Episode 44 Homes Under the Hammer

Hello, and welcome to the show.

Now, there's no getting away from it -

investing in a house is probably going to be

-one of the biggest investments you will ever make.

-That's right.

Now, Martin and I, over the years,

have fallen in love with so many properties, haven't we?

I'm probably worse than you are.

In fact, you are terrible. He does love everything.

The important thing here though

is to not let your heart rule your head.

No, and there are some bargains to be found

when you visit your local auction house.

Well, the excitement of a property auction is hard to beat.

-Even after all this time, we still love it, don't we?

-We do indeed.

So what were the properties that excited the buyers on today's show?

It's all about bigger and better today,

like this bungalow in Croydon.

It just goes on and on - it's huge!

And this surprisingly roomy one-bedroom flat in Gateshead.

Well, in terms of space... it's good, it's good.

But for renovation on a huge scale, well...

This really is such a property.

Look. It's this water tower.

All of these properties have been sold at auction

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

when they went under the hammer.

Well done, sir, it's yours.

This is Croydon in south-east London,

famous for being the birthplace of fashion model Kate Moss,

and these days, for its fabulous shops.

# She's in fashion... #

Let's hope the Croydon property I'm here to see

has a wonderful bone structure and just needs a bit of a makeover.

A couple of miles or so from Croydon town centre

and I'm in lovely, leafy suburbia - and highly desirable it is, too.

Now, the property I'm here to see is this -

a very substantial bungalow,

and it had a guide price of £390,000.

# Those first impressions

# They keep us guessing... #

Ooh, I love a good first impression,

and this property certainly delivers on that front.

Big, wide plot, lovely front garden,

plenty of space for off-street parking...

and some character on the outside.

And inside?

-Wowzer!

-SHE LAUGHS

This is what you call open-plan living.

It feels huge when you walk in here.

It feels like somebody has just knocked all the walls down

and it also feels like it's half-done. Hm...

You've got a kitchen area here without a kitchen in.

May have been quite tricky to secure a mortgage on a place like this

because you do need a sink in situ.

Lounge area - nice little fireplace that's been built.

What have we got up here?

Hm, this is quite an interesting use of space.

A sort of loft room.

You'd have to check the building regs on that.

You've got another big room to the right here,

something to the left, a couple of rooms at the back.

It just goes on and on - it's huge!

# Gonna be a big thing, yeah

# Bigger than a... #

In fact, the catalogue says there are seven rooms in total,

though how can you tell?

There are big rooms, there are small rooms -

it is such a confusing layout.

The upstairs is simpler,

but the space is obviously hampered by the slope of the roof.

The bungalow is big, but not as big as it could be,

and that is what a previous owner thought,

because planning permission has been passed

for dormer windows in the front and the rear in the roof

to add more accommodation up there,

and for a single-storey side and rear extension.

So we're talking about turning this into

a four- or even five-bedroomed place.

Now, that is more like it.

# That's the way, uh-huh, uh-huh

# I like it uh-huh, uh-huh

# That's the way, uh-huh, uh-huh

# I like it uh-huh, uh-huh... #

What isn't so likeable are these rooms at the back.

It's a confusing mix of shapes and sizes,

and I think the best way of thinking about this place

is a blank canvas on which to start again.

Outside, there is ample space at the front for off-road car parking,

and in the back, there's a large garden

which, with a bit of TLC, could be very pretty indeed.

But it's really the area

that will be adding big bucks to this development.

# That's the way, uh-huh, uh-huh

# I like it, uh-huh, uh-huh... #

This is a full-on family area.

You are so close to central London, but it feels leafy and lovely.

So, it'll come as no surprise

that big family houses command big money,

which makes me wonder, is it worth knocking this place down

and starting again?

Well, no, I don't think it is.

Even if you bought for the guide price,

the amount you'd need to spend demolishing

and rebuilding to a high spec

would probably leave you with very little in the way of profit.

I would just use my imagination

and make the most of what you've got here.

# Imagination, it's funny

# It makes a cloudy day sunny

# Makes the bees think of honey

# Just as I think of you... #

Well, my imagination is running riot with this place.

How will a local property expert see things?

This could be maximised to a four- to five-bedroom house,

I think, quite easily.

You know, a clever builder can really extend the property

but make it look like it was all original.

Of course, that won't come cheap.

What do you reckon? Anything between 60 and 100 grand?

And bear in mind, the guide price is 390,000.

So what could a house like that sell for?

Potentially, I think this property

you could put on the market for around 700-750,000

if you do a really decent job on it.

And what about the rental in this area?

You're probably looking at around 2,000-2,200 a month.

A great plot and a great opportunity

for someone to just remodel this bungalow

and make it a fabulous family home.

Let's see who that was at the auction.

Seven-room bungalow.

355?

355. Stream right. 360?

365?

At the back? 365 with the catalogue. 370?

Behind you, 370 sitting down. New spot. 375?

380.

The price rose steadily after these initial exchanges,

and we rejoin the auction at £415,000.

415?

416?

417?

418?

419?

420?

Have a think. 419 down here.

420, back in.

This side. 420?

If not, it's 419 down here.

419, first time, second time...

third and last time.

If you're all done...

-BANGS GAVEL

-Sold. 419. Well bought.

I liked that one.

And the successful bidder on the day was Croydon local Kishor.

He and his Chartered Surveyor son Amish

run a property developing business.

I met them back at the bungalow to find out more.

