0:00:02 > 0:00:05Have you ever wanted to buy a property at auction
0:00:05 > 0:00:10- but don't know where to start? - Perhaps we can show you some tricks of the trade.
0:00:10 > 0:00:12Join us now as we follow more people
0:00:12 > 0:00:15who bought their homes under the hammer.
0:00:40 > 0:00:45Now, auction houses aren't intimidating places to buy.
0:00:45 > 0:00:48All you need is money and a side helping of good sense.
0:00:48 > 0:00:52Today, we talk to some intrepid buyers who have taken the plunge.
0:00:52 > 0:00:56Will they sink or swim? Here's what they bought.
0:00:57 > 0:01:01'In the Vale of Glamorgan, everything's coming up roses at this former florist's.'
0:01:01 > 0:01:06Given that this is a bonus attached to the property, it's pretty good!
0:01:07 > 0:01:12'I get some pleasant surprises at this three-bed terrace in Chatham.'
0:01:12 > 0:01:16There's more character to this place than I expected.
0:01:17 > 0:01:21'And in Derby, this plot may lead you to believe
0:01:21 > 0:01:23'there's nothing to see here.'
0:01:23 > 0:01:27But before you go, "Eugh, boring!" Not at all.
0:01:28 > 0:01:30'All these properties were sold at auction.
0:01:30 > 0:01:36'We'll find out who bought them and what they paid for them when they went under the hammer.'
0:01:39 > 0:01:42'This is Barry in south Wales.
0:01:42 > 0:01:46'Originally a fishing port, Barry is now a popular seaside town.
0:01:46 > 0:01:50'It's only a few miles from the Welsh capital, Cardiff,
0:01:50 > 0:01:54'and that, as Barry's TV residents Gavin and Stacey would say,
0:01:54 > 0:01:56'is well lush.
0:01:58 > 0:02:01'Not only that, but the place I'm looking at today
0:02:01 > 0:02:06'had a very reasonable guide price of £47,000.'
0:02:06 > 0:02:10The property I'm here to see is on this fairly busy road,
0:02:10 > 0:02:14which under normal circumstances would be bad news.
0:02:14 > 0:02:17However, the lot that was up for auction
0:02:17 > 0:02:23was, in fact, a four-bedroom flat and attached to it this former florist's shop.
0:02:23 > 0:02:25Passing trade is a great thing to have.
0:02:25 > 0:02:28Former florist's shop? Bloomin' marvellous!
0:02:28 > 0:02:31So, what's it actually like?
0:02:31 > 0:02:36Firstly, nice big frontage onto the road, which is a positive thing.
0:02:36 > 0:02:39Then, basically, two rooms.
0:02:39 > 0:02:43This front room in a bit of a sorry old state, but not a bad size.
0:02:43 > 0:02:47So, you're thinking, what could you use it for?
0:02:47 > 0:02:51It's A1 useage, so a shop, a newsagent's, something like that.
0:02:51 > 0:02:55If you wanted to do food, you'd have to reapply for change of use.
0:02:55 > 0:03:00Then you've got this rear area here, which could be an ancillary bit to the shop, as it was,
0:03:00 > 0:03:03somewhere for preparing things or as back-room storage.
0:03:03 > 0:03:08That is pretty much it for the shop, really.
0:03:08 > 0:03:10Luckily, there's more.
0:03:12 > 0:03:15On to the living quarters now.
0:03:17 > 0:03:22Often with flats that are attached to a commercial premises,
0:03:22 > 0:03:26there are issues of access, sometimes it's through the shop.
0:03:26 > 0:03:29Not in this case. Separate door, which is good.
0:03:29 > 0:03:31It's looking like it's a half-decent space.
0:03:31 > 0:03:33Stairs up to your bedrooms there
0:03:33 > 0:03:36and then through into this,
0:03:36 > 0:03:40which is a decent-sized rear living room area.
0:03:40 > 0:03:43It's the only living room in the property.
0:03:43 > 0:03:47That is the kitchen and on to the bathroom.
0:03:47 > 0:03:50In terms of a layout, it's not ideal.
0:03:50 > 0:03:52You'd think about taking some of these walls out.
0:03:52 > 0:03:56But given that this is a kind of bonus attached to the property,
0:03:56 > 0:03:58it's pretty good.
0:03:58 > 0:04:02'Both the kitchen and the bathroom look fairly modern,
0:04:02 > 0:04:04'so that's good news.
0:04:04 > 0:04:07'There's also a backyard area, which needs a tidy up.
0:04:07 > 0:04:09'It's great to have some outside space.'
0:04:11 > 0:04:15Up here, you can't complain about the amount of space.
0:04:15 > 0:04:19Four bedrooms, pretty good sizes too, apart from one.
0:04:19 > 0:04:22The only disadvantage is that your loo is downstairs.
0:04:22 > 0:04:26Given that you've got four rooms, maybe convert the smaller one
0:04:26 > 0:04:28into a bathroom to create the bathroom upstairs.
0:04:28 > 0:04:31All in all, it's looking pretty rosy.
0:04:31 > 0:04:35The only fly in the ointment might be that some mortgage companies
0:04:35 > 0:04:40do not like properties which are mixed use - commercial and residential.
0:04:40 > 0:04:42If you're looking to take a mortgage out on this,
0:04:42 > 0:04:47you'd have to check that out with your mortgage provider before you commit to buying.
0:04:53 > 0:04:56'Three of the four bedrooms are pretty spacious.
0:04:56 > 0:05:02'All have modern double glazing. There's even a period fireplace.
0:05:02 > 0:05:05'But as the saying goes, every rose has its thorn.'
0:05:05 > 0:05:07Hm, just a small point!
0:05:07 > 0:05:11Whoever decorated this house went Artex crazy!
0:05:11 > 0:05:14It's all over the walls, the ceilings, wherever.
0:05:14 > 0:05:18Just one word of caution - older Artex does contain asbestos.
0:05:18 > 0:05:23When you're taking it off, you have to be really careful, depending on the age.
0:05:23 > 0:05:27Worth checking out before you go hacking into it with a sander.
0:05:27 > 0:05:31'Artex aside, everything else may be looking rosy
0:05:31 > 0:05:35'to anyone who fancied this former florist's.
0:05:35 > 0:05:37'There are several options.
0:05:37 > 0:05:42'You could keep it as a shop and flat, convert it into one large family home,
0:05:42 > 0:05:45'or there's the possibility of creating two flats.
0:05:45 > 0:05:48'Any major changes would need planning consent
0:05:48 > 0:05:53'and, as the property is leasehold, the leaseholder's approval.
0:05:53 > 0:05:59'Bearing in mind the guide price of 47,000, which option would make the best financial sense?
0:05:59 > 0:06:03'Let's hear some advice from a local estate agent.'
0:06:03 > 0:06:07You could sell this property as individual units
0:06:07 > 0:06:11for approximately 30,000 to 40,000 per unit.
0:06:11 > 0:06:16But I would suggest you would rent it rather than sell the property,
0:06:16 > 0:06:20to achieve approximately £450 per calendar month
0:06:20 > 0:06:22per individual unit.
0:06:23 > 0:06:28'What if you were to convert it into one single family home?'
0:06:28 > 0:06:31This property with four bedrooms would be able to be rented
0:06:31 > 0:06:34for approximately £600 per calendar month.
0:06:34 > 0:06:39'Or if you decided to keep the shop and let that?'
0:06:39 > 0:06:44I would expect the shop to achieve approximately 3,000 per annum.
0:06:44 > 0:06:50'So, you'd achieve more in rent if you split this into two flats,
0:06:50 > 0:06:55'but would just one house be worth less if you opted to sell it?'
0:06:55 > 0:07:00If the property was converted into a four-bedroomed residential,
0:07:00 > 0:07:05it would be, then, approximately between £80,00 to £90,000.
0:07:05 > 0:07:10'With the refurbished flat and shop combo being worth about the same,
0:07:10 > 0:07:14'you wouldn't necessarily make more by selling this as two flats.
0:07:14 > 0:07:17'The next owner will have to weigh this up carefully
0:07:17 > 0:07:20'before making their decision.'
0:07:24 > 0:07:28So, a really interesting mixed-use development opportunity here.
0:07:28 > 0:07:31Will the former florist's "bloom" again?
0:07:31 > 0:07:35Will it have too much of a "stigma" attached to it? Ugh!
0:07:35 > 0:07:38Or will the whole building become residential?
0:07:38 > 0:07:42It's all down to who bought it. Find out who that was when it went under the hammer.
