0:00:02 > 0:00:05- Hello and welcome.- For many, buying at auction offers the chance
0:00:05 > 0:00:08to get hold of properties that need a lot of work.
0:00:08 > 0:00:10People like to put their own stamp on what they buy
0:00:10 > 0:00:13and hopefully make a bit of a profit along the way.
0:00:13 > 0:00:17And you can often manage that if you buy your home under the hammer.
0:00:42 > 0:00:45We love the thrill and the excitement of an auction room.
0:00:45 > 0:00:48You can sometimes sense the hope and frustration in the air.
0:00:48 > 0:00:52You never know quite how it's going to go until the very last second,
0:00:52 > 0:00:56so let's see what tempted the buyers on today's show.
0:00:57 > 0:01:01In Lewisham, south-east London, there's a battle to combat
0:01:01 > 0:01:05the mould creeping through this top-floor two-bedroom flat...
0:01:07 > 0:01:10And another battle, this time against the elements.
0:01:10 > 0:01:12Could the weather be getting the better of this
0:01:12 > 0:01:15mid-terrace in Gilesgate, County Durham?
0:01:17 > 0:01:19These properties have been sold at auction.
0:01:19 > 0:01:22We'll find out who bought them and what they paid for them
0:01:22 > 0:01:24when they went under the hammer.
0:01:24 > 0:01:26GAVEL BANGS Sold.
0:01:29 > 0:01:32This is Lewisham in south-east London.
0:01:32 > 0:01:34It's an area that could be described as up and coming.
0:01:34 > 0:01:38So, investing your money in Lewisham before prices start to escalate
0:01:38 > 0:01:40could be a wise move.
0:01:40 > 0:01:43Now, the property I'm here to see is on this tree-lined
0:01:43 > 0:01:47residential street and it's a two-bedroom first-floor flat
0:01:47 > 0:01:51which had a guide price of 130,000.
0:01:51 > 0:01:55Let's head up those steps and see what we've got to greet us inside.
0:01:57 > 0:01:59There are two other flats in the property
0:01:59 > 0:02:02and the big back garden has been divided into three,
0:02:02 > 0:02:05so that each flat has some valuable outside space.
0:02:06 > 0:02:09Once through the front door, a second door gives
0:02:09 > 0:02:12access to the flat I'm here to see at the top of the property.
0:02:14 > 0:02:17What I love about these properties is the feeling of space.
0:02:17 > 0:02:20Look, that's double, triple, quadruple height.
0:02:20 > 0:02:24You really have got a lot of space all around you.
0:02:24 > 0:02:28It needs a lot of work, though. Bathroom, a complete refit.
0:02:28 > 0:02:31Same goes with the kitchen.
0:02:31 > 0:02:34You've got a little window over here with a nice view of the garden.
0:02:34 > 0:02:37But looking around, you know, you are going to need to spend
0:02:37 > 0:02:40some time and energy, and there is mould, damp...
0:02:40 > 0:02:42I'm not sure what it is.
0:02:42 > 0:02:44It's not looking fantastic and it is worrying me.
0:02:44 > 0:02:46I'm going to investigate further.
0:02:47 > 0:02:51Well, there's me thinking the mould in the kitchen was bad -
0:02:51 > 0:02:54have a look at this! It is everywhere.
0:02:54 > 0:02:56All over the walls and the ceiling,
0:02:56 > 0:02:59even the back wall. It's dripping down.
0:02:59 > 0:03:02Now, I'm not sure whether there's been a big leak.
0:03:02 > 0:03:03I think it's condensation,
0:03:03 > 0:03:07but it's definitely worth getting in a specialist to sort that out
0:03:07 > 0:03:10because you wouldn't want to buy this at auction to later on
0:03:10 > 0:03:15find there are whole heaps of problems with this property.
0:03:15 > 0:03:18The two bedrooms don't seem quite as badly affected.
0:03:18 > 0:03:22The large double and the single both have high ceilings that I love,
0:03:22 > 0:03:25and I love that original woodwork that remains in both the rooms.
0:03:25 > 0:03:29The only downside is that both bedrooms overlook the road,
0:03:29 > 0:03:31so that could be noisy.
0:03:32 > 0:03:34I think I've found the solution and it involves
0:03:34 > 0:03:38the living room, which is currently serving as a third bedroom.
0:03:40 > 0:03:43Through here, we've got a fantastic space. Look at this.
0:03:43 > 0:03:45It really is a wonderful room.
0:03:45 > 0:03:49Again, one of the bonuses with this flat is the space you have.
