Episode 52 Homes Under the Hammer

Hello! Even with the current volatile property market,

people are still hooked on buying.

And that includes Lucy and me.

We particularly love the auctions where thousands of people each year buy their homes under the hammer.

We are constantly amazed by the stories that come out of the auction rooms.

Some real life successes and some real life dramas.

So let's see what inspired our buyers on today's show.

In Sittingbourne, Kent, find out how this quirky wreck on an incredibly noisy plot

was transformed and tripled its value.

In Cumbria, this old care home has been unloved for years

which might explain its price tag of just £55,000.

And if you thought that was a bargain,

how about a two-bedroomed flat in London

for under 150 grand.

Was it too good to be true?

All these properties have been sold at auction.

We'll find out who bought them and what they paid for them

when they went under the hammer.

Sold!

This is Sittingbourne in Kent, midway between London and Dover.

It was once a centre of brick making.

Today it's more likely that the transport links will attract you to this part of the world.

The property I'm here to see today is just outside Sittingbourne

in a little village with the very cute name of Bobbin.

But funnily enough, it doesn't feel like a little village

because we are right here on this busy main road

which leads directly down to the M2

which is obviously full of fast, noisy cars.

The property itself is here,

right on the fringes of this road.

The guide price - 95 to £105,000.

MUSIC: "Shout" by Lulu

So with all this traffic, it's not the greatest of starts!

WHISPERS: Sorry, it's not the greatest of starts.

And this house, on a corner plot, rather stands out against the new builds

that sit in the quieter side streets.

But could the inside of this lot make it a good shout?

First things first. What would I do if I moved in here?

Not single, not double,

quadruple, double quadruple glaze those windows

so you don't hear that noise.

OK. Let's move on and see what we've got.

This could be quite a delightful room.

You've got all these lovely beams in here, a little fireplace there.

But here's a big problem.

You can see there's been some sort of water leak

and there's a lot of rotting going on here.

Look at this, the plaster is just falling off

and there's a fungus-type web growing up here.

I would get this looked at by a professional,

because that could be worrying signs of rot, damp, I don't know what.

There's a very small kitchen leading off this room.

Quite dinky, serves its purpose.

But a little bit small.

Then towards the back of the property,

it is incredible how much quieter it is in this room.

This is a really nice room.

Again, lovely beams, a great window there. A fireplace.

It might end up being a bit of a corridor along here

because there are the stairs leading to the bedrooms.

Through here we've got a little cubby hole, and some storage.

Downstairs bathroom. Again, very small.

The loo. I suppose you could knock those two into one.

And some very useful storage space behind. A utility there, which is great.

It's interesting, that's for sure!

I'd like to see what's going on upstairs.

So there's damp and rot, and no central heating.

Plus what's going on downstairs isn't great.

Yet despite its condition, I think this place could be pretty decent.

Especially if you moved the bathroom upstairs.

You could then knock the kitchen through

and make one good-sized room. Could that be done?

Now, this is where I would put the bathroom.

It's a rather small, awkward room.

I don't think it works terribly well as a bedroom.

You've got the kitchen below, so plumbing shouldn't be a problem.

That would leave you two bedrooms upstairs.

I think that's the way to go.

Excuse me while I step over this precarious board here,

into one of the main bedrooms.

It's a really nice room. It's got a lovely feel to it.

You've got a beam and a nice fireplace.

A bit of character. An old immersion heater

that I suspect has been leaking.

So that could be the source of the problem downstairs.

I would still recommend an expert come out and have a look at that damp area downstairs.

But it's really nice up here.

It feels very welcoming, very homely.

I know it might be hard to believe,

but this really could be made into a super home.

Underneath the dilapidated state

are all the bare bones. Old beams,

fireplaces and interestingly-shaped rooms.

Then there's the outside space.

I don't want to keep going on about this,

but this really is a major problem.

You can't see the road from here, but boy, can you hear it!

I mean, what is a garden for?

Somewhere to sit outside, have a tranquil space,

have your friends round.

I certainly won't be in my deck chair over there in the summer months.

It's such a shame. Once upon a time, this was a farm property.

Can you believe it was surrounded by fields?

I think this noisy neighbourhood will undoubtedly put off potential purchasers.

This house is going to have to wow to compensate.

What does a local estate agent make of this mixed bag?

Well, quite a lot of work is required here.

But there's some character. Some beams and fireplaces.

So it'll be interesting to see how this one comes out.

And the road? How big a factor is it?

We find locally that the busy road will put off quite a number of buyers.

It might make the property slower to sell than it would otherwise be.

Well, no surprises there, really.

But if you did find the right buyer,

what could this house, that was guided at 95 to 105,000 sell for

once fully renovated?

I think the value could rise to somewhere around 215 to £220,000.

Well, those re-sale values are certainly encouraging.

What about renting it out?

The rental market is very strong in the local area.

There wouldn't be any problem letting this property.

I'd expect to achieve somewhere around 750 to £800 per calendar month.

A character home in a reasonably desirable area with money to be made.

