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Hello and welcome to the show. More and more people are looking | 0:00:02 | 0:00:04 | |
to property as a way of investing their money rather than leaving it | 0:00:04 | 0:00:07 | |
-in the bank. -Yes. You do need to have a bit of cash, some confidence | 0:00:07 | 0:00:11 | |
and be prepared to do the hard work. | 0:00:11 | 0:00:14 | |
A good way to get a feel of your local market, | 0:00:14 | 0:00:17 | |
though, is to head down to the auction | 0:00:17 | 0:00:19 | |
and see what's going under the hammer. | 0:00:19 | 0:00:22 | |
# This village, baby | 0:00:50 | 0:00:53 | |
# Ain't large enough to be a town. # | 0:00:53 | 0:00:56 | |
This pretty and popular spot is Harborne, | 0:00:59 | 0:01:02 | |
a suburb only about three miles west of the city of Birmingham, | 0:01:02 | 0:01:07 | |
but with a much more village-y feel about it. | 0:01:07 | 0:01:09 | |
It has plenty of local amenities | 0:01:09 | 0:01:11 | |
and some attractive historical buildings. | 0:01:11 | 0:01:14 | |
And I'm just a hop, skip and a jump away from that village centre. | 0:01:14 | 0:01:18 | |
So nice, residential area. | 0:01:18 | 0:01:20 | |
Obviously, very close to local schools - there is | 0:01:20 | 0:01:22 | |
one right across the road. | 0:01:22 | 0:01:24 | |
Here to see a three-bed terrace | 0:01:24 | 0:01:26 | |
at a guide price the like of which I've not heard before - | 0:01:26 | 0:01:29 | |
£64,000 to £69,000. | 0:01:29 | 0:01:32 | |
Isn't that, like, an odd amount? | 0:01:32 | 0:01:34 | |
Anyway, it is what it is. And it looks pretty good from the outside. | 0:01:34 | 0:01:38 | |
Whoo, whoo, whoo! | 0:01:38 | 0:01:39 | |
Thank goodness for double glazing, eh? | 0:01:45 | 0:01:49 | |
Away from the noise of the school then and into the property. | 0:01:49 | 0:01:52 | |
And straightaway, a really nice feel. It doesn't smell damp. | 0:01:52 | 0:01:55 | |
The carpets look like they're in good condition. | 0:01:55 | 0:01:58 | |
Nice little entrance area here. Stairs up to your bedrooms there. | 0:01:58 | 0:02:01 | |
And then progressing into the kitchen. | 0:02:01 | 0:02:03 | |
Now, it's not in bad condition. | 0:02:03 | 0:02:04 | |
I mean, if you're renting this place out, | 0:02:04 | 0:02:06 | |
you'd pretty much leave it as it is. | 0:02:06 | 0:02:08 | |
It all seems to be vaguely working, which is good. | 0:02:08 | 0:02:10 | |
Not a bad size. | 0:02:10 | 0:02:12 | |
So, yeah, that gets my seal of approval. | 0:02:12 | 0:02:14 | |
And then, through this way. | 0:02:14 | 0:02:16 | |
I like houses where you can walk around, it's... | 0:02:16 | 0:02:18 | |
I don't know, just I like it. It's feng shui. It works for me. | 0:02:18 | 0:02:21 | |
This here... A large lounge, lots of light. You've got an open fire. | 0:02:21 | 0:02:26 | |
Yeah, ticking a lot of boxes already. | 0:02:26 | 0:02:29 | |
So, upstairs. Nice little landing area. | 0:02:35 | 0:02:37 | |
And then a separate loo and bathroom. | 0:02:37 | 0:02:39 | |
You probably know, I actually quite like that. | 0:02:39 | 0:02:41 | |
Other people might want to consider knocking that into one. | 0:02:41 | 0:02:44 | |
And then currently three bedrooms. Smaller boxroom there. | 0:02:44 | 0:02:47 | |
Largish bedroom towards the front there. | 0:02:47 | 0:02:50 | |
And then a third bedroom there. | 0:02:50 | 0:02:52 | |
And then what could potentially be a fourth bedroom is actually | 0:02:52 | 0:02:56 | |
currently laid out as a wet room. | 0:02:56 | 0:02:58 | |
If you didn't need those facilities, | 0:02:58 | 0:03:00 | |
that would then become another bedroom. | 0:03:00 | 0:03:02 | |
So a four-bedroom property. Wow, for that guide price, pretty good. | 0:03:02 | 0:03:07 | |
So, from what looks like a new house from the outside, | 0:03:13 | 0:03:15 | |
you might have expected a very small rear garden. | 0:03:15 | 0:03:18 | |
Hold that thought for a second. | 0:03:19 | 0:03:21 | |
Before I move onto the garden, look at this. | 0:03:21 | 0:03:24 | |
Just outside the back door, there's a soil pipe. | 0:03:24 | 0:03:26 | |
And going into it, | 0:03:26 | 0:03:27 | |
some pipes from probably the toilet or basin upstairs. | 0:03:27 | 0:03:31 | |
As you can see, they're dripping just little | 0:03:31 | 0:03:33 | |
amounts of water into this area of the property. | 0:03:33 | 0:03:36 | |
"So what?", you might say. | 0:03:36 | 0:03:37 | |
Well, believe me, | 0:03:37 | 0:03:38 | |
just that amount of water dripping into that spot over | 0:03:38 | 0:03:41 | |
a relatively short amount of time is going to cause all | 0:03:41 | 0:03:43 | |
sorts of problems for the foundations. | 0:03:43 | 0:03:45 | |
It could lead to subsidence in the future. | 0:03:45 | 0:03:47 | |
So, if you've got that going on in your house, sort it out now. | 0:03:47 | 0:03:50 | |
And if you were to buy this place, | 0:03:50 | 0:03:52 | |
definitely that is something that I would sort out pretty pronto. | 0:03:52 | 0:03:55 | |
Meanwhile, back to that garden. And... | 0:03:55 | 0:03:58 | |
Oh, no! Look at this! Not some postage stamp with artificial grass. | 0:03:58 | 0:04:03 | |
No, no, no. A great-sized, well-established garden, | 0:04:03 | 0:04:06 | |
with nice trees and shrubs. | 0:04:06 | 0:04:07 | |
It doesn't really tally with the look from the outside. | 0:04:09 | 0:04:12 | |
This is kind of intriguing. | 0:04:12 | 0:04:13 | |
There's also some useful outbuildings with | 0:04:14 | 0:04:17 | |
a loo and storage space. | 0:04:17 | 0:04:19 | |
And a handy side passageway. | 0:04:20 | 0:04:22 | |
So, it's great to have the access to the garden, but what is that?! | 0:04:24 | 0:04:28 | |
That, dear viewer, is a flying freehold. | 0:04:31 | 0:04:34 | |
I thought it felt a bit weird upstairs, | 0:04:34 | 0:04:36 | |
like it was bigger than downstairs. | 0:04:36 | 0:04:37 | |
Well, the reason is that bit there is actually | 0:04:37 | 0:04:39 | |
part of the upstairs of this building. | 0:04:39 | 0:04:41 | |
"So what?", you might think, "Fantastic news." Well, no. | 0:04:41 | 0:04:45 | |
When it comes to lending, mortgage lenders... Unless that is absolutely | 0:04:45 | 0:04:49 | |
clear in the title deeds, you might find that there's a bit of an issue. | 0:04:49 | 0:04:53 | |
So make sure your solicitor checks it out before you buy it. | 0:04:53 | 0:04:56 | |
But what does a local property expert make | 0:05:01 | 0:05:03 | |
of this pretty together property? | 0:05:03 | 0:05:05 | |
