Episode 56 Homes Under the Hammer

Hello. Over the years, Lucy and I have met thousands of people

who've decided that investing in property

-is what they want to do with their money.

-That's right.

Good investing in property starts with buying wisely.

One way you might be able to do that

and get property at a good price is by visiting your local auction.

Now, people buy properties for all sorts of reasons -

to provide a rental income,

possibly as part of a pension or as somewhere to live.

So what were the stories behind the properties

that went to auction today?

It's emotional at the auction

as this buyer in London feels the pressure.

Bit nervous on the day itself but managed to grab what I wanted.

The thrill of the auction floor entices one developer

back into the game in Staffordshire.

There is quite a buzz there. You can get a bargain.

And find out why it all gets a little too much

for this developer in Cornwall.

-The auction.

-Yes. Didn't sleep for a few nights before.

-Right.

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.

Today, I'm in the residential suburb of Edgware

in the Borough of Barnet in north-west London.

It's brimming with stylish cafes, restaurants and shops

and combined with those all-important transport links

to London, Edgware is an attractive place to invest in property.

Not far from some very good shopping along the high street

and you have Burnt Oak Broadway.

It's the property I'm here to see, so what have we got?

Well, it's a three-bedroom ground floor purpose-built flat

in this rather pleasant cul-de-sac with good links to the M1

and not far from Edgware Northern line into central London.

Sounds promising.

Through the main communal entrance

and it's just a short walk to get to your own front door.

Most other flats here only have two bedrooms

but the one I'm going to look at

on the corner of the building here has three.

And the guide price - £160,000 plus.

These flats were built in the '60s

and I like this end location of this one.

You've got this long corridor with loads of rooms off -

bedroom, another bedroom.

Got the kitchen here, a bathroom, another bedroom

and then right the way through into the lounge.

As I guessed, no beautiful fireplaces,

no ceiling roses or cornices

but you have got masses of practical space that really does work.

Look, big, square rooms.

You've got a door leading out to the front so you could use that

or of course the main entrance.

It certainly needs modernising in here but you can't extend it

or change the look too much as it's part of the uniform block

but don't forget, it's got three bedrooms, which is a real bonus.

It really does look as though this place hasn't had much done to it

since the 1960s when it was built.

There are still lots of little telltale signs from the period

in its fixtures and fittings.

This does of course mean you'll have to go for a full rewire,

probably new central heating

and, really, a full-scale modernisation plan.

You might not be able to do much to it structurally

but it's a great layout as it is.

You really do have a blank canvas here.

I was talking earlier about how practical a flat like this is.

One of the positives here is that every single floor,

apart from the kitchen and bathroom, has this solid parquet floor.

Now, I know it will look totally different once it's been sanded,

stained and polished.

I even painted my own floor a parquet floor

a whitewash and let the grain come through.

It looked fabulous and it really did add value.

Another bonus with this flat is that the entire plot

is surrounded by some really well maintained gardens.

You'll have to factor in costs for the upkeep of the grounds

but luckily here, the communal service charge

is relatively low - around £350 per year.

All in all, I think this is a great little flat in a great area

with that all-important easy access to central London.

I reckon you need around £20,000 to refurbish it to a high standard

but what sort of return might you expect on your investment?

Let's ask a local property expert.

My first impressions of the property are it's very dated.

Obviously in need of complete modernisation.

It's a very spacious property. Fantastic quiet cul-de-sac location.

Very safe and it will be a fantastic property once it's refurbished.

The positive things about this property is the excellent size.

You've got three good-sized bedrooms, a nice big kitchen,

excellent-sized bathroom and it's very close to the tube station.

Once this property is refurbished, on the sales market,

it should achieve somewhere in the region of £300,000-£310,000.

On the rentals market, this property should achieve

somewhere in the region of £1,400 per calendar month.

With this, you get a solid, well-built property with no frills

but in a Greater London location like this,

it's going to be a popular lot, I'm sure.

Let's see who was bidding on the day.

Lot 59 is a three-bed flat.

Start 150 on this.

150 with you. 155. 155.

160. 165. Take it in front. 165.

170. 175. 180.

As you can see, this property was in demand.

We rejoin the bidding at £240,000.

240 with the catalogue. 245 with the phone.

250. 255.

255. 260. 260. 265.

270. 275.

280. 280. Yes? No?

275 with you.

280 in the check shirt? 275.

Gent has been there all the time. 275 first time.

Second time.

Third and last time, if you're all done.

Sold at 275.

And after that dogfight, it was Raqesh who finally won the day.

By day, he works as a dry cleaner

but he has also been developing property

along with his parents and his wife since 2002.

The family have a portfolio of properties which they rent out

but Raqesh's plans for this flat are to sell it on for a decent profit.

-Raqesh, congratulations.

-Thank you very much.

-Well done.

So, how do you feel now? You've got the flat you wanted on auction day.

Yes, very excited.

Bit nervous on the day itself but I managed to grab what I wanted.

So for you, the interesting thing

is you burst through the stamp duty threshold of £250,000

-and you paid £275,000!

-That's correct.