0:07:45 > 0:07:50Moving on to the next lot, this is a shop with four-bedroom flat over.
0:07:50 > 0:07:52It's an investment opportunity.
0:07:52 > 0:07:56Who's going to put me in there, ladies and gentlemen, at...
0:07:56 > 0:07:5847,000?
0:07:58 > 0:08:01Who's going to start me off at 47,000, to get things moving?
0:08:01 > 0:08:06Who's got 45 to start things off? Thank you. 45,000 is bid.
0:08:06 > 0:08:0945,000 I've got. Six, I'm looking for. 45,000 I've got.
0:08:09 > 0:08:12Six, thank you. 46. And seven. And eight?
0:08:12 > 0:08:14Eight. Nine. 50?
0:08:14 > 0:08:1650,000 is bid. And one? And two?
0:08:16 > 0:08:1952,000 is bid. 52,000 I've got. 52.
0:08:19 > 0:08:2352,000 I have. 52,000's in the market. 52,000.
0:08:23 > 0:08:26And three. 53. Four. Five.
0:08:26 > 0:08:29Six? 56,000. And seven?
0:08:29 > 0:08:31Eight? 58,000.
0:08:31 > 0:08:33And nine? 60? 60,000 is bid.
0:08:33 > 0:08:35And one? Two?
0:08:35 > 0:08:3762,000. Three?
0:08:37 > 0:08:3963. And four?
0:08:39 > 0:08:4363,000 on you, sir. Any advance on 63,000?
0:08:43 > 0:08:4663,000 is bid. 63,000.
0:08:46 > 0:08:49Last chance. Be quick. 63,000.
0:08:49 > 0:08:5264. 64,000. And five?
0:08:52 > 0:08:5564,000 is bid.
0:08:55 > 0:08:57Any advance? 64,000...
0:08:57 > 0:08:5965. And six?
0:08:59 > 0:09:0365,000 on you, sir. 65,000 I'm going to sell it at.
0:09:03 > 0:09:07Any advance? Be quick. 65,000... Last chance.
0:09:07 > 0:09:10BANGS GAVEL 65,000.
0:09:11 > 0:09:14'So, with his successful bid of 65,000,
0:09:14 > 0:09:20'the new owner of the flat and florist's shop is Barry-based businessman Ian.
0:09:20 > 0:09:22'Regular viewers may recognise him,
0:09:22 > 0:09:26'as he's been on Homes Under The Hammer a couple of times.
0:09:26 > 0:09:31'He owns 16 rental properties in Barry, as well as a pleasure park.
0:09:31 > 0:09:36'He's got outline planning permission to develop that by adding 190 apartments.
0:09:36 > 0:09:39'Busy man! Time to meet up with him again
0:09:39 > 0:09:43'to find out why he's bought this former flower shop.'
0:09:43 > 0:09:47# Cos you, you and I
0:09:47 > 0:09:51# Back together again Got the world in a spin... #
0:09:52 > 0:09:55- Ian, good to see you again. - Thank you.
0:09:55 > 0:09:58- Congratulations. You've done it again!- I've done it again.
0:09:58 > 0:10:03It's three years since we last saw you. How's things gone since then?
0:10:03 > 0:10:05Yeah, not too bad, to be honest.
0:10:05 > 0:10:09- This is number 17.- Oh, wow!- Yeah.
0:10:09 > 0:10:12Tell me why you wanted to buy this place.
0:10:12 > 0:10:14I looked at the building and thought
0:10:14 > 0:10:19- maybe I could split it into two living accommodations.- Right.
0:10:19 > 0:10:23And maybe have one two-bedroom flat downstairs
0:10:23 > 0:10:26and a two-bedroom flat upstairs.
0:10:26 > 0:10:28- You've got to get planning permission.- Yeah.
0:10:28 > 0:10:33- How do you think that'll go? - Hopefully, it won't be a problem.
0:10:33 > 0:10:36But, you know, everything I do is a learning curve.
0:10:36 > 0:10:39MARTIN LAUGHS So we'll see what happens.
0:10:39 > 0:10:42What kind of budget? Talk me through the two options.
0:10:42 > 0:10:45If you just convert it as it is, if you like,
0:10:45 > 0:10:49what would it cost and what would you get in return?
0:10:49 > 0:10:55To convert it as it is, staying with a commercial shop,
0:10:55 > 0:11:00um...it'd be in the region of about £6,000, maybe £8,000.
0:11:00 > 0:11:06- OK.- To do the extra bits that I need to do to break it up into two living accommodations,
0:11:06 > 0:11:09we'll be looking at maybe 15,000, 20,000.
0:11:09 > 0:11:15- Not a lot more to give you two saleable properties, or rentable properties.- No. That's right.
0:11:15 > 0:11:19- And timescale for all of this? - Depends on the planning.
0:11:21 > 0:11:25Subject to planning, I'd say 12 weeks' turnaround.
0:11:26 > 0:11:30'There's no guarantee that planning permission will be granted
0:11:30 > 0:11:33'and Ian still has to make contact with the freeholder, too.
0:11:33 > 0:11:37'But this, it seems, is the least of his worries.'
0:11:37 > 0:11:41- The idea is to sell one...- Oh! - ..and rent one.- Right.
0:11:41 > 0:11:47The idea behind that is just to pull the money back in that I've paid for the property.
0:11:47 > 0:11:51Having said that, I haven't paid a penny out yet,
0:11:51 > 0:11:55apart from the deposit because, unbeknown to me, it was...
0:11:55 > 0:12:01I knew it was a commercial mortgage but I didn't realise under 75,000 people won't lend.
0:12:02 > 0:12:04So, at this moment in time,
0:12:04 > 0:12:08- we haven't actually exchanged contracts.- Ah!
0:12:08 > 0:12:14So I might have to try and find... some money from somewhere.
0:12:14 > 0:12:17Is there any danger you won't complete on it?
0:12:17 > 0:12:19No. There's no danger of that.
0:12:19 > 0:12:23I've got the monies in place, if I need to use it.
0:12:23 > 0:12:26I just don't want to buy it cash.
0:12:26 > 0:12:32- Gosh. So another slight headache that you weren't expecting? - Bit of a learning curve, isn't it?
0:12:32 > 0:12:35# Worry, worry, worry
0:12:36 > 0:12:40# Worry's all I can do... #
0:12:40 > 0:12:46'It's common for commercial mortgage lenders to require a large deposit
0:12:46 > 0:12:48'and have minimum loan amounts.
0:12:48 > 0:12:53'Let's hope that, with a bit more shopping around, Ian can find a lender.'
0:12:53 > 0:12:57After this, then, are you going to sit back and enjoy things
0:12:57 > 0:12:59or are you after another property?
0:12:59 > 0:13:02I-I... I'm always on the lookout for properties.
0:13:02 > 0:13:08It just depends where a deal comes up. I'm always on the lookout.
0:13:08 > 0:13:10- If the pleasure park comes off, it's happy days?- Yeah.
0:13:10 > 0:13:13I'll be able to go to auction every day!
0:13:13 > 0:13:18- Listen, good luck with it. Nice to see you again.- Nice to see you.
0:13:19 > 0:13:23So, it seems that it's not all plain sailings
0:13:23 > 0:13:27in the world of pleasure parks and property for Ian.
0:13:27 > 0:13:31An unexpected issue here that could have serious connotations.
0:13:31 > 0:13:35Thankfully, he's got the money to complete on the purchase.
0:13:35 > 0:13:38Otherwise it could get really nasty. Lessons to be learned.
0:13:38 > 0:13:42Will he get the planning permission? Will he get it sorted out?
0:13:42 > 0:13:45You can find out later in the show.
0:13:49 > 0:13:52'I'm in Chatham in Kent,
0:13:52 > 0:13:55'the historic town which once housed naval dockyards
0:13:55 > 0:13:59'and was home to a young Charles Dickens.
0:13:59 > 0:14:03'While maritime and literary history are important here,
0:14:03 > 0:14:07'the town is undergoing something of a sea change.
0:14:07 > 0:14:10'Is all this regeneration keeping property prices afloat?
0:14:10 > 0:14:13'Today's lot sounds promising.'
0:14:15 > 0:14:17I do love a "no through road".
0:14:17 > 0:14:20No-one using your lane for cut-throughs,
0:14:20 > 0:14:22quieter, peaceful even.
0:14:22 > 0:14:26Although in this case, the peace is shattered by the mainline trains
0:14:26 > 0:14:29that rumble past pretty frequently just there!
0:14:29 > 0:14:31Oh, well! You can't win 'em all!
0:14:31 > 0:14:35The property I'm here to see might make you a bit of cash, though.
