Episode 19 Homes Under the Hammer

Hello. More and more people would love to have a property portfolio,

but that doesn't have to be as grand as it sounds.

No, even if you can raise a small sum,

you can usually find something to buy.

And at least you've got your foot on the property ladder.

But where do you start? Try a property auction.

Because of the variety on offer at an auction,

it's a great place to invest your money.

And if you do your research and make sure your finances are sorted out,

you should be on your way to making a success of it.

So, let's see what our buyers invested in on today's programme.

The buyer of this mid-terrace in Carlisle wasn't quite sure

what was in store until she got the keys.

-Which was when?

-Today.

-Today.

But a much nicer surprise was awaiting me

in this multi-storey property in Kent.

Upstairs is where it gets rather exciting.

And at this community centre in Dunfermline,

there's lots of space, but...

what you do with it...

Now, that's the tricky bit.

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.

Carlisle has its roots far back in history,

as is evident by the castle and its defensive walls.

But it's also a modern, vibrant place

with excellent public transport and a variety of shops and markets,

earning the city the title of Shopping Capital of Cumbria.

So, 15 minutes' walk from the train station and the town centre

is the property I'm here to see.

Two-bedroomed, mid-terrace, a guide price of £20,000.

Not a lot.

However, initial signs aren't good.

Boarded-up windows, what are we going to find inside?

Well, it's going to be dark, that's for sure. But what have we got?

Oh, actually, surprisingly, nice, high ceilings. Yeah, we like that.

Fairly standard layout.

Sort of corridor here, front living room there.

Yeah, looks all right.

Could do with a coat of paint.

Stairs up to your bedrooms

and through into the, sort of, rear living area.

I'd love to see a big, open fire there,

it's obviously got a gas one at the moment.

It's all a bit, well, dingy, but again, that could be to do with

those shutter-wood things on the windows.

But, oh, dear. That's the kitchen.

And by the look of it, the loo, as well.

# What a state I'm in... #

It is, indeed, in an awful state.

The kitchen and bathroom have been extensively damaged

and, of course, it's not just fire that damages.

So does the water used to put it out.

So, a particularly close inspection of this property

is going to be paramount.

# Oh, oh-oh-oh

# What a state I'm in... #

So, up here, two really good-sized double bedrooms. No loo, obviously.

Maybe enough space to put a loo here? I don't know.

You could play around with the layout a little bit.

And look, this bedroom even comes with a house plant.

This should really be on the outside.

It just gives an indication of the, kind of, state of disrepair

this place has got into.

But from up here,

a really useful chance to check out exactly how much damage that fire in

the kitchen has caused and you can see, looking over that roof,

it looks to me like it's going to be a new roof job.

You really do need to know what you're doing

when it comes to fire-damaged properties and the first question

is whether the building is still structurally sound.

Once you've passed that hurdle,

then there's still a lot of work you need to do, just to clear

the property out safely

and, only then, can you start cleaning up the remaining surfaces.

Whoever is doing the work needs to remember,

you're not just dealing with the fire and water,

but also, the potential chemicals produced from all sorts of materials

burning at high temperatures.

So, what will a local property expert think of this scarred,

but nicely-proportioned property, guided at £20,000?

My first impressions of the property are good. It's a spacious property -

two reception rooms, two big double bedrooms, it's in a good location.

So, all positive.

-But what about the damage?

-There has been fire damage.

There's a lot of work to be done in this house.

The integrity of the building is yet to be seen.

Once they start pulling things apart

then they'll find out exactly what they need to do.

There are always surprises when you're renovating a property.

You know, the tree growing through into the bedroom and things.

So how much will all this work cost?

I would imagine somewhere in the region of £25,000 to £30,000

would be a sensible kind of budget.

You know, taking into consideration it needs double glazing, it needs

central heating putting in and then bathrooms, kitchens, etc, etc.

So, you know, it does need an amount of work.

I think, with a property like this, when it comes up to auction,

when we're doing the viewings and things like that,

because we get such a whole variety of people looking,

your weekend DIY-er, your builders, all those sorts of people,

if it's the guy looking for something to do over the winter

or whatever, then probably something like that will probably put him off.

As always, if you know what you're doing, then it's all very simple,

but if you don't, this property could be a whole heap of pain.

But would the final return on the property be worth it?

Once it's been refurbished to a good standard,

I would be probably looking to market it at £89,995.

If this property came up for rental,

I would expect it to achieve between £400 and £450 per calendar month.

Well, a wee bit of patching up to be done on this one,

especially in that kitchen and bathroom.

But it's a good-sized house and just remember that guide price,

20,000 quid. I think it's a great one to go for.

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

OK, 20,000 is the guide. 20, then?

20 here. At 20, I'm bid. In once.

21, 22, 3, 4,

5, 6, 7.

Shake of the head. With you, it's £26,000.

This fire-damaged sale is off to a very brisk start.

Bids rapidly climb to £46,000 as we rejoin the action.

46, 46, I'm bid, 7.

With you then... Oh, you're back in at 47. 48?

48, I'm bid. 49?

You're out, you're in. £48,000, with you, sir.

Against you, against a load of other people.

At £48,000, first time.

At £48,000, second time. Are we done?

-Selling away, then, at £48,000...

-HAMMER SLAMS

Well done, sir.

Stephen made that final bid of 48,000.

He bought the house in partnership with his sister, Tina,

who came along to meet us with Stephen's daughter, Courtney.