If you've got the patience and passion for period property

and some ear plugs!

Let's find out who did at the auction.

Lot 39 us a detached cottage. Refurbishment and modernisation.

Three bedrooms on the corner plot.

Start me midway. 100,000.

Thank you, sir. £100,000 I'm bid.

105. 110.

110. 115. 115. 120.

125. 125. 128.

130. 132.

132 in a fresh place. 135.

135 in a fresh place.

138.

138. Gentleman on the left again.

138. 139 for you?

At 138,000, then.

For the first time at 138,000.

For the second time at 138,000.

Third and final time. 138,000. Are you all done?

Sold at 138,000. Congratulations.

So for 138,000

it was Derek and his wife Karen

who bought the three-bedroomed detached Kent house.

Derek is a plasterer by trade

and owns his own plastering company.

He already has a small portfolio of properties.

He'll get help on this refurbishment from his middle son, Andrew,

who also works for the company.

I met up with both of them to find out more.

Derek and Andrew, congratulations.

Tell me, who spotted this? Who wanted to buy it?

We spotted it, myself and my wife in a catalogue.

It was a little bit quick. We had to sort of rush into it.

We went to view the property and went to the auction the day after.

-So it was a little bit rushed. Originally we went to see one at Herne Bay.

-OK.

And this was a secondary one that we called in at on the way home on the off-chance.

Then we were pleasantly surprised.

A detached place. We thought this was the one to go for.

-Are you local?

-We're about 60 miles away in Hertfordshire.

-Ooh.

-So it's a bit of a travel, but it's not too bad.

I know you guys work together. You're in the trade, aren't you?

Yeah, we're both plasterers, family business.

My dad started out and I sort of went along with it.

-Went from there.

-My wife, Andrew's mum, she likes getting involved,

decorating and designing and all the lady bits.

So she'll be along doing it with us.

-So it really is going to be a family affair.

-Definitely.

'It's great to hear that they'll be getting stuck in here.

'Because there's plenty to be done!

'And I do have to mention the elephant in the room.

'Or, rather, the one outside!'

It's on a main road. Did that not put you off, first and foremost?

It did a little bit,

but it's such a quirky property,

that with double glazing it'll quieten the noise down a bit

and it is detached and on its own. I think someone will fall in love with it.

I think it's going to be a bit of a hard one.

You could love it, but if you're six foot, you won't be able to live in it.

But I think it's a lovely little property and it will look lovely when it's done.

I think you need to get that window triple-glazed!

-Most definitely.

-Cos it does get quieter throughout the rest of the house, doesn't it?

Yes, it does. I think what we'll do is have all bespoke windows made up

in keeping with the cottagey feel. We want to keep it as a cottage.

We don't want to go away from like a retro style, sort of thing.

I think everything's got to be done to make it look right, otherwise it'll be a mish-mash.

So you are going to stay with the cottagey, character feel of the place.

Yeah, we'll keep as much as we can of the original features.

If we do change them, try and put back what was there originally.

Keep it nice and old and characteristic.

Now, what about the kitchen?

It has to be made bigger, really.

With the bathroom downstairs, we'll try and move that

and that'll create a bigger kitchen.

Exactly what I was thinking.

Yes, I totally agree with you.

Move that into that room there,

to have a really nice big kitchen,

shift that bathroom upstairs in the small room

and then that leaves you with two bedrooms.

We knew the bedroom could be an important thing from the financial side,

but I reckon it's a good thing to do because the market we're trying to target,

a two-bed would be better, with the bathroom upstairs and a bigger kitchen

than having a three-bed.

What sort of budget have you got for a property like this?

-We reckon around 40,000 should be a realistic budget.

-Yeah, that really is a healthy budget.

How long do you think it'll take to complete?

We reckon between four and six months. With our normal work, most of the weekdays are taken up

so it'll be a weekend project.

So no real rush. Four to six months.

So on a Friday night, five o'clock, you'll be in your car driving down to Kent,

staying all weekend, driving back up to Hertfordshire Sunday night/Monday morning?

We have sort of done one or two of these before.

We done one in Ramsgate, a little bit further away.

So what we done was, once we got one bedroom tidy

and the bathroom with a bit of hot water, then we stayed overnight.

It makes it a bit better. You can work a bit later, get an early start.

And sometimes it's pleasurable. Treat yourself to a meal and a drink afterwards,

it's a lovely Friday or Saturday night.

-You can have fun as a family.

-That's what it's all about.

Guys, congratulations. I can't wait to see what you do.

I think knocking these two rooms together is going to set this place apart.

-Andrew, Derek, thank you.

-Thanks very much. Thank you.

Well, this house has lucked out with Derek and Andrew taking on the renovations.

They really do seem to care about this place.

I'm hoping when we return there'll be a massive transformation.

Join us later in the show to find out.

This is Maryport, on the Cumbrian coast.

Amazingly, much of this largely 18th-century town

was built on the site of one of the most northerly Roman ports in their empire.

But it's not Romans I'm here to see today.