Guys, congratulations. This is a brilliant property.

So, who spotted it?

I spotted it.

On Sunday evening around seven o'clock,

I was just passing this road, I saw it,

I thought, "Oh, that's in the auction. Looks interesting."

Had a peep through the window. Monday was the auction.

So, Sunday night to Monday, and you went to the auction and bid for it?

And just bid for it.

Offered the auctioneer 300,000.

He said, "Nah, don't be silly," you know?

I said, "All right, take 350."

He said, "All right, we start you at 350."

And came in until 419,000 and the hammer fell.

So, Amish, what do you make of that?

Well, this is typical of my dad, to be honest with you.

He'll give me a call and say,

"I've seen a property and this is the price. What do you think?"

And I'm like, "Well, let's have a research of it," normally.

He's like "No, no time for that.

"I've got to go to the auction and have a go."

I was like, "Fine, go and do what you've got to do."

So, what's the family history?

-Do you guys do this kind of thing all the time?

-Yes.

I'm a quantity surveyor and Dad's a developer

and we sort of teamed up

and we've, you know, started doing a bit more developments

and sort of taking it from there really.

I basically started working as a carpenter

when I came to this country in 1972 from Kenya,

and since then I've bought a DIY shop, got interested in it,

bought another DIY shop... with my brothers.

And eventually started buying properties.

So the very first property,

my brother, Arnit, and myself were here.

We just collected about £5,000 and went to the auctions in 1976.

So, hold on a minute.

So your first ever auction property was back in 1976 and it was £5,000?

-5,500.

-Whoa!

# Oh, you got to learn to roll with the changes

# Got to, got to, got to... #

Kishor certainly has rolled with the changes -

that's nearly 40 years of experience in property development.

So what do they have planned for this place?

The plan that we were thinking about doing was at the back,

where you've got, sort of, about three walls

that divide three rooms into the back -

knock all the three through, OK?

And then, put an extension on the corner

-so that'll be a nice L shape.

-Absolutely.

-You know?

Kitchen-diner would be lovely

with some bifold doors out the back to the garden.

It'd be quite nice.

-Two bedrooms upstairs.

-Yes.

-A bathroom?

One en-suite and one bathroom,

but, again, we've got to work with the space

and see what we can squeeze in there.

-And two bedrooms downstairs?

-Two bedrooms downstairs.

-So a four-bedroom property all in all?

-That's right.

-Two and two. Two-up, two-down. And open some dormers...

-Yeah.

Rear part of it, make more lighter ensuite bedrooms.

There's not as much light in here at the moment as well, so...

# Let the sunshine in

# Come over right away.

# Let the sunshine in and brighten my day

# Send those clouds away

# Let the sunshine in... #

I am delighted to hear the boys

talking about letting light into this house.

How much do they think this will all cost to do the work?

The budget for the work here, I would allow £70-£80,000.

So that's quite a healthy budget, really.

I mean, you know, new kitchen, new bathroom, building work.

What about extending out the front or putting on a nice big porch

because it can really take it - you've got such an amazing frontage.

It's a lovely thought - I hadn't even thought about that...

I mean, we'd have to do the measurements and see,

cos they do want to get a car in, so...

-Well, there's plenty of space for that.

-Yeah.

Six cars, ten cars! Come on!

-There's loads of room.

-Amish, it's huge out there.

I'm just looking at the cost element.

Caravans even!

# Pull up to my bumper, baby

# And drive it in between. #

Amish is having none of my nonsense,

but after all, it's his job to rein in the spending,

and he's hoping to have the work done in six months.

Kishor has three brothers - they all work together

and have 70-plus properties between them.

There is also the possibility that

one of Kishor's brothers might move into the house.

But if that plan changes,

what do they think they could sell it for?

I mean, we were discussing this

and I would go lower, Dad would probably go a little higher.

OK, go on, valuation.

Er, 675-700.

-OK.

-I would say in around the 650 mark.

Well, guys, I'm really excited to see what you do to the property.

It's been fantastic meeting you both.

-It was lovely to see you too, yes.

-Good luck.

It's been a brilliant day.

-Thank you so much.

-Thank you very much.

Thank you very much too, yeah.

So, Kishor took a chance on this bungalow,

but I think it was a chance worth taking in this case.

This is a great property, and with Amish onboard,

I'm sure they will transform it.

I can't wait to see what it looks like when we return,

and find out what it's worth and who's nearer the mark.

You can find out what happens later on in the show.

On the southern bank of the River Tyne,

just over the water from Newcastle lies Gateshead.

Home to 200,000 people,

this area is famous for its iconic bridges

as well as cultural landmarks

like the BALTIC Centre for Contemporary Art.

# Home is where I want to be

# Pick me up and turn me round. #

Well, just a mile from the centre of Gateshead

is a property I'm here to see.

What does £25,000-plus as a guide price

buy you, potentially, around these parts?

Well, in this case - this. Slightly unusual one, this.

It's this flat here.

One bedroom, but as you can see, there's a door just there.

I'll explain more about that later. Let's have a look inside.

So, what have we got?

Well, quite a grand entrance.

There's high ceilings, which is good.

Corridor here, you've got a little sort of porch area there,

which is always good.

Extremely large bedroom. Whoa!

Immediately, I'm thinking - is there a way of making this

more than just a one-bedroom flat?

Maybe incorporating a second bedroom perhaps, but I don't know.

Big bathroom as well. Nice family-sized bathroom,

and then through into this, which is your living room.

