'd finished his work from five until ten in the evening,
0:10:17 > 0:10:24back in again at the family home to make sure everything was fine. You can't ask for any more.
0:10:24 > 0:10:26I can't ask for any more.
0:10:26 > 0:10:32- # Couldn't ask for more - What more could I ask for? - Couldn't ask for more... #
0:10:32 > 0:10:38'This commitment is going to extend to the two working together on this property.
0:10:38 > 0:10:45'They have experience in the commercial sector, but this is a new venture for them.'
0:10:45 > 0:10:47Bob, why the change to residential?
0:10:47 > 0:10:53I think as I'm thinking of retirement, it's a form of pension.
0:10:53 > 0:10:58Also, if I get my figures right, I'm looking for a return
0:10:58 > 0:11:01of probably...6% return.
0:11:01 > 0:11:04- Mm-hm.- Far better than you can get in the bank.
0:11:04 > 0:11:10What are you going to do to turn this place around? It's in a right old state.
0:11:10 > 0:11:14Obviously, we'll clear the place. Then we'll have the place rewired,
0:11:14 > 0:11:19new bathroom suite upstairs, plaster each room, redecorate, new carpets.
0:11:19 > 0:11:26The kitchen, we'll perhaps move the doorway slightly. We'll have some double doors out here
0:11:26 > 0:11:31with a bit of decking to the side. We're looking for it to be a family home.
0:11:31 > 0:11:38- At the moment, it's neglected. - Is it a father and son project or will you do most of it yourself?
0:11:38 > 0:11:44I think I'll have mainly the input in it, with a bit of fatherly advice
0:11:44 > 0:11:47where he feels I'm falling off the rails!
0:11:47 > 0:11:52But, yeah, this hopefully will be the start of something quite big.
0:11:52 > 0:11:57I've been watching my father's footsteps on the commercial side.
0:11:57 > 0:12:01Now we're going into residential. It's a good starting place for me.
0:12:01 > 0:12:06It's great Bob has Nigel to help out with this renovation.
0:12:06 > 0:12:10The only downside with this project is that they aren't that local.
0:12:10 > 0:12:13Both live about 25 miles away.
0:12:13 > 0:12:18So how are they going to cope with the commuting?
0:12:18 > 0:12:22We've just purchased our motorhome. A 21-foot motorhome.
0:12:22 > 0:12:28We named it Brian. We've seen the state of the kitchen and bathroom. Not up to scratch.
0:12:28 > 0:12:34So we intend to use the motorhome on a three or four-day spell.
0:12:34 > 0:12:39- How much do you intend to spend? - £16,500.- To do everything?- Yes.
0:12:39 > 0:12:44- And what's your timescale? - We're looking at four months.
0:12:44 > 0:12:48What do you want to do with it, Bob? Sell it on with a profit?
0:12:48 > 0:12:56I think I'd look at both options, but initially it was to create a comfortable family home.
0:12:56 > 0:13:03I'm really looking forward to seeing it. Good luck with this project. I hope it really goes well.
0:13:03 > 0:13:06- Thank you.- Well done.- Thank you.
0:13:10 > 0:13:14Thank goodness for Brian the caravan. Without his trusty motorhome,
0:13:14 > 0:13:18Bob wouldn't be able to stay on site and keep on track.
0:13:18 > 0:13:24I'm worried, though, about that budget. If he spends too much, he could even make a loss.
0:13:24 > 0:13:28Join me later to find out what happens.
0:13:30 > 0:13:34Today I'm in the Hartshill area of Stoke-on-Trent,
0:13:34 > 0:13:38a really popular area for commuters with easy access to the motorway.
0:13:38 > 0:13:44But you've also got the University Hospital of North Staffordshire and that means potential renters,
0:13:44 > 0:13:51in terms of students and hospital workers. Sounds like a great place to buy a property at auction.
0:13:51 > 0:13:58Hospitals are always a great source of potential tenants, particularly a university hospital like this.
0:13:58 > 0:14:04Medical staff often move around the country while training, so they look to rent rather than buy.
0:14:04 > 0:14:11It sounds like this property that went to auction guided at £65,000 may appeal to buy-to-let investors.
0:14:11 > 0:14:17Like many houses in the area, the property I'm here to see is a traditional terrace,
0:14:17 > 0:14:22but it's an end terrace, which is an added bonus. Seems in good nick.
0:14:22 > 0:14:27So with that hospital, the potential rental there, it could be a safe bet.
0:14:27 > 0:14:30It's all about what we find inside.
0:14:30 > 0:14:34So any surprises in store? A very traditional layout.
0:14:34 > 0:14:38Through into your front sitting room, I'd have liked a fireplace,
0:14:38 > 0:14:44but that could be put in simply. I know it's just decoration, but that's quite sweet.
0:14:44 > 0:14:50"Life isn't about waiting for the storm to pass, it's about learning to dance in the rain."
0:14:52 > 0:14:57Well, let's hope that the rain in this instance is kept well out.
0:14:57 > 0:15:01But I'm not seeing anything that concerns me too much so far.
0:15:01 > 0:15:05Into the rear sitting room. Traditional layout, stairs there,
0:15:05 > 0:15:10a fireplace which has been blocked up. I'd like that opened up.
0:15:10 > 0:15:16Traditionally, the house would have stopped at this point. Somebody's built an extension.
0:15:16 > 0:15:22That's where the kitchen is housed. It's not huge, but it makes the most of the space there is.
0:15:22 > 0:15:29It could definitely be improved by getting rid of this humungous cupboard with the hot water system.
0:15:29 > 0:15:34Remove that, put a combi boiler in and open this up even more.
0:15:34 > 0:15:40At the moment, this is your bathroom. It's very small, right at the back here.
0:15:40 > 0:15:46Not too many issues with the location, but the size is lacking so get rid of that cupboard,
0:15:46 > 0:15:51maybe move the back door a bit, create a much nicer family bathroom
0:15:51 > 0:15:54and you're doing pretty well.
0:15:54 > 0:15:58'The bathroom may be small, but so is everything in it.
0:15:58 > 0:16:02'Look at the basin. It would be no use for sloshing around. It's tiny!'
0:16:04 > 0:16:07# Tiny bubbles... #
0:16:07 > 0:16:14'I like a bubble bath as much as the next man, but I'm not keen when they're on the wall.
0:16:14 > 0:16:18'It might just be condensation, but it might be signs of damp.'