-Courtney, Tina, great to meet you both.

-Nice to meet you.

Congratulations. Tell me why you wanted to buy this place, then.

Well, we went to the auction

because it was at such a good price in the auction book.

It's in a good area, it's close to, in fact,

it's very good walking distance into town.

And it is quite a good size,

with having two downstairs rooms plus your kitchen and bathroom.

Tell me a bit more about what you do when you're not doing this.

I run a letting agency and my brother runs the estate side of it.

I manage my landlords' properties.

And when Tina's not managing other people's properties,

the family are doing up their own.

Brother Stephen has a building company and this will be

their second property that they've renovated together.

Tina has renovated and sold on three properties already

and she rents out two more.

She sees the work as part of her DNA.

It's a family thing. My dad was a builder. It's just what we do.

-We just build them or renovate them and then we sell them on.

-Right.

But the whole family is very much involved in this whole

-world of property.

-We are, yes.

-All of us.

So, tell me a bit about you and Courtney,

-what's going on here, then?

-Well, Courtney left school in September

and, with this being our second one, she asked if she could learn

-and pick up what we know.

-Oh, great.

So you're learning to become a property developer?

Yeah, I want to be trained up to be one.

Well, maybe we'll be seeing more of Courtney on Hammer in the future.

Here's hoping.

In the meantime, the question of the roofless rooms.

-Now, the kitchen, obviously some fire damage there.

-Yes.

Were you aware of that?

We knew there had been fire damage done,

we didn't know the extent of it until we got the keys and we came in.

-Which was when?

-Today.

-Today.

-So, are you in a state of shock or are you quite happy?

-Um, yes.

I didn't realise that the roof at the bottom end was actually down,

but that's fine.

We had a little bit of contingency money, anyway,

-so that will go towards that.

-Right. So, not too much of an issue, then?

-No.

-And obviously fire damage can be superficial,

but it can have caused structural problems. Any thoughts on that?

My brother will look at that.

But looking at it, it does only look like it's the roof. Yeah.

-Only the roof, then?

-Yes.

Well, I guess people with building connections can say

"Just the roof", but experience always pays off.

Tina's planning a full renovation.

I wonder if that includes moving the downstairs bathroom.

You couldn't really do that,

because people still like two good-sized double bedrooms

in a property, so we're looking to put an en-suite over the hallway.

Right. So what's the budget?

-Our budget is about 20,000.

-OK.

So it's fairly, sort of, reasonable, actually.

Yes, we have realised that we're going to have to put a new roof on

in the kitchen and the bathroom, as well,

so that has taken it up a little bit, to the 20,000.

Right. And what's the, sort of, time scale?

-We work on round about 12 weeks.

-Right.

-And we usually come in on time, as well.

-And are your hands-on?

Um, no, I tend not to be, because I've got a business that I run,

so it'll be down to Stephen

-and I've got a younger brother, who looks after things, as well.

-Great.

So, on a day-to-day basis, Courtney,

how much time are you going to spend here?

For the next couple of weeks, like, most of the day, like

full working day here and then from there, I'll be going round,

like, doing more of the design stuff, like looking at kitchens

and bathrooms to go into the house.

Yeah, so I'll be pretty hands-on with my family, as well.

So what's the idea, then?

Is it to do it up and rent it out or to sell it on?

No, we'll just sell it on.

-And why not rent?

-We just like to turn them over, really.

-And are you looking forward to having Courtney involved?

-Oh, yes.

Yes, we're very family-orientated anyway. So yes, no problems, at all.

Good, it sounds like you've got a good mentor.

-Congratulations. Good luck with it.

-Thank you.

-I'm going to look forward to seeing how you get on.

-Nice to meet you.

Thank you.

So, Courtney learning the tricks of the property developing business

at the age of 18, from Tina and the rest of the family.

Quite a challenging project to start with, especially that kitchen.

How will everyone get on? You can find out later in the show.

Ashford in Kent is home to the fantastic high-speed rail line,

which will take you into London in only 38 minutes,

as well as providing connections abroad, to both Lille and Paris.

And not only does Ashford have a fast train line,

it's also one of the most rapidly-expanding areas in England,

now home to a wide range of high street and independent shops,

restaurants and cafes.

Well, my interest has certainly increased in size together

with this town, so time to pick up my pace and explore further.

MUSIC: "Totally Connected" by T-Connection

# Totally connected... #

And it's those fantastic rail links that has attracted

so many commuters to this area...

..and the town is a busy, bustling place to be.

The property I'm here to see today is slap-bang in the middle

of Ashford's town centre

and you certainly couldn't have more amenities right on your doorstep.

Sandwiched between a barber on one side and a cafe on the other

is this former travel agent with an all-inclusive deal,

which includes four floors in total.

Plenty of property on offer for a guide price of 100,000-105,000.

Let's fly on inside and take a tour.

MUSIC: "Fly Away" by Lenny Kravitz

# I want to get away, I want to fly away... #

Well, this is a lovely space for any business.

Nice and bright and you can tell it was a travel agent's!

You'd have a big screen up here, showing the sunny Caribbean island

or somewhere beautiful like that,

lots of glossy travel brochures all along here,

the desk, to welcome people,

and even somewhere that you can exchange your traveller's cheques.

Love it, fantastic.

It's got everything you need. A little area out the back,

this would probably be another office.

Downstairs in the basement,

there are three good-sized rooms that are being used for storage.

But without windows, could they be used for anything else?