Because this is Domus sub Pango!

That's Homes under the Hammer, in Latin!

I haven't come here today to conquer, but to look at an auction property.

It had a guide price of 45 to 55,000 quid,

and it's a whopper!

This, on this largely local authority housing estate.

Two semi-detached properties that were joined together to create this

which has been previously used as a care home.

Now, it's all shuttered up. I wonder if it's going to be hiding a multitude of sins?

This care home hasn't been in use since 2008,

hence its rather dilapidated appearance,

suggesting there might be rather a lot of work ahead.

Still, Rome wasn't built in a day.

It's going to be a case of piecing together what we've got

and what it used to be like.

Through the door into this large entrance foyer.

Then stairs up to all the rooms upstairs.

You've got two choices, you can either go that way or this way.

And my guess is that the house when it was two semis

was divided at some point here.

So let's see what we've got.

Coming down this way, you really get a sense of what this place was like.

Lots of rooms, and it all feels fairly substantial.

But the big question is, what are you going to do with it?

One option is to keep it pretty much as it is.

That's probably unlikely.

The money-making thing, I think, is to think about reconverting it back

into those two semi-detached properties.

They're obviously a pretty big size.

Look at the size of this kitchen. It obviously needs completely re-doing,

but the basic structure is here.

So a three-bedroomed and a four-bedroomed semi-detached.

You'd have to maybe put some stairs in,

and obviously kitchens and bathrooms.

But keep your costs down and buy this at the right price,

and I think there's money to be made on this one.

The corridor runs the length of the ground floor and the rooms all run off it.

There's also a reception room down here,

which I think has been used as a sitting room.

And if you turn the other way from the staircase,

there are more rooms.

On this side, you've got a loo, a really big loo and bathroom there.

And then through to this side end where there's a garage.

I'm a bit sort of intrigued by, if you like, the lack of damp-proofing,

and the fact you've only got a single skin wall here,

so you'd have to mess around with this to make it habitable.

But with a bit of effort, lots of potential.

And one thing you certainly cannot criticise this place for

is lack of space.

From the road you can see that the upstairs of this auction lot

that had a guide price of 45 to 55,000 isn't as wide.

As with the downstairs, there's a long corridor

but the room at the far end above the ground-floor bathroom

is more like an attic conversion and has very limited head-room.

But the problems don't stop there.

The six bedrooms, office and two bathrooms have all been vandalised

and the pipework has, well, disappeared.

Whoever bought this is going to have to factor in a complete re-plumb.

Also, a safety check of the electrics is a must.

At the back of the property, there's a lot of work required as well.

I'm beginning to think that fixing this place up

could prove to be rather expensive.

We invited the auctioneer who sold the property to come and tell us

what he'd advise for this former care home.

Prior to being a care home, it was two semi-detached properties.

And it could be converted back into either of those.

I suspect converting it back to two separate homes

would prove more expensive.

But how much could a semi achieve on the re-sale market?

If this property was renovated back into two semi-detached properties,

both slightly different sizes,

so perhaps one would be a three-bed semi-detached house.

That would achieve in the region of £80,000.

A four-bedroomed semi-detached property I think probably closer to £90,000.

What sort of rent could this generate if let?

I think the three-bedroom would achieve in the region of £400 per calendar month,

and the four-bedroomed house around £450 per calendar month.

But do beware!

It's a massive property.

Along with a massive property comes a massive project.

It really depends on what the buyer's going to do with it.

Lots of work to be done, but I think some good profits to be made here.

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

This is lot number six in the catalogue.

Previously registered as a care home.

This substantial detached property is in need of full renovation throughout.

Anybody in at 50?

At 45? At 45 here. We're away.

I'll take it in ones. Nice and easy.

£45,000 I'm bid.

46 in the aisle.

47. 48. 49.

And 50.

51. 52? Shake of the head at 52.

At £51,000. Are we all done?

Back in at 52.

53. 54.

Is that a bid or a "go away"?

At £53,000, then.

New bidder. 54.

55. 56. Shake of the head.

With you at 55.

Against you. Against you.

First time. 55, second time.

£55,000, then. Third and final time.

All done. All out. You, sir.

Well done.

That successful bidder who paid £55,000 was Alan.

Not only does he have a portfolio of properties which he lets,

but he also owns a business in the care sector.

So I was curious to find out what his plans were for this place.

I met up with him and his manager Amy to find out more.

Alan, Amy, great to meet you both.

-Congratulations.

-Thank you very much.

Tell me why you wanted to buy this place.

Well, we run a care company and we're actually looking to expand

-and this property came up. It was an ex care home.

-Yes.

To be quite honest, it was an opportunity not to be missed.

So your business is actually care homes?

No, we provide residential community-based support

for people with learning disabilities.

And within this area, there isn't a lot of residential options for people with learning disabilities.

We're looking to expand into that area to offer a new service to that sector.

Wow! This is almost purpose-built for you.

It needs a lot of work, but in terms of what its end use will be.

It's going to be slightly different.

We're actually going to make this into four self-contained units

for adults with LD.