Now, this is where the property I'm sure would have ended

at some stage in its history.

However, somebody's built on this area here

which contains the kitchen.

Now, it is obviously in need of some major refurbishment.

And I'm a bit concerned about

the way the plaster is coming off at the end there -

maybe showing some signs of damp.

In fact, other sort of indications that damp might be an issue

in more places than one with this flat.

But in terms of space... it's good, it's good.

# Wide open spaces. #

So, that's the interior.

A good space with potential for an extra room,

but with lots of work needed to modernise.

Time to take a look outside.

You never know quite what I'm going to find

when I come out to the back of the properties I visit.

But in this case, it's a real pleasant surprise.

I mean, no garden to speak of, as in no grass and stuff,

but somebody's done a really nice job of creating a lovely little space.

Basically, you've got concrete,

some steps leading up to a rear gate there.

But this bit here, I don't know,

it just has a sort of charm.

It's like a little cottage garden... in a flat in Gateshead.

Who cares? It's... It's lovely!

What's not quite as lovely is the length of the lease -

there's just 63 years left on it.

70 years tends to be the cut-off point for most lenders,

and it would also make it tricky to sell on.

To extend it, you'll need permission from the freeholder

which brings me back to those two front doors we saw earlier.

This is called a Tyneside flat.

Basically, two doors on the front,

separate entrances leading to a ground-floor flat here

and an upstairs flat there.

It then gets complicated,

'cause the lease is actually what they call a crossover lease,

so, you, as the owner of the downstairs flat,

are the freeholder to the upstairs flat,

and similarly, the person who owns upstairs,

the leaseholder upstairs, is the freeholder to your bit.

So you're going to have to ask their permission

for anything you want to do down here,

and also, to extend that lease.

So what's the end point of all this?

A classic case of making sure

you get on really well with your neighbours.

# Making friends and meeting people

# We're only happy when we're making friends and meeting people. #

The short lease may go some way to explaining

the guide price of £25,000.

So, what can a local estate agent tell us about this area

and this flat in particular?

The apartment is bigger than normal for this type of property.

It's got a much larger bathroom

and I think that lends itself to being able to remodel it

so that it could be a two-bedroom property.

Assuming the lease was extended

and the flat would remain as a one-bedroom flat,

the agent thinks the rent would be around £350-£375 per calendar month,

and the resale, 50-55,000.

So would it be worthwhile to do the work and make it a two-bed flat?

If it was remodelled and changed to a two-bedroom,

I think you should be able to achieve

somewhere between £400 and £450 per calendar month.

And for resale?

It should achieve somewhere between £60 and £65,000.

Well, I think this little flat

presents some really interesting opportunities,

but it's really important that you understand the complications -

or perhaps non-complications - of that whole lease issue.

Let's see who wasn't put off when it went under the hammer.

One-bed ground-floor flat.

It does require some modernisation and refurbishment.

Can ask a 25 to start? Do I have 25,000 anywhere?

Gentleman with the catalogue at 25,000.

Do I have 26 anywhere else?

One bid standing at 25.

26,000. 26 on the right. 27?

28? 29?

30? 31? 32? 33? 34?

I'm here.... 34, bid.

35? 35, bid. 36?

35 on the left-hand side. Do I have 36 anywhere else?

I'm standing in the doorway at £35,000.

I'll take 500.

35 and a half. 35 and a half, bid.

500, yourself? 36?

36 with a nod. 36 and a half?

36 and a half bid.

37? 37, bid. 37 and a half?

37,000 standing. Anybody else joining in?

I'm here left-hand side at £37,000.

250 elsewhere?

I'm selling at once at 37,000...

I'm selling for the second and final time at £37,000.

Sold to the gentleman in the doorway at £37,000.

After some fierce bidding,

it was Paul who managed to get the flat for £37,000

as a joint project for himself and his friend, Adrian.

# We're marching to the future

# Yeah, it's me and you. #

Paul, Adrian, great to meet you both.

-You too.

-Hello.

-Congratulations.

Tell me why you wanted to buy the flat.

Well, basically, he was having a look around

and he was wanting to join me on an investment.

Oh, so you do this a lot, do you?

I've done quite a few, yes.

-So, I do this, he runs pubs.

-Right.

And we're obviously mates.

-I drink in his pub.

-Oh, right. That works

-well, then. So...

It's something that we've talked about for quite a long time.

-Yeah, yeah.

-And essentially it's a way of hopefully making

a better return than having your money in a cash ISA.

I've been doing it for quite some time thanks to you and Lucy,

-of course.

-Oh, great.

-That's how I started originally.

-Really?

-Yeah, yeah.

Well, a massive fan of the show, years ago,

and I thought, "I can do that. I can do that."

And one day I just did and it went from one thing to another

-to another.

-So, how many properties have you got now?

-I've got 18 at the minute.

-18?

-Yeah.

And do you think you would have had those 18 properties without

-Homes Under The Hammer?

-Not at all, no.

So, what about the idea of taking on a partner?

Well, it's the first time ever, but we've been good mates for about

five years or so.

We get on quite well and that, so I think it'll be all right, yeah.

What about the work? How are you going to manage the work?

-Paul is more into doing the hard labour than I am.

-Yeah.

-So, I'll do that.

-I'm very good at finding things for the best price.

He'll source all the stuff cheaply and I'll put in.

-Right.

-Because...

-So, you do a few minutes on the internet,

find a cheap kitchen and then he spends three weeks fitting the thing.