With a guide price of £64,000 to £69,000, | 0:05:05 | 0:05:09 | |
could it make a good investment on the resale market? | 0:05:09 | 0:05:12 | |
Renovated as it is, in terms of accommodation, the property would | 0:05:12 | 0:05:17 | |
sell on the open market for something between £105,00 | 0:05:17 | 0:05:19 | |
and £110,000. | 0:05:19 | 0:05:21 | |
If this property was to be a four-bedroom | 0:05:21 | 0:05:23 | |
and the wet room was converted, | 0:05:23 | 0:05:25 | |
it would probably be on the open market for about £125,000 | 0:05:25 | 0:05:28 | |
to £130,000. | 0:05:28 | 0:05:30 | |
What about its rental potential? | 0:05:30 | 0:05:33 | |
As a three-bed, this property would rent for something between | 0:05:33 | 0:05:36 | |
£600 per calendar month and £650 per calendar month. | 0:05:36 | 0:05:39 | |
If the property was renovated to make a four-bed, the rental | 0:05:39 | 0:05:42 | |
would be something between £650 per calendar month and £700 per | 0:05:42 | 0:05:46 | |
calendar month, obviously depending on the condition of the property. | 0:05:46 | 0:05:49 | |
Well, clarify that flying freehold issue, | 0:05:53 | 0:05:55 | |
figure out what you're going to do with all those bathrooms, | 0:05:55 | 0:05:58 | |
and I think you've got yourself a cracking little property here. | 0:05:58 | 0:06:00 | |
Let's see who agreed when it went under the hammer. | 0:06:00 | 0:06:04 | |
This next lot | 0:06:04 | 0:06:05 | |
is a traditional three-bedroom freehold | 0:06:05 | 0:06:09 | |
mid-terraced house. | 0:06:09 | 0:06:11 | |
Where shall we start, folks? Lots of interest. | 0:06:11 | 0:06:13 | |
70,000 to get it started. Anyone want to buy this? | 0:06:13 | 0:06:16 | |
At £70,000 to get it going. | 0:06:16 | 0:06:18 | |
Where are we? | 0:06:18 | 0:06:20 | |
At 70,000, and thank you. | 0:06:20 | 0:06:22 | |
At £70,000, then. | 0:06:22 | 0:06:25 | |
Do I have 75 anywhere? | 0:06:25 | 0:06:27 | |
75 on the front. | 0:06:27 | 0:06:29 | |
You want one. If we're quick with ones. 76. | 0:06:29 | 0:06:32 | |
77? 77. 78? | 0:06:32 | 0:06:35 | |
78. 79? | 0:06:35 | 0:06:37 | |
79. 80? | 0:06:38 | 0:06:40 | |
80. 81? | 0:06:40 | 0:06:41 | |
No? 81. 82? | 0:06:43 | 0:06:46 | |
No. | 0:06:46 | 0:06:47 | |
At £81,000, on sale, make no mistake. | 0:06:47 | 0:06:51 | |
One, two, three... | 0:06:51 | 0:06:54 | |
496, that is yours, sir, at £81,000. And well done. | 0:06:54 | 0:06:59 | |
And so the hammer fell at £81,000 on the three-bed mid-terrace. | 0:06:59 | 0:07:04 | |
And the delighted bidder was Jimmy. | 0:07:04 | 0:07:06 | |
Jimmy lives locally and works | 0:07:07 | 0:07:09 | |
in the family property developing company. | 0:07:09 | 0:07:11 | |
And he joined me, along with his brother Wassim, | 0:07:11 | 0:07:14 | |
back at the Harborne house. | 0:07:14 | 0:07:16 | |
-Jimmy, Wassim, great to meet you both. -Nice to meet you too. | 0:07:17 | 0:07:20 | |
Congratulations. Tell me why you wanted to buy this place. | 0:07:20 | 0:07:24 | |
What it is, it fell in our budget | 0:07:24 | 0:07:27 | |
for what we wanted to purchase at the auction. | 0:07:27 | 0:07:30 | |
And to be honest, it was in the range, | 0:07:30 | 0:07:32 | |
so we thought we'd just go for it. | 0:07:32 | 0:07:34 | |
Right. I understand this is part of a family business. | 0:07:34 | 0:07:36 | |
-You want to tell me a bit about that? -Yeah. | 0:07:36 | 0:07:38 | |
What it is, we work alongside our four uncles. | 0:07:38 | 0:07:41 | |
Within us, we have got, like, about | 0:07:42 | 0:07:44 | |
-100 houses throughout the portfolio, yeah. -Wow! | 0:07:44 | 0:07:47 | |
So the family have a history of property? | 0:07:47 | 0:07:50 | |
Yeah, we have been doing it for the last...I'd say about, oh, | 0:07:50 | 0:07:53 | |
15, 20 years? | 0:07:53 | 0:07:54 | |
So how do you split up the work that needs to be done? | 0:07:54 | 0:07:57 | |
Wassim, what do you do, for instance? | 0:07:57 | 0:07:59 | |
I do go to the auctions too | 0:07:59 | 0:08:00 | |
and I do purchase my own as well. | 0:08:00 | 0:08:02 | |
-Right. OK. -And just split it up, really, just like that. | 0:08:02 | 0:08:04 | |
Right. And Jimmy, what do you sort of specialise in? | 0:08:04 | 0:08:07 | |
I mainly go to the auctions... | 0:08:07 | 0:08:10 | |
Well, this particular property, I did, like, kind of blindly buy it. | 0:08:10 | 0:08:14 | |
How do you mean? | 0:08:14 | 0:08:15 | |
Because I didn't view it before I bought it, kind of thing. | 0:08:15 | 0:08:18 | |
But that was only because it fell into, you know, the budget. | 0:08:18 | 0:08:22 | |
And I did take a bit of a gamble on this one. | 0:08:22 | 0:08:25 | |
So what did you think when you walked through the door? | 0:08:25 | 0:08:27 | |
Well, we were really, really glad the way it turned out. | 0:08:27 | 0:08:30 | |
You know, we were really happy. Yeah. | 0:08:30 | 0:08:33 | |
Hm, not seeing it before they buy? Always risky. | 0:08:33 | 0:08:37 | |
But these guys are experienced developers | 0:08:37 | 0:08:39 | |
with plans to rent it out. | 0:08:39 | 0:08:41 | |
And I guess, if you've got 100 properties, | 0:08:41 | 0:08:43 | |
you'd feel you can cope with most things a house can throw at you. | 0:08:43 | 0:08:47 | |
-So what is the budget? -The budget is £1,000. -1,000?! -Yeah. | 0:08:50 | 0:08:54 | |
What are you planning to do for that? | 0:08:54 | 0:08:56 | |
Well, in that, we are going to get the wet room converted. | 0:08:56 | 0:08:59 | |
-Into a bedroom. -OK. | 0:08:59 | 0:09:01 | |
We're going to get the garden done as well, all cleaned out. | 0:09:01 | 0:09:04 | |
Other than that, just a bit of painting. | 0:09:04 | 0:09:07 | |
And timescale? | 0:09:07 | 0:09:08 | |
-Between one and two weeks. -Weeks?! -Yeah. | 0:09:08 | 0:09:11 | |
-MARTIN LAUGHS Very fast. -Bing! In here. | 0:09:11 | 0:09:15 | |
For this property, we've got someone that's ready | 0:09:15 | 0:09:17 | |
to get into it straightaway. | 0:09:17 | 0:09:18 | |
-So I guess that's another reason why you need to do it quickly. -Exactly. | 0:09:18 | 0:09:21 | |
-Well, listen, congratulations. Good to meet you. -Brilliant. | 0:09:21 | 0:09:24 | |
-Nice to meet you too. -Good luck with it. -Take care. | 0:09:24 | 0:09:26 | |
-Thanks for your time. -Thank you. | 0:09:26 | 0:09:29 | |
Well, the brothers breaking a golden rule | 0:09:29 | 0:09:32 | |
in not viewing the property beforehand. Tut-tut! | 0:09:32 | 0:09:36 | |
You know it is a bad thing to do, don't you? | 0:09:36 | 0:09:39 | |