0:03:49 > 0:03:54I'm just wondering, is it worth moving that kitchen into this room,
0:03:54 > 0:03:58and having a kitchen, little dining area, sitting room,
0:03:58 > 0:04:02and then you could call that bedroom number three?
0:04:02 > 0:04:03That is food for thought.
0:04:05 > 0:04:09Another ingredient that might be worth thinking about is the loft.
0:04:09 > 0:04:12This is a leasehold property, so it's vital to know
0:04:12 > 0:04:14whether you would own this as well.
0:04:14 > 0:04:18If it is included for that guide price of 130,000,
0:04:18 > 0:04:21you could really add value if you get a room up there.
0:04:21 > 0:04:24Outside, the property looks to be in pretty good condition.
0:04:24 > 0:04:27The bit of garden allocated for this flat is overgrown
0:04:27 > 0:04:30and hidden right behind the shed.
0:04:30 > 0:04:33Be prepared to get your boots on to clear it before you can sit
0:04:33 > 0:04:36and enjoy the lovely sunshine.
0:04:36 > 0:04:39Could the new owner of the flat be about to clean up,
0:04:39 > 0:04:42or will they end up stuck in the mud with this lot?
0:04:42 > 0:04:45We asked a local estate agent to come and have a look
0:04:45 > 0:04:46and get his opinion on the flat.
0:04:46 > 0:04:50I think the property needs a lot of work, it's got a lot of damp.
0:04:50 > 0:04:55Needs a new bathroom, a new kitchen, new flooring, quite a lot to be done.
0:04:55 > 0:04:57OK, so let's talk figures.
0:04:57 > 0:05:00How much could the flat be worth after a refurbishment
0:05:00 > 0:05:02if it remained a two-bedder?
0:05:02 > 0:05:05When this property is renovated, I think it could reach
0:05:05 > 0:05:08a maximum of around £230,000.
0:05:08 > 0:05:09This flat is a great size
0:05:09 > 0:05:13and you might even be able to squeeze in a third bedroom.
0:05:13 > 0:05:17However, I still have my concerns, as it needs plenty of updating
0:05:17 > 0:05:20and there's that worrying mould to consider.
0:05:20 > 0:05:24Let's head to the auction and find out who was prepared to take it on.
0:05:24 > 0:05:26I move on now to Lot 133.
0:05:26 > 0:05:31It's a two-bedroom raised ground floor flat, in need of updating.
0:05:31 > 0:05:34It's got its own section of garden.
0:05:34 > 0:05:37Who'd like to get me started on this? What about 150?
0:05:37 > 0:05:40OK, we'll start there, 150 I've got. Thank you.
0:05:40 > 0:05:46151, 152, 153, 154, 155.
0:05:46 > 0:05:48Considerable interest at the auction,
0:05:48 > 0:05:52and we rejoin the bids at £180,000.
0:05:52 > 0:05:57180, 181, 182, 183, 184.
0:05:57 > 0:06:01185? Yeah? 185, 186?
0:06:03 > 0:06:05LAUGHTER
0:06:08 > 0:06:12Anybody else? If not, 185 for the first,
0:06:12 > 0:06:15185 for the second,
0:06:15 > 0:06:18185 for the third and final time. Are we all done?
0:06:18 > 0:06:20- GAVEL BANGS - Sold, 185, well bought.
0:06:22 > 0:06:26That successful bidder, paying £185,000, was Grant.
0:06:26 > 0:06:30He and his partner Dawn have bought the flat as an investment.
0:06:30 > 0:06:33I met them back at the flat to find out more.
0:06:35 > 0:06:39Dawn and Grant, congratulations. I want to know the whole story
0:06:39 > 0:06:42- and how you've ended up with this property.- It was our first auction.
0:06:42 > 0:06:47- Yep.- Which was interesting. We'd had about five properties on the go
0:06:47 > 0:06:51that we were looking at on the day. This one ended up
0:06:51 > 0:06:55a lot more over guide, but it had potential and I liked it.
0:06:55 > 0:06:57Are you a property developer?
0:06:57 > 0:06:59Is this something you've been doing for a long time?
0:06:59 > 0:07:04We started this a year ago, finished a place down in Hampshire
0:07:04 > 0:07:08in Liss Forest, which is just under offer now.
0:07:08 > 0:07:11A lot of work. Moved kitchens, bathrooms, the lot, so...
0:07:11 > 0:07:14What was it that you did before you started the houses?
0:07:14 > 0:07:18It's always been project management but in banking and insurance
0:07:18 > 0:07:19and financial services.