So now, most people, I would've assumed,

would have gone up to £250,000 with this flat and then pulled out.

My aim was £250,000 itself.

I did get carried away but I think...

I did a lot of research before I came for this property itself.

I came here three times, brought the builders,

had the legal pack in my hand as well

so it was a point where I just didn't want to let go of it.

So you just wanted to make sure you bought something on the day?

Absolutely. My wife was a bit shocked afterwards, obviously.

I told her I'd just spent £275,000.

"And now I've got to spend 3% stamp duty."

Yes, absolutely. But she was over the moon at the same time as well.

# I want you, I want you

# Yes, I want you so bad... #

Raqesh is delighted,

especially as he was not the only one that wanted the property.

He could have made an immediate profit

as a rival bidder for the property

offered him another 25 grand on the spot to just flip it -

a very tempting offer indeed.

But you weren't interested?

I wasn't because I really fell in love with this.

I wanted to renovate it and I will see after...once this it's all done.

He's given me his contact.

He's still interested and we'll speak once it's all ready.

So tell me what you're going to do to this property to improve it.

OK. We're going to renovate the complete new kitchen, bathroom.

Obviously remove all the wallpaper off the walls

and redecorate the whole area. New gas boiler in the storage cupboard.

And make it to a higher standard itself.

And take it and see how it goes.

As you might expect from a seasoned property developer,

Raqesh has a team of trusted builders ready

and willing to start the job immediately.

He has a budget of £15,000

and hopes to have the refurbishment finished

in around four to five weeks.

He plans to make use of that little redundant area

currently housing the big old water tank

to increase the size of the kitchen

and that will certainly improve the appeal of the flat

but what I want to know

is what's he going to do with that fabulous parquet flooring?

We were thinking of actually sanding that down

and reusing the whole flooring.

But we haven't decided as yet what we would want to do with the floor.

-It is everywhere.

-It is. Yes.

You've got parquet flooring throughout the whole flat,

which is incredible.

It is, yes, so we'll see as we go along with the renovation.

It doesn't smell of damp.

Cos that's something that I have to walk around

-and think, "Is there any damp?" It just smells musty.

-It does.

-Do you think that's just lack of air flow?

-Yeah, absolutely. I think...

We're going to have it checked out whether there is damp or not

but I think it is just really condensation in the property itself.

Well, not having any damp to deal with certainly

saves on the renovation costs

but Raqesh has talked about a high-spec finish

so I'm keen to find out what plans he has up his sleeve

for decor and colour schemes.

-It's going to be pure white.

-Pure white?

-Pure white.

-Not magnolia.

-Not magnolia.

-Not an off-white.

-Absolutely.

-Pure white? Lovely.

That's how all my flats I have renovated to that standard.

What about the kitchen?

The kitchen, again, we're going to have gloss white in the kitchen

to a high spec, and the same with the bathroom.

We've already picked out a colour.

-In fact, I have an interior designer with us on board.

-Wow.

-So I'm expecting big things, Raqesh.

-Absolutely.

-I'm expecting a bit of a wow factor when I walk in the door.

-Absolutely.

-Well, good luck with this property.

-Thank you.

I'm excited to see the interior design swishiness of it

and congratulations.

Thank you very much.

Raqesh really did his research with this property

before spending £275,000,

and breaking through that stamp duty threshold,

and he did all that without telling his wife.

Still, he fell in love with this property and with £15,000

and an interior designer, he is going to turn this place around.

Join me later on in the programme

and you can find out how good it looks.

This is Newcastle-under-Lyme, in Staffordshire,

a pretty market town sitting right next door to Stoke.

The market here dates back to the 12th century.

With Manchester and Birmingham less than an hour's drive away,

this is a popular area for commuters.

Just a couple of miles from the town centre,

in this popular residential area, is the property I'm here to see.

Before I even get there, one slight note of caution -

it's right opposite a pub.

That could throw up a few issues in terms of noise and resale values.

Not everyone likes living so close to such an amenity.

The property itself, though, sounds pretty good.

Three bedrooms, semidetached and a guide price of £80,000 plus.

Hmm. Got to be worth a look.

# We're going down the pub... #

There are so many plus points already for this house.

It looks in great condition

and it's near the sought-after Seabridge and Clayton areas

of Newcastle-under-Lyme

where houses can sell for half a million pounds.

Useful little porch. We like that.

If there was any noise from the pub

then it would certainly be slightly kept down by having that

but very traditional layout.

The moment you walk through the door,

stairs up there to your bedrooms and bathroom

and then little corridor leading to...

Well, let's find out.

Front living room area there, looks to be in pretty decent nick.

Um...yeah.

It's not sparkling-sparkling but it's not at all bad.

Same news when you walk into the kitchen.

This is a really nice space.

It's a sort of kitchen stroke...

I'd like to think family area there.

Maybe even better if you put French doors in through

where those windows currently are.

But obviously, it hasn't been updated in a while

so lots of chance to add value. We like that.

And as a starting point, yeah, it's doing pretty good.

# Things could be marvellous soon... #

Upstairs, there are two reasonably-sized bedrooms,

a larger bedroom and thankfully an upstairs bathroom,

showing a sign or two of damp possibly but not too bad.