0:16:18 > 0:16:20# Tiny bubbles... #
0:16:22 > 0:16:25'The kitchen looks tired and needs upgrading,
0:16:25 > 0:16:30'but it's a relatively small space so shouldn't be too big a job.'
0:16:31 > 0:16:34# Pink, it's my new obsession... #
0:16:34 > 0:16:40'Upstairs in this house that was guided at £65,000 plus, there's a pink colour scheme
0:16:40 > 0:16:44'right the way through to the rear bedroom.
0:16:44 > 0:16:50'It's a good-size room in good order, like the front bedroom, where the colour's been replaced
0:16:50 > 0:16:54'with a monochrome animal print feature wall.
0:16:58 > 0:17:05'You do get the feeling that whoever lived here before had a really happy, optimistic outlook on life.
0:17:05 > 0:17:08'Will the outside of this house be as upbeat?'
0:17:10 > 0:17:16At the rear of the property, as well as the extension, you've got this garden. It looks a bit drab,
0:17:16 > 0:17:22partly to due with the time of year, but get a nice bit of lawn in there, some nice plants,
0:17:22 > 0:17:29and it'll make a big difference. While I'm out here, one thing that strikes you is the bricks.
0:17:29 > 0:17:34It's worthy of note. They are absolutely beautiful, probably very local.
0:17:34 > 0:17:39And you know what? I've got a thing about bricks.
0:17:39 > 0:17:43This is a modern brick, right? Look how boring that is.
0:17:43 > 0:17:48It's orange and all the same colour. Now this is a traditional brick,
0:17:48 > 0:17:55probably fired in this area. Look at the colours - you've got blacks, dark oranges, yellows.
0:17:55 > 0:18:01You probably think I'm going loopy here, but this would have been... What do you mean, "Yes"? No.
0:18:01 > 0:18:06This would have been made locally, probably hand-fired,
0:18:06 > 0:18:11and I think it's a really wonderful architectural feature.
0:18:11 > 0:18:16So thank you, Staffordshire or Stoke-on-Trent bricks.
0:18:19 > 0:18:26'As the property's an end of terrace, you get a lot of bricks on show. Shame they're painted over.
0:18:26 > 0:18:31'The detail at the front is very nice, even though the windowsills need attention.
0:18:32 > 0:18:38'We asked a local estate agent for her advice about the work required here.'
0:18:38 > 0:18:43I would recommend new kitchen, attention to the bathroom,
0:18:43 > 0:18:45attention to the damp downstairs,
0:18:45 > 0:18:49double glazing and redecoration throughout.
0:18:49 > 0:18:56'So once you've cleared that little lot up, what standard of refurbishment would be advisable?'
0:18:56 > 0:18:59I would recommend a basic specification throughout
0:18:59 > 0:19:05because I could see this going into the buy-to-let market and being rented out.
0:19:05 > 0:19:11- What rental income could it generate?- Once modernised,
0:19:11 > 0:19:15I recommend renting this property out at £475 per calendar month.
0:19:15 > 0:19:21What about a re-sale valuation, the possible return on the investment?
0:19:21 > 0:19:26Once this property has been modernised to a basic standard, I'd be looking to achieve
0:19:26 > 0:19:29in the region of £70,000-£75,000.
0:19:31 > 0:19:36Well, it's a property that's got a lot going for it. A good area, a solid house,
0:19:36 > 0:19:43which doesn't need too much doing to it. And you get those fantastic Staffordshire bricks for free.
0:19:43 > 0:19:46Let's see who fancied it.
0:19:46 > 0:19:52Lot number 59. An end-of-terrace house close to the hospital. Good investment opportunity.
0:19:52 > 0:19:55What shall we say? 50,000?
0:19:55 > 0:19:5945, then? 45 bid. Thank you.
0:19:59 > 0:20:01£45,000. Can we say 50?
0:20:01 > 0:20:04Yeah, 50 bid. At £50,000.
0:20:04 > 0:20:07At 50. I'll go in ones if it helps.
0:20:07 > 0:20:08Yeah, 51. 52.
0:20:08 > 0:20:1353. 54. 55. 56.
0:20:13 > 0:20:1557. 58.
0:20:15 > 0:20:1959 anywhere else? At £58,000.
0:20:19 > 0:20:21Are we all done?
0:20:21 > 0:20:24At £58,000 for the first time.
0:20:26 > 0:20:30At £58,000 for the second time.
0:20:30 > 0:20:34Third and final time, then, at £58,000. Are we all done?
0:20:34 > 0:20:41- Sorry. That's just not quite enough. If the bidders would like to talk. - 'This lot was withdrawn
0:20:41 > 0:20:48'because it didn't reach its reserve price, the price below which the vendor isn't willing to sell.
0:20:48 > 0:20:54'However, a satisfactory deal was struck eventually with husband and wife team Sharon and Chris.
0:20:54 > 0:20:57'They've been married for 29 years and live locally.
0:20:57 > 0:21:04'Chris works full-time as a telecoms engineer and Sharon part-time as a medical administrator.
0:21:04 > 0:21:07'I met up with them to find out their plans.'
0:21:07 > 0:21:12- Chris, Sharon, lovely to meet you. - Hello.- Congratulations.
0:21:12 > 0:21:16- Why didn't you bid in the auction? - We just bottled it on the day.
0:21:16 > 0:21:22We didn't dare. We couldn't believe it would have gone for less than the asking price.
0:21:22 > 0:21:26The reserve was 65. Then it was 58 it got up to.
0:21:26 > 0:21:34- But you didn't think about bidding? - No.- We looked at each other to bid, but didn't.
0:21:34 > 0:21:39It does happen quite quick. I can understand. In the heat of the moment, you have to decide quickly.
0:21:39 > 0:21:43It ran away with us a bit. It is quick.
0:21:43 > 0:21:47We heard this bid of £58,500 or thereabouts
0:21:47 > 0:21:54and then I dropped a bit of paper on the floor and by the time I'd come back up, "It's not enough."
0:21:54 > 0:22:02- And we thought, "Well..." - So you went up. Were you told then what price you needed to pay?
0:22:02 > 0:22:06Yes, they said 60,000, so we were happy with that price.
0:22:06 > 0:22:13'I'm not surprised they reckon they've got an unexpected bargain at £60,000 for this end-of-terrace,
0:22:13 > 0:22:20'especially as similar houses are selling for around the £70,000-£75,000 mark.
0:22:20 > 0:22:22'But what did they buy this for?'