0:07:19 > 0:07:21Why did you want to stop that and move into this?
0:07:21 > 0:07:25- Just a complete lifestyle change. - Yeah, just a complete change
0:07:25 > 0:07:28and just potentially do something different.
0:07:28 > 0:07:32He's much happier. Although he's using the same skills,
0:07:32 > 0:07:35if you will, project management, but it's obviously a different area.
0:07:35 > 0:07:36Plus, you are your own boss.
0:07:36 > 0:07:39It's also planning, and having a proper plan,
0:07:39 > 0:07:42whether it's finding new people if someone doesn't turn up...
0:07:42 > 0:07:45What's it like living with him? Because project-managing,
0:07:45 > 0:07:48making sure you're on time... I mean, is he quite strict?
0:07:48 > 0:07:50- Spreadsheets! - SHE LAUGHS
0:07:51 > 0:07:53- There are spreadsheets.- Yes.
0:07:54 > 0:07:56You've got to laugh. Poor Grant!
0:07:56 > 0:07:58He doesn't stand a chance between us, does he?
0:07:59 > 0:08:02I wonder WHY the couple have bought the flat.
0:08:02 > 0:08:04Is the intention to sell or rent?
0:08:04 > 0:08:07We'll put it onto the rental market. That's the plan.
0:08:07 > 0:08:10So are you going to try and reconfigure the space,
0:08:10 > 0:08:11or leave it as it is?
0:08:11 > 0:08:12The bathroom is quite small.
0:08:12 > 0:08:16There is a partition wall between that and the kitchen
0:08:16 > 0:08:18which we'll take down anyway cos it's rotten,
0:08:18 > 0:08:20so there might be configuring to be done there.
0:08:20 > 0:08:23I've seen people move the kitchen into the lounge,
0:08:23 > 0:08:26and then create a third bedroom. You could have that at the back.
0:08:26 > 0:08:29- That could work, yes. - That could work, just...yeah.
0:08:29 > 0:08:32Hopefully the plumber can work the pipes.
0:08:32 > 0:08:33We'll have a think about it.
0:08:33 > 0:08:35Grant intends to take on a lot of the work himself
0:08:35 > 0:08:39using the skills he learned on his previous project.
0:08:39 > 0:08:41Dawn will provide crucial backup,
0:08:41 > 0:08:44helping to source materials and tradesmen.
0:08:44 > 0:08:48Now to tackle the problem that could scupper all those well-laid plans.
0:08:48 > 0:08:52I have noticed a lot of black mould all over the walls.
0:08:52 > 0:08:54What do you know about it?
0:08:54 > 0:08:56We had a surveyor come in recently
0:08:56 > 0:08:59and he confirmed it was just condensation.
0:08:59 > 0:09:02He tested it with a damp meter and the walls aren't damp.
0:09:02 > 0:09:07So it's just a bad case of condensation.
0:09:07 > 0:09:11How much does Grant think the work is going to cost?
0:09:11 > 0:09:14We've said 20,000 to do it,
0:09:14 > 0:09:17How long do you think this project, start to finish, will take you?
0:09:17 > 0:09:20- Erring on caution, probably three months.- Yeah.
0:09:20 > 0:09:22Guys, congratulations. It's been lovely talking to you both
0:09:22 > 0:09:26- and I can't wait to see what you do with it!- Thanks.- Thank you.
0:09:26 > 0:09:29Will we come back and see a spacious two-bed,
0:09:29 > 0:09:33or will they have squeezed in that third bedroom?
0:09:33 > 0:09:36You can join me later on in the programme to find out.
0:09:38 > 0:09:42We're in the lively and historic university city of Durham
0:09:42 > 0:09:44in the North-East of England.
0:09:44 > 0:09:48The property I'm here to see is a 15-minute walk away
0:09:48 > 0:09:52from the city centre, in a suburb that retains a lovely village feel.
0:09:54 > 0:09:59So this is Gilesgate, very close to Durham city centre.
0:09:59 > 0:10:03And more importantly, to its student population.
0:10:03 > 0:10:07Yes, we are in Studentland, which makes this property
0:10:07 > 0:10:11potentially very interesting. It's got three bedrooms,
0:10:11 > 0:10:14it's terraced - let's take a look.
0:10:14 > 0:10:19The guide price in the auction catalogue was £49,950-plus.
0:10:19 > 0:10:22OK. Well, through the front door
0:10:22 > 0:10:25and straightaway I'm thinking "Mmm, yes, bit of work required."