One thing to bear in mind is that this is a conservation area,

so major work would need to meet with a planner's approval.

But upstairs is where it gets rather exciting. I'm going to investigate.

At first-floor level, there's a decent-sized kitchen area.

And then, there's this lovely, bright,

airy room at the front of the building.

The bay window lets light stream in.

That's when conservation regulations come into their own.

They preserve lovely features like these and, as you know,

I do like my period features.

It's not all sweetness and light, though.

There's a pretty big hole in the ceiling.

But don't forget, there's another floor upstairs to investigate.

Hmm, it all feels terribly wonky, walking up here.

I mean, just take a look at the doorframe.

You don't need anyone to tell you there's been

a bit of movement in this house.

I reckon, get a surveyor in and check this place out,

as soon as possible. Oh, now, look at this.

The bathroom is massive! It is a total waste of space, I might add.

You've got the loo over here,

then you've got to walk all the way over here to the sink.

I think you really need to think about this layout,

because it's not working, as it is. Why not have a self-contained flat?

You've got the square footage,

so all you need is to have this space cleverly laid out

because if you leave it as it is, a bathroom, well,

you can flush your profit straight down the pan, for starters.

MUSIC: "Wash Your Face In My Sink" by Dream Warriors

# You wash your face in my sink? In my sink? Sink?

# You wash your face in my sink? In my sink? Sink?

# You wash your face in my sink... #

You also have a lovely large and bright room to the front of

the second floor, which I'm pleased to see still has a fireplace intact.

I think you could create a two-bedroom flat

and it could really work well on these two upper floors.

You'd need to get an architect in, to work out the correct

use of space, who could also help you plan a separate entrance.

But I think this would be fairly straightforward,

with a partition wall on the ground floor, to create a new

corridor to the staircase, which you could then turn around.

Yes, you would lose a little bit of space from the shop, but I think

it could be worth it, to gain a flat on those two floors above.

So, if you convert the first and second floors into a flat,

what would you do with this, the ground floor?

Now, I know the property currently has a business classing of A-1,

which means it can be used as a variety of different shop types,

such as a hairdressers. It could be a gift shop

or, perhaps, even a sandwich bar.

Or you could think about applying for change of use,

for, perhaps, an estate agents or a solicitors' firm here.

Although times are hard on the high street, I think it would

be such a wasted opportunity not to take advantage of this

central town location and all the passing footfall.

It does have to be noted that parking is an issue here -

there isn't any.

So, that's a bit of a downer for a business or a resident,

but will that put buyers off?

A local property agent came along, to give us her thoughts

on this interesting property,

guided at £100,000 to £105,000.

My thoughts on the property are that it's a fantastic location,

there's a lot of scope to alter the building

and make changes to it to improve it.

If this was my property, I would convert it into residential

and commercial, to maximise the profits.

Having a flat near the town centre is quite attractive to some people.

We're agreed, then, on the potential here.

But this will be a numbers game.

What if, for instance, this was just done as a straightforward

renovation with no conversion?

The whole property renovated would resell for approximately

£180,000 to £190,000.

And if the new owner did decide to make the two floors into one flat,

how much would that be worth on the resale market on its own?

The resale value of a two-bedroom flat in this area would be within

the region of £125,000 to £130,000.

The agent thinks that if the whole building was just refurbished,

it could get you about £24,000 a year in rent.

But if you went ahead with conversion,

what rentals could you get, then?

The shop on its own, once the conversions have taken place,

would rent for approximately £18,000 to £20,000 per annum.

A two-bedroom flat in this area would rent

for approximately £650 to £700, per calendar month.

Dividing this property could really pay off.

These top valuations could bring you in an income of £28,400 per year.

An extremely convenient location

and there's no doubt that this property has plenty of potential.

But it's not without its issues.

It's in a conservation area, there's no parking

and as a fully-commercial property,

I really don't think the space is being fully utilised at the moment.

Time to head to the auction

and see who wanted to exchange their money for this.

Lot 41, say 90,000?

90,000, I thought you might. £90,000 I have.

92, 92, I don't mind, sir, 94 if it helps.

92 is on my left. Then 94 and 96

and 98, 98, and 100. 102.

The packed auction room means bids came in thick and fast.

We rejoin the bidding at 111,000.

111 at my left. 112, 112 is bed.

113?

113. 114? 114, 115?

You said that three times before.

You mean it, this time?

At £114,000, still in the centre of the room, for the first time,

then, at 114,000.

For the second time at 114,000.

You're out on my far left, last chance.

114,000, third and final time, are you all done?

-HAMMER SLAMS

-Sold at 114,000.

And that calm and collected buyer was Adrian,

who bought the property for 114,000.

Adrian used to work in financial services, but since 2007,

he's been buying commercial and residential properties

and working as a developer, full-time.

-Well, congratulations. You did well.

-Thank you very much.

You got the property you wanted on auction day.

Now, you used to be in finance. Why the swap?

Well, when I was in the financial services world,

I used to be involved in equipment leasing and renting,

but that was, sort of, cars, trucks, lorries, busses,

that type of thing, so renting and buying property is actually

quite similar. It's just a different type of facet, really.

Why this building? Tell me more.

Really, I bought this because I think it's a great location.

It's just off the high street, it's walking distance from

the international train station and I think it's got a lot of potential.

Adrian and I totally agree on what a good buy this property is.

So, will he agree on how much it should be transformed?