0:22:22 > 0:22:27Purely rental income. It's a bit of a long-term investment for us.
0:22:27 > 0:22:33We don't see ourselves working until we're 67, as it is now. The pension age keeps increasing
0:22:33 > 0:22:39and pension returns are diminishing and money in the bank isn't getting a great return,
0:22:39 > 0:22:45so we just thought property seems to be the way to go. So we're on the bandwagon.
0:22:45 > 0:22:53- Tell me what you're going to do to sort it out.- The first thing is double glazing, new doors,
0:22:53 > 0:22:59we're going to replace the fireplace, do something with that, new kitchen.
0:22:59 > 0:23:03We'll have someone look at the tiles. A couple are loose.
0:23:03 > 0:23:08Just general painting and decorating.
0:23:08 > 0:23:11- No layout changes?- No.- None planned.
0:23:11 > 0:23:16'So if they're not going to do anything with that cupboard
0:23:16 > 0:23:21'and keep things just as they are, they can probably get away with a minimal spend here.
0:23:21 > 0:23:25'What budget do they have in mind?'
0:23:25 > 0:23:29- Perhaps about £7,000, we think. - We do have contingencies on that.
0:23:29 > 0:23:35A couple of thousand more. It depends on the roof, if it was completely condemned.
0:23:35 > 0:23:40- And the boiler. We're not sure. - We need it to be checked. And the electrical wiring
0:23:40 > 0:23:43by somebody who's qualified.
0:23:43 > 0:23:48'They've set themselves a goal of 3-4 months to get it done
0:23:48 > 0:23:55'and will do most of it themselves. They've got another property in Crewe, so they have got experience.'
0:23:55 > 0:24:01How have you found dealing with tenants? A lot of people are put off renting for fear of midnight calls,
0:24:01 > 0:24:05- "My boiler's broken". - We've had ours fully managed.
0:24:05 > 0:24:11- Right.- Any problems they've dealt with for us.- You pay a little bit more to the management agency.
0:24:11 > 0:24:18A percentage to the agent, yes. And we're quite happy so we don't have to get involved, face to face,
0:24:18 > 0:24:25with the tenant. We're a bit soft. If they were a bit short of money one week, we might just say,
0:24:25 > 0:24:31- "Oh, it's OK." So we're quite happy for a management company to just... - Do that for us.
0:24:31 > 0:24:36- Well, congratulations. Good luck. - Thanks.- Look forward to seeing it.
0:24:36 > 0:24:43So Chris and Sharon expanding their property portfolio with this little terrace in Stoke-on-Trent.
0:24:43 > 0:24:47Not too many issues to sort out. Maybe some damp in the bathroom.
0:24:47 > 0:24:53I'm sure they will take it in their stride. Find out how they get on later in the show.
0:24:53 > 0:24:58Coming up: in Dipton, County Durham, there's no getting around the fact
0:24:58 > 0:25:03that for all this house's plus points...the layout's rubbish!
0:25:03 > 0:25:09Back in Stoke-on-Trent, is this going to be Chris and Sharon's last property investment?
0:25:09 > 0:25:13- I'd be quite happy to do another, but we agree to disagree.- We do.
0:25:15 > 0:25:21But first we find out why Bob and Nigel are so chuffed with their renovation efforts.
0:25:21 > 0:25:23Overall, we're really pleased.
0:25:27 > 0:25:33The Kent town of Chatham on the River Medway has a proud maritime history
0:25:33 > 0:25:37and the redevelopment round the docks is for a new generation.
0:25:37 > 0:25:43Earlier in the programme, this 1950s three-bed semi was bought
0:25:43 > 0:25:49for £125,000 by Bob, who runs his own printing company. His son, Nigel, is also a printer,
0:25:49 > 0:25:54but doesn't work with his dad. Bob has built a buy-to-let portfolio
0:25:54 > 0:26:00of mainly commercial property. The plan was for Bob to project manage this house,
0:26:00 > 0:26:03while Nigel refurbished it on his days off.
0:26:03 > 0:26:06Bob, why the change to residential?
0:26:06 > 0:26:11I think as I'm thinking of retirement, it's a sort of pension.
0:26:11 > 0:26:15Also, if I get my figures right,
0:26:15 > 0:26:19I'm looking for a return of probably...6% return.
0:26:19 > 0:26:26They'd set a budget of £16,500 and four months to refurbish the house.
0:26:26 > 0:26:31Then Bob would decide whether to sell or let it. There have been some delays.
0:26:31 > 0:26:36We meet Bob, Nigel and new puppy Jessie one year and 10 months later.
0:26:38 > 0:26:41But hasn't the wait been worth it?
0:26:41 > 0:26:44The house has a new porch,
0:26:44 > 0:26:49off-street parking and the leaking roof's been repaired.
0:26:51 > 0:26:56You no longer have to go through the kitchen to get to the lounge
0:26:56 > 0:27:00and a new door's been created. Much better!
0:27:01 > 0:27:06The kitchen has a crisp white, black and charcoal colour scheme
0:27:06 > 0:27:08and looks very smart.
0:27:08 > 0:27:14At the back of the house, that dilapidated conservatory that ran all the way along the sitting room
0:27:14 > 0:27:19and kitchen has been split into two rooms, as Nigel explains.
0:27:19 > 0:27:23Initially, we realised we had to rebuild. In doing so,
0:27:23 > 0:27:26we made a garden room here, put some French doors in there,
0:27:26 > 0:27:33put some doors at the back. We split it in two because it was too big to make it one room.
0:27:33 > 0:27:37So we put it in two and made that a utility room.
0:27:37 > 0:27:40Overall, we're really pleased.
0:27:40 > 0:27:46It's a fantastic result, but they did aim to do it in four months. Mm, what happened?
0:27:46 > 0:27:53I was meant to be doing most of the work, but due to my son having a spell where he wasn't well,
0:27:53 > 0:28:00my dad sort of took back over and he's produced it to a very high standard.
0:28:00 > 0:28:04Absolutely. A great team effort.
0:28:05 > 0:28:12The entire house has been replastered and the three bedrooms are superbly finished.
0:28:15 > 0:28:22This 1950s house has big rooms, so the rear bedroom lost a corner to the enlarged bathroom.
0:28:24 > 0:28:27More quality fittings.
0:28:27 > 0:28:34And as if this wasn't enough, they've submitted plans to improve the place further.