0:10:25 > 0:10:29Look at that fuse board. The old fuses...not good.
0:10:29 > 0:10:33So apart from electrics, what else is required?
0:10:33 > 0:10:36Well, down here, glancing into that downstairs room
0:10:36 > 0:10:39which would have originally been the lounge, you can see
0:10:39 > 0:10:42that it has already been used, I think, as some kind of a let,
0:10:42 > 0:10:44because that is laid out as a bedroom.
0:10:44 > 0:10:46A fairly untidy one,
0:10:46 > 0:10:48but a bedroom nevertheless.
0:10:48 > 0:10:53But this room, this is a very large kitchen/living area.
0:10:53 > 0:10:56This is an ideal room as a kind of common room -
0:10:56 > 0:10:58it has a cooker in here.
0:10:58 > 0:11:00It carries on through the back - a bit of a utility area
0:11:00 > 0:11:03and on to the loo, and then upstairs to the bedrooms.
0:11:03 > 0:11:07Erm... Oh, that's nasty.
0:11:07 > 0:11:09Yes. It was all looking quite good until that.
0:11:09 > 0:11:12Moving swiftly on. It's great.
0:11:12 > 0:11:16Well, maybe not. But I'm prepared to give it time to grow on me.
0:11:16 > 0:11:18The mould certainly has.
0:11:18 > 0:11:20There is significant damp here.
0:11:20 > 0:11:24I think our old friend the flat-roof extension is at fault.
0:11:24 > 0:11:26I need to check outside.
0:11:26 > 0:11:28Well, when you're looking at properties,
0:11:28 > 0:11:32it's really important to look at them from all angles.
0:11:32 > 0:11:36If you head out the front here, and take a look at the roof,
0:11:36 > 0:11:39you can see something which could be a problem.
0:11:39 > 0:11:42You can see the tiles look like they've got some problems with them
0:11:42 > 0:11:44and if you look at the chimney stack,
0:11:44 > 0:11:49again, the pointing on that looks like it's in need of some attention.
0:11:49 > 0:11:52Now, any work on the roof is going to need scaffolding
0:11:52 > 0:11:56if it's to be done safely, and that is going to be expensive.
0:11:56 > 0:11:58So, as I said, whenever you view a property,
0:11:58 > 0:12:01make sure you come outside and give it a good look.
0:12:04 > 0:12:07If you're going to rent this out as an HMO
0:12:07 > 0:12:10- that's a house of multiple occupancy -
0:12:10 > 0:12:13then among a lot of other regulated issues, like fire alarms,
0:12:13 > 0:12:15gas certificates and so on,
0:12:15 > 0:12:19HMO inspectors would look at the suitability of the rooms.
0:12:21 > 0:12:24At the front of the house, there is a good-sized double,
0:12:24 > 0:12:25but the single room is small.
0:12:25 > 0:12:28The third at the back is very small,
0:12:28 > 0:12:30and only has this skylight.
0:12:32 > 0:12:35Would they all qualify as habitable, lettable rooms? I'm not sure.
0:12:37 > 0:12:40We invited a local estate agent along to find out what
0:12:40 > 0:12:43he would advise for this property
0:12:43 > 0:12:46that was guided at £49,950.
0:12:46 > 0:12:50If you were to look at owner-occupier values, a resale price could be
0:12:50 > 0:12:54somewhere in the region of £90,000 as a two-bedroom property.
0:12:54 > 0:12:58If it were to go on the open student market for sale, you would be able
0:12:58 > 0:13:01to achieve somewhere in the region of £110-£115,000.
0:13:01 > 0:13:02On a family rental basis,
0:13:02 > 0:13:06I would suggest somewhere in the region of £500 per calendar month.
0:13:06 > 0:13:10On a student market, we rent on the basis of £80 per room per week,
0:13:10 > 0:13:13which would equate to £240 per week,
0:13:13 > 0:13:16a total of £960 per calendar month.
0:13:16 > 0:13:20Don't forget that although this might sound like a no-brainer,
0:13:20 > 0:13:24you have all those regulations to comply with for an HMO let,
0:13:24 > 0:13:28and also, students don't rent for 52 weeks a year.
0:13:28 > 0:13:32Well, this is a good-sized house with masses of potential.
0:13:32 > 0:13:35Yes, there is work to be done,
0:13:35 > 0:13:39but get it right and this really could be a bit of a gold mine.
0:13:39 > 0:13:42Let's see who spotted it when it went under the hammer.
0:13:42 > 0:13:45We're going to go to a three-bedroom mid-terraced property.