Sounds like you've got the good end of the deal here.

-I might get rid of a few bags of rubble for him.

-Absolutely, yeah.

So, why this property for your first joint venture?

Well, he was... After we'd had a conversation about

the return on investment from his ISA account,

he started looking through the auction catalogue.

And because the guide price was very low I thought,

"Well, there's obviously something wrong with it."

And after looking at the information pack,

-I realised the lease was very short.

-Right.

But with it being a Tyneside flat,

I thought, well, it can be, obviously,

sorted without too many problems.

So I knew... So, I knocked on the neighbour next door and asked him

would he be interested in increasing the lease and he said,

"Oh, yes, of course. I'd be more than happy to do that."

-Oh, wow.

-So, we went to auction and bought the property.

Right. Do you think that might have put some people off?

I think it would put a lot of people off, yeah.

So, what are you going to do to it?

Well, we're going to strip it out, rewire it, replumb it,

put a central heating system in.

We're going to divide this room into two spaces

and the bathroom will be in this space where we're actually standing

-right here.

-Oh, right.

And then what's presently the bathroom,

which is a really big space will become a second bedroom.

-Oh, gosh.

-And then we'll put a new kitchen in and...

So, what's the budget for the work?

-We've got a budget of about £12,000.

-12.

-And you paid 37 for it, was it?

-£37,000. That's right, yeah.

-So, you're in it for £49,000-£50,000 or so.

-Yeah.

And you think you might be able to sell it for...?

We're hoping for £75,000 as a sale price.

Right, so 25 grand potential profit, split between you.

-Not bad for a first venture.

-Yeah, yeah, it's OK.

I mean, we might not get that but, you know,

it's worth a try, isn't it?

It is worth a try.

They may seem to be aiming a bit high on that resale price

but let's wait and see what impact that lease extension has.

They have been very clever on that lease issue

and should be able to resolve it with some fairly minor legal fees.

Paul is an experienced developer and Adrian has overseen

renovation projects in several of the bars he owns,

so what could possibly go wrong?

Are you nervous at this point?

Not really because of the fact that I'm quite happy with the area

that the house is in and obviously more than happy for Paul

to take the lead since it's what he's done for at least

the last decade. You know, possibly if we were buying a property

and turning it into a pub then it would be the opposite way around.

But having him as your mentor, if you like,

-has really made the big difference to you?

-Oh, yes.

It gives you a great deal more confidence to go ahead with it.

Right. What's the timescale?

About six to eight weeks.

It would be shorter but I've got a couple of holidays coming up.

Oh, really? OK.

-Well, listen, congratulations.

-OK, great.

-Good luck to you both.

-We look forward to seeing how you get on.

-Cheers. Thanks a lot.

So, Paul finally tempting Adrian into the world of property investment

with this little flat in Gateshead.

And a good one to start off with it is too.

I think they're right to convert it into two bedrooms.

I like their plans.

How will it all go? You can find out later in the show.

Coming up, we see if this water tower in Kent finally made a splash.

It has to have that impact, that punch.

While Paul and Adrian face an impact of a less welcome kind.

Upstairs, his kitchen was actually going to...

About to collapse into this property.

It's time to venture back to Croydon where a year has passed

since we last saw this dark and cavernous bungalow

purchased at auction for £419,000 by Kishor and his son Amish.

It was more or less a shell with allegedly seven rooms

but, oh, what a messy old layout.

# Looking back it's so bizarre

# It runs in the family. #

At the back where you've got sort of about three walls

that divide three rooms into the back.

Knock all the three through, put an extension on the corner,

so it will be a nice L shape.

Kitchen-diner will be lovely with some bifold doors

out the back to the garden. It'll be quite nice.

The father and son team had experience to draw on.

Quantity surveyor Amish had been involved in developments before

and Kishor wasn't exactly a beginner.

The very first property, we just collected about £5,000

and went to the auctions in 1976.

# How we going to stop the time? #

As to the potential resale value of the property

once the work was completed, there were mixed opinions.

OK, go on, valuation?

-£675-£700,000.

-OK.

I would say around the £650,000 mark.

Well, we'll find out who was nearer the mark in a minute.

But first, let's look at what's happened to that empty shell.

Just to warn you, if you're holding a hot drink

you might want to park it somewhere safe, just for a few minutes.

This is simply stunning.

From an empty shell has emerged a beautiful family home.

I don't know about you but I'm getting a serious case of

kitchen envy.

Just look at that. Wow!

The living room retains it's beautiful brick fireplace,

the only original feature that has survived unaltered.

The other front room has become a cinema room,

just awaiting a state-of-the-art installation.

Behind these two front rooms lie two double bedrooms.

But it's to the back of the house where things really start to change.

We've extended the property by about four metres to the back

across the entire span of the house.

And we've raised the roof and we've created two extra bedrooms.

Extending upwards has created two really spacious double bedrooms

plus a stylish shower room.

Outside, the front garden has been paved over

for plenty of off-street parking.

Everything is topped off with solar panels.

So, has the original budget gone through the roof?

The original figure was around £80,000 to spend

but since my brother and his wife want to move in,

it went on and on and on until I think we've spent in the region of

£145,000-odd.

So, almost nearly double the money, you know.

The area that we're building in, the property prices are a lot higher.

So whatever we are going to put into it, the list of features,

the extra features, you will get that back... I hope.

HE LAUGHS

Well, it's no surprise the budget has taken a hit.