Well, my plan is really to see if I can subdivide it

into two separate parts, so a self-contained shop

and then, a two-bedroom apartment.

So, let's talk through how you're going to work it upstairs,

because you've got two different levels...

Yeah, on the first floor, I'd like to create an open-plan kitchen,

diner, living area, which will be double aspect, so it will have

lots of natural light coming through and be a nice, sort of, living space.

Hopefully, up on the second floor

we can create two bedrooms and a bathroom.

Now, how are you going to do that?

Well, I think we'd need to look at the natural light and the windows,

so I think we'll probably have two bedrooms at the front

and keep the bathroom at the back, where you've got all the pipework.

Great. Adrian and I are certainly singing from the same song sheet.

He's got a clear plan in his head,

as you'd expect from a seasoned developer.

His intention is to open up the shop area and put a staff kitchen and loo

in the basement, completing all the work in three to four months' time.

He's well used to dealing with planners,

so this being a conservation area shouldn't worry him.

How lucky do you think you're going to be with that?

Have you had a chat with the planners already?

Yeah, we had a word with the planners.

They'd be happy, in principle with the idea of residential,

provided we keep the shop unit,

because they want to make sure that there's continued employment.

And also, we won't be able to make many changes

to the front of the building.

Adrian's plans for making the second floor rooms open-plan

may mean using steel supports and this might also involve him

in a Party Wall Agreement, which usually means time and money.

So, what sort of budget are you looking at, to do all the work here?

I'm thinking we're going to need to spend

around 30,000 to 35,000, in total.

Adrian, good luck with this project.

It's going to be exciting to see what happens

and I hope you get the planning permission.

-Thank you very much.

-Thank you.

With his financial services background,

I hope Adrian will keep a close eye on the figures during this project,

but will he get that all-important planning permission

for the flat on these upper floors,

so that he can really make the most of this space?

I hope so.

You can join me later in the programme,

to find out how he gets on.

Still to come, it might not be beautiful,

but this community centre won someone's heart.

I had a skip in my step when I went up to hand over the cheque.

And Adrian lets us back in, to shed some light on

whether his upstairs/downstairs plan has paid off.

Time to head back to Cumbria,

where earlier, I met aunt and niece team, Tina and Courtney.

They bought this fire-damaged mid-terrace two-bed property

for over twice the guide price.

Mind you, that guide price was a modest £20,000.

Tina, and Courtney's father, Stephen,

run a lettings agency together and are seasoned renovators.

But for Courtney, this was something of a training exercise.

And to be honest, they couldn't have picked a tougher one to start with.

-Now, the kitchen, obviously, some fire damage there.

-Yes.

-Were you aware of that?

-We knew there had been fire damage done.

We didn't know the extent of it until we got the keys and we came in.

-Which was when?

-Today.

-Today.

So are you in a state of shock, or are you quite happy?

Yes, I didn't realise the roof at the bottom end was actually down,

but that's fine, we had a little bit of contingency money, anyway,

so that will go towards that.

So on a day-to-day basis, Courtney,

how much time are you going to spend here?

For the next couple of weeks, like, most of the day,

like full working day here and then, from there, I'll be going round,

like, doing more of the design stuff, like, looking at kitchens

and bathrooms to go into the house.

Before any designing was to take place, though, there was

a lot of dirty work to be done.

It wasn't just the kitchen that needed sorting, either.

The bathroom had also been ravaged by the fire and I think this

was definitely the first bedroom I'd seen that needed pruning.

They reckoned it would take 12 weeks to make this place habitable.

Well, just 11 weeks later, we're back.

It's hard to believe it's the same kitchen.

The change downstairs is phenomenal.

By using contemporary design, they've transformed this

once-neglected property into a fresh, beautiful home.

The kitchen is unrecognisable,

with a fantastic new skylight in the brand-new roof.

To find the new bathroom, you'll need to pop upstairs.

Tina and her team have squeezed a bathroom between the two bedrooms

and created a corridor to accommodate the change.

It's made one bedroom smaller, but I think it's a very smart move.

The transformation of the kitchen is key to this renovation

and, for me, it's the attention to detail and the high-quality finishes

throughout this property that will set it apart.

Tina and Courtney came along to tell us

just how successful this renovation project has turned out to be.

Well, we did put the property on the market.

It went on the market on the Thursday,

ready for going into the paper on the Friday,

but by the Thursday night, we did actually have viewings going round

and, by Saturday morning,

those viewers were actually putting offers in.

Wow. Rewind, though.

Let's hear what's been done here first, starting with the kitchen.

We stripped it out, totally. We took all the roof off, all the beams out.

We raised it all up, so we raised the walls up to give it the height,

then we put skylights in on the roof just to make it light and airy.

We decided we wanted to make it more of a kitchen/diner,

that way, giving the use of two full rooms in the main part of the house.

So, we went upstairs, had a look at the back room,

we measured everything out and we felt it was fine to put the bathroom

upstairs and then still have a good sized room as the second bedroom.

Whilst Tina is very experienced, her niece, Courtney,

had one or two things to learn.

Well, she has learned a lot as she's gone along.

The first job was for stripping all the walls.

I handed her a steam stripper

and she looked at it and didn't know what it was.

So, we had to give her a quick course on how to strip the walls.

We had to strip everything off the walls,

including the woodchip wallpaper which took quite a while

and, pretty much, just rip off all the skirting boards

and just everything from the house, so it was just back to the basics.