0:13:45 > 0:13:49It's got the gas-fired central heating, it's got the double glazing.
0:13:49 > 0:13:52We've got it advertised with a price guide of 49,950 plus.
0:13:52 > 0:13:54Can I ask for 50,000?
0:13:55 > 0:14:03I'll take £46,000. 47 anywhere else. One bid on the left-hand side of 46. Do I have 47?
0:14:03 > 0:14:0947 on the telephone. 48. 48.
0:14:09 > 0:14:1249. 50.
0:14:12 > 0:14:14Shaking your head.
0:14:14 > 0:14:18I'll take 500 if it will help.
0:14:18 > 0:14:2549 and a half. Do I have 50,000? 50,000 on the telephone. 50,500.
0:14:25 > 0:14:30Definitely shaking. Going once at 50,000.
0:14:32 > 0:14:36Sorry. 50,500. 51.
0:14:36 > 0:14:4051 bid. 51 and a half. 52.
0:14:40 > 0:14:4552 and a half bid. 53. 54.
0:14:45 > 0:14:5054 bid. 55.
0:14:50 > 0:14:5255 bid.
0:14:52 > 0:14:5555 and a half. 56. 56 bid.
0:14:55 > 0:15:0156 and a half. 57. Do I have 57 anywhere else?
0:15:01 > 0:15:07Going once at 56 and a half, going for the second time at £56,500.
0:15:07 > 0:15:10Sold to the gentleman standing.
0:15:10 > 0:15:15That final bid of £56,500 was made by Andre
0:15:15 > 0:15:17and Hillary here with daughter Sophie.
0:15:17 > 0:15:19I met them to find out more.
0:15:21 > 0:15:25- Hillary, Andre, lovely to meet you both. Congratulations.- Thank you.
0:15:25 > 0:15:32- Good place.- It's got character. - Tell me why you wanted to buy it.
0:15:32 > 0:15:37Sophie is studying philosophy at Durham University and is
0:15:37 > 0:15:41renting a house a couple of streets away.
0:15:41 > 0:15:45She thought this might be a good area to buy in. We have let out houses before.
0:15:45 > 0:15:49We have done them up and let them out, but not to students.
0:15:49 > 0:15:53- Right. You bought it for your daughter?- I want more rent than that!
0:15:53 > 0:15:59- You are going to be ruthless, are you?- We're not ruthless.
0:15:59 > 0:16:01Durham I really like and it would be
0:16:01 > 0:16:02an excuse to spend more time in Durham.
0:16:02 > 0:16:05And Sophie could help us do this up.
0:16:05 > 0:16:08- It's more than just a property? It's a lifestyle decision.- Yes.
0:16:08 > 0:16:12- Tell me about you two. What do you do?- We teach at York College.- Great.
0:16:12 > 0:16:17- Art and Design.- Fantastic. - We've been teaching life drawing the last couple of days.
0:16:17 > 0:16:23- Life?- Life drawing. Nude model.- This is something different, doing up properties.
0:16:23 > 0:16:25I would have thought you'd be able to bring some of your art
0:16:25 > 0:16:27and design into this.
0:16:27 > 0:16:30- Do you want a mural on the walls? - That would be good.
0:16:30 > 0:16:35In our house at home he has painted lilies on doors and on the walls.
0:16:35 > 0:16:38Good. I'd be disappointed if you don't. Make a feature of it.
0:16:38 > 0:16:43It makes a change from magnolia. But no life drawing please, we're British.
0:16:50 > 0:16:54But with Sophie studying here at university
0:16:54 > 0:16:56maybe this could be her next student pad.
0:16:56 > 0:17:00- She could be living in this next year?- She could. She could.
0:17:00 > 0:17:06- If she pays us enough rent.- Come on. It's your daughter.- This is business.
0:17:06 > 0:17:09I think he's joking.
0:17:09 > 0:17:14They have a budget of £7,000 set aside for the project
0:17:14 > 0:17:18- What are the plans for it?- The roof at the back probably needs replacing.
0:17:18 > 0:17:22- The roof needs a good looking at. - Roofs can be expensive.
0:17:22 > 0:17:25- You could blow seven grand on the roof.- I don't think so.
0:17:25 > 0:17:28We have actually got some quotes and it won't be that much.
0:17:28 > 0:17:32- Don't worry.- We need to check the boiler out. We need to check the electrics.- Yes.
0:17:32 > 0:17:36The last house we did a heck of a lot of work.
0:17:36 > 0:17:40But I wouldn't want to get up on a roof.