This house has been furnished with an eye to the luxury end

of the market. Can you spot any radiators?

No - because it's all underfloor heating. Nice.

What was the most challenging part of this renovation?

The biggest part was the roof structure,

which we never intended to do

but then we decided to completely remove it.

So, we did the whole new roof.

The planning process...is always very difficult.

Working with the local council, you really have to answer

a lot of their questions and pre-empt what they're going to

come back at you with.

So, we did try our best and we had a couple of appeals

but that's part of the game.

Well, if this is a game, it's time now for the final scores.

I'm dying to know what this amazing refurbishment has done

to the value of the property.

We invited two local experts to visit this suburban Shangri-la

to give us their opinions.

Well, a great improvement since when I was last here.

A complete transformation and the property's got bigger.

It's still got the appeal of people looking for a bungalow,

there's still two bedrooms downstairs

that could be used for that.

But equally it's a family home as well and you've got

one of the best primary schools in the area very nearby.

The combination of that and the standard to which it's been done,

it should appeal to a whole range of buyers.

Kishor and Amish purchased this bungalow for £419,000

and have spent a further £145,000 on its luxurious upgrade,

bringing the total to a rather impressive £564,000.

How does this compare to resale values in current market conditions?

We would market this property at £750,000.

I would expect this property to resell, in the current market,

at a minimum figure of £750,000.

That's potential profit of £186,000 before taxes and fees.

So, as you will recall, there was some difference of opinion

between father and son on the possible resale.

What do they have to say for themselves?

Great. Fantastic. Especially cos I went in quite cheap

but obviously I didn't really want to rock the boat.

Yeah. I came round about £750,000 sort of thing...plus.

Well, that's 40 years of experience for you.

The house won't be going on the market any time soon

but those estimated figures are music to the ears of father and son

property developers.

Well, around this area is quite... A market of around £800,000,

so I'm sure we can sell it for £750,000 plus very easy.

And we're not in the negative, so we are on the plus

so I'm quite happy about that.

Well, if you thought that was an ambitious project

then wait and see what I've got for you next.

In 2012, I visited a property in Harrietsham, Kent,

which I know most developers could only dream of.

The beauty of auctions is that it's a place where the unique and unusual

can be bought.

Properties which would be hard to value

as there are no market comparables - and this really is such a property.

Look. It's this water tower, built in 1903.

Wow! I need to explore.

# Water tower

# It sure is good to see you

# I've been away for way too long. #

The building itself is impressive, if a little basic.

But the best thing about this,

it's got full planning permission to convert to residential.

In 2004, this sold for £120,000

but because it's now got planning in place,

the guide price at auction was £200,000-£220,000.

It just goes to show, getting planning permission

can really add pounds.

# Water tower

# Like a lighthouse in a storm. #

It was an awesome building, no doubt about it.

But for that money, all you were buying was an empty shell

with a metal box on top and a challenge or two.

Now, obviously, the shape of this building presents some issues

when it comes to converting this into a home.

You've got to imagine living in there.

Put some floors in, well, you're going to end up with lots of small

little rooms just one on top of another with lots of space taken up

by stairs.

Not the easiest layout to live with, but the plans allow for

a large extension to be built out here at the rear.

Now, this will be connected to the tower

with a glass entrance area - stunning.

The extension will be single-storey with a beautiful curved wall

round here and this will house the main living areas.

You've got your lounge, kitchen, dining room

and also you'll have two bedrooms with en suites just over there.

It was an amazing state-of-the-art plan with the extension

having curved windows, designed to make the most of the views.

And the plan to utilise those more awkward tower spaces included

a TV room on the ground floor, a third bedroom on the floor above

and on the second floor, a bedroom with ensuite.

And that ugly metal box on top -

well, that was going to be the master bedroom.

This water tower really does offer a very unique opportunity

to build an unusual home.

All the hard work's been done, the planning permission is in place,

so now all the new owner has to do is build it.

So, who was tempted by this wonderful tower?

Let's find out who bought it at the auction.

200 to start me.

200, I'm on the way, I'm obliged.

200, 205 on my left-hand side.

210, it's against you. 210, it's with you. 215. 215.

£220,000. 218 if it helps you. 218 I've got.

220, it's with you. 222 it's against you again.

222 in a fresh place standing at the back corner. 225. 228 I've got.

230 I have. 232, it's against you.

232.

£230,000 in for the first time.

230 for the second.

If you're sure you're all done, it's going to be sold...

£230,000 sitting down, make no mistake.

-Third and final time.

-GAVEL BANGS

You've bought yourself a water tower, sir, well done.

Andy managed to capture this tower for 230,000.

Andy runs a consultancy in fire protection

and other related businesses

but had taken up property developing.

He had a reliable building team which, let's face it,

on a project like this is a must.

I met him back at the tower to see what he had planned.

-Andy, congratulations.

-Thank you.

You certainly like to take on a challenge, don't you?

I don't know, don't know if we see it too much of a challenge.

But we like to think it's more interesting

than a challenge, really.

So, why would you think this isn't a challenge?

Because I know a lot of people looking at something like this

would A, think it's amazing

but B, think, "Wow, I've got to build a house around this."

My normal course of work was working on residential developments

that were sort of up to 40 storeys high and, you know,

1,000, 2,000 unit developments.

So it's not something...

When we look at this, yes, it's got its own intricacies

but we don't really see it as...

We see it as a challenge but not something that's daunting.