Anyway, it seems like they got away with it in this instance. | 0:09:39 | 0:09:43 | |
But £1,000 to do it up in one to two weeks? Really? | 0:09:43 | 0:09:48 | |
You can find out how they get on later in the show. | 0:09:48 | 0:09:50 | |
Maida Vale in the city of Westminster, in London, is | 0:09:53 | 0:09:57 | |
recognisable by its large late Victorian and Edwardian | 0:09:57 | 0:10:00 | |
blocks of mansion flats in these beautiful tree-lined streets. | 0:10:00 | 0:10:05 | |
Right on the fringes of Maida Vale is Maida Hill, which is | 0:10:08 | 0:10:11 | |
slightly less expensive to buy in. | 0:10:11 | 0:10:14 | |
But this is a vibrant, colourful neighbourhood. | 0:10:14 | 0:10:17 | |
And the property I'm here to see is a two-bedroom flat. | 0:10:18 | 0:10:22 | |
And it is above this delightful little cafe here. | 0:10:22 | 0:10:25 | |
Guide price - £225,000. | 0:10:25 | 0:10:29 | |
Now, bear with me, won't you? There's a fair few stairs to climb. | 0:10:32 | 0:10:36 | |
# We're running up that road | 0:10:36 | 0:10:38 | |
# We're running up that hill | 0:10:38 | 0:10:41 | |
# We're running up that building. # | 0:10:41 | 0:10:43 | |
Thank goodness I'm here! | 0:10:47 | 0:10:48 | |
I know I said it was at the top, | 0:10:48 | 0:10:50 | |
but it really is at the top of the top of the top. | 0:10:50 | 0:10:52 | |
There are a lot of stairs to climb. | 0:10:52 | 0:10:54 | |
And I don't even have any shopping bags. | 0:10:54 | 0:10:57 | |
So, once I've got over that shock, let's have a look around this flat. | 0:10:57 | 0:11:00 | |
Now, straightaway, you don't get the feeling of space and high ceilings. | 0:11:00 | 0:11:05 | |
It is quite a small, compact flat. | 0:11:05 | 0:11:07 | |
Bedroom - small. | 0:11:07 | 0:11:09 | |
Second bedroom - small again. | 0:11:09 | 0:11:12 | |
Bathroom - not bad. Blue tiles, we could change that. | 0:11:12 | 0:11:15 | |
And into the living room/kitchen/sitting area. | 0:11:15 | 0:11:21 | |
So, the layout is not fantastic here | 0:11:21 | 0:11:23 | |
and space is not in abundance, | 0:11:23 | 0:11:26 | |
so I think I would try and change this kitchen around. | 0:11:26 | 0:11:29 | |
You've got to think about putting a little table in here as well, | 0:11:29 | 0:11:33 | |
so you can eat. I'd get rid of all this furniture | 0:11:33 | 0:11:35 | |
and just have something a lot more manageable. | 0:11:35 | 0:11:38 | |
For me, it's just a little bit on the small side. | 0:11:38 | 0:11:41 | |
On the plus side though, | 0:11:44 | 0:11:46 | |
the property is in pretty good condition, so it wouldn't | 0:11:46 | 0:11:49 | |
take much to get it ready for the rental or sales markets, | 0:11:49 | 0:11:53 | |
especially if you're happy with the layout as it is. | 0:11:53 | 0:11:57 | |
It does need central heating installing, | 0:11:57 | 0:12:00 | |
but with a guide price of 225,000+ | 0:12:00 | 0:12:03 | |
in a sought-after area | 0:12:03 | 0:12:05 | |
such as Maida Hill, this little flat | 0:12:05 | 0:12:08 | |
could bring in a big profit. | 0:12:08 | 0:12:10 | |
# From small things, Mama Big things one day come. # | 0:12:11 | 0:12:16 | |
We've asked along a local property expert for their opinion. | 0:12:16 | 0:12:20 | |
It is a tiny flat. It's not the biggest of flats, but it has got | 0:12:21 | 0:12:25 | |
two good-sized bedrooms, it is a good location. | 0:12:25 | 0:12:28 | |
It would be ideal for | 0:12:28 | 0:12:31 | |
young couples or a first-time buyer who possibly can rent out | 0:12:31 | 0:12:36 | |
the second bedroom. | 0:12:36 | 0:12:37 | |
Let's start considering the numbers. | 0:12:38 | 0:12:41 | |
In the current rental market, we would expect to achieve £350 | 0:12:41 | 0:12:46 | |
per week, which is approximately £1,500 per calendar month. | 0:12:46 | 0:12:50 | |
So that's good. What about the sales? | 0:12:50 | 0:12:53 | |
Once renovated, I think | 0:12:53 | 0:12:55 | |
this apartment should achieve in the region of £400,000. | 0:12:55 | 0:12:59 | |
Well, if you do get it anywhere near that guide price of £225,000+ | 0:13:00 | 0:13:05 | |
and keep costs down, | 0:13:05 | 0:13:07 | |
that could potentially be a very healthy return on your investment. | 0:13:07 | 0:13:10 | |
So selling or renting on should be straightforward. | 0:13:10 | 0:13:14 | |
This is a great central London location here. | 0:13:14 | 0:13:17 | |
But let's not forget this snug flat is above a shop. | 0:13:17 | 0:13:21 | |
And there are quite a lot of stairs to climb before you even get inside. | 0:13:21 | 0:13:24 | |
Still, you're five minutes from the Tube station | 0:13:24 | 0:13:26 | |
and a ten-minute walk from one of London's most famous | 0:13:26 | 0:13:29 | |
bustling markets - Portobello Road. | 0:13:29 | 0:13:32 | |
So let's see who fancied this lot when it went to auction. | 0:13:32 | 0:13:36 | |
Self-contained, third-floor flat, | 0:13:43 | 0:13:46 | |
200 may I say? | 0:13:46 | 0:13:47 | |
Thank you, gentleman there. At 200. | 0:13:47 | 0:13:50 | |
Shall we say 210? | 0:13:50 | 0:13:51 | |
210 will be it, thank you. 210. | 0:13:51 | 0:13:53 | |
So 220 now. 230? | 0:13:53 | 0:13:55 | |
230, thank you. | 0:13:55 | 0:13:57 | |
And 240. 250? No. | 0:13:57 | 0:13:59 | |
240 then. In the sort of coral shirt there. | 0:13:59 | 0:14:03 | |
240. | 0:14:03 | 0:14:04 | |
250 anywhere? | 0:14:04 | 0:14:05 | |
With the lot proving popular, we rejoin at 320,000. | 0:14:07 | 0:14:12 | |
320, gentleman there. | 0:14:12 | 0:14:14 | |
Sunglasses on his head. | 0:14:14 | 0:14:16 | |
£320,000. | 0:14:16 | 0:14:18 | |
First time at 320. | 0:14:18 | 0:14:19 | |
Second time at 320. | 0:14:21 | 0:14:23 | |
He's back. Thank you, 325. 330 now. | 0:14:25 | 0:14:27 | |
It's still going. 35? He's thinking. | 0:14:27 | 0:14:29 | |
330 then, the gentleman here. | 0:14:29 | 0:14:31 | |
330,000 for the first time. | 0:14:31 | 0:14:34 | |
35. 40? | 0:14:34 | 0:14:36 | |
Says no. OK, I think we're close. | 0:14:38 | 0:14:39 | |
So we've got 335 here, very front. | 0:14:39 | 0:14:42 | |
335 for the first. | 0:14:42 | 0:14:44 | |
Second. | 0:14:44 | 0:14:45 | |
40, he's back. 45? | 0:14:45 | 0:14:47 | |
He says no. First time. | 0:14:48 | 0:14:51 | |
Second time. | 0:14:51 | 0:14:52 | |
345. | 0:14:52 | 0:14:53 | |
Quite sure? | 0:14:56 | 0:14:58 | |
I'm trying for you. | 0:14:58 | 0:14:59 | |
345, very front. | 0:15:00 | 0:15:01 | |
White shirt and shorts. First time. | 0:15:01 | 0:15:04 | |
Second time. | 0:15:04 | 0:15:05 | |
Third and final time. Very front then at 345,000, against you. | 0:15:06 | 0:15:11 | |