0:17:40 > 0:17:44A wise decision. Some jobs should be left to the professionals.
0:17:44 > 0:17:47The couple are hoping to have the house ready in about six
0:17:47 > 0:17:50months, in time for the next student academic year.
0:17:50 > 0:17:53As they both teach, they'll have time off in the summer to do some
0:17:53 > 0:17:55finishing touches.
0:17:55 > 0:17:57It could work out just fine.
0:17:57 > 0:18:00What are you most looking forward to?
0:18:00 > 0:18:04The point where the roof is done and all the major stuff's done
0:18:04 > 0:18:08and we can just paint and make it look nicer.
0:18:08 > 0:18:11Listen, lovely to meet you both.
0:18:11 > 0:18:14I'm exhausted after that interview. Good luck with it.
0:18:14 > 0:18:17- Thank you.- Thank you.
0:18:17 > 0:18:19And breathe.
0:18:20 > 0:18:22Wonderful.
0:18:22 > 0:18:26Andre and Hillary have got themselves a great buy here.
0:18:26 > 0:18:30The charming thing is, I kind of don't think they really realise
0:18:30 > 0:18:33quite what a fantastic investment it is.
0:18:33 > 0:18:36I can't wait to see how they go on sorting it out.
0:18:36 > 0:18:39Will there be a special mural painted when we get back?
0:18:39 > 0:18:43Oh, yeah, and will she end up on the roof? Hopefully not.
0:18:43 > 0:18:45You can find out later in the show.
0:18:49 > 0:18:52Now, finding good tradesmen is often the key to getting a property
0:18:52 > 0:18:54done up well and on time.
0:18:54 > 0:18:59But some people choose to do it themselves to keep the budget down.
0:18:59 > 0:19:04So, have our buyers been getting stuck in or just stuck?
0:19:04 > 0:19:05Let's find out.
0:19:06 > 0:19:10Lewisham in south-east London has begun attracting buyers who have
0:19:10 > 0:19:13spotted that it's still a little more affordable than its neighbours,
0:19:13 > 0:19:17even though it has good train access to Docklands and Central London.
0:19:19 > 0:19:21Earlier in the programme, on this tree-lined street,
0:19:21 > 0:19:24the two-bed first-floor flat in this property was
0:19:24 > 0:19:30bought for 185,000 by Grant and his partner, Dawn.
0:19:30 > 0:19:33The intention is to, having bought it and renovated it,
0:19:33 > 0:19:36put it onto the rental market. That's the plan.
0:19:36 > 0:19:40The most obvious issue about this property was that horrible, black
0:19:40 > 0:19:43mould everywhere, but I wondered what else they were going to tackle.
0:19:43 > 0:19:46So, are you going to try to reconfigure this space
0:19:46 > 0:19:49- or leave it as it is? - The bathroom is quite small.
0:19:49 > 0:19:51There is a partition wall between that and the kitchen
0:19:51 > 0:19:54which we'll take down anyway because it's currently rotten.
0:19:54 > 0:19:56Potentially there could be other changes. I don't know.
0:19:56 > 0:20:00They'd set a budget of 20,000 and hoped to have the flat ready
0:20:00 > 0:20:01to let in three months.
0:20:02 > 0:20:06It is now four and a half months later and we're back.
0:20:08 > 0:20:11Wow. The flat has really undergone some major changes.
0:20:18 > 0:20:22The staircase now welcomes you into this flat and the beautiful
0:20:22 > 0:20:26open-plan kitchen/living area is at the front of the property.
0:20:29 > 0:20:33They removed the walls that had formed the two front bedrooms
0:20:33 > 0:20:35and this lush, light room is the result.
0:20:37 > 0:20:38But where did the two bedrooms go?
0:20:38 > 0:20:42Well, the former kitchen has become one, as I suggested, and with
0:20:42 > 0:20:46the kitchen relocated to the very front of the flat, the middle
0:20:46 > 0:20:50room that I thought would make a kitchen-diner is now also a bedroom.
0:20:52 > 0:20:56And what about that black mould? Was there any damp? What was the cause?
0:20:56 > 0:20:58It was literally just condensation.
0:20:58 > 0:21:01All the rooms were locked up, all the windows were locked up,
0:21:01 > 0:21:03so there was just moisture everywhere.
0:21:03 > 0:21:05It was pure condensation.
0:21:07 > 0:21:11Following the expert's report, they cleaned the mould
0:21:11 > 0:21:14and then replaced a lot of the ceilings anyway.