So, with Courtney working hard

and her uncles doing the majority of the big jobs,

there was little need for tradesmen to come in,

meaning a total transformation here took just ten weeks.

But what about the original budget of £20,000? Is that still intact?

We ended up spending 27,000, in total, which was over the budget,

but with the kitchen and all the work that we've done in the kitchen

and moving the bathroom upstairs, that is what sent the budget up,

really, and we did go for a much nicer kitchen in the end, as well.

Along with all the obvious changes here,

they've also done a total rewire, installed central heating

and replaced all the windows.

And considering the standard of finish here,

I don't think the overspend on the budget is anything to worry about.

Add that £27,000 renovation cost to the purchase price of 48,000

and they've invested £75,000 on this once-dilapidated property.

We asked two estate agents along

to assess whether it's all been worth it.

I think the property's been refurbished

to an excellent standard. It's very spacious.

Both bedrooms are a good size

and the kitchen, in particular, is fabulous.

The kitchen also impressed the agent who saw the house before work began.

You know, it's got all the integrated goods.

It's got the oven and things like that. It really does give you

the wow factor, as you walk through.

It's not something I've seen before, so it's very good.

The decor of the property has been finished to a lovely standard.

The addition of feature walls in some of the rooms should really

help the property to stand out from others available on the market.

What they've done here is particularly good,

they've moved the bathroom upstairs.

With that in mind, I would market the property at around £100,000

and expect to achieve offers of around 90,000 onwards.

If I was to bring this property to the market for sale, I would

suggest an asking price of somewhere in the region of £90,000 to £95,000.

£90,000 would give them a pre-tax profit of 15,000.

It's been a good learning curve for Courtney

and did the marketing experience live up to the expectations?

We did viewings on the Thursday night.

By Saturday morning, we had offers on it and, by Monday morning,

we'd actually accepted an offer on the property.

We accepted an offer of £90,000, which we were very happy with.

A hop over the border now into Scotland,

and then on to Dunfermline in Fife, a place steeped in history.

Robert the Bruce was born in the palace here.

Nowadays, it's a vibrant place, with some major employers,

and it's also well-placed for commuting,

with plenty of bridges to take you to Glasgow, Edinburgh and beyond.

I don't know about you,

but every time I see the legendary Forth Rail Bridge,

it makes me wonder,

what happened to the first, second and third bridges(?)

You never hear about them.

Well, seven miles from Dunfermline

and about ten miles from the Forth Road Bridge

is the little community of Blairhall and that's where this is located.

Up for grabs at the auction was a former community centre.

Touch of '70s about it, touch of needing a lot of work about it.

Let's take a look inside.

Its guide price of £30,000 would still make it hard to overcome

the lack of curve appeal here.

MUSIC: "As Ugly As I Seem" by The White Stripes

# I am as ugly as I seem

# Worse than all your dreams

# Could ever make me out to be... #

With a generous car parking area,

this could be a commercial proposition, but what?

As it stands, it's easy to see why this community centre

is no longer a valued member of the community. So, what's on offer?

Well, into the entrance area here, you've got loos,

you've got a little, sort of, office area there.

Obviously, in a bit of a state, but that's just the start.

You could imagine plenty of '70s discos taking place here,

back in the day.

But now, it will take more than a little TLC

to restore this to its former glory.

Through here is the kind of room you would expect in a community centre -

one very big space.

A couple of ancillary rooms off it, which presumably were used

for storing equipment and stuff like that.

I mean, very typical of things that were built around this time

for this kind of use and what you've got is just a lot of square footage.

What you do with it, now that's the tricky bit.

And that is the issue with this place.

It's a big footprint for 30 grand, but it's not the bonniest

building ever and what kind of business could work here?

Could it be a shop or are we talking some kind of workshop?

Would you get a change of use or could you get planning permission

to build something in its place?

Well, it comes back down to research.

You've got to know the local area,

you've got to know what you might do with this place,

you've got to know how much it would cost you to do whatever you

wanted to do with it and how much the end product could sell for.

But get all that right and you could be laughing.

MUSIC: "The Laughing Gnome" by David Bowie

# Ha, ha, ha, hee, hee, hee,

# I'm a laughing gnome and you don't catch me

# Said the laughing gnome... #

Seeing that gnome has made me think of outdoors.

So, with this, what are you looking at?

Well, for me, I'm looking at the land itself.

How flat is it, how close to local amenities,

services, gas, electric...?

Well, obvious the fact it was used as a community centre

is great news, cos all things like sewerage and electricity

and water are already there.

The other good bonus is the amount of land you've got around it.

A nice bit at the back here and it's flat. Easy access to the road.

Forget about the building, knock it down, clear the site

and you've got yourself a fantastic building plot.

I'm picturing a very nice house on this site.

There's a total of 2,235 square feet in old money, here,

and on offer for a guide price of around £30,000.

You could do a lot with that.

But the question is,

would that be a viable proposition here?

A property expert came along to tell us.

Looking at what the new build detached houses are achieving,

I would have thought it would be

in the region of around about £180,000 to £200,000.

You'd have to add in demolition costs to your purchase price

and then your build costs, but still worth considering.

Are there any other options that would work here?

If you could get planning consent, I think it might convert to a shop.

There doesn't seem to be a decent-sized shop in the village

and with the car parking, that's a major plus,

because vehicles could get off the road.

You ought to be able to achieve a rental of around about

£7,500 per annum.

Well, definitely one of those projects for somebody who can

think outside the box, this one.