0:28:34 > 0:28:39That would be for a granny annexe, single storey, basically, on the side of the property,
0:28:39 > 0:28:43then the main house would have a fourth bedroom en-suite.
0:28:43 > 0:28:47In the meantime, the space has been put to good use.
0:28:47 > 0:28:53I've tried to tidy the whole area up here to create a soft area here
0:28:53 > 0:28:59which could be used for a children's play area, perhaps a pet. We designed it for more of a barbecue area.
0:28:59 > 0:29:03We fenced it off because, basically, the area needed tidying up.
0:29:03 > 0:29:05And I just think it works really well.
0:29:07 > 0:29:11Nigel and Bob have done the decorating themselves,
0:29:11 > 0:29:14but employed qualified gas and electrical tradesmen.
0:29:14 > 0:29:19Did they keep to their £16,500 budget? How much have they spent so far?
0:29:19 > 0:29:21About 26,000.
0:29:23 > 0:29:2725,200, so yes, we've gone over budget.
0:29:27 > 0:29:31Ooh, just a bit! With the £125,000 they paid at auction,
0:29:31 > 0:29:36that takes their total investment here to £150,200.
0:29:36 > 0:29:41There's still the kitchen and bathroom to tile and a few snags here and there.
0:29:41 > 0:29:45The house was rented out before Bob bought it
0:29:45 > 0:29:49which has made him undecided about whether to let or sell.
0:29:49 > 0:29:55It would break my heart, I think, if I came in and found it how it was before,
0:29:55 > 0:30:01so I am sort of split between the two - whether to rent it out or whether to sell on.
0:30:02 > 0:30:06Maybe some expert valuations from two local estate agents
0:30:06 > 0:30:09will help Bob make his choice. What do they think of it?
0:30:09 > 0:30:13What a fantastic job he's done! There are a couple of things to finish off,
0:30:13 > 0:30:15but the standard is fantastic.
0:30:15 > 0:30:19They've done it to a lovely neutral standard throughout.
0:30:19 > 0:30:24It's lovely how they've separated the utility room, giving it a bit of extra space.
0:30:24 > 0:30:27They've utilised the space very well.
0:30:27 > 0:30:31The driveway is fantastic. They've made the bathroom bigger
0:30:31 > 0:30:34by taking a bit off a big bedroom. What a great idea!
0:30:34 > 0:30:37If Bob and Nigel do decide to let it,
0:30:37 > 0:30:43how much income could the house generate in its current three-bedroom configuration?
0:30:43 > 0:30:46If I rented it, I would get £850 per calendar month.
0:30:46 > 0:30:50In the current market, we'd look to achieve £950 per calendar month.
0:30:50 > 0:30:53Those rents would produce a yield of between 6 and 7.5%.
0:30:53 > 0:31:00- I had a vision of 900 a month, so I think we're...- In the middle. - ..pleased with that.- Yeah, pleased.
0:31:00 > 0:31:04If they're successful with their planning application
0:31:04 > 0:31:09and decide to sell the property with the permission, how much could it be worth then?
0:31:09 > 0:31:15The third bedrooms are always smaller on these properties. This would sell at £175,000.
0:31:15 > 0:31:21Sale value, we'd look to market this property probably in the region between 180,000 and 190,000.
0:31:21 > 0:31:25That valuation range would produce a gross profit
0:31:25 > 0:31:30of between £24,800 and £39,800 before taxes and expenses.
0:31:30 > 0:31:34A little bit lower than anticipated.
0:31:34 > 0:31:39We were thinking, with the application for the annexe, 195.
0:31:39 > 0:31:42That was the figure we had in our head.
0:31:42 > 0:31:46Maybe adding the extension is the answer.
0:31:46 > 0:31:51You'd like to think it would go up in comparison with what they spent, but I don't think it would.
0:31:51 > 0:31:57I think if they spent £50,000 to extend it, they might get £40,000 more for the property.
0:31:57 > 0:32:00You won't get properties for £250,000 down here.
0:32:00 > 0:32:04If the extension is built, the estate agents' valuations increase
0:32:04 > 0:32:07to between £210,000 and £220,000.
0:32:07 > 0:32:14With all that financial information, is Bob any nearer to deciding whether to sell or rent?
0:32:14 > 0:32:18- I think myself, personally, I'm tempted on the rental element.- Yeah.
0:32:18 > 0:32:23The finish Bob and Nigel have achieved here is excellent,
0:32:23 > 0:32:25but has it been worthwhile?
0:32:26 > 0:32:30Yeah, it's taken longer than anticipated.
0:32:30 > 0:32:33- But, um...- A bit of fun. - Yeah.- Great.
0:32:38 > 0:32:42Today, I'm in County Durham in the former mining village of Dipton.
0:32:42 > 0:32:47It's approximately 12 miles from Newcastle and three miles from Consett
0:32:47 > 0:32:53and I'm sure it's lovely when the sun shines, but for now, I just want to find some shelter.
0:32:53 > 0:32:57Well, it's a bit of a yucky old day today, but who cares?
0:32:57 > 0:33:01It's one of those ex-miners' homes I'm here to see.
0:33:01 > 0:33:06This is it. It's a two-bedroom mid-terrace. It had a guide price of 30,000 quid.
0:33:06 > 0:33:08Let's get inside!
0:33:12 > 0:33:16Well, let's hope it's drier inside than it is out.
0:33:16 > 0:33:21And to be fair, I have been in some houses where that's not the case.
0:33:21 > 0:33:26But what about the layout? A bit of a corridor here. I don't particularly like that.
0:33:26 > 0:33:28It feels very sort of cramped in.
0:33:28 > 0:33:33That feels like a stud partition wall, so maybe that wouldn't be too bad to get rid of.
0:33:33 > 0:33:39Under-stairs cupboard... Does that look like the sort of thing you'd expect a telephone to be in?
0:33:39 > 0:33:43It just does at first glance to me. Through into this room here.
0:33:43 > 0:33:47I guess this was previously the kitchen, but that's now elsewhere.
0:33:47 > 0:33:51You've got this room with far too many doors in it.
0:33:51 > 0:33:55It makes it a pretty useless space, to be honest.
0:33:55 > 0:34:01Through into this side of the front of the property, the other side of that wall,
0:34:01 > 0:34:07and you've got your living room area. You've got an open fire with a gas fire placed in front of it,
0:34:07 > 0:34:09but the layout's rubbish, isn't it?