It's all tying into place and given the location,

it's looking like a great family home to me.

Time to look for that all-purpose family garden.

So, at the back of the property, confirming its status

as a really good family home, a decent-sized garden.

Now, at the moment, obviously the grass could do with a bit of mow

but apart from that, you can see a few hours in here

would make a big difference and good news

that the leylandii over there

are at least a decent distance away from the drains.

Otherwise, that would be a problem.

So as I said, all in all, just adds to the appeal of the place.

Well, I'm already quite excited about this place

but it seems to be a house that just keeps on giving.

At the front of the property, a bit of a garden

and off-street parking, which is a big bonus. However, there is more.

A little bit of a surprise because next to the next-door property,

you have also got a single garage.

Bonus!

On first impressions, this place gets ten out of ten.

Three bedrooms, a garden, the garage.

It has potential to be a great family home.

But what about the area?

We asked a local estate agent to come and look at the property

and give us the lowdown on the neighbourhood.

The local area, Clayton, is really close to Newcastle-under-Lyme.

The commuter links obviously take you to the M6 in no time.

Local amenities are fantastic.

There's shops, pubs, hairdressers

and of course local schools are really well-regarded as well.

That's top marks for the area, then, but what about the property itself?

Ideally, I'd like to see the kitchen and bathroom refreshed

and replaced and just good level of decoration throughout

and that's all it needs, really, I think.

So it's all good news on the location, the property's layout

and its condition.

How much does he think it will be worth on the open market?

I think this property, once renovated,

would quite easily be worth £145,000.

Wow! That could mean

if you bought it for anything like that £80,000 guide price

then even with refurbishment costs,

there could be quite possibly a handsome profit in it.

Suppose you weren't interested in resale, though,

but wanted to rent it out. What could you get for it?

If I were to place the property on the rental market,

I'd expect to achieve £625 per calendar month.

What do you think? I think this is a great little property.

Not too much work to be done but you could really add value to it.

A perfect auction purchase.

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

Lot 13, Newcastle-under-Lyme now.

It's a three-bedroom semidetached house.

It is in need of modernisation.

Get it going at 75. 75 bid. Thank you. At £75,000.

80 anywhere? At 75.

80 left now. At £80,000. 85?

One, you're saying. 81. 82?

82. 83. 84.

Slow to start, this sale picked up speed and we rejoin it

when the bidding reached £105,000.

105 on the phone. 105. 106. 107?

No? At 106. Under the sign at 106. 107 anywhere else?

If not, £106,000.

107.

108? 108. 109. Shaking his head.

109 back to you in the aisle, sir.

£109,000.

110 anywhere else?

If not, £109,000 once. £109,000 twice.

Third and final time.

£109,000.

Bought it in the aisle. Well done.

The successful bid of £109,000 was made by Kevin,

who has only recently got back into property development

after a ten-year break.

I met up with him back in the house.

Kevin, great to meet you.

-Nice to meet you.

-Congratulations.

-Thank you.

So why did you want to buy this place?

It's a really nice neighbourhood

and just come up at the right price at the right time, really

-so an investment for the future.

-Right.

What was it about the house particularly that appealed?

It looked in pretty good condition other than a few cosmetic bits.

I know it had been previously rented out

-and it just looked in pretty good condition, really.

-So location.

Yeah, it's a very good road.

The top end of Seabridge, they fetch half a million pounds plus

so yeah, it's a very nice neighbourhood.

However, the house itself is right opposite a pub.

Does that bother you at all?

No. I did actually speak to some of the neighbours

and they said at closing time, it's very, very quiet.

-It's a very respectable pub.

-Right, that's good.

-# What a good place to be... #

-So no worries about the pub.

Kevin has done his homework.

# It's happy hour again... #

Not surprising given that he used to combine property development

with his day job as a sales rep

before the recession put brakes on his part-time business.

But now he's back.

He has four properties already on the rental market

and this will be his fifth, all bought at auction.

Three I purchased on auction night

and the other two were done the following day

because it didn't hit reserves.

I like the fact that you can...there is quite a buzz there

and you can get a bargain.

So this one, then, what are you going to do to it?

Cosmetically, it looks fairly clean

but it does need...every room needs repainting.

The bathroom needs completely ripping out. That's very old-fashioned.

Also, the kitchen is probably 1960s and not been touched yet

so that needs ripping out. There's a window going out into the garden.

I want put some French doors in there so it blends itself into the garden.

It's south-facing as well and it's got a nice patio area

-so it could be a very nice little family home.

-Yeah.

-And the garden is not massive but copable with.

-Manageable, yeah.

Apart from installing the French doors,

Kevin isn't planning any major structural changes to the house.

However, the living room is missing a key feature.

Is he going to do anything to that empty fireplace?

Being a rental, I'd probably actually just leave it

and let the tenants do that if they want to put something in there,

an artificial fire or something,

but, yeah, it's an expense I don't really need, I suppose.

Spoken like a true property developer.

With a possible monthly rental of around £600,

Kevin is happy to add this house to his portfolio

but he always has one eye on the local sale prices.