-That's learning difficulties?

-Learning difficulties, yes.

And it'll have 24/7 staff.

Tell me how you two work together. What are your roles?

I retired over a year ago

and I've provided housing for adults with LD for about ten, 12 years, now.

And I looked at providing care a few years ago,

but with us working full time,

I didn't have the time to do it.

So when I retired, we started this off, Amy came on board.

It took us over two years, even with Amy's help.

And we've got the business going now

and we're going from strength to strength.

Amy's the registered manager for the organisation.

She has to make sure that whatever housing they provide

meets the strict regulations of the Care Quality Commission.

The intention is to provide enhanced care.

'Normally, you have residential properties with residential beds.'

So that's an independent bedroom, maybe an independent bathroom,

but with communal living areas.

What we're looking to establish here is four self-contained flats

where people can live completely independently

and create the illusion of full independence,

whilst risk-managing all the day-to-day living skills.

As well as the independent living quarters,

the plan is to redevelop some shared areas

where they can work together to learn skills from each other.

After around two years with this support,

the residents will be ready to move into fully independent living.

How, then are you going to convert what we've got here now into what you'd like it to be?

Basically, there will be four self-contained units.

Where we're standing now is going to be a communal living area.

There will be walls to take out, walls to put up.

At the end there, we're going to make that into a living room.

The little garage area.

Obviously there'll be building regs as well to go with that.

'Alan intends to project manage.

'He and his son Christopher will do as much as they can,

'bringing in electricians, plumbers and plasterers as required.

'Alan's brother is a roofer,

'so that will be very handy.'

Do you know roughly how much you've got to set aside for doing the work?

We've got a budget of 45k

but I'll be very upset if we get anywhere near that.

I can't see us reaching that area, so to speak.

And a timescale?

Approximately three months. We should be there in three months.

Listen, congratulations. I'm truly delighted.

-I can't wait to see how you get on. A worthwhile venture. Good luck to you both.

-Thank you.

Well, it's not often that that happens.

What a fantastic find for Alan and Amy.

A property that's almost purpose-built for their requirements.

A bit of work to be done, but with their enthusiasm and determination,

I'm sure it'll be a successful project.

You can find out how it goes later in the show.

Still to come: in London, there's bags of potential in this flat.

You could theoretically enhance the property by extending upwards.

Wait till you see the fantastic work

Alan and Amy have done at this care home in Cumbria.

But did they do it within their budget?

And back in Kent, it's looking fabulous!

But the costs spiralled.

We think that what we spend we'll get back, and more, so it's worth it.

One of the appeals of Sittingbourne in Kent is its location,

with good transport links to Dover, Maidstone, Canterbury and London.

However, it's less appealing if you happen to be on one of these main road links.

That was the case with this three-bed detached property,

that went to auction, in the nearby village of Bobbin.

Mind you, that wasn't the only negative about this cottage.

There were signs of damp, possibly from the leaky water tank upstairs,

a rather small kitchen and a downstairs bathroom.

It was generally in quite a sorry state.

But there were a fair number of character features

and an opportunity to improve considerably what was already here.

Hertfordshire-based Derek and his wife, Karen, and son Andrew

had bought it at auction for 138,000

as a family project to do up and sell on.

It's on a main road. Did that not put you off, first and foremost?

It did a little bit, but it's such a quirky property,

with double glazing to quieten the noise down a bit,

and it is detached and on its own,

I think someone's going to fall in love with it.

Now, what about the kitchen?

It's too small and it has to be made bigger, really.

So with the bathroom downstairs, we'll try and move that

to create a bigger kitchen.

But that leaves you with two bedrooms.

It's a good thing, because the market we want to target, a two-bed would be better

with a bathroom upstairs and a bigger kitchen, than possibly the three-bed.

Both Derek and son Andrew are plasterers.

They'd hoped that with help from Karen and contacts they have in the trade,

they could get the renovation done in four to six months

on a budget of 40,000.

Now, just four months later,

we're back with Andrew and his mum Karen

to see how they got on.

Wow! That's more like it.

It certainly has kerb appeal now.

Not only is the cottage looking splendid,

but the garden and the surrounds are so much more welcoming.

And it doesn't stop there.

Let's have a look inside.

It really is simply fantastic.

The basic changes we've made have been a complete refurb throughout.

Took everything back to the brick.

Completely re-plastered, electrics, plumbing, damp-proofed everywhere,

damp-injected everywhere.

A complete refurb.

Yes, a complete refurb - and then some!

I just love it!

Changed the layout quite a bit.

We had the bathroom and kitchen in one before,

so we've knocked it through and made it a kitchen downstairs

and moved the bathroom upstairs into the third bedroom.

So they may have lost a bedroom upstairs,

but boy, have they gained a bathroom!

The two remaining bedrooms are rather impressive, too.

And with double-glazing throughout,

just listen... Shh!

Hmm, that certainly makes a difference.

And they've also come up with some added extras.

Removing the immersion heating and airing cupboard,

they've created room for an upstairs shower room.