0:34:09 > 0:34:12# Something better change
0:34:12 > 0:34:15# I said something better change... #
0:34:16 > 0:34:21"Rubbish" is perhaps a rather strong word, but what I mean is that it doesn't feel right
0:34:21 > 0:34:23and there's no natural flow.
0:34:23 > 0:34:28The lounge is only reachable via the corridor and through the back reception room
0:34:28 > 0:34:33which has now become a corridor leading here, there and everywhere.
0:34:33 > 0:34:35It really does need to be changed.
0:34:35 > 0:34:38Things aren't much better with the kitchen.
0:34:38 > 0:34:44For some reason, the kitchen has been positioned in this little lean-to area at the back.
0:34:44 > 0:34:48It's bad on so many different levels. I don't know where to start.
0:34:48 > 0:34:51If you look at the thickness of the walls here,
0:34:51 > 0:34:55that's not going to be a cavity, so there is no damp-proofing in here.
0:34:55 > 0:35:00It's got lots of glass and lots of light, but it's a very cramped space
0:35:00 > 0:35:03and for a room that you use such a lot, it's not good.
0:35:03 > 0:35:07I've got a horrible feeling it won't get better when I go outside.
0:35:08 > 0:35:10Yeah, pretty much as I predicted,
0:35:10 > 0:35:13a flat, felt roof.
0:35:13 > 0:35:16Not ideal at all. Basically, it's got to come down.
0:35:16 > 0:35:20The good news though is you've got a decent-sized rear yard,
0:35:20 > 0:35:23some outbuildings and, more importantly,
0:35:23 > 0:35:28space to potentially put a proper extension on this place.
0:35:28 > 0:35:31Yes, the outbuildings might be worth keeping
0:35:31 > 0:35:33as a useful workroom space,
0:35:33 > 0:35:36and there's an outside loo,
0:35:36 > 0:35:39but the pre-fab extension, well, that simply has to go.
0:35:39 > 0:35:42# Since you gotta go
0:35:42 > 0:35:44# Well, you'd better go now... #
0:35:48 > 0:35:53Not only does it not meet current building regulations, it's starting to fall apart.
0:35:54 > 0:35:57But what about the rest of the house?
0:35:57 > 0:36:01Well, upstairs, I think the bathroom might need a bit of attention,
0:36:01 > 0:36:06although it's not black and white whether to keep or replace the suite!
0:36:08 > 0:36:13And the two bedrooms? Well, redecoration and new carpets are a must.
0:36:13 > 0:36:17The electrics need replacing and there's work needed on the ceilings.
0:36:17 > 0:36:21Once the old furniture is removed, they're both a decent size,
0:36:21 > 0:36:26so, overall, I think this place is worth having a go at upgrading and improving.
0:36:31 > 0:36:35What does a local estate agent think of this two-bedroom, terraced house?
0:36:38 > 0:36:42It's a nice-looking property from the front. It's a stone-fronted house.
0:36:42 > 0:36:45It's a good, traditional, solid property.
0:36:45 > 0:36:48Some work needs to be done to the property,
0:36:48 > 0:36:51including pulling down the kitchen offshoot,
0:36:51 > 0:36:58which would either be then replaced or simply left with the dining area turned into a kitchen/diner.
0:36:58 > 0:37:04If this property that was guided at £30,000 was rejigged and refurbished,
0:37:04 > 0:37:08how might it fare on the rental or re-sale markets?
0:37:08 > 0:37:11In the current market, once renovated,
0:37:11 > 0:37:17I think this property would be achieving somewhere in the region of £70,000 to £75,000.
0:37:17 > 0:37:23You would put the house on the rental market for somewhere in the region of £400 to £425 per month.
0:37:23 > 0:37:29Those valuations suggest that take away some parts of the house and re-divide others
0:37:29 > 0:37:33and this property could add up to being a good investment.
0:37:34 > 0:37:37Well, intrinsically, this is a good-sized house.
0:37:37 > 0:37:41It's just that the internal layout is a bit mixed up at the moment,
0:37:41 > 0:37:45so I don't think it would cost too much to put it right.
0:37:45 > 0:37:48Let's see who fancied it when it went under the hammer.
0:37:52 > 0:37:57So we're going to move now down to Stanley, County Durham.
0:37:57 > 0:38:02Mid-terraced house, it requires refurbishment. It has gas central heating, partial double glaze.
0:38:02 > 0:38:04I'll start at 24.
0:38:04 > 0:38:07Thank you, at 24,000, to get us going.
0:38:07 > 0:38:09£24,000 bid.
0:38:09 > 0:38:12Do I have 25 anywhere else? 25 bid.
0:38:12 > 0:38:1526. 27. 28.
0:38:15 > 0:38:1729. 30.
0:38:17 > 0:38:2131. 32? 31,000 on the front row.
0:38:21 > 0:38:24You're out. I'm at 31,000 on the front row.
0:38:24 > 0:38:27I'll take 32? 32 bid.
0:38:27 > 0:38:2933. 34. 35.
0:38:29 > 0:38:3136. 37. 38.
0:38:31 > 0:38:3439. 40.
0:38:34 > 0:38:3741. 42. 43.
0:38:37 > 0:38:3943 at the back. 44.
0:38:39 > 0:38:4145?
0:38:41 > 0:38:44I'll take 500 if it helps. 44 and a half?
0:38:44 > 0:38:49It's on the front row at 44. 44 and a half. 45.
0:38:49 > 0:38:5345 and a half? Front row at £45,000.
0:38:53 > 0:38:57I'll take a half? I'm selling once at 45.
0:38:57 > 0:39:00I'm selling for the second time at £45,000.
0:39:02 > 0:39:05Sold to the gentleman on the front row at 45.
0:39:08 > 0:39:13'And so for £45,000, £15,000 over the guide price,
0:39:13 > 0:39:16'the successful and delighted bidder was Ray.
0:39:16 > 0:39:23'He works as a sportswear supplier and has been keen to start a property developing sideline.
0:39:23 > 0:39:26'This is his first investment.'
0:39:26 > 0:39:32- Ray, great to meet you. - Thank you.- Congratulations. Tell me why you wanted to buy this place.
0:39:32 > 0:39:35I live near the village, 400 metres down the road.
0:39:35 > 0:39:41I thought, "I know the area well, it's an ideal property, especially as it needs some work done to it."
0:39:41 > 0:39:44Ideal location. I can come at night-time after work.
0:39:44 > 0:39:48- Will it be an investment property? - Hopefully, renovate it top to bottom
0:39:48 > 0:39:52and most likely, put it on the buy-to-let market.