0:14:35 > 0:14:39It's this three-bedroom terrace. It had a guide price of £65,000.
0:14:40 > 0:14:44There's a bit more character to this place than I expected.
0:14:44 > 0:14:48Look at those lovely sash windows. They could be original.
0:14:48 > 0:14:52They're not double glazed. It's a lovely room, spacious.
0:14:52 > 0:14:57You need to take down the wallpaper, but look, a second reception room.
0:14:57 > 0:14:59Perfect for that big dining table.
0:14:59 > 0:15:03You've got some storage space over here and look!
0:15:03 > 0:15:06You've even got some doors leading out to the garden,
0:15:06 > 0:15:10which I really like, although they're old and look a bit rotten,
0:15:10 > 0:15:12so they'll probably need replacing.
0:15:12 > 0:15:14And then you've got the kitchen.
0:15:14 > 0:15:18Not quite sure about the, er, wedding cake effect.
0:15:18 > 0:15:21Artex is one thing - not a personal favourite of mine.
0:15:21 > 0:15:24I'd be inclined to get rid of it.
0:15:24 > 0:15:28Also, the kitchen cupboards resemble a bit of old chipboard.
0:15:28 > 0:15:32Again, it all needs replacing but it's a brilliant space.
0:15:32 > 0:15:35As I'd expect, you've got a downstairs bathroom here.
0:15:35 > 0:15:40This gap between the bathroom and kitchen isn't a legal requirement any more,
0:15:40 > 0:15:43but I think it's a great space to put your washing machine,
0:15:43 > 0:15:45keep your smalls tucked away.
0:15:45 > 0:15:49We've also got a downstairs door that leads out to the garden.
0:15:49 > 0:15:53I'd block that up and you could put some more units here.
0:15:53 > 0:15:55So, overall, for around 60 grand?
0:15:55 > 0:15:59Well, I can't help but think you get a lot for your money.
0:15:59 > 0:16:02'Under the stairs, there's a large cellar.
0:16:02 > 0:16:06'This wouldn't need too much work to turn it into living space
0:16:06 > 0:16:09'or another bedroom, if a window can be made.
0:16:09 > 0:16:13'However, bedrooms are something this property is not short of.
0:16:13 > 0:16:16'There are three on the top floor.
0:16:16 > 0:16:20'Two are well-proportioned doubles and the other a single,
0:16:20 > 0:16:23'which you may be tempted to turn into a bathroom.
0:16:23 > 0:16:27'But with lots of cosmetic work needing to be done here,
0:16:27 > 0:16:32'conversion of the cellar and adding another bathroom won't come cheap.
0:16:32 > 0:16:37'You need to find a calculator and work out if it's worth it.'
0:16:38 > 0:16:41# Was it worth it?
0:16:42 > 0:16:45# Yes, it's worth living for... #
0:16:46 > 0:16:49I've seen many terraces like this in Chatham.
0:16:49 > 0:16:52Usually, you'd expect just a yard.
0:16:52 > 0:16:54But with this property, look!
0:16:54 > 0:16:59You get all of this - a really nice sized garden.
0:16:59 > 0:17:03One of the bonuses is, if you can't park at the front of your house,
0:17:03 > 0:17:07well, look, there's the other street so you could park there
0:17:07 > 0:17:10and come all the way in through the back door.
0:17:10 > 0:17:12I think that is a great selling point.
0:17:14 > 0:17:16'This extra space at the back
0:17:16 > 0:17:20'may make up for the train line outside the front door.
0:17:20 > 0:17:22'What are the prospects for this property?'
0:17:24 > 0:17:28Done up, this house is probably worth around 120,000.
0:17:28 > 0:17:34So, with a guide price of 65 grand, you're thinking, "Hm! There could be cash in this."
0:17:34 > 0:17:37Well, on paper and in theory, yes, there is.
0:17:37 > 0:17:41The problem that you're likely to face is actually selling the thing.
0:17:41 > 0:17:45The resale market in Chatham is flat as a pancake at the moment.
0:17:45 > 0:17:49If you're intent on recouping the cash and pocketing the profit,
0:17:49 > 0:17:53you may very well end up disappointed.
0:17:53 > 0:17:55# See these lines?
0:17:55 > 0:17:58# Truly disappointed
0:17:59 > 0:18:02# Truly, truly, truly
0:18:02 > 0:18:05# A-a-ah. #
0:18:05 > 0:18:09'We asked a local estate agent what he truly, truly thinks
0:18:09 > 0:18:12'of this auction lot guided at 65,000.'
0:18:17 > 0:18:21My first impression is that there is an awful lot of work here.
0:18:21 > 0:18:27It looks to me like there's issues with floorboards, the stairs, wiring
0:18:27 > 0:18:29and the windows may need to be replaced.
0:18:29 > 0:18:34I would think you'd need to spend 10,000 or 15,000 on this property.
0:18:34 > 0:18:39That might be more if there's other issues uncovered, such as damp.
0:18:39 > 0:18:42You never know until you start on a project like this.
0:18:42 > 0:18:45'He's absolutely right.
0:18:45 > 0:18:49'There is obvious cosmetic work to be done, but scratch the surface
0:18:49 > 0:18:52'and there could be more worrying issues to tackle.
0:18:52 > 0:18:57'Once all these were fixed, however, how much could this place be worth?'
0:18:57 > 0:19:01Done up, depending on the standard of finish,
0:19:01 > 0:19:06I think you could achieve something in the region of £115,000.
0:19:06 > 0:19:09I think the rental per calendar month on this property
0:19:09 > 0:19:13would be £650 to £700.
0:19:15 > 0:19:21This is a fabulous rental with a decent profit built in for sunnier market conditions.
0:19:21 > 0:19:25I just hope whoever bought it was prepared to keep hold.
0:19:25 > 0:19:27Let's find out who that was at the auction.
0:19:29 > 0:19:33Lot 29. We've got a guide of £65,000-plus.
0:19:33 > 0:19:36Start me where you will. 65,000? It'll be worth all of that.
0:19:36 > 0:19:38Three bedrooms. 65,000 anywhere?
0:19:38 > 0:19:43Hands should be springing up like mushrooms. £65,000, thank you.
0:19:43 > 0:19:4668? 68 is bid. And 70?
0:19:46 > 0:19:4870 I have. 72?
0:19:48 > 0:19:5174 is bid. 76. 78.
0:19:51 > 0:19:55And 80. £81,000 I have. 82 I'm bid at the back.
0:19:55 > 0:19:58And 83? 83. And four?
0:19:58 > 0:20:0184 is bid. 85?
0:20:01 > 0:20:0486. And 87? 87.
0:20:04 > 0:20:0888? 88 is bid. And 89?
0:20:08 > 0:20:11And a half. And 89? 89.
0:20:11 > 0:20:13And a half. And 90?
0:20:13 > 0:20:15And 90. And a half? And a half.
0:20:15 > 0:20:1891? And a half. And 92?
0:20:18 > 0:20:20And 92 and a half?
0:20:21 > 0:20:2592,000, gentleman's bid. 92,000 for the first time.
0:20:25 > 0:20:28At 92,000 for the second time.
0:20:28 > 0:20:3192,000, third and final time?
0:20:31 > 0:20:33At £92,000. Are you all done...?
0:20:33 > 0:20:36BANGS GAVEL Sold at 92,000...
0:20:36 > 0:20:40'First to cross the finish line with his bid of £92,000,
0:20:40 > 0:20:44'27 grand over the guide price, was plumber Ian.
0:20:44 > 0:20:48'He lives around 30 minutes away in Brands Hatch.
0:20:49 > 0:20:53'So, it was a race back to the property for the two of us
0:20:53 > 0:20:58'to hear what he believes is the winning formula for this place.'
0:20:58 > 0:21:00- Ian, congratulations. - Thank you very much.
0:21:00 > 0:21:05- Why did you want to buy this at auction?- Cos I need to earn some money, basically.
0:21:05 > 0:21:11- You need to earn some money, so that means that you need to get this at a good price.- That's right.
0:21:11 > 0:21:15- But you paid £92,000.- I did and it was a bit more than I wanted to pay.
0:21:15 > 0:21:18- It wasn't exactly a steal. - No, it wasn't.
0:21:18 > 0:21:21I see this house as a great little renter.
0:21:21 > 0:21:25- What are you going to do with it? - My intention is to sell, actually.
0:21:25 > 0:21:30- I'm not into renting.- What are you going to do to turn it around?
0:21:30 > 0:21:34Well, it needs, obviously, a new kitchen, new bathroom,
0:21:34 > 0:21:37cosmetic works completely, new heating system.