So, this isn't really going to add

that much stress to your life, is that what you're saying?

Is that what you're hoping for?

-I'm not allowed to add any more stress to my life.

-Tell me why.

I've had to take a step back from my other businesses

-because of stress and various other reasons so...

-Really?

This is taking a step back?

Yeah, it is. I mean, this is, for me, it's like a hobby, I guess.

# You've got to step back, baby So I can get along with you. #

I never in my wildest dreams would imagine this project

would be a way of reducing stress,

especially since Andy clearly had high ambitions for his high tower.

So, look, let's talk about the water tower itself.

How are you going to turn this around

and turn it into a beautiful home?

The ground floor itself, I mean, the modern extension

it's really where we're going to try and create

the sort of living spaces that will be the...

You know, a lot of people nowadays want the open-plan kitchen

and your dining and your living space.

Looking at this house, we've always said

it's got to be high spec, high budget.

So, you know, a really good kitchen.

It's got to have a kitchen with a wow factor

and all that sort of stuff in it.

Um... And, you know, something that when someone walks in

they're not only going to see the view, you know,

but it's also got that sort of, you know,

it has to have that impact, that punch.

# Nothing but the best is good enough for me. #

The budget of 230-250,000 seemed reasonable.

But the thing with a project like this

is the heart can soon start ruling the head.

And before you know it,

you've thought up lots more things to add

and every amendment could add to the cost, and Andy had one.

I'd like to try and develop something

like a roof terrace with grass, you know,

so you'd have to take your lawnmower up there every now and then,

that sort of stuff.

I love the thought of just mowing your roof.

Well, you know, this is the thing.

It creates a sort of a garden on the roof

but it also, as well, I mean,

it then really sort of raises you up a level

and enhances the view even further.

Certainly the disadvantage with this property

was the rather small outside area left once the house was built

so the garden terrace was a stroke of genius.

This is an Area of Outstanding Natural Beauty.

There was no certainty planners would look kindly on this

and any wrangles cost time and money.

Now, come on, how long's it going to take you to build?

Um... We're sort of estimating probably about six to eight months.

15 months later, we return to see if Andy had a towering success

on his hands and a more stress-free life.

I'm not really surprised given the scale

and ambition of this project that it was still ongoing.

But what Andy had achieved at this stage was still very exciting.

We've been fairly happy with the progress.

We've stuck pretty much to the original planning.

Haven't tried to push the envelope too much

because we understood there was planning issues on the site.

So, the finish that we're looking for

is a very high spec finish throughout the property.

The type of market we're trying to put this out to,

we know that we've got to really

sort of bring out the luxury within the spaces.

Andy certainly hadn't run out of vision for this project.

This is the open-plan living space, so over to here

we have the kitchen.

We've got a German-made kitchen for this section.

And then basically it's completely open-plan through the living space.

We're going to have a wood-burning stove over in this part

because the intention is for basically the entire extension

is a modern extension to what is the old tower.

So we have the full glass sliding openings following the curvature.

So they are actually curved sliding doors as well,

which has taken a bit of time to get to grips with the glass

but hopefully we're finally getting there.

But it should look absolutely fantastic.

Ah, it's the windows, isn't it?

And those curved ones proved really ambitious.

The windows in the tower impressed me too.

What was once a gloomy shell was being transformed,

flooding the spiral staircase with light -

I loved it -

winding through the four floors of the tower

and ending in what was clearly going to be a unique top master suite.

We're currently standing in the master bedroom

at the top of the tower.

So we're looking at the top of the spiral staircase

as it's being installed.

So we've had to extend the roofline outwards to avoid the staircase.

But one of the benefits that we get

is you can actually now walk right up to the front

of the roof elevation and look straight down

over what would be the sedum roof on the full extension.

And you'd benefit from the views as you can look out from here.

Everywhere in this house, attention to detail and quality was obvious.

But getting to this stage had taken such a long time.

And on this day, when the new windows were proving troublesome

it seemed Andy's wish for lower stress levels was far, far away.

We've had a view stressful points.

You know, the windows in particular

have been pretty stressful element of the project

but we just sort of roll with the punches,

I guess, is what you'd say.

Just to add to the pressure,

they were working across several other developments.

But Andy felt this one was finally coming to a conclusion of sorts.

We could effectively finish this within the next six to eight weeks.

A lot of it depends whether we get interest from the market

cos, you know, we've already put it on the market now

for looking for a buyer that potentially might want to

put they're own stamp on the sort of internal finishes.

Andy originally set a budget of £230,000-250,000 for the work,

but in order to increase the appeal of the property

with its high-end finish, upped it to £380,000.

So, was that enough?

We're currently round about...

Looking at finishing at about 405,000.

Sort of about 25,000 over the sort of budget that was revised.

But that's still including the purchase cost

and the rest of it.

We're more than happy with the budget we've come out with.

Over schedule, over budget and certainly not stress-free.

This project was in some ways the stuff of nightmares

but also promised to be a dream house.

Find out later in the programme how it all turned out at the tower

when we returned five months later.

Well, there's nothing quite like the sense of satisfaction you get

from standing back after you've completed a renovation and going,

-"Good job."

-Yeah.

Well, we've seen how one of our buyers got on.

Let's check out the rest of them.

We return to Newcastle-upon-Tyne now

where veteran developer Paul teamed up with new kid on the block Adrian

to purchase this one-bedroom flat for £37,000.

Tell me why you wanted to buy the flat.