Downstairs, the old utility space has been turned into a study

or potentially a small single bedroom.

This is an amazing transformation.

It certainly looks like they've worked very hard.

I've been hands on throughout. I've done the majority of stuff inside.

Ripping out, changing the layout, the plastering,

and my dad's done similar stuff to me, and moved on to the garden.

Me and Mum have done the finishing touches like the painting

et cetera, that sort of stuff. And the woodwork.

It's been really good working as a family.

It's been hard work, and we had to bring our dog with us every weekend.

He's given us a lot of fun, running of with paint rollers and running round the garden.

All full of paint!

But it's been really good. We've enjoyed it.

What's even more impressive is that not only have they done this transformation in four months,

but the majority of the work was done only at weekends.

Wherever possible, they tried to enhance and sympathetically embellish

what was already here.

We've made the most of the character of the cottage.

Like the fireplaces have been made by Del using the bricks from the old kitchen wall.

And we've added a lot of oak, which we've reclaimed.

The handrail up the stairs

and floors in the bedroom, they're like old pine.

This is a very comprehensive refurbishment

and the cottage is now really looking the business.

But at what cost?

Our budget started at £40,000

but after the first few weeks, we realised it was probably a bit unrealistic.

Obviously an older property, we learnt a bit.

We decided to spend a bit more and it probably doubled by the end.

75,000. But we think what we spent we'll get back and more so it was worth it.

I was always concerned that this noisy location would put buyers off.

So now, I really am worried.

Given that the estate agent who saw the property previously

valued it at around 215 to 220,000 once done up,

then, ooh, well, this could be tight.

I think the finish is perfect for the sort of market you're going for.

Probably a professional couple.

It won't appeal much to families because of the location.

The main road will put a few people off,

but just by looking at the beauty of the property and standard of finish,

I think that will outweigh the road noise.

It's really nice the way they've managed to keep the original features.

And then blend it in nicely with the modern things, bathroom and kitchen. It's fantastic.

Derek, Karen and Andrew decided to increase their budget

to give their cottage the wow factor.

But will that pay off, as they've now invested a total of 213,000.

I think this property would sell for between 275 and £295,000.

I think the achievable price for this property would be around the £250,000 mark.

Values seem pretty reasonable. A minimum of 250.

After what we've done to the place, I want to see 250.

Obviously 275, 280 would be pretty reasonable.

Well, that could potentially be a pre-tax profit

of between 37 and 82,000.

And the estate agents estimated a rental value of between 800 and £900 per calendar month,

meaning a yield of around five per cent could be possible.

So overall, this has been a successful project.

What's next for them?

A nice little break, first, then straight into another one.

I'd look forward to doing another one.

Today, I'm in the south-east London suburb of Lewisham.

During the Victorian era,

Lewisham became very popular with city workers

who wanted to escape to a more rural and peaceful place,

but still with easy access to the city.

In recent times, it has been slightly overlooked

but that access is absolutely key to its rejuvenation.

Because we are literally just 15 minutes from London Bridge

or Canary Wharf on the DLR.

Off the busy high street, Lewisham is a little more peaceful

with some lovely period properties and an attractive park.

The property I'm here to see is at the end of this terrace.

It's a first floor two-bedroomed flat,

had a guide price of 135,000 quid. Let's take a look.

The front garden belongs to the ground floor flat,

but you do have a right of access across it.

That's fortunate, as otherwise, it would be very hard to reach the front door!

It's nice you've got that little communal area there,

and then your own private door into the flat itself.

As soon as you come in, a really nice feel about it.

High ceilings and this big landing area, making it feel quite open.

Kitchen and bathroom are that way.

Your first bedroom there.

And then down the little landing.

Storage space with a little hot water thing.

Second bedroom. It's small, but it is at least a second bedroom.

Then through into your living room.

Again, a nice feel to this. Bay windows, high ceilings.

I imagine there's quite nice floorboards here.

If you stripped them back, though, you'd have to consider the people downstairs,

cos clickety-clack with high heels and stuff.

Not nice for whoever's downstairs.

Apart from that, it's got a really good feel to it.

There are some odd scuffs and scrapes to be dealt with.

The walls definitely need re-skimming and a freshen up decor-wise would be a good idea.

But nothing radical.

But there are layout problems back at the other end of the corridor.

A bathroom next to the kitchen is far from ideal.

I think there's definitely a re-jig needed to sort out this layout.

The other question that's buzzing around in my head is,

is there any way to add more value to this property?

Now, one thing which is really important to consider

whenever you're buying a flat

is the situation regarding the lease.

You want to be really sure what your lease entitles you to.

The outside space, the inside space and, in this case, the space above the flat.

We're in the upper flat here.

Sometimes the leasehold in this flat wouldn't own the space in the loft.

In this case, you do.

You are responsible for its upkeep,

but the good news is that you could theoretically enhance the property by extending upwards.

You would have to get the approval of the freeholder to do it,

but it could be a way to add good value to this flat.