# By 11 o'clock, I'll be bringing that money home... #

There's one just up the road for sale,

the same house for quite a bit more.

-How much more, do you know?

-It's 155.

-Wow.

-It's next door but one.

-And you paid...?

-109.

-109.

Well, if he ends up with a house worth that much,

this looks like a bit of a bargain.

Kevin has set aside a budget of £7,000 for this upgrade

and plans to have the job finished in six weeks,

carrying out a lot of the work himself

so I expect he'll be keen to get cracking.

I'm off to California... I'm going down to Gatwick this evening.

Oh, wow.

An early morning flight to Vegas followed by a trip

down the Pacific Coast to LA, San Francisco and San Diego.

What a great trip. So you've just bought a house

and you're disappearing off for how many weeks?

Three weeks off. Can't wait.

-Good luck with that and good luck with the house.

-Thank you.

It will be interesting to see what you do to it.

-Nice to meet you.

-Thank you.

# California dreaming California dreaming... #

Well, I think Kevin has chosen well with this place

to add it to his property portfolio.

Budget seems fine but that timescale,

will it be affected by his California dreaming?

You can find out later in the show.

Still to come, is the price of this cottage in Cornwall

too good to be true?

Just £40,000. So what's the catch?

There are unforeseen developments in Staffordshire

that are close to home.

My stepdaughter suddenly decided they wanted somewhere else to live.

We return now to Edgware in north-west London where earlier,

I looked round this three-bed ground floor flat

which had a guide price of £160,000.

After a real battle on auction day,

it was eventually bought by Raqesh for £275,000,

115 grand over the guide price.

If he was in the least bit worried he may have gone over the top,

something happened that reassured him right away at the auction.

A rival bidder offered him £25,000 on the spot to flip it.

But seasoned developer Raqesh was determined to see this one through.

I did a lot of research before I came for this property itself.

I came here three times, brought the builders,

had the legal pack in my hand as well

so it was a point where I just didn't want to let go of it.

Raqesh, whose day job is running his dry cleaning company,

had big plans for this fairly big

but rather dated and slightly damp flat.

He clearly had quite the transformation in mind

and I was getting pretty excited.

-I have an interior designer with us as well on board.

-Wow.

-I'm expecting big things, Raqesh.

-Absolutely.

-I'm expecting a bit of a wow factor when I walk in the door.

-Absolutely.

Almost two months later, we're back to find out

if Raqesh has injected that wow.

I think that's what you call the wow factor.

When we were last here,

we had a partition wall which we completely removed.

The kitchen actually felt very claustrophobic

and removing the wall, having a bit more open-plan,

it naturally let more daylight inside and it made the place,

the kitchen actually look much more bigger as well.

The rest of the flat isn't looking too shabby either.

A high-end finish was promised by Raqesh

and a high-end finish is exactly what he delivered.

I do love the clean lines of the porcelain tiles

but what about that lovely old parquet flooring?

Originally, we were going to keep the parquet flooring.

However, we looked at having to sand it down.

Bring it back to its original life wasn't very cost-effective

so therefore what we actually did was completely removed

the parquet flooring from each and every individual room.

We decided to go for natural bamboo in the living room.

With the kitchen itself, we're going to go for the porcelain tiling

and each bedroom was going to be carpeted.

I think the carpet part also brings more comfort

towards each home as well.

OK, maybe cleaning up that parquet wasn't cost-effective

but I have to say, I am sorry to see it go

but this flat does have a truly lovely finish.

The attention to detail is really impressive.

I particularly like what he has done with the lighting.

Dropping the ceiling, making that special extra feature,

we put LED lights around them just to give

that extra special effect in the living room, bathroom and kitchen.

Originally, we were going to go for a standard finish

but then I thought, you know, give that little bit extra spec

is always a selling point as well

and a bit of a wow factor but, yeah, we have put my extra effort

in here and made sure that we give

that special finish to the whole flat.

An upmarket finish can mean an upmarket budget.

Has Raqesh gone over?

Initially, yes, we were going to spend £15,000 on the property itself.

However, there were extra special features we did add on

and that obviously added cost on at the same time.

I have virtually got to a stage of my spreadsheet at the moment

where it's just hit £18,000.

I think considering that the finishing has come to this level,

spending that extra £3,000 hasn't really made a big difference

to anything because it actually does look better than it was

and it's given that special effect.

Keeping that budget under control with this finish is amazing

but Raqesh managed to do that

by doing a fair amount of the work himself.

Whilst he and his team of builders have gone the extra mile,

I'm hoping it's going to be enough to balance the books.

Now, remember, Raqesh did get carried away

and paid £115,000 over the guide price

and with the renovation costing £18,000,

his total investment here is a whopping £293,000.

So with his mind totally set on selling, will his gamble pay off?

We've invited along two local estate agents

to give us their expert opinions.

I think the real selling futures of the flat

are the aesthetics of it. It looks good.

The doors, the flooring,

even the ceilings have all been done to a very high standard.

It is in a good location

and I would think it would be very popular to many, many buyers.