0:21:14 > 0:21:17The flat had new fire doors installed,
0:21:17 > 0:21:18plus a replacement boiler,
0:21:18 > 0:21:22and the flat roof over the dormer window's been fixed.
0:21:23 > 0:21:25Grant has been on site every day,
0:21:25 > 0:21:28project-managing the team that he's employed,
0:21:28 > 0:21:31and he's been doing a lot of the hard work himself
0:21:31 > 0:21:32to reduce the costs.
0:21:32 > 0:21:36The loft space is jointly owned by all the flats in the property,
0:21:36 > 0:21:40so Grant and Dawn couldn't make use of it for a third bedroom.
0:21:40 > 0:21:44Outside, the overgrown garden has been partially cleared,
0:21:44 > 0:21:48and money is being included in the budget to finish the job.
0:21:48 > 0:21:53Talking of funding, how did the initial 20-grand budget fare?
0:21:53 > 0:21:55We've run over - we're ready 4,000 over,
0:21:55 > 0:21:57so we're looking at 24,000.
0:21:59 > 0:22:02With the 185,000 they paid at auction,
0:22:02 > 0:22:06it takes the total investment to £209,000.
0:22:06 > 0:22:10And it sounds like the original plan to rent the property
0:22:10 > 0:22:14- has now changed. - We ideally want to sell it.
0:22:14 > 0:22:16We don't want to keep it as a rental property.
0:22:16 > 0:22:21We would like to just take the profit and then move on to the next one.
0:22:21 > 0:22:22But will there be a profit?
0:22:22 > 0:22:26Don't forget, they paid 55 grand over the guide price,
0:22:26 > 0:22:29and they've gone over the renovation budget.
0:22:29 > 0:22:32Not by a drastic amount, though, but it all adds up.
0:22:32 > 0:22:36How much do the experts think the flat could now be worth?
0:22:36 > 0:22:40If I was to put this property on the market, I'd hope to achieve
0:22:40 > 0:22:44£255,000 to £260,000.
0:22:44 > 0:22:47If I was to put this property on the market today,
0:22:47 > 0:22:49I would put it on for £260,000.
0:22:49 > 0:22:55Well, a possible profit of £46,000 to £51,000 before taxes
0:22:55 > 0:22:57and expenses, if they were to sell.
0:22:57 > 0:22:59If I was to put this property up to rent,
0:22:59 > 0:23:03I would expect it to achieve £1,200 per calendar month.
0:23:03 > 0:23:06If I was to put this property on the market today,
0:23:06 > 0:23:08it would achieve £1,200 per calendar month.
0:23:09 > 0:23:14And that would generate a yield of nearly 7% if they do decide to rent.
0:23:16 > 0:23:19This has been the second property that the couple
0:23:19 > 0:23:22have invested in, after Grant's career change.
0:23:22 > 0:23:25So do they see this as a sustainable business model?
0:23:27 > 0:23:30We'd need to be pushing three a year.
0:23:30 > 0:23:33Right now, it's one to two.
0:23:33 > 0:23:36If we can do three to four, that'd be great.
0:23:40 > 0:23:42We're now returning to the city of Durham in the north-east
0:23:42 > 0:23:44of England where, earlier in the programme,
0:23:44 > 0:23:48in the suburb of Gilesgate, this three-bed semi was
0:23:48 > 0:23:54bought for £56,500 by art tutors Andre and Hillary.
0:23:54 > 0:23:57Their daughter, Sophie, is a student in Durham,
0:23:57 > 0:24:00and she persuaded her parents that this would be a good place to
0:24:00 > 0:24:02add to their portfolio.
0:24:03 > 0:24:06We have let out houses before, done them up and let them out,
0:24:06 > 0:24:09- but not to students.- You bought it for your daughter then, or...?
0:24:09 > 0:24:12Well, I want more rent than that, so...
0:24:12 > 0:24:16- Oh, you're going to be ruthless, are you?!- No, we're not ruthless!
0:24:16 > 0:24:19The couple had a budget of £7,000 and hoped to have the property
0:24:19 > 0:24:22ready for the next academic year in about six months.
0:24:25 > 0:24:27Well, it's now ten and half months after our first visit
0:24:27 > 0:24:31and we return to meet the family again.
0:24:34 > 0:24:36The former kitchen at the back has been cleared
0:24:36 > 0:24:40and the room is now a living area once again, because the
0:24:40 > 0:24:43kitchen has been relocated into the utility room
0:24:43 > 0:24:45in the rear extension.