There we go. Sold. Fair enough. | 0:15:11 | 0:15:14 | |
# Smooth operator | 0:15:16 | 0:15:19 | |
# Smooth operator. # | 0:15:20 | 0:15:23 | |
The successful bidder was Aleksandar, originally from Serbia. | 0:15:25 | 0:15:29 | |
And if he was nervous about the price, well, he didn't show it. | 0:15:29 | 0:15:33 | |
Aleksandar has been living in the United Kingdom for 50 years | 0:15:33 | 0:15:37 | |
and has been a property developer for 30 of those. | 0:15:37 | 0:15:40 | |
I met him back at his latest purchase to find out his plans. | 0:15:40 | 0:15:44 | |
-Aleksandar, congratulations. -Thank you. | 0:15:45 | 0:15:48 | |
So why did you want to buy this flat? | 0:15:48 | 0:15:50 | |
Because it is a very good position, very close to West End, | 0:15:50 | 0:15:56 | |
very close to Paddington and | 0:15:56 | 0:15:59 | |
all the facilities around here. | 0:15:59 | 0:16:03 | |
Have you bought it for yourself to live in or as an investment? | 0:16:03 | 0:16:05 | |
No, no, as an investment, yeah. | 0:16:05 | 0:16:08 | |
And what are you going to do to the flat? | 0:16:08 | 0:16:10 | |
Are you going to let it out or are you going to do it up and sell it? | 0:16:10 | 0:16:13 | |
I'm going to do it up and sell it, yeah. | 0:16:13 | 0:16:15 | |
So, were you happy with the price you paid on auction day? | 0:16:15 | 0:16:18 | |
I am very happy, yeah, yeah. | 0:16:18 | 0:16:21 | |
I was very happy when I saw the flat | 0:16:21 | 0:16:23 | |
because it is in much better condition than I thought it was. | 0:16:23 | 0:16:27 | |
-So had you viewed the flat before the auction? -No. | 0:16:27 | 0:16:30 | |
-SHE GASPS -So you purely just looked at it | 0:16:30 | 0:16:32 | |
-in the catalogue? -Yeah, I looked at it on the computer, internet. | 0:16:32 | 0:16:38 | |
And what are you going to do inside to really make this place look | 0:16:38 | 0:16:41 | |
-wow? -I hope to put a new floor and new central heating. | 0:16:41 | 0:16:47 | |
-And what about the bathroom? -Yes, bathroom as well. | 0:16:47 | 0:16:50 | |
Bathroom has to be changed. | 0:16:50 | 0:16:51 | |
What's your budget? How much money have you got to spend? | 0:16:51 | 0:16:54 | |
Well, about £10,000. | 0:16:54 | 0:16:56 | |
Aleksandar is clearly confident that he has made a sound investment | 0:16:56 | 0:17:00 | |
here and he plans to consult local property agents before he makes | 0:17:00 | 0:17:04 | |
any changes to the layout. | 0:17:04 | 0:17:06 | |
Of course, he would have to check any structural changes | 0:17:06 | 0:17:09 | |
meet with the freeholder's permission. | 0:17:09 | 0:17:12 | |
The flat is leasehold and has just over 100 years left on the lease, | 0:17:12 | 0:17:16 | |
and the freeholder intends doing some of the work to the | 0:17:16 | 0:17:19 | |
block, so Aleksandar will wait until that is done before selling. | 0:17:19 | 0:17:24 | |
Aleksandar, good luck with the project. | 0:17:24 | 0:17:26 | |
-And I think I am right in saying you were lucky here. -Thank you. | 0:17:26 | 0:17:29 | |
Thank you. | 0:17:29 | 0:17:31 | |
Aleksandar, well, he took a big risk here by not seeing this flat, | 0:17:31 | 0:17:35 | |
but luckily, it has paid off. | 0:17:35 | 0:17:37 | |
He has got £10,000 to spend and years of experience behind him. | 0:17:37 | 0:17:42 | |
Join me later in the programme to find out | 0:17:42 | 0:17:45 | |
if Alex has made a profit in Maida Vale. | 0:17:45 | 0:17:48 | |
Still to come, in Dunfermline, it all boils down to the three Ps - | 0:17:50 | 0:17:56 | |
planning, parking and pavements. | 0:17:56 | 0:17:59 | |
And in Maida Hill, will the profits be pouring in from Aleksandar's | 0:18:02 | 0:18:06 | |
top-floor flat? We'll find out later. | 0:18:06 | 0:18:08 | |
It was just outside Birmingham, in the popular residential | 0:18:14 | 0:18:18 | |
area of Harborne, where we first came across a three-bedroom, | 0:18:18 | 0:18:21 | |
mid-terraced property that was actually in pretty good nick. | 0:18:21 | 0:18:25 | |
That's exactly why brothers Jimmy | 0:18:25 | 0:18:27 | |
and Wassim bought it for £81,000 | 0:18:27 | 0:18:30 | |
as yet another addition to the | 0:18:30 | 0:18:33 | |
family firm's 100-strong letting portfolio. | 0:18:33 | 0:18:37 | |
But they weren't planning on a big spend on this one. | 0:18:37 | 0:18:41 | |
# We're talking about money, money | 0:18:41 | 0:18:43 | |
# We're talking about money, money... # | 0:18:43 | 0:18:46 | |
-So, what's the budget? -The budget is £1,000. -1,000? -Yeah. | 0:18:46 | 0:18:49 | |
Now, just three weeks later, we're back | 0:18:52 | 0:18:55 | |
to find out how project manager Jimmy has got on. | 0:18:55 | 0:18:59 | |
Yes, well, outside was already in good shape, | 0:19:00 | 0:19:03 | |
though there are plans to put in off-road parking in the future. | 0:19:03 | 0:19:09 | |
But what about inside? | 0:19:09 | 0:19:10 | |
We've had the whole house renovated. | 0:19:21 | 0:19:24 | |
We've had the upstairs bathroom and toilet knocked into one. | 0:19:24 | 0:19:28 | |
We've had the wet room converted into a bedroom. | 0:19:31 | 0:19:35 | |
And having given the other three bedrooms a good makeover, | 0:19:38 | 0:19:41 | |
the property is now a four-bedroomed house. | 0:19:41 | 0:19:44 | |
Did they meet that two-week deadline? | 0:19:47 | 0:19:50 | |
Yeah. It's been done in two weeks. | 0:19:51 | 0:19:53 | |
That's pretty impressive. | 0:19:54 | 0:19:56 | |
And it wasn't just the house they completed in two weeks. | 0:19:56 | 0:19:59 | |
Initially, the garden was overgrown. | 0:20:01 | 0:20:04 | |
The fact that we've had it all tidied up, | 0:20:04 | 0:20:06 | |
it has really turned out to be a really big garden | 0:20:06 | 0:20:09 | |
and you get to see the whole of the garden, | 0:20:09 | 0:20:11 | |
and surprisingly, it goes over the fence as well. | 0:20:11 | 0:20:14 | |
So, what has Jimmy been doing for this short two-week project? | 0:20:15 | 0:20:20 | |
For the last two weeks I've been, like, here every day, | 0:20:20 | 0:20:23 | |
on top of all the workers, just making sure everything's perfect | 0:20:23 | 0:20:27 | |
and to be honest, it's all been done good. | 0:20:27 | 0:20:30 | |
Yes, it certainly has in terms of timescale, | 0:20:30 | 0:20:32 | |
but what about that rather tight budget? | 0:20:32 | 0:20:35 | |
Initially, the budget was £1,000, | 0:20:37 | 0:20:40 | |
but we've had to stretch it up to around £1,800. | 0:20:40 | 0:20:44 | |