The accommodation, being a three-bedroom flat,

would be ideal for either a family or a professional couple

or even a buy-to-let.

Positive noises about the valuations

are matched by a pretty positive top rental valuation

of £1,450 per calendar month.

That would mean a yield of just under 6%

but this was never meant for rental.

Raqesh is determined to sell.

I believe this flat could be retailed

at a figure of no less than £325,000.

If we were marketing this flat,

we would be looking to seek offers in excess of £330,000.

It's slightly lower than what I was expecting.

However, I will be very frank with you

that we have accepted an offer

and it is in the region of £375,000

and we are starting legal on Monday.

Crikey! What a result for Raqesh.

If that sale does go through,

it could mean a pre-tax profit of £82,000

and as a result of that success,

Raqesh has decided to property-develop full-time

but saying goodbye to this property won't come too easy.

I've enjoyed every moment of this project.

It's heartbreaking that I have to sell it

because I have fell in love with it

and I think my family as well are really heartbroken

that we have to let it go but this is business

and it's just move onto the next one and make it just as good.

And we're moving on to our next property too, here in Cornwall.

# I've gotta run I need to get a tan

# I'll get in my car and we'll go on holiday... #

It's a hugely popular tourist destination

but on the way to the holiday hot spot

are plenty of lovely villages.

Well, five miles from Liskeard,

in the little village of East Taphouse

is the property I'm here to see.

It is right by the side of this fairly busy main road,

which is not a good start.

However, the guide price is intriguingly low.

Just £40,000.

So what's the catch?

Hm. Maybe I'm being just a bit suspicious

but not even that busy road can explain the guide price.

The roof doesn't look too great. Could that be it?

There's a charming rear garden. So what is the catch?

So, through the back door,

partly because that front door is on that busy main road

so I guess you would end up using this entrance more often than not.

Straight into the kitchen. Bit of a downside.

That is the loo and bathroom and it's the only one in the property.

Is that the main catch? No.

And I'm sure you could live with that.

You've got a sitting room, front sitting room there

with an open fire, which is nice.

Kitchen itself, well, it's kind of quaint.

I guess it's built into some kind of extension at some point.

Needs a bit of work

but actually it's pretty in keeping with the cottage itself.

Through here, and I'm getting the feeling this could almost have been

a couple of cottages knocked through at some point

because there's another sitting room here, a middle sitting room,

and then through to another lounge at the front there.

Again, downside - right by the side of the road.

However, none of those things are the catch.

The catch is that, in case you hadn't guessed,

this place is actually lived in by somebody.

There's a tenant in place and a rent is being paid.

What's the problem with that?

You could say that's actually good news.

Trouble is that rent isn't necessarily

the full market rent at the moment

and you don't know what the tenancy agreement is that's in place.

Is it an assured short-hold tenancy agreement

you could change and maybe ask the person to move out?

Is it... Does it exist at all?

There's all sorts of unknowns

and those definitely need to be sorted out

because it makes this not an ideal one to go for perhaps

but let's carry on looking around the property.

This is one of those auction lots where reading the legal pack

and the auction catalogue thoroughly

and getting advice would have been imperative.

Directly opposite the top of the stairs,

this double bedroom overlooks that busy road

and there's no double glazing.

Definitely worth installing.

A good-sized double bedroom on the front there

and at the rear of the property, a half decent-sized second bedroom

but then...

This is where it goes a bit wrong

because in order to access the third bedroom,

you have to come through here.

I mean, in terms of layout, it's not ideal at all.

The bedroom itself is quite good so what's the solution?

It might not be as expensive or difficult as you might imagine.

Just moving the stairs to the centre of the property

would solve all your problems.

You would then access the front bedroom from the other corner.

-# Move it on over

-Move it on over

# Move it on over... #

And the rear bedroom and master bedroom on the sides of the house

will have their own separate doors. Much better.

Of course, you will need to check with the planning department

and get expert advice as there are possible structural issues

for a cottage that was built in 1847.

Being on a busy road, the curb appeal isn't a selling point

for this cottage but at the back,

this glorious garden with distant views

and a separate entrance providing off-street parking is a real winner.

We invited a local estate agent to come round and give us his opinions.

I really like it. Lots of potential. Very cosy. Lots of nice features.

It could make a fantastic little cottage.

You've got parking for several vehicles

so that's a huge benefit for this cottage.

Knowing the area and similar properties,

I wonder if he thinks reconfiguring the staircase

and the layout is a good idea.

Personally, I wouldn't suggest altering the layout.

I think you'd reduce the size of one of the bedrooms so much so

that it's actually better to have three good-sized double bedrooms.

OK, well, if the cottage was left configured as is

and the buyer was looking to rent,

how much income could the property generate?

In its current form, I believe around £450 per calendar month.

Renovated, £550-£600 per calendar month.

And what about the sales figures?

Once renovated, I'd be able to put this on the market

for £125,000 to £130,000.

Well, it's a charming little cottage

but buying a tenanted property does have its issues

so it won't be for everybody.

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

East Taphouse, Liskeard.

Freehold subject to an assured tenancy.

45 with you. Certainly will.