0:21:37 > 0:21:40I'm a plumber, so the heating's not a problem.
0:21:40 > 0:21:44Partial electrics. Fuse board's in a bad way.
0:21:44 > 0:21:46Generally needs updating, bringing up to scratch.
0:21:46 > 0:21:52- I detect that you're going to be doing most of the work. - I'll do 99% of the work.
0:21:53 > 0:21:59'Ian has flexible working hours and hopes to manage most of the work himself.
0:21:59 > 0:22:04'That will save him money, but as he's more keen to sell than rent,
0:22:04 > 0:22:10'I want to hear how he's organising the finances to make a return on his investment.'
0:22:10 > 0:22:12What is your budget for the work?
0:22:12 > 0:22:16I estimate about 12,000 to 15,000.
0:22:16 > 0:22:20What do you think you could sell this property for?
0:22:20 > 0:22:26- Well, I know that one sold for 116,000 recently.- Hm.
0:22:26 > 0:22:32- So, maybe 116, 120.- OK. So that's not a lot of profit.
0:22:32 > 0:22:35- There's a little bit. - It's not a great earner.
0:22:35 > 0:22:38But at the minute, work-wise, in the outside world,
0:22:38 > 0:22:40it's pretty tight.
0:22:40 > 0:22:44I was looking for something to give me some income, basically.
0:22:44 > 0:22:47I'm going to put this to you, then you can tell me to shut up.
0:22:47 > 0:22:52The market is quite flat for sales. This would rent really well.
0:22:52 > 0:22:57You can achieve as much as 650 per calendar month for a property like this.
0:22:57 > 0:23:00Have you not thought about holding on to it?
0:23:00 > 0:23:02I'm not ruling out renting at all.
0:23:02 > 0:23:07If I can sell for the price I need to sell for, fair enough. If not, then I will rent.
0:23:07 > 0:23:11'Although Ian has a history of working in properties,
0:23:11 > 0:23:14'this is his first solo development project.
0:23:14 > 0:23:17'If this goes well, it may be the first of many.'
0:23:17 > 0:23:21How many of these a year are you hoping to turn over?
0:23:21 > 0:23:25I'd like to do two, I suppose, in between other things I'm doing.
0:23:25 > 0:23:28It should produce a reasonable amount of turnover.
0:23:28 > 0:23:32- What are you most worried about with this project?- Keeping the budget in!
0:23:32 > 0:23:38My worry for you is that you stick to the budget and there's enough profit in it for all your hard work.
0:23:38 > 0:23:42Yeah, well. I mean, profit's profit and earnings are earnings.
0:23:42 > 0:23:46As long as I get what I think I should get for it, that's fair enough.
0:23:46 > 0:23:51I'm not looking to make loads of money. I know it's not going to be a big earner
0:23:51 > 0:23:56Ian, you have got a great work ethic and, like you say, any profit is a profit.
0:23:56 > 0:24:00In these hard times, it's worth grafting over.
0:24:00 > 0:24:02It's lovely to meet you. Good luck with this project.
0:24:02 > 0:24:07- I can't wait to see how it turns out.- I hope it's nice. Thank you.
0:24:08 > 0:24:13I'm pleased Ian doesn't think he'll retire on this one, but he's right.
0:24:13 > 0:24:16Some profit is much, much better than none.
0:24:16 > 0:24:19I'm also pleased he'll consider renting, if he has to,
0:24:19 > 0:24:22as this could be a really nice slow-burning earner.
0:24:22 > 0:24:25You can find out how it goes later in the show.
0:24:26 > 0:24:30'Coming up, I'll have to hedge my bets in Derby.'
0:24:30 > 0:24:32The actual plot itself...
0:24:33 > 0:24:35..is somewhere behind those bushes!
0:24:36 > 0:24:42'We return to Kent to find out if Ian did buy a money-spinner.'
0:24:42 > 0:24:46This job was a lesson in budget control!
0:24:47 > 0:24:52'But first, back in Barry, was the work here a pleasure?'
0:24:52 > 0:24:56It's just been one adventure after another, if you like.
0:24:59 > 0:25:04'Time to wend our way back to Wales and the seaside town of Barry.
0:25:04 > 0:25:09'This shop was sold at auction and included a four-bedroom flat above.
0:25:09 > 0:25:14'It was bought for £65,000 by Ian, a pleasure park owner,
0:25:14 > 0:25:18'who was planning a development of 190 flats there.
0:25:18 > 0:25:21'But remind me, what did he plan to do here?'
0:25:21 > 0:25:26- Maybe I could split it into two living accommodations.- Right.
0:25:26 > 0:25:30And maybe have one two-bedroom flat downstairs
0:25:30 > 0:25:35- and a two-bedroom flat upstairs. - But you've got to get planning permission.- Yeah.
0:25:35 > 0:25:39- How do you think that'll go? - Hopefully, it won't be a problem.
0:25:39 > 0:25:42But everything I do is a learning curve.
0:25:42 > 0:25:45MARTIN LAUGHS So we'll see what happens.
0:25:45 > 0:25:49'So, how did he get on with those pesky planning permissions?
0:25:49 > 0:25:52'We're here to catch up with Ian seven months on.
0:25:52 > 0:25:55'It looks like the shop is closed for good.'
0:26:04 > 0:26:06It's a brand new house.
0:26:06 > 0:26:09It's a building within a building, to be quite honest.
0:26:09 > 0:26:13We've created two two-bedroom flats.
0:26:13 > 0:26:18Downstairs, we've knocked all the way through to put two bedrooms
0:26:18 > 0:26:21where the lock-up shop was and its bit of warehouse.
0:26:21 > 0:26:23It's now become two bedrooms.
0:26:23 > 0:26:27Just really blasted all the way through from top to bottom.
0:26:27 > 0:26:32Plastered all the walls, rewired, et cetera. Yeah, the whole works.
0:26:33 > 0:26:35'What a great job he's done.
0:26:35 > 0:26:39'It's clean, bright and modern with brand new bathrooms and kitchens
0:26:39 > 0:26:41'in each of the flats.'
0:26:43 > 0:26:47There used to be a wall along here, which we've opened up
0:26:47 > 0:26:49to make it a kitchen/living room.
0:26:49 > 0:26:55There's a bathroom next door. This used to be the master bedroom.
0:26:55 > 0:26:59It's worked out quite well. I'm very pleased with the kitchen.
0:26:59 > 0:27:01'It hasn't all been plain sailing.
0:27:01 > 0:27:05'Ian had a bit of difficulty getting the planning approval,
0:27:05 > 0:27:07'but not for any of the work inside.'
0:27:07 > 0:27:12There was going to be two doors to the front of the premises,
0:27:12 > 0:27:16so each flat would have its own access.
0:27:16 > 0:27:19But again, the council decided
0:27:19 > 0:27:22that they wanted to keep it within keeping of the street.
0:27:22 > 0:27:25So it had to be the one entrance.
0:27:25 > 0:27:29We had to amend, if you like, and just put the one doorway in.
0:27:29 > 0:27:34So the two flats have got a shared hallway coming into the premises.
0:27:34 > 0:27:38'Originally, he'd hoped to get the work done in three months,
0:27:38 > 0:27:40'but it's just over double that time.
0:27:40 > 0:27:44'The issue of the front door set him back a few weeks.
0:27:44 > 0:27:46'What else delayed him?'
0:27:46 > 0:27:50I didn't realise there was so much work involved with the property.
0:27:50 > 0:27:55It's an old-build. All the walls are skew-wiff.
0:27:55 > 0:28:01The floors were out. It's just been one adventure after another.
0:28:01 > 0:28:03'What about his budget?
0:28:03 > 0:28:08'He had thought he'd need to spend between £15,000 and £20,000
0:28:08 > 0:28:11'to convert the property into two flats.
0:28:11 > 0:28:14'How's that figure looking now?'
0:28:14 > 0:28:20I've ended up spending around 40... £45,000 it'll be.
0:28:20 > 0:28:22Around that figure.
0:28:22 > 0:28:24Too much. LAUGHS
0:28:24 > 0:28:28'Hm, indeed! Over twice the original estimate.
0:28:28 > 0:28:31'Hopefully, he'll at least make his money back.
0:28:31 > 0:28:33'Before we find out,
0:28:33 > 0:28:37'what's the plan for the flats when they're finished?'
0:28:37 > 0:28:41I always had it in mind for me daughter to have the bottom flat,
0:28:41 > 0:28:43Rebecca.
0:28:43 > 0:28:46She's excited to move in.