That's due to the fact that we've had a lot of stuff done. | 0:20:44 | 0:20:48 | |
Even so, £1,800 seems like a good deal for what they've achieved. | 0:20:49 | 0:20:54 | |
And with their £81,000 purchase price, | 0:20:54 | 0:20:57 | |
it takes their total spend to £82,800. | 0:20:57 | 0:21:02 | |
So, have they done enough to make this ready for the local market? | 0:21:02 | 0:21:06 | |
What do two local estate agents think? | 0:21:06 | 0:21:08 | |
Should this property come on the open market for sale, I'd recommend | 0:21:10 | 0:21:13 | |
a guide price of £90,000 to achieve offers between 85,000 and 90,000. | 0:21:13 | 0:21:20 | |
I believe the property would be marketed at £89,950 | 0:21:20 | 0:21:24 | |
to achieve between £82-85,000. | 0:21:24 | 0:21:28 | |
Ah, well, those values could see a small loss of £800 | 0:21:28 | 0:21:33 | |
or a potential pre-tax profit of £7,200. | 0:21:33 | 0:21:36 | |
But there is that off-road parking still to do and it does all | 0:21:38 | 0:21:42 | |
depend on find a buyer in an area where rental values are strong. | 0:21:42 | 0:21:46 | |
So what does Jimmy think about that? | 0:21:46 | 0:21:49 | |
The value doesn't mean much to me | 0:21:49 | 0:21:51 | |
but because it's going on the rental market, | 0:21:51 | 0:21:53 | |
that was the key thing that we were looking forward to. | 0:21:53 | 0:21:56 | |
And to be honest, because we've got people lined up for it already, | 0:21:56 | 0:22:00 | |
tenants, they are moving in and about three days' time so, yeah. | 0:22:00 | 0:22:04 | |
Yes, this has never been about resale. | 0:22:05 | 0:22:07 | |
In fact, the family firm have yet to sell any of their 100+ properties. | 0:22:07 | 0:22:12 | |
But with that tenant already lined up, | 0:22:12 | 0:22:15 | |
have they got a good rental rate? | 0:22:15 | 0:22:17 | |
The rental market in this area is very strong. | 0:22:17 | 0:22:19 | |
Should this go to the rental markets, | 0:22:19 | 0:22:21 | |
I would suggest a £700 per calendar month rental. | 0:22:21 | 0:22:25 | |
I believe if the property was placed on the rental market, we would be | 0:22:25 | 0:22:28 | |
able to able to achieve a figure of £695-725 per calendar month. | 0:22:28 | 0:22:33 | |
Well, they are more or less close to what we are getting. | 0:22:33 | 0:22:35 | |
We are getting £750 per calendar month, so it's all good. | 0:22:35 | 0:22:40 | |
Well, that's impressive. | 0:22:42 | 0:22:44 | |
And £750 per calendar month represents an annual rental | 0:22:44 | 0:22:48 | |
yield in excess of 10%. Not bad at all. | 0:22:48 | 0:22:53 | |
So, will this family team be back at the auctions? | 0:22:53 | 0:22:56 | |
Well, my brother is at the auction now and to be honest, I need to find | 0:22:58 | 0:23:02 | |
out what is going on with him now to see if they have purchased anything. | 0:23:02 | 0:23:06 | |
And yeah, we will carry on buying more houses. | 0:23:06 | 0:23:09 | |
So, from a property empire in Birmingham, we move to Scotland, | 0:23:16 | 0:23:20 | |
to Dunfermline, a town with a long association with Scottish royalty. | 0:23:20 | 0:23:25 | |
Beginning in the 11th century | 0:23:25 | 0:23:27 | |
when King Malcolm III married his bride, Margaret, | 0:23:27 | 0:23:30 | |
in the local church, which later became Dunfermline Abbey. | 0:23:30 | 0:23:34 | |
It must have been a great wedding | 0:23:36 | 0:23:38 | |
because Malcolm took rather a shine to the place, | 0:23:38 | 0:23:40 | |
and for a while, the town became the unofficial capital of Scotland. | 0:23:40 | 0:23:45 | |
In more recent times, Dunfermline is famous for being | 0:23:45 | 0:23:48 | |
the birthplace of renowned philanthropist Andrew Carnegie, | 0:23:48 | 0:23:51 | |
and was home to '80s pop band Big Country. | 0:23:51 | 0:23:54 | |
Well, just a mile from the town centre of Dunfermline is this plot | 0:24:00 | 0:24:06 | |
of land that went up for auction with a guide price of £20,000. | 0:24:06 | 0:24:10 | |
Now, apparently, talking to the locals, for the last 30 years | 0:24:10 | 0:24:13 | |
it has been used as a car park, and that indeed is a car. | 0:24:13 | 0:24:17 | |
What could it be? Well... | 0:24:17 | 0:24:20 | |
That's for us to discover. | 0:24:20 | 0:24:22 | |
It's a corner plot of around 250 square metres in size and | 0:24:25 | 0:24:29 | |
there was obviously a building here at some point, | 0:24:29 | 0:24:32 | |
long since demolished. | 0:24:32 | 0:24:34 | |
OK, so let's review what we've got here. | 0:24:34 | 0:24:36 | |
You are obviously in an area where there are lots of utilities. | 0:24:36 | 0:24:40 | |
I mean, you've got electricity, you've probably got sewerage, | 0:24:40 | 0:24:44 | |
gas within easy reach so that's good news. | 0:24:44 | 0:24:46 | |
Bad news is - the roads are extremely narrow | 0:24:46 | 0:24:50 | |
and you are pretty much surrounded on all sides by housing. | 0:24:50 | 0:24:54 | |
Those people would probably have something to | 0:24:54 | 0:24:56 | |
say about whatever was built here. | 0:24:56 | 0:24:58 | |
So in terms of your potential for planning permission, | 0:24:58 | 0:25:02 | |
I think not too bad. | 0:25:02 | 0:25:04 | |
I'm sure the council would like to see it used for something, | 0:25:04 | 0:25:07 | |
maybe affordable housing. | 0:25:07 | 0:25:08 | |
All in all, out of ten, | 0:25:08 | 0:25:11 | |
I'd give it about a 6.5. | 0:25:11 | 0:25:13 | |
One thing you are going to have to consider before you develop | 0:25:16 | 0:25:19 | |
this is the issue of pavements. | 0:25:19 | 0:25:21 | |
This one is very narrow and you can't just go either extending it | 0:25:21 | 0:25:25 | |
or taking it away without getting the council involved. | 0:25:25 | 0:25:28 | |
For them to be involved, | 0:25:28 | 0:25:30 | |
they're going to have to talk about maybe lowering the kerb... | 0:25:30 | 0:25:33 | |
Getting people out to do all that kind of stuff | 0:25:33 | 0:25:35 | |
isn't going to be cheap, | 0:25:35 | 0:25:36 | |
so it is definitely something to factor into your budget. | 0:25:36 | 0:25:39 | |
Pavements, parking, and access. | 0:25:43 | 0:25:45 | |
The local council planning department will have a field day, | 0:25:45 | 0:25:49 | |
so I reckon it's high time we got | 0:25:49 | 0:25:51 | |
the opinion of the auctioneer who sold the property. | 0:25:51 | 0:25:54 | |
The possibilities for this plot, I think, | 0:25:55 | 0:25:58 | |
are mainly the opportunity to obtain | 0:25:58 | 0:26:00 | |
consent for residential development. | 0:26:00 | 0:26:02 | |