At £45,000. One more to advance to 46.

47 now. 48. 49. 50.

At £50,000 standing here. 51.

No, you're done. It's at £50,000 standing here. Take one.

Anywhere else in the room? If anyone else wants to now come in here.

£50,000 standing.

It's 51 now. And two? And three? And four? And five? And six?

And seven? And eight?

And nine? And 60.

60? No?

£60,000 standing here against you and against you. At £60,000.

Call it for the first time. Second time.

Third and last time at £60,000 standing here.

Quite sure we're all done.

-HE HITS GAVEL

-Yours at £60,000.

Very happy smiley face.

The very, very happy bidder was Sarah who was at the auction

with her husband and next-door neighbours.

Sarah knows the cottage well

because she and her husband Graham and their four-year-old son Toby

are the tenants who have lived there for many years.

Sarah also operates a childminding business from the cottage

so it was really crucial for them to get the cottage

when it went under the hammer.

I went back to the property to congratulate her on the purchase

and find out more.

-Sarah, lovely to meet you.

-You too.

-Congratulations.

-Thank you.

-Now, how long have you lived here for?

-16 years.

The auction, I can only imagine how nerve-racking that was for you.

-Yes, didn't sleep for a few nights before.

-Right.

You happy with what you paid?

It was right on our limit. We couldn't go any higher than that.

-That was it?

-That was it.

-That was your last bid?

-That was our last bid.

I had to look confident and just try and go for it

and hoping that whoever it was bidding against us would stop.

Have you thought about buying it before?

Yes, we had tried to put an offer in beforehand. It was declined.

-How much was your offer for?

-£55,000.

-OK.

-So you had to pay a little bit more.

-Yes.

The prospect of the sale of this house, what did that mean to you?

Um...

It was very nerve-racking and not knowing what's going to happen.

It was like we had to go for it.

What would the worst-case scenario have been?

We were always told they couldn't get us out

so if anyone else bought it,

it would have to deal with somebody else

and hoping they would do the house up

because there's a lot of work needs doing to the place

but how they were going to do that while we were living in here

was all going to be very difficult.

So you say they couldn't get you out. What do you mean?

-No, we had an assured tenancy.

-For how many years?

Well, we have never signed anything. There wasn't anything in place.

-We were told we could stay here as long as we'd like...

-Oh, wow!

..when we first moved in.

-You've got a bit of a bargain, actually.

-Yes.

What do you know about the price?

Well, we kind of went for the mortgage and things like that

and then they came back and said actually the value is £120,000.

-Really?

-Yes.

-As it is?

-As it is. So...yes.

-So you've got a £120,000 house for £60,000?

-Yes.

That was our one and only option of buying our own home

and it's worked out, thank goodness.

# It took a whole lot to do it but we did it

# Yes, we did it... #

Sarah's husband is a gardener

and he'll do as much work as he can to keep the costs down

with help from a builder friend

but I'm keen to find out what their plans are for the cottage.

So 16 years you've been living here.

-Have you changed it round much since you moved in?

-No, not really.

We've tried to decorate it as time goes on

and patched it up here and there

because not much has been done on the house since we moved in

so we have made it liveable.

-Are there things you wanted to do?

-Yes, like the bathroom, the kitchen.

It needed redoing, really.

We have kind of patched it up as much as we could.

-Yeah, and the roof.

-Does it leak?

Well, it doesn't leak but there is a chimney behind a wall

-where sometimes we can hear a dripping.

-Ew. But it is now yours.

-It's ours so we can do the work.

-Cut and dry. Do what you want.

-Yeah.

-Result. What are you going to do to it?

-Well, we're hoping to get the bathroom upstairs.

-Where?

-In the large bedroom. Just cut that up a bit.

-OK.

If we can move the stairs,

hopefully, that will separate the house into three bedrooms

and a small bathroom.

And then the bathroom downstairs, keep that?

No, we'll move that and turn that into...

Hopefully get some planning to extend out slightly

and have a kitchen-diner

so you're looking out into the garden so that's the plan.

Well, I like that idea because

the cottage really doesn't make the most of the garden

and those cracking views.

If they get planning permission for the extension,

a larger kitchen could transform the place

and the couple plan to add double glazing

which will cut down the traffic noise.

What's the sort of budget set aside for doing the work?

So far, we've got £8,000

then hopefully, we'll see how far we can go with that

and then we'll hopefully get a loan on top.

And the timescale?

Roof and windows by winter

and then the rest will follow suit, really

and see how we go by from there.

-Well, Sarah, congratulations. Delighted for you.

-Lovely.

-Good luck.

-Thanks.

-Look forward to seeing how you get on.

-Thank you.

Well, I do love a happy ending and for Sarah and her family,

it certainly looks like one of those.

An obvious thing for her to buy

and it seems like she has done really well in the process.

How will they get on with the renovations?

I like the idea of moving the stairs

and sorting out the bedrooms upstairs, changing it all around.

Sounds great. You can find out how they get on later in the show.

We've seen how one of our auction properties turned out.

What about the other two?

Have there been many changes or have they remained exactly the same?