Well, basically, he was having a look around and

he was wanting to join me on an investment.

-Something we've talked about for quite a long time.

-Yeah.

And essentially it's a way of hopefully making a better return

than having your money in a cash ISA.

I've been doing it for quite some time, thanks to you and Lucy.

-Oh, great.

-That's how I started originally.

-Really?!

Yeah, yeah. Well, I were a massive fan of the show years ago

and I thought, "I can do that, I can do that."

And one day I just did and it went from one thing to another.

So, how many properties have you got now?

-I've got 18.

-18?!

-Yeah.

-And do you think you'd have had those 18 properties

-without Homes Under The Hammer?

-Not at all, no.

# We are family. #

Oh, makes us all feel like proud parents here at Hammer.

Carry on, junior. Why this flat?

So, because the guide price was very low I thought,

"Well, there's obviously something wrong with it."

After looking at the information pack

-I realised the lease was very short.

-Right.

But with it being a Tyneside flat I thought,

"Well, it can be, obviously, sorted without too many problems."

They reckoned it would be an easy fix

because of the topsy-turvy Tyneside lease system,

which means that the neighbours in the properties

own each other's freehold so a deal could be done.

I knocked on the neighbour next door and asked him

would he be interested in increasing the lease?

And he said, "Of course, I'd be more than happy to do that."

-Oh, wow.

-So, obviously, I went to auction and bought the property.

With the deal done, it was time to transform and did they?

Oh, absolutely.

We've done a full damp-proof course in the house.

Been fully rewired, fully replumbed,

full central heating system, fully replastered.

New bathroom, new kitchen, new carpets.

It's basically everything. Inside it's a brand-new house.

The only thing that was left was the shell.

# Take on me. #

Right from the start, this project was about

getting the most from the original space.

Basically, the wall went straight across there.

There was nothing here and it was just a giant bedroom.

The door was here so we just built a wall here, built a wall there

and created a bathroom behind this wall

so that we could create then a second bedroom

in what was the bathroom previously.

Adding the bathroom downstairs to create a second bedroom

was a masterstroke by the lads

and they didn't approach things in half measure.

Well, we didn't have to, but we chose to put a window

in what is now the new bathroom

so that it would have some natural light

and actually feel like a proper room,

as opposed to feeling like a cupboard,

-which, in a lot of new builds... Wouldn't you say?

-Yeah.

..you go in and they don't have windows in the bathroom

and they just feel very cupboard-like.

-And we didn't really want that, did we?

-No.

We thought it would give it the feel

of the fact that it felt like it had always been there, so to speak.

And, of course, having a window helps with the ventilation.

Of course.

Everyone's a winner. As a first project together,

how did they divide up the responsibilities?

I project managed the renovation and I did a lot of the work myself.

Obviously, I have a good team of people around me -

family, friends and all that kind of stuff.

So, everybody worked really hard. I did lots of the labour.

-I built the new bathroom, installed...

-The kitchen.

..installed all of the kitchen myself.

I did all the skirting boards, architraves,

door frames and everything.

My brother helped with that. My partner helped.

Paul, with all his expertise, led the way

and Adrian enjoyed gaining valuable experience.

But what were the major obstacles they encountered?

We also replaced the entire floor

between the two properties in the kitchen

because when we exposed the beams,

we realised they were totally rotten.

So, upstairs' kitchen was actually about to collapse

into this property,

so they had to have their kitchen removed

and we had to redo all of that as well.

And the water-based problems continued.

Originally, we thought it just had damp in the kitchen

and on the fire breast wall of the living room,

but it turned out that damp-proof course

was needed throughout the entire house.

It had very severe rising damp, so we had to take the plaster off

1.5 metres high right round the building.

Every wall in every room.

Obviously, it had a new damp-proof course

and it was all replastered.

Every project throws up unexpected issues.

What's important is how you deal with them.

This first-time team should be very proud of themselves.

How did they fare with the budget?

The budget was 12,000, um, and we had...

The damp-proof course,

because it had rising damp right round the building,

ended up costing double what we anticipated.

So, that came in at just under £3,000

as opposed to just under £1,500.

So, that was a bit of an awkward moment because we thought,

"Oh, we're going to overspend straightaway,"

but I managed to pull it back by just cutting corners here and there,

sourcing items cheaper if we could

and doing a lot more of the labour myself.

So, we ended up spending 12,200-ish, give or take a few pounds.

Wow! That brings their total spend here to £49,200.

Not only did they stay within budget,

but they also completed within the estimated eight weeks.

-What a team these boys are.

-I'm very happy with it.

Really love it. I think we've done a really good job,

considering the hiccups that we had, the budget that we had.

And it's been a transformation, you know,

from what it was to what it is now.

I think that Paul's done a really good job project managing it

and it really looks good.

Good?! It looks fantastic. Mission accomplished here.

What has all their hard work done to the value of the property?

We asked two local experts to come along and have a look.

This is the first time that I have been inside the property.

I think they've done it to a very good standard

and I'm very pleased to see

that they've managed to get a second bedroom.

This is my second time inside the property

and I think the changes are absolutely amazing.

I've never seen a transformation like it.

The layout works really well.

I wasn't really that sure how they were going to do it,

but the final finished apartment is fantastic.

No doubt about that, but with a total spend of just over £49,000,

what has the transformation done to its value?

I would value this property on the open market

for offers in the region of £70,000.

If I was to put the property on the market,

I would market it at around £75,000.