0:24:45 > 0:24:49You still have to go through the kitchen to get to the bathroom
0:24:49 > 0:24:53where the suite has been retained and new flooring laid.
0:24:56 > 0:24:59But the plans for the property have taken a detour.
0:24:59 > 0:25:01Well, when we originally bought the property
0:25:01 > 0:25:04we planned to rent it to four students,
0:25:04 > 0:25:07and that all looked great, and then, we found
0:25:07 > 0:25:11out that there are HMO regulations which mean room sizes have to
0:25:11 > 0:25:15be a specific size in communal areas, so, in the end,
0:25:15 > 0:25:19we realised that we couldn't do it, even if we shifted walls
0:25:19 > 0:25:21and sorted things out.
0:25:21 > 0:25:25We ended up having to keep it as more of a family home,
0:25:25 > 0:25:28and we're actually renting it out to a couple now, which is great.
0:25:28 > 0:25:31Yeah, and they are lovely, so, I feel good about that.
0:25:31 > 0:25:37# Gonna make you feel good Gonna make you feel good. #
0:25:38 > 0:25:39It means upstairs
0:25:39 > 0:25:44the three bedrooms have remained in their original configurations,
0:25:44 > 0:25:47decorated, and the damp doors dealt with.
0:25:49 > 0:25:54Downstairs, the living room has been returned to its original use.
0:25:54 > 0:25:56But treating the damp in the former kitchen
0:25:56 > 0:25:58threw up some unexpected problems.
0:26:00 > 0:26:05Well, when we came to this wall, we had real problems with the damp.
0:26:05 > 0:26:08There was poor guttering and it was letting in a lot of water,
0:26:08 > 0:26:12the slates on the roof needed sorting.
0:26:12 > 0:26:15There was also another problem - there were some units here
0:26:15 > 0:26:18and when they took them out, they found some dry rot.
0:26:18 > 0:26:21That had to be sorted and that was quite costly and time-consuming.
0:26:23 > 0:26:25The work took longer than expected,
0:26:25 > 0:26:29but with Sophie's help, they did a lot of the decorating themselves.
0:26:29 > 0:26:31Time to "brush up" on the budget.
0:26:31 > 0:26:34Did that stick to what it said on the tin?
0:26:34 > 0:26:37Well, I think we originally estimated about 7,000,
0:26:37 > 0:26:43but with solicitors' costs, auction fees, unexpected things that happened like the dry rot, the roof,
0:26:43 > 0:26:46it ran to about 11,000 at the end.
0:26:47 > 0:26:50With the 56,500 they spent at auction,
0:26:50 > 0:26:55it takes the total investment to 67,500.
0:26:55 > 0:26:58Time to see what two local estate agents think of the finish
0:26:58 > 0:27:01- they've achieved.- I think it was a good idea not to pursue
0:27:01 > 0:27:03the student route for this property.
0:27:03 > 0:27:05The sizes of the three bedrooms upstairs would always
0:27:05 > 0:27:07make it difficult for student occupation.
0:27:07 > 0:27:10Overall, the property is deceptively spacious.
0:27:10 > 0:27:12I think the property could be improved
0:27:12 > 0:27:15by refitting the kitchen and also the bathroom.
0:27:15 > 0:27:20Could the property be worth more than the £67,500 invested?
0:27:20 > 0:27:23In the current configuration for the property,
0:27:23 > 0:27:26I'd recommend an asking price in the region of 80-£85,000.
0:27:26 > 0:27:28I'd currently value the property at £75,000.
0:27:29 > 0:27:34That valuation range for the current three-bedroom configuration
0:27:34 > 0:27:38would generate a profit of £7,500-£17,500
0:27:38 > 0:27:41before taxes and expenses.
0:27:41 > 0:27:44Interestingly, both agents agreed the rental income would be
0:27:44 > 0:27:47£450 per calendar month
0:27:47 > 0:27:50in its current configuration - a yield of 8%.
0:27:50 > 0:27:54And Hillary and Andre are achieving a slightly higher figure.
0:27:54 > 0:27:57They haven't added a student let to their portfolio.
0:27:57 > 0:27:59I wonder if they'll be trying again.
0:27:59 > 0:28:03All the complications have made us think it is perhaps a little bit
0:28:03 > 0:28:06harder renting to students than you actually first think.
0:28:11 > 0:28:12Well, that's it for today.
0:28:12 > 0:28:15Join us next time for more Homes Under the Hammer.
0:28:15 > 0:28:17- We'll look forward to seeing- you then. BOTH: Goodbye.