0:28:46 > 0:28:50Unfortunately, the bathroom is not finished downstairs.
0:28:50 > 0:28:54This one on the top floor, I'm either selling or renting.
0:28:54 > 0:28:57'Maybe some figures will help Ian decide.
0:28:57 > 0:28:59'We asked along two local experts
0:28:59 > 0:29:02'to give us their thoughts.'
0:29:03 > 0:29:05The flats are looking very well conditioned.
0:29:05 > 0:29:07Refurbished to a high standard.
0:29:07 > 0:29:10Any first-time buyer, investor,
0:29:10 > 0:29:12would be very interested.
0:29:12 > 0:29:15Especially the ground floor, which has its own garden.
0:29:15 > 0:29:18Both flats have been converted professionally
0:29:18 > 0:29:20to a very good standard.
0:29:20 > 0:29:24I particularly like the ground floor flat with a courtyard style garden
0:29:24 > 0:29:26for someone to enjoy the sunshine.
0:29:26 > 0:29:31Upstairs, even though it doesn't have outside space, is on a par presentationally.
0:29:31 > 0:29:35I think they'll achieve plenty of interest, whether they be sold or let.
0:29:35 > 0:29:38The standard of finish is very well presented.
0:29:38 > 0:29:41It has been done to a high standard.
0:29:41 > 0:29:45It is a sought-after area, especially for first-time buyers.
0:29:45 > 0:29:49It's near all amenities - shops, schools and public transport.
0:29:49 > 0:29:51'Let's talk figures, then.
0:29:51 > 0:29:54'How much could Ian sell each flat for?
0:29:54 > 0:29:59'Remember, he paid £65,000 for the property and spent £45,000 on the work.
0:29:59 > 0:30:04'That's a total outlay of £110,000 on both flats.'
0:30:05 > 0:30:09I would value the ground floor flat at £70,000.
0:30:09 > 0:30:12It'll have the edge on the first floor, due to the garden space.
0:30:12 > 0:30:16Upstairs, I would put between £65,000 and £68,000.
0:30:16 > 0:30:21The ground floor flat would resale for £74,000.
0:30:21 > 0:30:24It does have the garden, so it would be more sought-after.
0:30:24 > 0:30:30The first floor flat would resale for...£68,000.
0:30:30 > 0:30:36'If you take the top two figures for both flats, that's £142,000.
0:30:36 > 0:30:42'Potentially, a profit of £32,000, minus tax and expenses, of course.
0:30:42 > 0:30:44'What does Ian make of that?'
0:30:44 > 0:30:49Yeah, I'm quite happy - very happy with those valuations, to be honest.
0:30:49 > 0:30:56Yeah. I was expecting around the 70,000, 75,000 per flat.
0:30:56 > 0:31:01So, um... I have spent a lot of money on these flats.
0:31:01 > 0:31:05It's a new-build, really, you know what I mean?
0:31:05 > 0:31:09So, um... I'm happy with that. That's fine.
0:31:09 > 0:31:12'What about rental figures on both flats?'
0:31:12 > 0:31:16Both flats, for me, would be lettable at £525 per month.
0:31:16 > 0:31:20The ground floor would probably let easier because of the garden space,
0:31:20 > 0:31:25but I do feel we'd get 525 for both of them because of the professional conversion that's been done.
0:31:25 > 0:31:31The ground floor flat would rent for £550 per calendar month because it does have the garden.
0:31:31 > 0:31:35The first floor flat would rent for £525 per calendar month.
0:31:35 > 0:31:40I'm looking at 550 for both... for both flats, to be honest.
0:31:40 > 0:31:42So it's not that far away.
0:31:42 > 0:31:45'Have those estimates helped him decide
0:31:45 > 0:31:47'what to do with the first floor flat?'
0:31:47 > 0:31:51I would prefer to sell it, but it's about the right tenant.
0:31:51 > 0:31:56If the right tenant approaches me, I'm quite happy to rent.
0:31:56 > 0:32:00But I would prefer to sell. Get me money back in the pot.
0:32:00 > 0:32:03'Keeping his options open for now, then.
0:32:03 > 0:32:07'Has Ian enjoyed this, his biggest project so far?'
0:32:07 > 0:32:11It's ups and downs, swings and roundabouts and it's had its ups and downs.
0:32:11 > 0:32:15When I saw the carpets go in this morning, I was well lifted.
0:32:15 > 0:32:19So a few beers tonight. Happy times ahead.
0:32:22 > 0:32:24'I'm in the Midlands
0:32:24 > 0:32:29'in a residential suburb just over a mile from Derby city centre.'
0:32:29 > 0:32:33The property I'm here to see isn't a "property" at all.
0:32:33 > 0:32:38It's a plot of land, but before you go, "Eugh, boring!"
0:32:38 > 0:32:40Not at all.
0:32:40 > 0:32:44Over 20,000 people in the UK decide to self-build every year.
0:32:44 > 0:32:47It's an opportunity to build something to your own design
0:32:47 > 0:32:50and it could save you a lot of money.
0:32:50 > 0:32:53So "plot of land" equals "opportunity".
0:32:55 > 0:33:00'Sometimes, a self-build project can cost more than buying a house
0:33:00 > 0:33:06'and it is crucial to make sure you have the most suitable plot.'
0:33:06 > 0:33:10One of the things you look for when you choose a plot is access.
0:33:10 > 0:33:13Fantastic! You've got a bus route into the city centre.
0:33:13 > 0:33:16That's a great start, a very good selling point.
0:33:16 > 0:33:19This is the plot of land itself.
0:33:19 > 0:33:23It's flat. We like that. It's very close to amenities.
0:33:23 > 0:33:26There are probably gas pipes here, water, things to connect to.
0:33:26 > 0:33:28But the actual plot itself...
0:33:31 > 0:33:33..is somewhere behind those bushes.
0:33:33 > 0:33:37# I can't look at hovels and I can't stand fences
0:33:37 > 0:33:39# Don't fence me in... #
0:33:39 > 0:33:43'The front of the plot has been used for parking and has a dropped kerb,
0:33:43 > 0:33:47'giving good access for any building equipment.
0:33:47 > 0:33:50'Unfortunately, the rest of the plot is off limits,
0:33:50 > 0:33:53'so it's tricky to see what the layout might be like.'
0:33:56 > 0:34:00The rest is over this fence and, as you can see, terribly overgrown.
0:34:00 > 0:34:04When you combine it with this bit at the front, it's not a bad size.
0:34:04 > 0:34:06And it gets better.
0:34:06 > 0:34:10It has outline planning permission for the building of two properties.
0:34:10 > 0:34:14'That's right, two, with integral garages.
0:34:14 > 0:34:19'Let's get an idea of the dimensions of this plot.
0:34:19 > 0:34:22'It's actually 232 square metres.
0:34:22 > 0:34:27'If you're of a different vintage and prefer feet and inches,
0:34:27 > 0:34:31'it's 2,497 square feet.
0:34:31 > 0:34:35'That's very roughly the size of a tennis court.
0:34:35 > 0:34:39'So, what are we talking here? What could you build?'
0:34:41 > 0:34:44The plot currently has this outline planning permission
0:34:44 > 0:34:47for two two-bedroom semis.
0:34:47 > 0:34:53To be fair, getting that outline planning permission is a real big step in the planning process.
0:34:53 > 0:34:57If it's going to fail, it's likely to fail at that stage.
0:34:57 > 0:35:01It's not the end of the story. You have to apply for full planning permission.
0:35:01 > 0:35:05They'll look at things like materials, the design of the properties.
0:35:05 > 0:35:10You're not there yet, but you're a lot closer than if no planning permission was in place.
0:35:15 > 0:35:17'Full or detailed planning permission
0:35:17 > 0:35:21'also covers the positioning of the semis on the plot,
0:35:21 > 0:35:24'plus the siting of windows and drains and the like.
0:35:24 > 0:35:28'Basically, as the phrase implies, it covers all the finer detail.
0:35:28 > 0:35:31'I think there's definitely some money to be made here.
0:35:31 > 0:35:33'With that guide price of £17,000,
0:35:33 > 0:35:37'this is a different proposition to buying a house.
0:35:37 > 0:35:41'If you're not a developer and this is a self-build,
0:35:41 > 0:35:47'you'll need to find a specialist who deals in mortgages for home building and a deposit.
0:35:47 > 0:35:51'The lender usually provides the cash in instalments
0:35:51 > 0:35:53'at agreed stages of work.
0:35:53 > 0:35:56'Would it be worth taking a punt in this location?