0:39:52 > 0:39:56Why did you choose this house, other than it's in the village?
0:39:56 > 0:40:01I got this one because I missed out on another one, so everything was all set in place.
0:40:01 > 0:40:06This one came up and I jumped at it straight away because I wanted to get started,
0:40:06 > 0:40:09get something on the rental market as soon as possible.
0:40:09 > 0:40:13'Despite this being Ray's second choice, he had seen the property.
0:40:13 > 0:40:19'In fact, he tried to buy it before the auction, but his £38,000 offer was rejected.
0:40:19 > 0:40:24'But now, having paid £45,000, the house is finally his
0:40:24 > 0:40:28'and he can at last get started on the renovation.'
0:40:28 > 0:40:33- It's got an interesting layout. - It has. I'm going to change that. That's one plan.
0:40:33 > 0:40:36Tell me how you'll sort it out.
0:40:36 > 0:40:41Where we're standing now, hopefully, will be the kitchen, so it's going to be a kitchen/diner.
0:40:41 > 0:40:45I'll block this off and have the original door to the right.
0:40:45 > 0:40:50- So that will be a front sitting room?- It will be, yes. It'll be all separated.
0:40:50 > 0:40:52And the extension at the back?
0:40:52 > 0:40:57I'll remove that altogether and tidy the back up, make it a bit more presentable.
0:40:57 > 0:41:02Upstairs, I'll modify everything, new central heating system, new electrics
0:41:02 > 0:41:07and fresh plaster to give it nice, sharp edges and then decoration throughout.
0:41:07 > 0:41:10- What's the timescale for the work? - Two to three months.- The budget?
0:41:10 > 0:41:15I'll hopefully be in between 8,000 and 10,000 to complete everything.
0:41:15 > 0:41:19'Ray seems to know exactly what he wants to do here.
0:41:19 > 0:41:23'Indeed, as he's local, he has seen inside similar properties,
0:41:23 > 0:41:30'so he knows what layout changes can be done and, more importantly, which alterations are worth doing.
0:41:30 > 0:41:36'But even so, there's a fair amount of rearranging, rebuilding and rejigging to be done here.'
0:41:36 > 0:41:42- Who's doing the work?- I'm going to do most of it myself with friends and contractors to help out.
0:41:42 > 0:41:47- What do you do when you're not doing this? - I work for a sportswear company.
0:41:47 > 0:41:51I supply team kits to schools, colleges, universities and local sports clubs.
0:41:51 > 0:41:54Where have the DIY skills come from?
0:41:54 > 0:41:56It's just a hobby, something I really enjoy.
0:41:56 > 0:42:01- I grew up with a lot of it and I want to get more involved in it.- Good stuff.
0:42:01 > 0:42:07- How many properties have you done? - This will be my second renovation. It's my first investment property.
0:42:07 > 0:42:13The other one is my home and we renovated that from top to bottom. That gave us the bug.
0:42:13 > 0:42:15What tempted you into doing it now?
0:42:15 > 0:42:20The low house prices. I'm trying to take advantage of it when there's some good deals out there.
0:42:20 > 0:42:27- Congratulations.- Thank you.- Good luck. I look forward to seeing how you get on.- That's great. Thank you.
0:42:27 > 0:42:33So, Ray's first investment property and he's sticking to the area he knows well,
0:42:33 > 0:42:35which is a really good thing to do.
0:42:35 > 0:42:40How is he going to get on? Will this be here when we get back?
0:42:40 > 0:42:42You can find out later in the show.
0:42:45 > 0:42:51If you want to profit from property, timing is crucial and you have to be flexible with your plans.
0:42:51 > 0:42:56And not let time pass you by. Let's see how our buyers got on today.
0:42:59 > 0:43:03We're heading back to Hartshill, Stoke-on-Trent now
0:43:03 > 0:43:06where earlier, we met Chris and Sharon.
0:43:06 > 0:43:11They'd purchased this two-bed, end-of-terrace property for £60,000.
0:43:11 > 0:43:16Just! The property didn't reach the reserve price in the auction room,
0:43:16 > 0:43:19even though that was within the couple's budget.
0:43:21 > 0:43:26- I'm confused. Why didn't you bid in the auction? - We just bottled it on the day.
0:43:26 > 0:43:30We couldn't believe it would have gone for less than the asking price.
0:43:30 > 0:43:37- But you didn't think about bidding at that point?- No.- We looked at each other to bid, but didn't.
0:43:37 > 0:43:40So neither raised their hand in the auction room,
0:43:40 > 0:43:45but luckily, it didn't put paid to their plans to purchase this place.
0:43:45 > 0:43:50Once they did, they aimed to get it ship-shape in three to four months.
0:43:51 > 0:43:58We're now back six months later to see if they've managed to bring out the sunny side of this property.
0:43:59 > 0:44:04# Let the sun shine, let the sun shine, let the sun shine
0:44:04 > 0:44:09# Let it all go, let it all go, let it all go
0:44:09 > 0:44:13# Let the sun shine, let the sun shine, baby
0:44:13 > 0:44:17# Let it all go, just let it all go, baby... #
0:44:17 > 0:44:21And it seems they've stuck to their plans here.
0:44:21 > 0:44:24There's new double glazing, new doors,
0:44:24 > 0:44:27new carpets, a new fireplace downstairs
0:44:27 > 0:44:29and there's a brand-new kitchen.
0:44:33 > 0:44:35The kitchen's been stripped out.
0:44:35 > 0:44:40There was some damp on this side of the wall which has gone back to plaster.
0:44:40 > 0:44:44That side of the wall was skimmed, but we ripped out the entire kitchen.
0:44:44 > 0:44:50The cooker was originally over there with just a gas point which we've had taken out
0:44:50 > 0:44:54and then we moved the oven to where it is now and it works quite nice.
0:44:54 > 0:45:00Overall, the kitchen came out just about as we planned, really. It's turned out quite nice.
0:45:00 > 0:45:05Because I've done all the work myself, it's come out to no more than £1,200.
0:45:05 > 0:45:11That includes the tiles, all the furniture and the flooring, tiling. That's it at the very most.
0:45:11 > 0:45:16So that's part of their budget explained, but what about the rest?
0:45:16 > 0:45:20They aimed to spend £7,000 on the renovations here,
0:45:20 > 0:45:23but had a contingency of up to 9,000.
0:45:23 > 0:45:26Pretty much on target, really.