Creating a bedroom and bathroom upstairs

would improve the flow downstairs.

The downside of this lease is that it only has about 68 years left,

so you'd need to think about the flat's mortgageability.

The real bonus here is the outside space.

It comes with a private part of the rear garden

accessed from an exterior shared stairwell.

We asked a local property expert to give us his opinion

on this two-bed flat guided at 135,000.

What needs to be done to this property is purely cosmetic.

Come in, strip the walls, redecorate,

new kitchen, new bathroom, Bob's your uncle.

The only thing I would say to whoever buys it

is to look at the electrics, cos they look possibly out of date.

A very good tip. Extremely important.

What does he reckon about extending into the loft?

It looks like it's got quite a high spined ridge on the top of the loft,

so it looks like you could convert up into the loft

and the hallway is long enough to put in another set of stairs

so it's quite exciting.

Let's talk figures.

One renovated, how much could it sell or let for?

Once it's brought to a good standard,

the sale value, I think you're looking at £250,000.

That is limited only really because of the stamp duty in the area,

which is happening everywhere.

But you should get that sort of figure.

I think you'd be looking rental-wise at about £1,100 per calendar month

to £1,200 per calendar month.

And will the estimates improve with that loft conversion?

If you went into the loft and added a bedroom, turned it into a three bed,

you should see a fairly good uplift in the property.

In some areas, that's taken you all the way up to the 300,000 mark.

So the person has to look at the cost of doing the actual conversion

to the cost of what they'll get in the uplift.

So, a nice Lewisham flat with the potential to extend upwards.

A good price, good location.

An interesting one to go for. Let's see who agreed when it went under the hammer.

50,000, anyone?

125?

125.

126. 127.

128? 128.

130.

There were two keen bidders on this lot,

so we rejoin a little later

at 150,000.

150. 151.

151. 152.

153?

Come on, you've been there all along. You've been a good bidder. Don't leave empty-handed.

153, sir. Against you.

153. 154 against you.

155?

155 against you, madam.

Yeah? Bidding at 155.

156. 157?

157. 158.

159. Back of the room.

160.

At 160.

161. 162. 163.

163. 164.

164. 165.

165. 166. 167?

167. 168. 169?

169.

170, sir. 170. 171.

171. 172.

173? 173. 174?

174. 175?

175. 176?

Might be her limit. Never stop on those numbers.

176, sir, sitting down? You've been a good bidder.

176. 177.

Against you standing up.

It's with the gentleman sitting down.

Can't let him have it on that!

176 with the gentleman sitting down.

176 for the first.

176 for the second.

176,000 for the third and final time.

In the end, that successful bidder was Anish,

who paid 176,000.

He's been developing properties since he was just 21.

Up until now, he's had a full-time job as a business development manager

in a retail business.

But recently that all changed.

I met up with him at his new flat

to find out more.

-Anish, great to meet you.

-Likewise.

-Congratulations.

-Thank you very much.

Anish. That's a really interesting name.

-It originates from India. It means hero in Indian.

-Hero? Fantastic!

So, have you turned into a bit of a property hero?

I'd like to think so, yeah!

I've recently given up the day job and going into property development full time.

What kind of thing have you been working on?

What projects have you done so far?

Generally residential houses.

Full refurbs and extensions as well.

-So we've added value that way.

-Who's "we"?

-Me and my wife.

-Right.

-Satinda.

-Oh, great. It's a partnership.

-She's going to continue working

so she's got the short straw!

-What does she do?

-She's a shop manager.

Anish and Satinda plan to buy four properties a year

and set up a property management company.

You have to admire his courage.

He's certainly living up to his name.

# I can be your hero, baby

# I can kiss away the pain... #

So why this particular flat?

We live quite a distance from it, so it was a little bit different.

But I think it's got good commuter links into London.

And it's a lovely road.

Layout wise, are you happy with how it is?

It's not ideal with the bathroom off the kitchen.

That area is a bit of a disaster.

It's a bit of a mish-mash. We've looked at alternative options,

-but I think we would keep it as is.

-What are you planning to do to it, then?

It's not in bad condition, so I think we would look to skim the walls,

put new carpets down,

do some work to the kitchen. The kitchen units are quite good,

so we'll see what we can salvage.

And a complete new bathroom suite to give it a bit of a wow factor.

Anish has allowed nine weeks and a budget of £9,000 for the work.

And then hopes to rent it out.

I'm just wondering, could he be missing a trick here?

On the lease, we actually are responsible for the roof area and all the guttering.

Anything above our flat we are completely responsible for.

And therefore you own it, or, rather, you lease it.

We lease that area. So we do actually have the right

to go up into the loft.

You'd have to get the approval of the freeholder to do any works like that.

We would do. And we'd probably have to investigate with the council as well.

So that could be an option. We will cost that model up.

-Congratulations. Good luck.

-Thanks.

-Nice to meet you.

-Brilliant.

-Look forward to seeing how you get on.

-Thanks very much. Cheers.

So, Anish taking on a heroic challenge or not?

No, I don't think there's too much to do with this place.