0:35:56 > 0:36:00'I think so, but what does a local property expert reckon?'
0:36:02 > 0:36:04This is a very tight plot of land.
0:36:04 > 0:36:07I think it would be difficult to build a residential property
0:36:07 > 0:36:09of any note here.
0:36:09 > 0:36:12The shops opposite also detract
0:36:12 > 0:36:15from the area as a residential area.
0:36:15 > 0:36:19It's not the right place to build a commercial property, either,
0:36:19 > 0:36:23so the council are quite happy with the residential pair of semis.
0:36:23 > 0:36:25I think that's the best use of the land.
0:36:25 > 0:36:28'Hm, that's not hugely positive.
0:36:28 > 0:36:32'Could there be any other option for a developer?'
0:36:33 > 0:36:37The alternative to the proposal here would be a block of flats.
0:36:37 > 0:36:41I think there'd be room to put four flats on.
0:36:41 > 0:36:47It's quite an inexpensive area. It's good for renting and it's close to the city centre.
0:36:48 > 0:36:53'Opting for flats would mean going through the whole planning process again
0:36:53 > 0:36:56'and there's no guarantee you'd get permission.
0:36:56 > 0:36:59'This is a case where homework is required.
0:36:59 > 0:37:05'Not least about whether you'd want to live in, sell or rent the properties.'
0:37:05 > 0:37:10Once built, they will almost certainly be rental properties.
0:37:10 > 0:37:13It would be difficult to sell a property here in the current climate.
0:37:13 > 0:37:15'He sounds very definite.
0:37:15 > 0:37:19'What returns might be possible for this place,
0:37:19 > 0:37:23'that had a guide price of £17,000 plus building costs?
0:37:23 > 0:37:27'What would a semi rent out for?'
0:37:27 > 0:37:31The rental income would be approximately £450 per calendar month.
0:37:31 > 0:37:34'And if things changed in the market,
0:37:34 > 0:37:38'what could a new two-bedroom house achieve, if sold on?'
0:37:38 > 0:37:41If these properties were marketed for sale,
0:37:41 > 0:37:43they'd make around £90,000 each.
0:37:44 > 0:37:48Certainly a lot of work involved with a self-build,
0:37:48 > 0:37:52but for some people, a bit of a dream to take on such a project.
0:37:52 > 0:37:58As you're building two houses, maybe you could build one and sell it to pay for the other.
0:37:58 > 0:38:02Let's see who fancied the opportunity when it went under the hammer.
0:38:06 > 0:38:09Lot 43, a nice little site
0:38:09 > 0:38:14with consent for a pair of semi-detached houses - start me where you like.
0:38:14 > 0:38:17Can I say 20,000 for it? 20,000?
0:38:17 > 0:38:1818?
0:38:18 > 0:38:21£18,000?
0:38:21 > 0:38:2315 to start me? 15,000?
0:38:23 > 0:38:2615 is bid here. Thank you.
0:38:26 > 0:38:30At 15, my opener. 16 is bid. At 16. 17?
0:38:30 > 0:38:3317,000? At 17.
0:38:33 > 0:38:34£18,000?
0:38:34 > 0:38:38At £17,000. 500. 17,500?
0:38:38 > 0:38:4017,500. 18?
0:38:40 > 0:38:45At 18,000. 500. 18,500. 19.
0:38:45 > 0:38:4819,000. It's in the market, no mistakes. We're selling it.
0:38:48 > 0:38:51At £19,000... 500.
0:38:51 > 0:38:5320,000.
0:38:53 > 0:38:5720 and a half. 21? 21,000.
0:38:57 > 0:38:59500. No.
0:38:59 > 0:39:0221,500. 22 somewhere else?
0:39:02 > 0:39:08At £21,500 going once. Twice, third time...
0:39:08 > 0:39:10Sold at 21,500. Thank you.
0:39:10 > 0:39:14'That final bid of 21,500
0:39:14 > 0:39:17'was placed by Burton-on-Trent based builder, Rob.
0:39:17 > 0:39:20'He was at the auction with his wife, Karen,
0:39:20 > 0:39:24'who was clearly pleased with their plot purchase.
0:39:24 > 0:39:25'I met him at the site
0:39:25 > 0:39:30'to hear if he was going to play it safe and build the two semis,
0:39:30 > 0:39:33'or if he was planning to go off-plan.'
0:39:34 > 0:39:38Rob, congratulations. Tell me why you wanted to buy the plot.
0:39:38 > 0:39:41Basically, as an investment so we can carry on working.
0:39:41 > 0:39:44We've got one or two plots that we buy and build.
0:39:44 > 0:39:48- That's your background and your job, a builder?- Yeah.
0:39:48 > 0:39:52And why a plot of land rather than a refurbishment?
0:39:52 > 0:39:56- We find it easier to do a new-build than refurbing.- Really?- Yeah.
0:39:56 > 0:39:59- In terms of what? - You put in what you want to.
0:39:59 > 0:40:02You start from afresh and it's all OK.
0:40:02 > 0:40:07They say that sometimes knocking a house down and starting again is cheaper than patching it up.
0:40:07 > 0:40:10- That's what you're obviously buying. - We think so, yeah.
0:40:10 > 0:40:13- How many thing like this have you done?- About 19.
0:40:13 > 0:40:16- 19?!- Yeah.- And how have they gone?
0:40:16 > 0:40:20OK. Sold most of them. Kept a couple back, rented them out.
0:40:20 > 0:40:24- Are they mostly in this area? - Burton, south Derbyshire and Derby.
0:40:24 > 0:40:27- How many years have you been doing this?- About 12 years.- Right.
0:40:27 > 0:40:32- Do you still get satisfaction seeing things come out the ground? - A lot of satisfaction.
0:40:32 > 0:40:34Let's talk about this particular plot.
0:40:34 > 0:40:38It's not the most obvious choice. There's some issues about it.
0:40:38 > 0:40:40What attracted you to it?
0:40:40 > 0:40:43It was available and it was cheap at the time!
0:40:43 > 0:40:47'Short and to the point, but at least he's honest.
0:40:47 > 0:40:52'Rob will stick to the planning permission and build two semis,
0:40:52 > 0:40:56'but he's hoping to reuse some old plans he had drawn up
0:40:56 > 0:40:58'for a previous project.
0:40:58 > 0:41:04'He feels that, with a few minor tweaks, those plans could work just as well on this site.'
0:41:06 > 0:41:08So, from your point of view,
0:41:08 > 0:41:11using existing plans saves in terms of architect's fees.
0:41:11 > 0:41:14- It does, yeah. Saves quite a bit. - And also time.
0:41:14 > 0:41:18- This is the ground floor. - We've got parking spaces in front.
0:41:18 > 0:41:23Front door into sitting room. Kitchen in the back. WC.
0:41:23 > 0:41:27Then upstairs, you've got your two bedrooms and a bathroom.
0:41:27 > 0:41:32The plans that had outline approval had an integral garage. You decided not to go for that?
0:41:32 > 0:41:38We're trying to get two parking spaces on the front of each property and get more living space.
0:41:38 > 0:41:43'So, other than a few tweaks here and there, Rob is ready to go.
0:41:43 > 0:41:46'As he's built from these plans before,
0:41:46 > 0:41:50'he should know if there are any potential pit-falls.
0:41:50 > 0:41:54'All going well, he's hoping to complete each house
0:41:54 > 0:41:56'for a maximum of £50,000.'
0:41:56 > 0:42:01# If you want it Go out and get it
0:42:01 > 0:42:05# You've got to do it yourself Do it yourself... #
0:42:06 > 0:42:09Talk me through how the £50,000 per property comes out.
0:42:09 > 0:42:15You've got your main materials, your sewer connection, electric connection, gas, water.
0:42:15 > 0:42:17That'll eat into a lot of the money.
0:42:17 > 0:42:20What's the timescale for getting this sorted out?
0:42:20 > 0:42:23Three months for planning, then nine months to build them.
0:42:23 > 0:42:27- So a year from now we should see something on the plot?- Yeah.
0:42:27 > 0:42:30The plan for these, is it to sell them or to keep them?
0:42:30 > 0:42:35We're hoping to sell them, but if the market's still as bad then we'll rent them out.
0:42:35 > 0:42:39- What's next on the agenda for you? More plots of land?- Oh, yeah.
0:42:39 > 0:42:41We're looking for another plot.
0:42:41 > 0:42:44We'll go to the next auction, see if anything turns up.
0:42:44 > 0:42:49- Congratulations. We look forward to seeing how things come out the ground.- Thanks very much.