It's an established residential area. | 0:26:02 | 0:26:05 | |
There is both traditional houses, stone-built houses, | 0:26:05 | 0:26:07 | |
and some more modern ones. I think there wouldn't be any problem | 0:26:07 | 0:26:11 | |
obtaining consent for perhaps two units. | 0:26:11 | 0:26:14 | |
The agent thinks the site, guided at £20,000, would work for two | 0:26:17 | 0:26:21 | |
two-bedroom flats and they could each be worth £100-110,000. | 0:26:21 | 0:26:27 | |
If the flats were rented out, I would anticipate | 0:26:27 | 0:26:30 | |
they should be able to get £650 per calendar month for each flat. | 0:26:30 | 0:26:35 | |
Well, you certainly can't complain about location close to the | 0:26:35 | 0:26:38 | |
town centre or the fact the plot is nice and level | 0:26:38 | 0:26:40 | |
and has easy access to services. | 0:26:40 | 0:26:42 | |
Maybe a few planning permission issues regarding the neighbours | 0:26:42 | 0:26:46 | |
and these very narrow streets. | 0:26:46 | 0:26:48 | |
So, not necessarily a no-brainer, but possibly worth a punt. | 0:26:48 | 0:26:52 | |
Let's see who agreed when it went under the hammer. | 0:26:52 | 0:26:54 | |
We move on to lot three, we stay in Fife, | 0:26:55 | 0:26:58 | |
but we move across to Dunfermline. | 0:26:58 | 0:27:00 | |
The land we are selling is situated in an attractive mixed | 0:27:00 | 0:27:03 | |
residential area approximately one mile from the town centre. | 0:27:03 | 0:27:07 | |
Somebody start me off with lot three. I'm looking for 20,000. | 0:27:07 | 0:27:10 | |
20,000 anywhere? 18,000? | 0:27:11 | 0:27:14 | |
It'll be big enough to put something on this. | 0:27:16 | 0:27:18 | |
Again, a good development opportunity. 16, then. | 0:27:18 | 0:27:21 | |
-16 anywhere? -Could be 15? -15, 15 I will take. Thank you. | 0:27:22 | 0:27:26 | |
15 to get me going. Is there 16 anywhere else? | 0:27:26 | 0:27:29 | |
16 I have, thank you. 17? | 0:27:30 | 0:27:32 | |
16,500 on the proxy. Gosh, you're working me hard already. | 0:27:33 | 0:27:36 | |
16,500 I will take. 17, I am looking for. 17 I have. 17,500? | 0:27:36 | 0:27:41 | |
Proxy is out. The bid is with a gentleman in the room at 17,000. | 0:27:41 | 0:27:44 | |
Do we have any other interest? | 0:27:44 | 0:27:46 | |
We are all done at 17,000, I am selling... | 0:27:46 | 0:27:49 | |
Any other interest? | 0:27:49 | 0:27:51 | |
17 going once... | 0:27:52 | 0:27:53 | |
Twice... Third and final time. | 0:27:55 | 0:27:58 | |
Sold to the gentleman in the room at 17,000. Thank you. | 0:27:58 | 0:28:01 | |
The successful bidder getting the lot for £17,000 was Andy. | 0:28:03 | 0:28:08 | |
Andy is registered blind. | 0:28:09 | 0:28:12 | |
He currently owns two flats in Edinburgh which he lets out. | 0:28:12 | 0:28:15 | |
He came along with his wife Shintana to tell us | 0:28:16 | 0:28:19 | |
what plans he has for this little piece of Dunfermline. | 0:28:19 | 0:28:22 | |
-Shintana, Andy, nice to meet you both. -Thank you. -Nice to meet you. | 0:28:27 | 0:28:30 | |
-Congratulations. -Oh, thank you. -Thank you. | 0:28:30 | 0:28:33 | |
So why a plot of land, then, | 0:28:33 | 0:28:35 | |
rather than a house which you could renovate? | 0:28:35 | 0:28:37 | |
What led you to this, do you think? | 0:28:37 | 0:28:39 | |
Partly because we like the challenge of building something new. | 0:28:39 | 0:28:44 | |
We just thought it was a good idea. | 0:28:44 | 0:28:45 | |
So have you done anything like this before? | 0:28:45 | 0:28:48 | |
We did buy a house at auction before and Shint and I | 0:28:48 | 0:28:51 | |
worked on it for three months, and when we sold it we made | 0:28:51 | 0:28:56 | |
a profit of about £600, so for three months work it wasn't... | 0:28:56 | 0:29:00 | |
-Right, so not the best financial decision you ever made. -No. | 0:29:00 | 0:29:04 | |
He paid too much. | 0:29:04 | 0:29:06 | |
-You paid too much, did you? -Yeah. -Oh, dear. | 0:29:06 | 0:29:08 | |
Andy's sight loss was due to a degenerative eye condition | 0:29:10 | 0:29:15 | |
and I wondered what particular challenges property | 0:29:15 | 0:29:18 | |
development raised for him and how he overcame them. | 0:29:18 | 0:29:21 | |
I can't see the properties so I have to think of it just in my mind's eye, | 0:29:22 | 0:29:28 | |
how big it is and what shape the site is and things. | 0:29:28 | 0:29:31 | |
So what in your mind's eye do you think this looks like? | 0:29:31 | 0:29:35 | |
It's fairly flat. | 0:29:35 | 0:29:38 | |
It's almost a square, slightly longer in the downhill section. | 0:29:39 | 0:29:43 | |
And quite wide. It's quite a large bit of property. | 0:29:43 | 0:29:47 | |
And this... | 0:29:47 | 0:29:48 | |
There was a building here which wasn't there in 1955, so that's... | 0:29:48 | 0:29:54 | |
-Before I born! -Right. | 0:29:54 | 0:29:56 | |
It's been an empty space for a long time. | 0:29:57 | 0:30:00 | |
-Right, obviously used for car parking it seems at the moment. -Yes. | 0:30:00 | 0:30:04 | |
-That is an issue around here is car parking. -Right. | 0:30:04 | 0:30:07 | |
You could always turn it into a car park and rent it out to the locals. | 0:30:07 | 0:30:11 | |
The council, I don't think, would want that. | 0:30:11 | 0:30:14 | |
Have they given you an indication then that, in principle, | 0:30:14 | 0:30:16 | |
-they'd be happy for you to something here? -Yes. | 0:30:16 | 0:30:19 | |
They want a residential property built here. And... | 0:30:19 | 0:30:23 | |
Their only stipulations would be that we widen the pavement at the front | 0:30:23 | 0:30:28 | |
and to the side, and that vehicle access from the narrow lane... | 0:30:28 | 0:30:35 | |
would mean that you have to have enough room to do a three-point turn | 0:30:35 | 0:30:39 | |
-inside cos they don't want cars reversing out onto the lane. -Right. | 0:30:39 | 0:30:43 | |
So you'd have to go out nose first. | 0:30:43 | 0:30:45 | |
So tell me the process from this point on | 0:30:45 | 0:30:48 | |
as far as you're concerned. | 0:30:48 | 0:30:50 | |
We have to get drawings done to put in for outline planning | 0:30:50 | 0:30:55 | |
permission and then if that is agreed then | 0:30:55 | 0:30:58 | |
we put in for the full planning permission. Then we build the house. | 0:30:58 | 0:31:02 | |
Andy and Shintana feel that the plot is big enough to take two | 0:31:05 | 0:31:09 | |
semidetached houses, but given the council's stipulation about | 0:31:09 | 0:31:13 | |
off-street parking, I'm thinking it might be a tight squeeze. | 0:31:13 | 0:31:17 | |