So, taking the top estimate of 75,000,

that would leave a potential profit of just over £25,000

before taxes and expenses, of course.

So, how do Paul and Adrian feel about that?

I think they're quite good, really.

I mean, it's around what we expected.

Um, so, yeah, so...

But, I mean, it's for sale already anyway, so that's fine.

-The agent came and he said...

-Slightly more.

-Yeah, yeah.

Well, he's put it on the market at 79,950

with a view to achieving somewhere between 75,000 and the 79,950 mark.

So, it's fine. We're more than happy with it.

Job done for this first-time partnership

and a very successful one at that.

Any advice for similar attempts by others?

Do your research, choose wisely, get a good price for your property,

do a very good job, get a good team around you and...

Always allow a little bit of money on the side

for any hiccup that you didn't expect.

-You mean like an entire damp-proof course?

-Yes.

HE LAUGHS

It's time now to return to that ambitious project in Kent -

the former water tower,

which we first saw in the summer of 2012.

Andy was creating a luxury four-bedroom home

by building a state-of-the-art extension to this.

When we last saw the project,

progress had stalled due to problems with the new windows.

We've had a few stressful points. You know, the windows in particular

have been a pretty stressful element to the project,

but we just sort of roll with the punches

I guess is what you'd say.

Despite some setbacks along the way, Andy was always determined

that the standard of finish would be a match

for the impressive and unique nature of the water tower.

The finish that we're looking for is very high spec.

The type of market that we're trying to put this out to,

we know that we've got to sort of really sort of

bring out the luxury within the spaces.

Purchased at auction for £230,000, Andy had initially budgeted

an additional £250,000 to complete the renovation,

but as time passed, this had increased to over £400,000.

The schedule had also stretched,

as completion had originally been planned for summer 2013.

Two years have passed since Andy bought this place

and apart from a few minor details, the renovation is now complete.

Are you as excited as I am?

Ooh, let's look!

Andy said he was aiming for luxury

and I think he has hit the bull's-eye.

This place is absolutely stunning.

On the ground floor, the open-plan living space

is beautifully framed by those curved windows on one side

and the internal wall on the other.

The kitchen continues the classy and contemporary finish.

Just gorgeous.

I think I'd like one of those.

But the stove gives some rustic charm

to an otherwise modern living area.

Two bedrooms and a bathroom complete the ground-floor accommodation.

The centrepiece of the tower is the spiral staircase

leading to the upper floors.

Such a lovely piece of engineering.

It almost seems to float in mid-space.

On the first floor sits a third double bedroom.

The second floor is occupied by an opulent family bathroom,

complete with freestanding bath and large shower.

And finally, on the top floor, the master bedroom

with its spectacular views over the surrounding countryside.

With such a successful outcome to this project,

what is Andy most pleased with?

I think I'm most pleased with the quality,

you know, of the final product.

The tower itself, everything looks visually stunning.

We've tried to use a bit of our own ideas, you know,

bringing some brickwork into the building,

mixing the modern and old and that sort of stuff

and I think that the new extension

really works really well with the tower.

Especially when you stand up on the top floor bedroom

and look down at the roof

with all the flowers really now starting to sort of come out,

you know, it looks great.

So, that's probably what I'm most pleased with.

This has been a major project for Andy and his team

and not without its problems.

The two biggest problems - obviously, the windows.

We've talked about the windows throughout the project.

The only other problem, really, was getting the actual rendering done

at the rear of the property,

which you'd think should be fairly simple.

Something we learnt for the next one is, you know,

certain types of render products

will only be done by certain installers.

We had about 14 or 15 people look at the job.

We only got two quotes. Absolutely outrageous.

And then we finally found a manufacturer directly.

Yeah, we were happy with the finish once we got the people.

Andy is selling up and moving on to the next project

and so the water tower is already on the market.

We asked two local property experts

to cast their eyes over this impressive home

and see if Andy's ambitions will be rewarded.

The finish of this property is to a very high standard.

The owner hasn't scrimped on anything at all.

I love it. It looks fabulous.

It's been thoughtfully converted.

I think the design is very well laid out.

I think there's good proportion and space

and the detail is very good.

Clearly, it's a niche market for the style of property.

I think it's one that will possibly attract

someone from the London area.

It's that kind of individual property

that will provide the discerning buyer

with the opportunity to live in a home like this.

This area is very popular.

There's a very high demand for property in this area.

However, this property being so unique,

it may take longer to sell.

I can understand that this isn't a property for everyone,

but Andy knew he wanted to create something unique

and in doing so, he spent a total of 680,000.

I would value this property in the region of £1.2 million.

I believe, in this market, the property should be offered for sale

in the region of £950,000-£995,000.

It's a difficult project to work with, you know,

in terms of valuation,

but it's still, you know, whatever it's...

You know, 995,000 or 1.2 million, it's still a great profit for us.

Andy's right there.

The lowest valuation of 950,000

would mean a potential profit of £270,000,

while the highest of 1.2 million

would mean a potential £520,000 profit,

all minus taxes and fees, of course.

How does he feel about the experience?

It's nice to see it, you know, finished

and it's nice to see the sort of quality

and that sort of stuff and, you know, to be honest, it's...

My guys are that proud of it, they won't allow corners to be cut

and that's what's tough. So, yeah, it's been good.

Well, join us next time to see how more brave auction buyers get on.

-Yes, here on Homes Under The Hammer.

-See you then.

-Goodbye.

-Goodbye.