0:45:26 > 0:45:29I think the whole lot, with solicitors' fees,
0:45:29 > 0:45:35any agents' fees and stuff like that in purchasing the property, it's come out to no more...
0:45:35 > 0:45:38- Seven and a half is about what we came to last night.- Yeah.
0:45:40 > 0:45:44Keeping their budget at 7,500 is pretty impressive,
0:45:44 > 0:45:48given that this project wasn't as straightforward as it looked,
0:45:48 > 0:45:52particularly when it came to sorting out the damp issues in the house.
0:45:52 > 0:45:57Those involved pulling up floorboards and installing a damp-proof course
0:45:57 > 0:45:59which also affected their timescale.
0:45:59 > 0:46:05It did slow us down. We had to wait two to three weeks for somebody to come out,
0:46:05 > 0:46:09then another two weeks or so for them actually to come and do it,
0:46:09 > 0:46:13- so that was a month that we'd lost anyway.- That's right.
0:46:13 > 0:46:19So their three to four months was extended to five and now they're almost finished,
0:46:19 > 0:46:22but there's a valuable lesson to be learnt here.
0:46:22 > 0:46:26When planning a renovation, do be sure to build into your schedule
0:46:26 > 0:46:29not just how long it takes to get a job done,
0:46:29 > 0:46:33but how long it will be for the right people to be available to do it,
0:46:33 > 0:46:37even if you're putting every second you have into it.
0:46:37 > 0:46:41- How many bank holidays are there in a year?- Every bank holiday this year.
0:46:41 > 0:46:45Every Saturday and Sunday since April.
0:46:45 > 0:46:47- Near enough.- Yeah.
0:46:47 > 0:46:52There's no denying they've put the hours in, but has it been fun?
0:46:53 > 0:46:55I enjoy it.
0:46:56 > 0:47:00I enjoy it. Yes, I'd be quite happy to do another project.
0:47:00 > 0:47:06- But I think we have to agree to disagree, don't we? - Yes, we do. Sorry.
0:47:06 > 0:47:10Perhaps the potential returns will change Sharon's mind.
0:47:10 > 0:47:13She and Chris purchased this place for 60,000.
0:47:13 > 0:47:20And with £7,500 on the work, their total outlay comes to 67,500.
0:47:22 > 0:47:26We invited two local estate agents to the property
0:47:26 > 0:47:28to see if they're impressed.
0:47:32 > 0:47:36My first impressions are that the property's had a full refurbishment.
0:47:36 > 0:47:41New kitchen. I like how they've stripped it right back and really refreshed it throughout.
0:47:41 > 0:47:43The property's very nice.
0:47:43 > 0:47:48Very airy, very spacious. Obviously, neutral colours as you'd expect.
0:47:48 > 0:47:51It's a typical two up, two down terraced property.
0:47:51 > 0:47:57The biggest thing with this one is it sets itself apart with a lovely back garden,
0:47:57 > 0:48:00so that's going to be a very good selling point.
0:48:00 > 0:48:05And if Chris and Sharon did want to sell, how much could they put it on the market for?
0:48:05 > 0:48:11In the current market, I would look at achieving in the region of £75,000 to £80,000.
0:48:11 > 0:48:15We'd achieve between £75,000 and £80,000 in this current market.
0:48:15 > 0:48:18- I think that's about what we expected for this area.- Yes.
0:48:18 > 0:48:25It might be a touch more than I expected when we initially bought the property, but that's about right.
0:48:25 > 0:48:30It's nice to hear they're pleased that their potential pre-tax and expenses profit
0:48:30 > 0:48:33would be between £7,500 and £12,500.
0:48:35 > 0:48:40However, they're still keen to go ahead with the original plan of letting it.
0:48:40 > 0:48:44How much could they earn if they put it up for rent?
0:48:44 > 0:48:46On the rental market,
0:48:46 > 0:48:51I believe this property could achieve in the region of £400 to £425 per calendar month.
0:48:51 > 0:48:56I'd expect to achieve between £400 and £450 per calendar month.
0:48:56 > 0:49:02Yeah, I think the one at 450 is about the one that we'd prefer to chase if we possibly could.
0:49:02 > 0:49:06- 425 might be about right, kind of in line with what we're expecting.- Yeah.
0:49:06 > 0:49:11Either way, the rental yield is impressive, sitting at between 7 and 8%.
0:49:11 > 0:49:17We know Chris is keen to do another, so now she knows the financial potential,
0:49:17 > 0:49:19would Sharon be convinced?
0:49:21 > 0:49:24Not for a long, long, long time.
0:49:24 > 0:49:26Never say never!
0:49:30 > 0:49:36In the small village of Dipton in County Durham, a two-bed terraced house went up for auction.
0:49:36 > 0:49:42Although it was basically structurally sound, its downstairs layout was less than ideal.
0:49:42 > 0:49:49There was no direct access to the front lounge and a rear reception room that was more like a corridor.
0:49:49 > 0:49:54Then there was the kitchen housed in a pre-fabricated rear extension
0:49:54 > 0:49:57which was flat-roofed and single-skinned.
0:49:57 > 0:50:01Quite frankly, it either had to go or be replaced.
0:50:02 > 0:50:05# Where did it go...? #
0:50:05 > 0:50:10But with two decent bedrooms upstairs and a reasonable family bathroom,
0:50:10 > 0:50:16this place had lots of potential for anyone willing and able to untangle the awkward layout.
0:50:19 > 0:50:24It was snapped up at auction for £45,000 by local man Ray.
0:50:24 > 0:50:28He works as a sportswear supplier, but had refurbished his own property
0:50:28 > 0:50:33and had been chomping at the bit to get his first investment project under way.
0:50:33 > 0:50:38I got this one because I missed out on another one, so everything was all set in place.
0:50:38 > 0:50:43This one came up and I jumped at it straight away because I wanted to get started
0:50:43 > 0:50:46and get something rented out as soon as possible.
0:50:46 > 0:50:49# Baby, I'm ready to go... #
0:50:50 > 0:50:52So Ray was ready to go.
0:50:52 > 0:50:58Armed with an £8,000 to £10,000 budget, he hoped to prepare it for the rental market
0:50:58 > 0:51:00in two to three months' time.
0:51:00 > 0:51:04# Baby, I'm ready to go... #
0:51:05 > 0:51:10Now, nearly five months later, we return to see if the house is ready to go.
0:51:11 > 0:51:16It's certainly looking sharper with a crisp, new, white front door.