Bit of sorting around of the internals.

And that decision of whether or not you extend up into the attic.

Will he do it? You can find out later in the show.

Well, time and tide wait for no man, as they say,

and in the property world, time usually means money.

So let's see how time and money have been spent.

Back now to the Cumbrian coastal town on Maryport,

where Alan paid £55,000 for this former care home.

He runs a company that provides residential care and support

for adults with learning disabilities.

Amy is his manager, who ensures the care they provide

meets the Care Quality Commission's guidelines.

In this area, there isn't a lot of options for people with learning disabilities

and we're looking to expand into that area to offer a new service to that sector.

'The plan was to create four flats to allow independent living

'and a communal area for support.

'However, the abandoned building was in a poor state

'as it had been vandalised.'

Do you know roughly how much you've got set aside for doing the work?

We've got a budget of 45k.

But I'll be very upset if we get anywhere near that!

Was Alan upset about that budget?

Two and a half months after we first met them,

it's time to find out, because we're back.

From outside, the newly-painted property is looking good.

And it's almost ready to welcome its new residents.

There are now two self-contained one-bedroomed flats on the ground floor.

Plus an office and a communal area.

And two more flats up on the first floor.

All four of the flats have an open-plan kitchen/sitting room

plus one bedroom and a bathroom each.

We knew we wanted the four individual flats

and the best way to do it plus a communal area.

So obviously downstairs is bigger than upstairs,

so that had to have the communal area.

There was like five, six bedrooms up here.

It already had some bathrooms.

We've moved some walls a matter of a couple of foot

to gain a bigger bathroom or a bigger kitchen.

It fell into place well.

Alan's skills are primarily the building side,

whereas my skills are the registration and legislation regarding this type of building.

Alan had to follow building regulations, of course,

and he discovered that he had additional fire-boarding work to do.

On the build side, the fire laws have changed a lot since it was a care home.

The amount of fire-boarding we've had to do downstairs is unbelievable.

It delayed the project a little,

but the extra time it provides to escape in a fire

more than compensates for that.

It all has to be certified along with the gas,

electricity and fire alarm installation.

Many of the rooms have changed from their original use,

and others have needed less work.

The four self-contained flats contain independent living environments

which is very important to help the residents learn to be self-sufficient.

The communal areas are just as important

because a lot of people who will be referred to our service

are most likely to come from a home environment where they're well supported with their families.

And having that communal space and communal kitchen area

will enable them to still have that sort of family environment.

They can learn how to do their general daily living skills, how to carry out the washing,

how to do their cooking and cleaning.

We've still the grounds to sort out.

We're looking at getting the residents involved in that.

-We want a greenhouse, garden, you know.

-A veg patch.

-A veg patch, aye.

Alan was determined to stick to a maximum budget of 45,000

and he's not quite finished yet.

Is he on target?

I done my figures this morning before you came

and we're at £33,000.

All I've got left to buy is all new skirting and architraves downstairs,

there'll be joiners' bills for the fitting of it and that.

We haven't paid the solicitor yet.

So at the very most, I would think we're going to come in at 36 to 37. That'll be all.

Alan paid £55,000 at auction,

and with his projected maximum outlay of 37,000,

that would take his total investment to £92,000.

Once it's operational, the rent will include 24-hour support,

all bills and food and skills training for the residents.

But how much does such specialist care cost?

At the moment, I'm going through new contracting,

which we can't finalise until we have our Care Quality Commission registration.

What I proposed to adult social care

is that we'd be looking to let out the residential beds

at around £750 to £850 per week per person.

That equates to £3,000 to £3,400 per calendar month.

So, based on the lower figure,

if all four flats were let,

that would produce an annual income of £144,000.

That's not all profit, of course,

as the running costs would have to be deducted from that total.

Time to find out what two local property experts think of this renovation so far.

I think the proportions of the property have been well considered.

They've divided it nice and equally

between the four separate flats

and given some good communal space.

There's a lot of work to still continue.

But what has been done so far has been done to a good standard.

I think it's a great location. This end of town has got the elevated position

so they'll get some fantastic sea views

particularly on a day like today.

There isn't enough places like this.

It's an advantage for people with learning disabilities

to be able to lead an independent life but in a safe environment.

It's great that the property's nearing completion

and will hopefully get the necessary certification

so that it can welcome its new residents soon.

But what value might the individual flats have

if they were to be returned to the open market?

The difficulties in valuing this property

because it's been converted for a specific use

is that on the open market the valuation I would give it

probably isn't going to be relevant for its specific use.

However, looking at comparable properties in the area of one-bedroomed flats,

I would say probably 40 to £50,000 each.

I would value the two ground floor flats and one of the first floor flats at £35,000 each.

However, the fourth flat is a lot bigger, dual aspect,

and I would put that on the market at £40,000.

Well, if all four flats were sold for around that valuation range,

that would produce a gross profit

of between 53 and £78,000 before tax and expenses.