0:42:49 > 0:42:54Rob's clearly got the experience to make a success of this project.
0:42:54 > 0:42:57But there's still planning issues to resolve
0:42:57 > 0:43:01and will he be able to sell the properties once they're built?
0:43:01 > 0:43:04Find out how he gets on later in the show.
0:43:08 > 0:43:11Time has passed since we last saw those properties.
0:43:11 > 0:43:14Have the renovations been plain sailing
0:43:14 > 0:43:17- or bumpy rides? - Let's go back and find out.
0:43:20 > 0:43:24'Back down the Medway now to Chatham and this three-bedroom terrace.
0:43:24 > 0:43:29'It offered great rental potential to someone willing to invest the time and money.
0:43:29 > 0:43:32'Enter Ian, a plumber by trade,
0:43:32 > 0:43:35'who bought it at auction for 92,000 -
0:43:35 > 0:43:39'27 grand more than the guide price.'
0:43:39 > 0:43:41Why did you want to buy this at auction?
0:43:41 > 0:43:44I need to earn some money, basically!
0:43:44 > 0:43:49- You need to earn some money, so that means you need to get this at a good price.- That's right.
0:43:49 > 0:43:54- But you paid £92,000 for this. - It was a bit more than I wanted to pay.
0:43:54 > 0:43:57- It wasn't exactly a steal, was it? - No. It wasn't.
0:43:57 > 0:44:01'Ian may have paid more than he'd hoped to secure the property,
0:44:01 > 0:44:04'but what he did have on his side was experience
0:44:04 > 0:44:08'and the ability to do a chunk of the work himself.
0:44:08 > 0:44:11'We've come back just over seven months since I met him
0:44:11 > 0:44:14'to see how it looks now.
0:44:29 > 0:44:32'The ground floor has been freshened up throughout.
0:44:32 > 0:44:35'The only detail missing is carpets,
0:44:35 > 0:44:38'but that's because Ian chose not to put them down.
0:44:38 > 0:44:41'This allows whoever purchases the property
0:44:41 > 0:44:45'to make their own choices, thus making their personal mark.
0:44:45 > 0:44:48'But everything else downstairs - done.'
0:44:48 > 0:44:53The kitchen's been completely renewed. Everything's nice and tidy.
0:44:53 > 0:44:58The archway into the kitchen was covered in Artex and very small.
0:44:58 > 0:45:02I've extended the opening, made it much bigger, replastered everything.
0:45:02 > 0:45:07The patio doors did have big brick columns in the corners
0:45:07 > 0:45:11and it was very much subduing the light into the room.
0:45:11 > 0:45:14It's been opened up completely. All brand new.
0:45:14 > 0:45:17Fresh paint to make it nice and tidy.
0:45:18 > 0:45:21'Ian opted to keep the bathroom on this floor,
0:45:21 > 0:45:24'as he didn't want to lose any of the three bedrooms.
0:45:24 > 0:45:28'Speaking of which, let's see how they've been transformed.
0:45:40 > 0:45:43'As with downstairs, everything's been freshened up.
0:45:43 > 0:45:48'Throughout the whole property, Ian has replastered, rewired,
0:45:48 > 0:45:53'replumbed, installed central heating and new windows.
0:45:53 > 0:45:57'So, plenty of work - and there could be more.'
0:45:57 > 0:46:03The house is calling out to have more done to it, but financially, it's not viable.
0:46:03 > 0:46:06The cellar needs some work done to it.
0:46:06 > 0:46:08The loft is amazingly large.
0:46:08 > 0:46:11You could easily have a loft room put into it.
0:46:11 > 0:46:14Having said all that, that's not in my budget
0:46:14 > 0:46:16so what I've got is what I've got.
0:46:18 > 0:46:20'Ian's done the sensible thing.
0:46:20 > 0:46:22'While he realised the property's potential,
0:46:22 > 0:46:28'he didn't allow himself to get carried away and always kept the budget in mind.
0:46:28 > 0:46:31'His original estimate for the work was 15,000.
0:46:31 > 0:46:34'Did he stick to that?'
0:46:34 > 0:46:37I spent between 10,000 and 11,000.
0:46:37 > 0:46:40This job was a lesson in budget control.
0:46:40 > 0:46:44LAUGHS It needed to be the right budget.
0:46:44 > 0:46:50It is an area that doesn't sell at high prices so the budget was important.
0:46:50 > 0:46:54# It's hard to control myself It's hard to control myself... #
0:46:54 > 0:46:56'But control himself Ian did!
0:46:56 > 0:46:59'And a little Hammer hint to learn from him is,
0:46:59 > 0:47:02'make sure you know what sort of price you'll achieve
0:47:02 > 0:47:07'at the end of your project, as this should help you trim that budget.
0:47:07 > 0:47:11'This house is now complete, including a tidy up of the garden
0:47:11 > 0:47:14'and repainting the front of the property.
0:47:14 > 0:47:18'While Ian spent less than he'd hoped, it took more time than he'd planned.
0:47:18 > 0:47:21'Talking of time, did he have a good one here?'
0:47:21 > 0:47:26I do this all the time, so...it's bread and butter to me.
0:47:26 > 0:47:29LAUGHING: It's not a question of enjoying.
0:47:29 > 0:47:32It's come out quite nicely and I'm pleased with the finish.
0:47:32 > 0:47:34So no problems.
0:47:36 > 0:47:39'No problem is what we like to hear.
0:47:40 > 0:47:43'It's high time we asked two local property experts
0:47:43 > 0:47:46'what they think of it now.
0:47:46 > 0:47:50'Are they impressed by Ian's renovations here?'
0:47:50 > 0:47:53First impressions are very good.
0:47:53 > 0:47:56The house is smart, clean, fresh.
0:47:56 > 0:48:00I think the target market will probably be impressed.
0:48:00 > 0:48:06Possibly, the property's done to a higher standard than it needed to be, but very nice house.
0:48:06 > 0:48:08My first thoughts coming back today
0:48:08 > 0:48:12are that they've done a reasonably good job on the refurbishment.
0:48:12 > 0:48:17It's as good as you can get, I think, for this type of property.
0:48:17 > 0:48:20'Could it see some very healthy returns?
0:48:20 > 0:48:25'Ian paid 92,000 at the auction to purchase the house
0:48:25 > 0:48:28'and spent around 11,000 on the renovations.
0:48:28 > 0:48:34'What could he expect to earn on this investment if he was interested in letting it?'
0:48:35 > 0:48:38If this property was rented, I think it would achieve
0:48:38 > 0:48:43a figure of between £650 to £700 per calendar month.
0:48:43 > 0:48:46I'd expect the property to achieve around £650 per calendar month.
0:48:46 > 0:48:51That's about right. That's what I thought in this local area. OK.
0:48:51 > 0:48:54'So it could yield up to 8%,
0:48:54 > 0:48:57'which is a more than respectable rental return.
0:48:57 > 0:49:01'But right from the starting grid, Ian was keen to sell.
0:49:01 > 0:49:05'What would these experts suggest he could get for it?'
0:49:07 > 0:49:10I would be looking to market it around the 125,000 mark,
0:49:10 > 0:49:15probably to achieve around 120,000, 123,000, that sort of price.
0:49:15 > 0:49:19If I put this property up for sale, I would expect to achieve
0:49:19 > 0:49:25something in the region of 115,000 to maybe 125,000 at tops.
0:49:25 > 0:49:30That's a little bit more than I expected, so that's fine. That would be very good.
0:49:32 > 0:49:36'With Ian's total outlay of 103,000,
0:49:36 > 0:49:39'his investment could generate a pre-tax profit
0:49:39 > 0:49:41'of 12,000 to 22,000.
0:49:41 > 0:49:48'It's promising to hear the estate agents think he could achieve a bit more than he'd bargained for.
0:49:48 > 0:49:52'This may have been Ian's first solo project, but the grand plan
0:49:52 > 0:49:56'was to make property renovation part of his future career.
0:49:56 > 0:49:59'Does he feel the same now this one's complete?'
0:49:59 > 0:50:02I would definitely do it again. I've had a good time.
0:50:02 > 0:50:05Everything went according to plan.
0:50:05 > 0:50:10So, the maths works. Job works. OK. Fine.
0:50:15 > 0:50:19'We're back in the Midlands and it's destination Derby,
0:50:19 > 0:50:22'where earlier I met builder Rob.
0:50:22 > 0:50:28'He purchased this plot of land at an auction for £21,500.
0:50:28 > 0:50:32'Along with the land, there was outline planning permission granted
0:50:32 > 0:50:34'for two semi-detached properties,
0:50:34 > 0:50:37'which was the route Rob planned to go down.'