Although plans are at an early stage, | 0:31:17 | 0:31:19 | |
they estimate a budget of £70-80,000 for the completion of the project. | 0:31:19 | 0:31:24 | |
Do you have any idea what those type of properties would | 0:31:26 | 0:31:29 | |
sell for once you've built them? | 0:31:29 | 0:31:30 | |
Cos I'm just hoping that you're going to make more than 600 quid | 0:31:30 | 0:31:33 | |
-on this deal. -Yeah, I think... | 0:31:33 | 0:31:35 | |
-I think they'll probably sell for roundabout £70,000 each. -OK. | 0:31:35 | 0:31:40 | |
-And timescale? -Hm... One year maybe? -OK. | 0:31:40 | 0:31:43 | |
I think it will take longer to do the planning than it will to build | 0:31:43 | 0:31:46 | |
-the houses. -Really? That's toing and froing, then. | 0:31:46 | 0:31:49 | |
A bit of toing and froing as you know yourself, Martin, | 0:31:49 | 0:31:52 | |
with dealing with planning authorities. | 0:31:52 | 0:31:55 | |
But the council here have been very helpful. | 0:31:55 | 0:31:58 | |
You're always taking a chance when you buy a property at auction | 0:31:58 | 0:32:02 | |
and life is like that, isn't it? | 0:32:02 | 0:32:05 | |
MARTIN LAUGHS Taking chances. | 0:32:05 | 0:32:07 | |
Well, listen, congratulations. All the very best and good luck with it. | 0:32:07 | 0:32:11 | |
-OK, thank you. -I look forward to seeing how you get on. -Thanks. | 0:32:11 | 0:32:13 | |
Thank you. | 0:32:13 | 0:32:15 | |
So, Andy with ambitious plans for the site | 0:32:15 | 0:32:18 | |
and hopefully with the help of Shintana, | 0:32:18 | 0:32:20 | |
when we return in a year's time, there will be two semis here. | 0:32:20 | 0:32:24 | |
How will they get on? You can find out later in the show. | 0:32:24 | 0:32:27 | |
Back now to the sought after area of Maida Hill in London's W9 | 0:32:39 | 0:32:43 | |
where earlier I looked around this two-bedroom flat that | 0:32:43 | 0:32:47 | |
had a guide price of £225,000+. | 0:32:47 | 0:32:50 | |
There were lots of stairs which might put people off | 0:32:52 | 0:32:55 | |
and it was, well, let's say...compact. | 0:32:55 | 0:32:58 | |
However, it was in good condition | 0:32:58 | 0:33:00 | |
and could represent a sound investment. | 0:33:00 | 0:33:03 | |
Without batting an eyelid, | 0:33:06 | 0:33:08 | |
Aleksandar paid 110,000 over the guide price. | 0:33:08 | 0:33:12 | |
So, Aleksandar was set on selling | 0:33:17 | 0:33:19 | |
and with £10,000 budget, | 0:33:19 | 0:33:21 | |
he had plans to replace the kitchen and bathroom | 0:33:21 | 0:33:24 | |
as well as some flooring | 0:33:24 | 0:33:25 | |
and a general refurbishment job throughout, | 0:33:25 | 0:33:28 | |
all of which he was hoping to complete within two months. | 0:33:28 | 0:33:31 | |
So, around one month later, we've returned to Maida Hill, | 0:33:35 | 0:33:38 | |
and unfortunately, not all has gone to plan. | 0:33:38 | 0:33:42 | |
Yep, apart from a bit of a paint job throughout, | 0:33:53 | 0:33:56 | |
there is very little difference. | 0:33:56 | 0:33:58 | |
Time for us to catch up now with Aleksandar | 0:34:01 | 0:34:03 | |
to find out why the change of plan. | 0:34:03 | 0:34:05 | |
My original plan was to refurbish it completely and sell it. | 0:34:07 | 0:34:14 | |
But unfortunately, the market has stopped rising | 0:34:14 | 0:34:20 | |
and I couldn't get much profit, so I decided to let it for a while. | 0:34:20 | 0:34:25 | |
That's the thing in property - | 0:34:39 | 0:34:41 | |
you have to roll with the changes in the local market conditions. | 0:34:41 | 0:34:44 | |
In London, prices can be very volatile. | 0:34:44 | 0:34:47 | |
One moment you think you are on top of the market, next, you're not. | 0:34:47 | 0:34:52 | |
Overall, it is a good project in my opinion | 0:34:53 | 0:34:57 | |
because the property is in very good location, | 0:34:57 | 0:35:00 | |
walking distance from the City. | 0:35:00 | 0:35:03 | |
Aleksandar ended up spending just £1,000 of his initial £10,000 | 0:35:05 | 0:35:10 | |
budget and is happy to rent it before he sells. | 0:35:10 | 0:35:13 | |
So it will be interesting to hear if the two local estate agents | 0:35:13 | 0:35:17 | |
we asked along think this is the best option. | 0:35:17 | 0:35:19 | |
It's quite basic if I am being totally honest. | 0:35:22 | 0:35:25 | |
But it shows clean and tidy. | 0:35:25 | 0:35:27 | |
Yeah, for the size of the flat, | 0:35:27 | 0:35:30 | |
I can't see any more work that would enhance it. | 0:35:30 | 0:35:34 | |
At this stage, I would rent it out | 0:35:34 | 0:35:37 | |
and keep it for six to 12 months, | 0:35:37 | 0:35:41 | |
and then look at where the market is | 0:35:41 | 0:35:44 | |
and maybe put it on the market at that time. | 0:35:44 | 0:35:47 | |
Great, just what Aleksandar plans to do. But what rental could he expect? | 0:35:47 | 0:35:51 | |
This property in the current market would achieve | 0:35:52 | 0:35:55 | |
£1,450-1,500 per calendar month. | 0:35:55 | 0:35:59 | |
I would advise putting it on the rental market | 0:35:59 | 0:36:02 | |
at around £1,500 per calendar month. | 0:36:02 | 0:36:05 | |
Well, that's better than I thought, yeah. | 0:36:05 | 0:36:08 | |
I thought it was maximum £1,400. | 0:36:08 | 0:36:13 | |
So I am quite impressed by that. | 0:36:14 | 0:36:17 | |
That top valuation of £1,500 per calendar month could mean | 0:36:19 | 0:36:23 | |
a yield of around 5%. What about that troublesome sales valuation? | 0:36:23 | 0:36:28 | |
Has it gained any value on Aleksandar's £346,000 investment? | 0:36:28 | 0:36:33 | |
And does that vindicate Aleksandar's decision to rent? | 0:36:33 | 0:36:37 | |
I would advise putting it on the market for £360,000. | 0:36:37 | 0:36:41 | |
This property in the current market would achieve a sale | 0:36:41 | 0:36:44 | |
price of £365,000-370,000. | 0:36:44 | 0:36:51 | |
That's why I haven't put it on sale because it's a bit low, yeah. | 0:36:51 | 0:36:57 | |
That higher valuation of £370,000 would mean a possible | 0:36:59 | 0:37:04 | |
profit of £24,000, minus the usual taxes and expenses. | 0:37:04 | 0:37:09 | |
Now some of you might be thinking, "That sounds like a pretty | 0:37:09 | 0:37:12 | |
"good potential profit in just four weeks with minimal work." | 0:37:12 | 0:37:16 | |
But he would also have to factor in costs like agents' fees, | 0:37:16 | 0:37:20 | |
so in this case, Aleksandar has his eyes on a bigger return. | 0:37:20 | 0:37:24 | |
And the smooth operator that he is, | 0:37:24 | 0:37:27 | |