It could be so much, but you've got to get the numbers right.

Let's see who fancied the challenge, when it went under the hammer.

So, we'll move onto lot 15.

It's a former community centre,

with associated car-parking.

Looking for 30,000, to get started.

25, then.

Sorry. 10? 10, OK.

10 I'll take, 12 I need.

Worth a try, but just 45 seconds later,

the offers have climbed up to a more respectable 20,000.

20, 20,000 I have at the moment.

Are we all done at 20,000?

20 and a half? 21, 21 and a half?

22, 22 and a half?

23, 23 and a half?

24, 24 and a half?

25, 25 and a half?

25 and a half. 26?

26 and a half?

26 and a half? Yep, 27.

27 and a half? 28, 28 and half?

Are we all done at 28,000?

All done? Going once...

Twice...

Third and final time... Sold to the gentleman sat down on my left.

Well, right in there from the beginning was Phil

and he finally got it for £28,000.

When it comes to buildings like this one, Phil has plenty of form,

including a police station he turned into a block of offices.

His friend, Brian, has come along with him to tell us

more about what he has planned for this centre.

-Brian, Phil, great to meet you both.

-Hi.

-Good to meet you.

Congratulations.

Tell me why you wanted to buy this place, then.

I didn't really want to buy it. I just bought it on spec.

-What do you mean, on spec?

-Well, in the hope that I could rent it.

It was a very good price,

it was an opportunity to buy somewhere of this size

for a certain amount of money

and I thought I perhaps could make some profit by renting it.

-Rent it out?

-Definitely renting it out.

-What, as it is?

No, we'll need to renovate the place, cos it's in quite a mess.

-It needs new windows, new heating, lots of stuff...

-Right.

But I'm very lucky, because I've got Brian to help me with that.

And what's the relationship between you too?

Me and Brian have been friends for 30 years

and we've worked together for quite some time.

-Brian's basically the brains.

-The brains?

-The brains.

I'm the brawn and Brian's the brains, but he'll help me get it done.

So are you a builder or a project manager?

-No, actually, I'm self-employed.

-As a...?

-Maintenance, all this sort of maintenance, yeah.

-Right, brilliant.

So why did Brawn and Brains

think this rundown community centre was for them?

I went to the auction to buy a toilet and I didn't get the toilet,

-so I bought this.

-You went to buy a toilet?

-Yes. But I didn't get it.

You're a man of interesting tastes when it comes to property.

Aye, very much so. Very much so.

"I wanted a toilet first. I bought a community centre."

Well, we used to buy a lot of houses and rent houses out.

That is your traditional...

We still have the houses, but we try to get something a bit different now.

-Right.

-So, that's what we're trying.

Whether it'll work out or not, time will tell. I don't know.

Have you narrowed down your property to just

toilets and community centres?

No, no, we're wide open to anything else, something a bit different.

Well, Phil and Brian may have a rather unorthodox approach,

but it seems to work.

Phil has some 40 commercial properties and, for those

of you wondering, he has bought a public convenience before.

Phil does seem keen that this building will serve

some kind of function in the community.

There's things I think it could be used for.

It might be perhaps for childminding,

it may be used as a nursery.

Somebody might want to rent it, as a hall,

and they could rent it out to individual people.

I've had a number of individual people ask me

if they could use it, but that's not what I would do.

I would rent it to somebody else and they could do that.

-And then, keeping, what, the layout pretty much...?

-Exactly as it is.

-Really?

-Yes, aye.

-What about outside?

We'll put in fencing and we'll pave it and make it rather nice,

that's what we'll do.

I would have thought somebody would buy this and knock it down...

Well, that's the option that's open to me.

Brian said this to me,

he said we could see if we could get it rented

and even if we got it rented, perhaps for maybe for five or ten years,

we could then sell it on to a developer.

We could sell it on to a developer now, but where was the developer

when it was for sale just now? It's not really a...

They're not really buying things just now, are they? Or are they?

I don't know.

-Was it a bit of a punt for you?

-Oh, it's a definite punt.

Oh, aye, definitely a punt.

Do you know, when I was at the auction and I bought it,

the guy in front of me turned and said to me,

"What do you intend to do with that?" I says, "I really don't know."

He said, "I'd like to rent it for a fight club.

He said, "I run a fight club." I said, "Well, come and see me."

-And he's been up and he's seen me.

-Wow.

Aye, was sitting right in front of me.

That must have given you a bit of confidence, actually.

I had a skip in my step when I went up to hand over the cheque.

Phil's definitely a one-off,

but why did he move into buying one-off properties?

We did do a lot of houses but then we started buying shops and things like

that and they're better contracts for us, they're longer, as you'll know.

So, that's the idea of this, it gives you a mixture.

Had you seen it before you bought it?

Only from the outside and I was very pleased when I came in.

-It's really not as bad as it looks.

-It's not as bad as it looks, no.

-No, it isn't.

-You'd be surprised when it's cleaned up.

-Aye.

A lot of redecorating is required, right enough,

but once that's done, you'd be amazed.

So, who's going to be doing the work?

Well, Brian will help me enormously,

but we have other chaps who will take care of the heating

and we've got a decorator. So, various people will come.

And what do you think about this?

I think it's great. I really do.

I think it's an amazing place, very good value for money.

It's a pretty safe gamble.

Costs you more to buy a half-decent car

than it would be for what I paid for this.

And what's the kind of...

How do I talk about budget?

OK, yeah, I mean, what is the budget for...?