0:50:39 > 0:50:43Why a plot of land rather than a refurbishment?
0:50:43 > 0:50:47- We find it easier to do a new-build than refurbing.- Really?- Yeah.
0:50:47 > 0:50:50- In terms of what? - You put in what you want to.
0:50:50 > 0:50:53You start from afresh and it's all OK.
0:50:53 > 0:50:59They say that sometimes knocking a house down and starting again is cheaper than patching it up.
0:50:59 > 0:51:01- That's what you're buying. - We think so.
0:51:02 > 0:51:05'Rob had plenty of experience on his side,
0:51:05 > 0:51:08'as he'd already built two similar properties.
0:51:08 > 0:51:12'He hoped to combine the design with the planning permission in place,
0:51:12 > 0:51:16'with the aim of getting detailed planning permission in three months.
0:51:16 > 0:51:20'Then the builds would be finished nine months later.
0:51:20 > 0:51:23'However, it's now 22 months since we last saw him.
0:51:23 > 0:51:27'Will the two semis have risen from the jungle?
0:51:52 > 0:51:56'So, two clean-cut new-build semi-detached properties.
0:51:56 > 0:51:58'Each has a downstairs loo,
0:51:58 > 0:52:02'a living room with access to a good sized garden
0:52:02 > 0:52:05'and a kitchen on the ground floor.
0:52:05 > 0:52:08'Upstairs, there are not two bedrooms but three -
0:52:08 > 0:52:10'two doubles and one single -
0:52:10 > 0:52:14'and there's a family bathroom, too.
0:52:14 > 0:52:17'The houses are mirror images of each other,
0:52:17 > 0:52:21'except that the one on the left is a couple of weeks from completion.
0:52:21 > 0:52:25'So, come on, Rob, what happened to that one-year timescale?'
0:52:25 > 0:52:30We went to the council with a set of plans which they wouldn't accept.
0:52:30 > 0:52:33We tried to make them slightly bigger and move them back a bit,
0:52:33 > 0:52:35to make the rooms squarer.
0:52:35 > 0:52:38Because it had already got outline planning,
0:52:38 > 0:52:41they'd got a footprint of what they wanted to work to.
0:52:41 > 0:52:47We've had to keep going back until they'd accept the drawings.
0:52:47 > 0:52:50It's took us nearly 16 months to get planning permission.
0:52:51 > 0:52:53# I'm on a mission
0:52:53 > 0:52:58# I've got a vision I'm planning permission... #
0:52:58 > 0:53:02'Well, that just goes to show that even someone as experienced as Rob
0:53:02 > 0:53:05'can get caught out when it comes to planning.
0:53:05 > 0:53:09'While the outline planning permission is a great starting point
0:53:09 > 0:53:13'things can get sticky when it comes to getting agreement on details,
0:53:13 > 0:53:15'especially if you want to alter them.
0:53:15 > 0:53:20'Obtaining full planning permission can cost a lot of time and that means money.
0:53:20 > 0:53:24'Having been there and done that, what's Rob's advice?'
0:53:25 > 0:53:30Make sure it's got full planning, where you wouldn't have a long wait like we had.
0:53:30 > 0:53:33# Been a long time, been a long time
0:53:33 > 0:53:37# Been a long, lonely time... #
0:53:37 > 0:53:42'Once the wait was over, Rob and his crew were able to get cracking.
0:53:42 > 0:53:45'There was no shortage of work to do.'
0:53:45 > 0:53:49We cleared the site, excavated the foundations and concreted them,
0:53:49 > 0:53:52built the brickwork up to damp proof course,
0:53:52 > 0:53:55then built the shells up to roof height, put the roofs on,
0:53:55 > 0:54:00then complete them, plastering internally, electrics, plumbing.
0:54:00 > 0:54:04It took us about six months. The finishes are very good.
0:54:04 > 0:54:10The only down side is that the master bedroom could have done with being half a metre bigger.
0:54:10 > 0:54:16'Although waiting for planning permission forced Rob to go well over his one-year timescale,
0:54:16 > 0:54:19'given that he'd estimated work would take nine months,
0:54:19 > 0:54:23'getting it nearly done in six is impressive stuff.
0:54:23 > 0:54:27'What has been the most satisfying part of the journey for him?'
0:54:29 > 0:54:33Finishing it. And hopefully selling them.
0:54:33 > 0:54:36'No wonder he's got a smile on his face,
0:54:36 > 0:54:39'having almost reached the end of this lengthy build.
0:54:39 > 0:54:43'Will he still be smiling when his properties are valued?
0:54:43 > 0:54:46'This has been a tricky market and when we first met, it was suggested
0:54:46 > 0:54:49'this might be best for rental.
0:54:49 > 0:54:52'What do two local estate agents
0:54:52 > 0:54:54'make of this project now?'
0:54:55 > 0:54:59They've been done to a very, very high standard.
0:54:59 > 0:55:01Obviously a little bit of work
0:55:01 > 0:55:03to get them into the right state.
0:55:03 > 0:55:06However, I think they are done very well indeed
0:55:06 > 0:55:09and bring a welcome addition to the area.
0:55:09 > 0:55:14My impression of this pair of semis that the builder's put up
0:55:14 > 0:55:16is that he's created very successfully
0:55:16 > 0:55:19a silk purse out of a sow's ear.
0:55:19 > 0:55:24The sow's ear being the bit of scrub land, and he's created two very nice properties.
0:55:24 > 0:55:27'Adding up all Rob's costs,
0:55:27 > 0:55:30'including the £21,500 he spent on buying the plot,
0:55:30 > 0:55:33'plus his legal, planning and other fees,
0:55:33 > 0:55:37'makes a grand total of £164,000 for the two houses.
0:55:37 > 0:55:40'What could these semis sell for?'
0:55:43 > 0:55:50Having inspected this property and assuming next door is finished to the same specification,
0:55:50 > 0:55:55I would suggest to the builder that he markets the properties at around about £105,000 each,
0:55:55 > 0:55:59to achieve a final selling figure of £100,000 per property.
0:55:59 > 0:56:02If we were asked to market these properties for sale,
0:56:02 > 0:56:07I would suggest that we'd aim to achieve £100,000 per property.
0:56:07 > 0:56:12In order to achieve that, it would be sensible to ask £103,000 per property.
0:56:12 > 0:56:15That's fine. That's where we were expecting it to be.
0:56:15 > 0:56:21'With both estate agents agreeing that the final sale price for each would be 100,000,
0:56:21 > 0:56:24'brings the total to £200,000.
0:56:24 > 0:56:29'So, Rob stands to make a pre-tax profit of £36,000.
0:56:29 > 0:56:31'Although he's keen to sell,
0:56:31 > 0:56:35'if he can't get the right price, he'd consider letting them.
0:56:35 > 0:56:39'What might he be able to get for that?'
0:56:39 > 0:56:42If the properties were not to be sold but were to be rented,
0:56:42 > 0:56:45I would suggest under present conditions,
0:56:45 > 0:56:49each property would attract around £450 per calendar month.
0:56:49 > 0:56:53In my opinion, if the builder decided to rent the properties,
0:56:53 > 0:56:56I would suggest that he rents each property out
0:56:56 > 0:57:00at between £500 and £575 per calendar month.
0:57:00 > 0:57:04A little bit on the high side for this particular area,
0:57:04 > 0:57:09but due to the specification and the lack of other new-build properties,
0:57:09 > 0:57:12I feel that this would be definitely achievable,
0:57:12 > 0:57:17with young families looking to move into the area and close proximity to the city centre.
0:57:17 > 0:57:20I'd have thought it'd be about £500 a month.
0:57:21 > 0:57:24'So, quite varying rental valuations.
0:57:24 > 0:57:28'As both of them agree that the properties would be popular,
0:57:28 > 0:57:33'it seems fair to say it's not an option Rob would need to explore.
0:57:33 > 0:57:38'What's next for him and his team? A well-earned break, perhaps?'
0:57:38 > 0:57:42No! The plan is that we work for as long as we can for ten years.
0:57:42 > 0:57:44Hopefully, we'll retire after that.
0:57:44 > 0:57:48'No rest for the dedicated!'
0:57:52 > 0:57:59That's it for today. We'll be back with more thrills and spills from the auction room next time.
0:57:59 > 0:58:03- Join us then for more Homes Under The Hammer.- Goodbye.- Goodbye.
0:58:08 > 0:58:11Subtitles by Red Bee Media Ltd
0:58:11 > 0:58:14E-mail subtitling@bbc.co.uk