It's a good contingency because if we - I'm not saying that we will -

but there's never a guarantee, if we don't get registration

then it's an opportunity to recoup the money that we put in

and use that to invest in another opportunity if needs be.

Of course, this project is a business

and Alan is determined the flats won't be going on the open market any time soon.

There's a big need for it. We know that.

You know. The selling opportunity and rental doesn't come into it, really.

Let's return now to Lewisham in south London,

where I viewed a top floor two-bedroomed apartment

in this end terrace,

which had a guide price of £135,000.

It was a tad tired and tatty,

but all in all, it wasn't in bad nick.

Anish agreed with my impressions of the property

as he paid £176,000 for it at auction.

He'd been dabbling in development for ten years

and had even ditched his day job in business management

to concentrate on building up his property portfolio.

The property needed a renovation, but he also had the opportunity

to extend up into the roof.

You'd have to get the approval of the freeholder to do any works like that.

We would do. And probably have to investigate with the council as well.

So we'd look at that. That could be an option. We will cost that model up.

So, would this be a tale of heroic triumph

or a tragedy of noble failure?

One month later, we're back.

So, how has our intrepid hero found his first foray

into being a full-time developer?

This was my first professional property in terms of being off work.

It's been much easier to manage being off work

and being here on site to answer any kind of queries,

so from that side it's been very successful.

And hopefully I'll have many more to come.

Anish had been planning on putting this property up for rent.

To keep costs to a minimum, he hoped to salvage as much as he could

We've made good the wallpaper that was here

and we've covered any kind of seams.

Given it a good double coat of paint.

We've kept the existing kitchen units as is,

and we've replaced the worktop with a brand-new worktop.

We've got rid of the old white cooker

and replaced it with a built-in electric oven with a gas hob on top.

We've also put in a combi boiler, and kept that in its existing position.

On top of that, we've also put in a brand-new sink, just to finish off the apartment.

We've kept the existing tiles as well.

Just given it a good freshen-up look.

The flat certainly has a clean and fresh feel.

The new carpets and floorings throughout complement the neutral colour scheme.

With a little splash of colour in the kitchen.

And the toilet.

Anish had planned on stripping the woodchip and wallpaper,

plastering the walls and removing the Artex.

However, this labour-intensive task will have slowed down renovation,

and increased his spend while, according to local estate agents,

not adding to the rental value of the property.

So Anish's tradesmen just repaired the wallpaper where necessary

which I'm sure helped him stay within his £9,000 budget.

We've ended up spending 6,100.

A large part of that reduction

was based on not having to remove the Artex and re-plaster throughout.

So we made some savings there.

And the rest of the money, the 6,000, was all budgeted for. So we were just about bang on.

Adding that £6,100 spend to Anish's purchase price of 176,000

gives him a total outlay of just over £182,000.

Anish has kept control of his budget and his schedule,

with the work completed in only three weeks.

One area still under consideration, though, is the attic.

We did look at the loft conversion.

It was something that we wanted to do but with the level of spend, we scaled back.

We decided not to put the extra investment into the loft conversion.

We will look at that at a later date,

and probably something we will do when we look to sell the apartment.

But for now, this flat is for renting.

And the good news is that Anish has already found a tenant.

We've got a couple moving in next week, so that's good.

Happy with that.

We've decided to rent it for a couple of years

and let the market pick up within the area.

The Greenwich area and Lewisham areas are on the up at the moment

so we thought we'd rent it out for a couple of years

and see what the market's doing in two or three years' time.

Sounds like a good plan.

Anish has been very business-like about getting this property turned around

with the minimum of fuss and cost.

What do two local property experts make of the end result?

'The standard of finish is very basic.'

But good for the rental market.

If you went too high, you might not get the return back.

And the same as for sales.

I think it's a nice, large two-bedroomed property.

Light and airy. I think the work's been done quite well.

Anish's plan is to hang on to the flat and sell it later.

If he were to sell it just now,

how would his £182,000 investment fare?

If we were to sell this property, we should achieve round about £240,000

to £250,000.

I would market this property in the region of 240,000 to £250,000.

Wow. That higher figure would give Anish a profit of around £68,000,

minus the usual tax and expenses, for just three weeks' work.

Is he happy with that?

Very happy. That's exactly what we budgeted.

We thought it would be between 235 and 240.

So very happy with that.

What about rental valuations?

I think this property should rent for about £1,000 to 1,100 per calendar month.

This property would rent for £1,150 per calendar month.

Very good. Happy with those figures.

We budgeted for 1,100

and we've managed to achieve 1,150 on a 24-month tenancy, so we're very happy.

That rental figure gives Anish a yield of just over 7.5 per cent.

This investment was Anish's first as a full-time developer.

And it's been a great success.

And he's already onto the next one.

We've secured another property.

It's a three-bedroomed house.

It needs full refurbishment, so there's a lot more work to be done.

But I'm looking forward to it.

We hope you've enjoyed looking at today's property portfolio.

Yes. Join us next time for more brave buyers' stories

-here on Homes under the Hammer.

-See you then!

-Bye.

-Goodbye!

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