-We were speaking about that today.

-We were.

And we reckon it's 15,000 to 20,000. We reckon, to do it correctly, aye.

If it doesn't rent, we can knock it down.

You know, we'll have five or six windows lying in a garage,

but we can knock it down. But I wouldn't want to be knocking it down.

Not necessarily what I was expecting, so there you go.

-Well, we'll see how we get on.

-Good luck with it.

-Thanks very much.

-Thank you very much.

-Nice to meet you both.

Well, what a turn up for the books.

I was 95% sure this would go to a developer and surely, knocking

it down and building something here is the most profitable option.

It just goes to show that, for some people,

it's not just about the money. Jolly good it is to hear, too.

How will they get on? What will happen with this place?

You can find out later in the show.

Well, the big question is,

have our buyers made money on their investments?

Well, time has passed, so let's go back and take a look.

We return now to Ashford in Kent, where earlier, I met full-time

property developer Adrian, who bought this former travel agency.

Boasting four floors in total,

Adrian had managed to buy it for a very reasonable £114,000.

I thought this property had bags of potential

and Adrian had some very interesting ideas for it.

What potential have you seen with this?

Cos I think there's quite a lot to offer here.

Yeah, well, my plan is really to see

if I can subdivide it into two separate parts,

so a self-contained shop and then, a two-bedroom apartment.

Adrian has lots of experience.

Good job. This property needed someone with know-how.

Did this mixed-use project get off the ground

in his three to four months' time scale?

Well, almost one year on, we're back to find out if we got lift off.

The old travel agency is now a lovely deli cafe,

with a spacious seating area.

There's room in the basement, as well, for food storage,

prep area, and an employee's cloakroom.

Wow, what a difference a year has made.

If you think that looks good, let's go through the new door,

up the private stairs, into the upstairs flat.

It's turned out nice, hasn't it?

So, here on the first floor,

we originally had two rooms, with an office area at the front.

We knocked through the wall here

and created a nice spacious galley-style kitchen

and opened up the room, to provide

a nice living, dining and eating area.

We also have a nice double aspect here,

with light coming through from the back and from the front.

So, it's provided a really nice, comfortable space.

Oh, Adrian, you are spot on, there.

I always liked this bright, airy space

and I think this has made the best of it.

Will the second floor level impress as much?

Up here, they've split the large back bedroom, to create

a lovely modern bathroom and then, also, a smaller bedroom.

It's quite a transformation from the oversized bathroom that it was.

And there's a handy loo on the half-landing, as well.

I always thought that this property had real potential

and Adrian has certainly fulfilled it,

with a vibrant business using the two lower floors

and a very smart centrally-located flat on the two upper floors.

But this is a conservation area. He will have had to apply

for change of use for the shop, to a classification that allows hot food.

Has it been a bumpy ride?

The planning process was quite straightforward,

it took about three or four months to get everything agreed

and then we started the building work,

which was about six or seven months in total.

But we found a tenant for the shop within about seven or eight months

of the original purchase.

Adrian really hasn't hung about here

and if it wasn't for local flood damage

needing the attention of his builders,

he would have been done much sooner.

So, how did his original budget of 30,000 hold up?

Well, we went a little bit over.

We came in at a total spend of 43,000,

but that was mainly due to the additional structural work

that we had to do on the rear extension.

So, that had to be strengthened with an RSJ and some new flooring put it.

We also had to do a bit more work on the roof than we expected,

but other than that, it was pretty straightforward.

Adrian already had a tenant lined up for the flat.

But will two local property experts

think his spend of 157,000 was a wise investment?

My first impressions were good,

that it's been a good, well thought-out conversion,

maximising the potential.

Town centre flats like this are very sellable.

There's plenty of space further out of town, but this is prime.

And what about the shop?

It's a great use for the town centre, a deli takeaway,

just what's required at lunchtime, with a lot of workers in the area.

It's slightly different.

We've got a little, sort of, Indian takeaway-cum-restaurant

and it's, sort of, light and airy - well fitted, well presented.

If it's got good food, it should prosper.

I would expect the shop to let for £14,000 per annum.

The shop, I think, would be around, sort of. 14,000 a year.

Which is in fact what Adrian is getting from the existing tenant.

But what about that lovely flat?

I would expect to be able to obtain £650 per calendar month for the flat.

I think it may well achieve 700.

I'm very pleased with those valuations. They're pretty much where

I thought they would be and, yeah, it's been a good outcome, overall.

Both agents think if the building was to be sold as a whole,

with sitting tenants in both the flat and the shop,

it would fetch between 200,000 and 225,000, with the shop

earning £14,000 per annum

and the flat bringing around £8,000 per annum.

This would mean a total rental of around £22,000.

Yeah, very worthwhile, from the financial point of view, yeah.

It's been a good project.

That commercial property proved a winner for Adrian,

so would this former community centre in Blairhall, Scotland,

also do the same?

Once again, finding just the right use was the big question.

Or would it be best just to knock it down and start again?

Enter Phil on the left here, the brawn,

and his pal, the brains, otherwise known as Brian.

Phil bought the property as a pure punt for £28,000,

but he'd originally gone to spend a penny.

I went to the auction to buy a toilet

and I didn't get the toilet, so I bought this.

-You would buy a toilet?

-Yes, I'd buy a toilet, yeah.

Well, instead, he got three toilets

and over 2,200 square feet of 1970s nostalgia

and, much to my surprise,

wanted to renovate the centre to its former glory.