0:51:16 > 0:51:20At the rear, have we seen the back of that rather inadequate extension?
0:51:20 > 0:51:23# Yea-ea-eah
0:51:23 > 0:51:27# So good to be gone, so good to be gone
0:51:28 > 0:51:31# Yea-ea-eah
0:51:31 > 0:51:35# So good to be gone, so good to be gone... #
0:51:35 > 0:51:39Inside, not only has the lounge had a full renovation,
0:51:39 > 0:51:43including central heating, new plasterwork and a damp course,
0:51:43 > 0:51:45but the layout has been altered.
0:51:45 > 0:51:50The rooms have been widened and the access to the old rear reception room changed...
0:51:52 > 0:51:55..in order for it now to accommodate the kitchen.
0:51:55 > 0:52:01We've done a lot of work in the kitchen to get to this stage. Much of it was heavy, horrible, dirty work.
0:52:01 > 0:52:06We've blocked the wall up which was here. We've removed the chimney breast.
0:52:06 > 0:52:10It's created an extra three foot on the kitchen, so we can get a lot more units in.
0:52:10 > 0:52:15The original extension was damp, rain was coming in and it was unsightly,
0:52:15 > 0:52:20so we demolished the whole lot and now we've got a nice, clean view out of the kitchen into the yard.
0:52:20 > 0:52:26It is a work in progress. I hope to have it done in the next few weeks. Can't wait to finish it.
0:52:26 > 0:52:31So when it's finished, this is going to be a much improved kitchen and utility area...
0:52:36 > 0:52:41..while upstairs, the bathroom has also been brought bang up to date
0:52:41 > 0:52:46with a brand-new suite, tiling and an electric shower installed.
0:52:46 > 0:52:50Ray has also found a way of maximising the space in the two bedrooms.
0:52:51 > 0:52:57The main difference in the front bedroom is we ripped out two cupboards, both in the corner,
0:52:57 > 0:53:00and again they've created more space.
0:53:00 > 0:53:05In the back bedroom, we've taken out the chimney flue which has allowed us to square the room off.
0:53:05 > 0:53:11It gives you nice, square walls and once more, it's been painted, so it looks nice and clean.
0:53:11 > 0:53:17Apart from the gas and electrics, Ray has done most of the work with some help from friends and family.
0:53:17 > 0:53:20He's mainly worked in the evenings and at weekends,
0:53:20 > 0:53:24so not surprisingly, his two to three-month timescale has slipped.
0:53:24 > 0:53:28He still has to finish off the kitchen and utility area
0:53:28 > 0:53:32and there's also the space at the back, so what's to be done there?
0:53:32 > 0:53:38Finish off the concrete we've dug up and maybe do a bit of block paving or some timber decking
0:53:38 > 0:53:42immediately out the door to create a nice sitting area.
0:53:42 > 0:53:45I'll tidy up the outbuildings. They're useful storage.
0:53:45 > 0:53:48For the likes of mountain bikes or outdoor equipment,
0:53:48 > 0:53:52you've got somewhere to put it away from everything else.
0:53:52 > 0:53:57Ray hopes to finish off the remaining jobs in the next few weeks.
0:53:57 > 0:54:03How much has it cost to get this two-bedroom, mid-terraced house ready for the rental market?
0:54:07 > 0:54:12We are slightly over budget. The original budget was in the region of £10,000.
0:54:12 > 0:54:15We'll be looking at 13 to complete it.
0:54:15 > 0:54:19We put a better bathroom suite in than first expected
0:54:19 > 0:54:23and a damp-proof course which we didn't budget for at the very start.
0:54:26 > 0:54:30A £13,000 spend on top of his £45,000 purchase price
0:54:30 > 0:54:35takes Ray's total outlay to 58,000 without costs or fees.
0:54:35 > 0:54:40So has it been money well spent? What do two local estate agents reckon?
0:54:44 > 0:54:48My overall impression is very good. They've re-plastered the walls,
0:54:48 > 0:54:51put in a lot of contemporary fixtures and fittings,
0:54:51 > 0:54:53just what first-time buyers want.
0:54:53 > 0:54:55The house is looking very good.
0:54:55 > 0:54:59The owner has put a lot of time and effort into the refurbishment.
0:54:59 > 0:55:05There's a bit of work left to do in the kitchen and the rear yard needs some finishing off as well,
0:55:05 > 0:55:08but once done, it will be a very nice property.
0:55:08 > 0:55:14Some of the highlights for me would be the inglenook fireplace in the lounge, the brand-new fitted kitchen
0:55:14 > 0:55:20which will be superb and the bathroom as well. It's re-carpeted and redecorated throughout.
0:55:21 > 0:55:27Ray hopes to let the two-bed house out, but after spending £58,000 on it,
0:55:27 > 0:55:29does it add up to being a good investment?
0:55:29 > 0:55:35Once the house is complete, I would consider placing it on the market in the region of £70,000 to £75,000.
0:55:35 > 0:55:39Once the property is complete, I would market it at £70,000.
0:55:39 > 0:55:43That's definitely the ballpark figure I was looking for.
0:55:44 > 0:55:48That's a potential pre-tax profit of between 12,000 and 17,000.
0:55:48 > 0:55:52How could it fare on the all-important rental market?
0:55:52 > 0:55:55When the work is finished on the house,
0:55:55 > 0:56:00I would place this on the rental market for somewhere in the region of £400 to £425 per month.
0:56:00 > 0:56:06I would offer the property to market for rent at £425 per calendar month.
0:56:06 > 0:56:10Definitely what I was expecting. Hopefully, I can achieve that.
0:56:11 > 0:56:16A rental return of between £400 and £425 per calendar month
0:56:16 > 0:56:19will see an annual rental yield of over 8%,
0:56:19 > 0:56:23so that's plenty of incentive to get Ray to finish it off,
0:56:23 > 0:56:27get a tenant in and start getting revenue for the house.
0:56:27 > 0:56:32So how does he feel about this, his first property investment project?
0:56:32 > 0:56:38It's been a lot of fun renovating the property, especially with the help of friends and family.
0:56:38 > 0:56:41Everything went to plan. It's been an experience.
0:56:43 > 0:56:48That's it for today. We'll have lots more stories from the auctions next time on Homes Under The Hammer.
0:56:48 > 0:56:50- See you then.- Goodbye.- Goodbye.
0:57:11 > 0:57:14Subtitles by Red Bee Media Ltd