he is prepared to play the waiting game. | 0:37:27 | 0:37:29 | |
We're back in Dunfermline to visit Andy and Shintana who couldn't | 0:37:36 | 0:37:40 | |
resist temptation and bought this plot of land near the town centre. | 0:37:40 | 0:37:45 | |
They sealed the deal with a bid of only £17,000 | 0:37:45 | 0:37:49 | |
which sounds like a bargain, | 0:37:49 | 0:37:51 | |
except this lot came without planning permission. | 0:37:51 | 0:37:54 | |
You can never be sure what trials and tribulations await you | 0:37:54 | 0:37:58 | |
once your application hits the desk of the local planning office. | 0:37:58 | 0:38:02 | |
The plan was to construct two semidetached houses | 0:38:04 | 0:38:07 | |
with off-street parking, | 0:38:07 | 0:38:09 | |
and with a budget of £70-80,000 and a time scale of one year. | 0:38:09 | 0:38:14 | |
It was full steam ahead for this development project, or so we hoped. | 0:38:14 | 0:38:18 | |
This is how the site looked in November 2013 | 0:38:22 | 0:38:26 | |
and unfortunately, this is how it looked one year later. | 0:38:26 | 0:38:30 | |
Well, there are a few more weeds, but apart from that, | 0:38:34 | 0:38:37 | |
I can't see much difference at all. So, what has been going on? | 0:38:37 | 0:38:41 | |
I think we better catch up with Andy to get the full story. | 0:38:41 | 0:38:45 | |
We bought the property at auction a year ago. | 0:38:46 | 0:38:51 | |
It took almost two months to get the finalisation because the council | 0:38:51 | 0:38:55 | |
had to get permission from the Scottish Office to sell it. | 0:38:55 | 0:38:59 | |
We then put in for planning, out went planning, and it has taken | 0:38:59 | 0:39:04 | |
nine months, including an appeal, to get the planning for it. | 0:39:04 | 0:39:07 | |
Andy predicted that dealing with planning would be a slow | 0:39:09 | 0:39:12 | |
process and he was right. | 0:39:12 | 0:39:14 | |
He found the experience of dealing with different departments | 0:39:14 | 0:39:18 | |
terribly frustrating. | 0:39:18 | 0:39:20 | |
The Estates Department were the ones who were told to | 0:39:20 | 0:39:22 | |
sell off the odd bits of land. | 0:39:22 | 0:39:24 | |
The planners wanted a house built on it, the Roads Department | 0:39:24 | 0:39:29 | |
eventually agreed to where the entrance should be. | 0:39:29 | 0:39:34 | |
But the council has rejected the planning application | 0:39:34 | 0:39:37 | |
because there were more than five objections to it. | 0:39:37 | 0:39:40 | |
And it might not be a surprise to hear | 0:39:46 | 0:39:48 | |
the substance of those objections. | 0:39:48 | 0:39:50 | |
The objections were mainly on the ground that the plot had been | 0:39:51 | 0:39:55 | |
used as an unofficial car park, | 0:39:55 | 0:39:58 | |
and they objected not to have their free parking available, basically. | 0:39:58 | 0:40:02 | |
Andy and Shintana successfully appealed the planning decision, | 0:40:05 | 0:40:09 | |
but the original plans had to be substantially modified, | 0:40:09 | 0:40:13 | |
So, Andy and Shintana have decided to cut their losses | 0:40:13 | 0:40:17 | |
and put the plot back on the market with outlined planning | 0:40:17 | 0:40:20 | |
permission, so they have added some value. | 0:40:20 | 0:40:23 | |
But exactly how much? | 0:40:23 | 0:40:25 | |
We invited two local property experts along to assess the various | 0:40:28 | 0:40:32 | |
options available with this site. | 0:40:32 | 0:40:34 | |
The property currently has outlined planning permission | 0:40:34 | 0:40:36 | |
so one can be fairly safe in the knowledge that | 0:40:36 | 0:40:40 | |
permission will be granted, albeit for the type of property | 0:40:40 | 0:40:45 | |
that has been suggested for this site which is a three bedroomed... | 0:40:45 | 0:40:49 | |
A three-bedroom property. | 0:40:49 | 0:40:52 | |
There is a shortage of plots to buy, especially suburban plots. | 0:40:52 | 0:40:55 | |
We are used to rural plots, but suburban plots are hard to come by, | 0:40:55 | 0:40:58 | |
so yes, there is definitely demand for a plot like this. | 0:40:58 | 0:41:01 | |
On top of the purchase price of 17,000, | 0:41:02 | 0:41:06 | |
Andy and Shintana have spent another £5,000 on securing outline | 0:41:06 | 0:41:10 | |
planning permission, bringing their total spend to £22,000. | 0:41:10 | 0:41:14 | |
How much is the land worth now? | 0:41:14 | 0:41:16 | |
A plot like this with outlined planning permission, | 0:41:18 | 0:41:21 | |
I would value in the region of £45-50,000. | 0:41:21 | 0:41:24 | |
With outline plan permission, | 0:41:24 | 0:41:26 | |
I would value this plot between £45-55,000. | 0:41:26 | 0:41:31 | |
I think these figures are very encouraging and it makes me | 0:41:31 | 0:41:35 | |
think it was worth all the hassle of getting the planning permission. | 0:41:35 | 0:41:38 | |
I would have to agree with Andy. | 0:41:39 | 0:41:41 | |
Selling the land could give him a profit of around £33,000. | 0:41:41 | 0:41:46 | |
But if he did decide to go ahead with the build, | 0:41:46 | 0:41:49 | |
what could a three-bedroom house sell for? | 0:41:49 | 0:41:52 | |
For a three-bed property, if, for example, it were to have an | 0:41:52 | 0:41:56 | |
en-suite bathroom and be finished to the required standard, | 0:41:56 | 0:41:59 | |
I would be expecting a valuation of between £155-165,000. | 0:41:59 | 0:42:05 | |
I would estimate a three-bed detached villa on this plot | 0:42:05 | 0:42:09 | |
with parking, good specification internally, | 0:42:09 | 0:42:12 | |
would be valued in the region of £155,000 to £160,000. | 0:42:12 | 0:42:17 | |
So, have these figures prompted a change of heart? | 0:42:18 | 0:42:21 | |
I don't think these figures would persuade us to go ahead | 0:42:22 | 0:42:26 | |
and do anything now. | 0:42:26 | 0:42:28 | |
I think we are ready to sell at this stage | 0:42:29 | 0:42:32 | |
and give someone else the opportunity. | 0:42:32 | 0:42:35 | |
Well, our two intrepid developers have battled through | 0:42:39 | 0:42:42 | |
the planning process and ended up with a positive outcome. | 0:42:42 | 0:42:45 | |
If they achieve a sale of £55,000, it will mean a profit, | 0:42:45 | 0:42:50 | |
before tax and sales fees, of £33,000. | 0:42:50 | 0:42:54 | |
That's a bit better than 600 quid. | 0:42:54 | 0:42:57 | |
Well, that's it for today's show. | 0:43:08 | 0:43:10 | |
We'll have more properties that sold under the hammer for you next time. | 0:43:10 | 0:43:13 | |
-And we look forward to seeing you then. Goodbye. -Goodbye. | 0:43:13 | 0:43:16 |