Phil still had a hankering for the old community centre,

as a place for locals to stage events

and just over four months later, that's exactly what he's achieved.

MUSIC: "The Nutcracker" by Pyotr Ilyich Tchaikovsky

Dance teacher Lorraine has 100 to 120 students

attending classes in ballet, tap, jazz and competitive dance

and there are adult activities, too.

It keeps kids off the streets, gives the kids ambition,

somewhere to go at nighttimes after school

and I've also got a few students that are looking to

further their career in dance and actually become teachers,

so it's given them a career and a job and a lifestyle, which is nice.

Lorraine sounds like a happy customer.

So what did Brian and Phil have to do to create this dance studio?

'Everything's been renovated.

'The roof was repaired, all the windows were replaced,'

the heating was upgraded, plasterboard throughout was repaired,

the electrics were checked, security lighting has been fitted.

New alarms, new fire alarms, the toilets have been totally renovated.

-A lot of plastering, Brian?

-A lot of plastering, yes, aye.

-Willie the painter did that.

-That's right.

In fact, we thought he was living in there at one point.

An impressive job in just four months

and only four weeks longer than Phil's original estimate.

Brian uses a tried and tested team of four specialists

on all Phil's restoration work.

As well as Willie the painter, there's Chris the plumber,

Campbell the cleaner and Rab the slabber,

whose job it was to tackle the external paths and fencing...

plus, one of the most daunting of all the tasks they faced.

There was a choked drain,

but we weren't able to clear the drain, it had to be dug up

and completely renewed from one corner to the other of the building.

The drain had collapsed.

That's what had caused a lot of the problems with the building,

because the water that was coming off the roof wasn't being removed

from the premise and as soon as we did that, the place started to,

sort of, recover, shall we say?

Dodgy flat roofs, faulty drainage,

no matter how many times I mention them, they still keep

cropping up, but obviously that wasn't all that needed tackling.

This old building presented plenty of challenges

for Phil and Brian's trusty team.

So, this room needed quite a lot of work done to it.

We had to replace all the broken plasterboard here,

reattach the electrical fittings, the floor required repair,

the radiators needed reattached, we had a hole in the roof up here

and also damaged plasterboard here, all done and repaired.

And then we went in here and we have created an attic space

and a space we found that was wood-lined. We've put power

and we've put light up there, so it's extra storage space

and, obviously, we've revamped the cupboard.

Was that all, then? Of course not.

The kitchen, too, had more than its fair share of problems

that needed sorting out.

We had to rip out the old kitchen and put in a new kitchen.

New sinks, the plumbing had to be all renewed.

There had been a leak and there was a hole in the floor,

but that's been fixed.

It's all been retiled and redecorated,

new ceiling, new lights.

As you can see, it's been a lot of work

and a considerable amount of expense, as well.

MUSIC: "Money" by Pink Floyd

Ah-hah, yes, the money.

Phil's original estimate for all this work was

an optimistic 15,000 to 20,000.

So, what did it actually cost?

We spent £28,000.

So it cost £28,000, we spent £28,000.

Well, we'll soon find out if it's all been worth it.

But I can't help wondering if this project has put a strain

on Phil and Brian's working relationship.

Ten years ago, I started to do buy-to-lets

and we've worked continually for the ten years without a fall-out.

-Yes, that's true.

-That's true.

And what's been the highlight of the past four months?

-Seeing the place finished is the highlight.

-The end of the job.

Well, there could be more highlights to come,

because we asked two property experts to give us their valuations.

Will it be lots more than the £56,000 total spend?

If you bought the building, as it stands at the moment,

ready to go, with vacant possession on the market,

I would think you're probably talking about £60,000 to £65,000.

That could mean a profit of between £4,000 and £9,000.

Is Phil impressed with that?

-I really think it's worth more money than that.

-That'll be a no, then.

To be fair, commercial properties are notoriously difficult to value.

What does the other agent think?

Well, it is an unusual property.

But given the market,

I believe we could achieve between £95,000 and £105,000.

Well, that's realistic. I think that's about right, aye.

I think that's about right.

A commercial property is often worth what someone is willing to pay.

In this case, being tailored for a very specialist purpose

has determined what it is worth to the dance school,

who are renting it for £18,000 per annum.

I am delighted and I'm sure that it's a fairly good rent I've got for it.

But at the same time, the pleasure really for me is

it's a young business and I do think that they could grow

and do very well here.

Plus the fact that the local people can use it,

which to me was a good thing.

This studio is a lot better than our old studio.

We have disabled access, pram access,

we also have a kitchen, so we can cater for different events.

It's a lot bigger, cleaner and safer environment for the kids.

Since I was three years old, I wanted to be a dance teacher

and I thought, with my old studio, that was it.

When I got this opportunity to have the larger studio,

it was my dream come true.

It does sound like a win-win.

And another quirky building has worked out for Phil and Brian.

He'll have his investment pay for itself in just over three years.

So, what advice does he have for fellow auction-goers?

I've always been of the opinion that, when you go to an auction,

don't go looking to buy something.

Go looking for a situation to exploit.

Houses are fine, but if you buy a commercial property,

nobody knows the value of the thing

and you can make a good return on your money.

Yeah.

Well, that's it for today's show.

We hope you've enjoyed watching today's buyers

and maybe got some inspiration along the way.

-Yeah, look forward to seeing you next time.

-Goodbye for now.

-Goodbye.