Let's find out.

Back to Newcastle-under-Lyme in Staffordshire now

where earlier, I looked around this three-bedroom semidetached

which sat opposite the local pub and on a main road.

It was a solid property with very few obvious problems

and, at a guide price of £80,000, looked like a bit of a bargain...

..especially when I discovered...

Next to the next-door property, you've also got a single garage.

Bonus!

It was bought on auction day by Kevin for £109,000.

After a ten-year break from property developing,

Kevin was making a comeback and this was his latest acquisition.

So this one then, what are you going to do to it?

Cosmetically, it looks fairly clean but it does need...

Every room needs repainting.

The bathroom needs completely ripping out.

That's very old-fashioned.

Also, the kitchen is probably 1960s and not been touched yet

so that needs ripping out.

There's a window going out into the garden.

I want to put French doors in there so it blends itself into the garden.

It's south-facing as well and it's got a nice patio area

so it could be a very nice little family home.

Kevin was keen to add this property to his portfolio of rentals

and had given himself a six-week timescale

and a £7,000 budget to get the job done.

Well, rather than six weeks, it's five months before we return.

Let's see if Kevin's plans have run smoothly.

The downstairs has been transformed

into a cosy, comfortable family home...

..with the kitchen and diner looking much more appealing.

What's changed in this room? Really, quite a lot has changed in this room.

We've got a new kitchen, complete new ceiling and French doors,

which let a lot of light into the room.

It makes it much, much brighter and a nicer room to be in, really.

Upstairs and the improvements continue with the bathroom -

all clean lines and contemporary design.

The three bedrooms are showing what a lovely family home

this property was always meant to be.

The French doors open out onto a tidied-up garden

with a new resident.

It looks like Fudge is very happy with his new abode.

But enough of me rabbiting on.

What have been the biggest challenges?

The main work that's been done

is replastered the hallway losing all the Artex.

The kitchen has been replastered.

A new kitchen and replastered

and complete new bathroom is the main works.

The ceiling in the kitchen wasn't as good as we thought it was

so we actually changed the ceiling in the kitchen

and then central heating, I was debating whether to change that

and in the end, we decided to rip that out completely

and start again with a good-quality central heating system

which was the biggest expense, really, so far.

I took the old kitchen out.

I installed the majority of the new kitchen,

did a lot of the painting, decorating,

the landscaping around and then had contractors to do the rest.

Kevin's hands-on approach helped him

stick close to his original budget of £7,000,

going just £1,000 over that figure.

However, he is some distance away

from his original timescale of six weeks.

The reason it's taken so long to get you back here, really,

and to get into the position we are now

is my stepdaughter, who's building her own house, suddenly decided

they wanted somewhere else to live

while they're having their own house built so they came in,

did a quick decorate and moved in straightaway

and we have got them here probably until around March, April next year.

They've been very involved and one of the lucky things really

is the tenant that's here is a tiler so he can tile

and he's done all of the tiling work for me.

An in-house tiler? That's a jammy outcome.

So right now, and for the next six months or so,

Kevin's stepdaughter and her family will be staying in the house.

However, Kevin has spent a total of £117,000

buying and developing this house

and will be keen to see a future return on his investment.

We've invited two local property agents along

to give us their opinions.

The one thing that really stands out is the kitchen.

Most people these days are looking

for a good-sized kitchen-diner family room.

It overlooks the garden as well, which is a really nice feature.

I think people will really take to that.

I think the bathroom is fitted really, really nicely.

It's modern fitted, ideal for families with the bath

and obviously shower over so it's convenient.

I think the kitchen now has opened it out.

It offers a dining kitchen so that's great for families again

because there is lots of space and obviously the patio doors

leading out onto the garden so you can have a nice view.

Let's get stuck into those figures, then. Rentals first.

I think the landlord should probably be looking

somewhere in the region of £575-£600 per calendar month.

I would expect the vendor to achieve £625

per calendar month on the rental market.

Yeah, that's about right. That £625 is really great.

That's about what I'm looking for so, yeah,

certainly think I'll get the higher end.

Well, if he does get £625 per calendar month,

that could mean a yield of over 6%.

What about those sales figures?

In the current market, I would say somewhere in the region of £110,000.

In the current market,

I would suggest a resale value of £150,000.

110 is ridiculously low.

There's no way it would fetch that amount.

I know next door but one has just sold for 150 and it's identical.

One reason for the difference in values

is that this is a very long street

and prices tend to vary depending on where you are.

But if Kevin gets that £150,000,

he stands to make a profit of £33,000

minus the usual taxes and expenses.

However, with his stepdaughter, and of course Fudge the rabbit,

settled in for the next six months at least,

Kevin is happy to hold on to the property

and will rent it out for some time to come.

So with a successful property here and a pub over the road,

I can see only one outcome. What do you reckon, Kevin?

I think over there for a quick pint.

Back to Cornwall now and to the village of East Taphouse

where I looked at this semidetached cottage.

Although on a main road,

it had a huge back garden along with three good-sized bedrooms,

all for a guide price of £40,000 plus, so what was the catch?

In case you hadn't guessed,

this place is actually lived in by somebody.

There's a tenant in place and a rent is being paid.

What's wrong with that? You could say that's actually good news.

Trouble is that rent isn't necessarily the full market rent

at the moment.

So there's a tenant in place.

They may not be paying the amount of rent you'd like

and you don't know what the tenant's contract is,

if indeed there is any contract at all.

All this and there's the usual old windows and dodgy-looking roof.

A lot of potential banana skins.

Sarah, the buyer, was overcome with joy

because she was the tenant.

-How long have you lived here for?

-16 years.

-Were you happy with what you paid?

-It was right on our limit.

We couldn't go any higher than that. That was it.

-That was your last bid?

-That was our last bid.

I had to look confident and just try to go for it.

After 16 years of living there, Sarah and her family

finally own the property and can begin making improvements.

Two years and four months later, we return to see how she got on.

# Stay with me

# Stay with me

# For tonight you'd better stay with me

# Stay with me, stay with me

# For tonight you'd better stay with me... #

Sarah and her family have stayed put but made changes

so the house they love better suits their needs.

Windows we did first.

That was the easier job. And then we did the roof.

We still have to redesign the kitchen

and hopefully do a kitchen-diner

with windows looking out to the garden,

which hopefully will be next year.

And we still want to do the flooring in the other room.

We found flagstones under the carpet so we want to restore them.

There's still a lot to do, then,

especially with the kitchen extension yet to be tackled

but by sorting the windows and the roof,

the family are now warm and dry,

a very smart move, in my opinion.

Despite those being big jobs, they were by no means the biggest.

Well, in this room, we have moved the stairs.

The stairs before were here in the corner in a cupboard

and now we have moved it to the centre of the house going up

and also we have removed the wall to open it up

and give us more space and light in this room, which is great.

And moving the stairs hasn't just benefited

the layout of the ground floor.

With the stairs coming up through the centre of the house,

we now don't have to walk through Toby's room

to get to the master bedroom.

We now have a bathroom and a small guest room on the left

and then we also have what's going to be our bedroom

over up onto the right.

I think this is a much more sensible layout.

They have managed to retain three bedrooms

and have a bathroom upstairs.

And how does Toby like his bedroom?

-It's good.

-There you have it.

He loves his new room. He's so proud.

He always wanted fish and we always said,

"As soon as you have your new room, you can have some fish,"

so he has now got a fish tank.

So meet Goldie, Wriggler, Spotty and Stripy.

So, Toby, care to tell us what you like best about the new set-up?

It's mostly got more pictures and I've got my fish now.

It used to be a bit long travelling to the bathroom

because we had to go all the way downstairs.

Budget restraints meant Sarah and family were only working weekends

and relying on friends in the building trade

to get the work done so it's taken a while - almost two and a half years,

but this was a labour of love and timescale wasn't a priority.

The most important thing

was that they had the home they always wanted to own.

Now it's ours and because we've put the work in as well,

it makes us feel like we have done this

and knowing that you are not putting money in where you're wasting it

and somebody else might take it away from you so, yeah,

everything we put in it is ours now.

# Our home, let me come home

# Home is wherever I'm with you... #

This is going to be a long-term project and Sarah and husband Graham

will do the work as and when they have the finances...and the energy.

Talking about finances, it seems almost rude

when this is a project of the heart, but here we go.

Sarah had a budget of £8,000 to do the first stage.

That included the roof, the windows and the staircase

so how did she get on?

Yeah, budget is about £10,000 now.

With the roof and windows and the new chimney as well

so we've done pretty well actually with that.

The couple have had a huge task

making some very necessary but transformative changes

and I'll bet they can only have improved the value.

So far, with the purchase price of £60,000

and their spend of £10,000, they have spent £70,000 on their home.

We asked two local estate agents to give us their thoughts.

I like the way they have opened it all up, let a lot of light in.

Still a long way to go but there's a lot of potential here.

I like the fact that they have opened up the two rooms

because they were quite small

and having changed the location of the staircase,

that is probably a big advantage to have the dog-leg staircase now.

Despite clearly being a work in progress, positive comments

so far from the experts.

If she were to rent, what could she expect to achieve?

I think you could let this property in the region of £450

per calendar month.

The rent that we could achieve on this

being a three-bedroom property

would probably be around the £375-£395 per calendar month.

Both estate agents said they would market the property

in its current state at £125,000.

However, were they to go ahead

with the kitchen extension they're planning,

it could be worth up to £160,000.

Certainly would be worth doing, Sarah.

Even without renovating the kitchen,

this would give Sarah a profit of £55,000.

But this wasn't about the money.

This development was about improving the quality of life

for Sarah and her family.

Don't forget, Sarah has been living in a building site

for more than two years with more work still to do

so how does she feel about the whole process?

It's daunting at first and it's definitely hard work.

You have ups and downs but the end result, once you're there,

I think it's a big thumbs-up.

Yeah.

What do you think? Would you have been tempted to buy

any of those properties at today's auctions?

Well, there's plenty more where they came from

so make sure you join us next time for more Homes Under The Hammer.

Goodbye.