Episode 22 Homes Under the Hammer

Welcome to the programme. In some parts of the country,

property bargains can be hard to find, but are out there.

Yes, so you're just going to have to track them down

-if you want to make the most of your money.

-So how do you do that?

You know what I'm going to say - visit your local property auction.

People go to auction with all kinds of budgets,

-but they're all looking for a deal.

-Did today's buyers find one?

Well, let's take a look what we're featuring on today's show.

In Cochrane Park, Newcastle,

this three-bed semi is bright, light and airy.

It seems...perfect?

Spoke too soon!

In Leyton, London, my favourite phrase applies - original features!

I'm excited straight away, because look what you've got!

Some shutters!

And in Gainsborough, Lincolnshire,

a low guide price has got me mouthing off about moneymaking.

You are on the right lines to making a decent amount of profit.

All these properties were bought at auction.

We'll find out who got them and how much they paid

-when these homes went under the hammer.

-Sold!

MUSIC: De Do Do Do, De Da Da Da by The Police

Cochrane Park is a popular suburb in Newcastle and is home to this

impressive 1940s Art Deco building, which is now luxury flats.

That must've been quite a conversion.

I think we should tackle something on a slightly smaller scale.

Well, you can tell straight away that this really is

a lovely residential area. So, property prices to match?

Well, maybe not, if you head to the auctions.

£130,000 plus was the guide price

for this three-bedroomed semidetached with a garage.

Let's take a look inside.

That's a good start. You've got this nice little porch area.

And then, through into the main part of the house.

Stairs up to your bedrooms and a nice area here

that welcomes you when you come in

-through the front door.

-LOUD SQUEAKING

Ooh, squeaky floorboards!

Um, but, er, through here to the kitchen,

it's not as big as I would've hoped, um,

but it's in half-decent nick and, yeah, it's looking all right so far.

Spoke too soon! Come and have a look.

HE WINCES

This is the lounge. It's been knocked through.

That isn't the problem. It's the floor.

Cos, if you look, I don't know if you can see,

but it's sloping back into this corner.

Um, I don't...I don't want to guess the differences

between the level here and over there, but it's got to be...

two, three, four inches. Yeah, seriously.

It's a shame, cos it's a nice-sized room and

I like the bay window there, lovely little conservatory on the back.

But we're down to some basics here. That ain't good!

Suddenly, that guide price makes sense.

We could be looking at the dreaded subsidence here.

# Yeah we're all very worried about you... #

The first thing I would do here is get a full structural survey

and find out if there's a serious issue or not.

HE SIGHS

Well, let's see what's upstairs. Fairly traditional layout.

Um, bathroom and loo there, looks in pretty decent condition.

A small bedroom at the front, larger bedroom there, also on the front,

and in the back bedroom, unfortunately,

it's back to those same old problems of major slopes.

Now, I can't see any sort of... Oh!

I was almost going to say I can't see any serious cracks in the wall!

But, er, that's not ideal. I mean, you don't need to see cracks!

You just literally stand here and see it!

It mirrors what's happening downstairs,

which means that this part of the house is definitely settling, um...

Hmm... Ooh!

# Oh-oh! Baby, I'm lost for words! #

If it wasn't already obvious, I'm worried!

Maybe outside will provide some good news.

Well, at the rear of the property, it's good news and bad news.

The good news is this garden!

Absolutely charming, especially on a day like today, a lovely space.

The bad news is that underneath here is an old riverbed.

Now, I know that, because I've been doing something which you should do

if ever you look at a property, and that is talk to the neighbours.

And, apparently, there was once a river which flowed from up there,

basically, down there, along this line.

And that resulted, when it dried out, when that river dried out,

the riverbed dried out,

in subsidence issues for some of these properties.

Now, at the back here, you can see this rear wall,

some signs of structural issues in the past

and certainly those internal rooms would back that up.

The big question, of course, is - is it historic?

Is the house still moving or is it something that's

happened in the past, as in historic?

That, really, is only a question which a good structural survey

is going to be able to answer.

Now, lots of old houses have movement. It's not uncommon.

And, even if it's still on the move, there is

remedial action you can take.

But that costs money.

I'm really disappointed that what is a lovely, bright, spacious house

has what looks like a serious issue.

Certainly, that guide price of 130 grand is tempting.

If we make an assumption that the problems caused by that riverbed

are historic, what could this house fetch on the open market?

If the property was updated and renovated,

we'd probably recommend an asking price in the region of £165,000.

Hmm, now there is room for profit,

if it turns out the movement is historical, but if it needs fixing,

then you could be talking about a lot of money to underpin the house.

So, the result of a survey is crucial.

What's the rental market like for a house like this in this lovely area?

You'd probably see a rent in the region of £750 per calendar month.

Well, sometimes, when it comes to buying property,

you have to make informed compromises.

In this case, the cost of putting right those slopey floors

and potential subsidence, against the fact, if this house was perfect,

it'd probably cost a lot more money. It's a choice you have to make.

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

We've got a three-bedroom semidetached property here.

I ask for 130 anywhere?

OK, how about 120?

Do I have any bid at 120,000?

Sitting down, gentleman on the front row, at £120,000.

121 bid. 122.

123?

122, on the front row.

123 anywhere else?

123 bid.

124. 125?

I'm here, at £124,000, we want to sell.

Take 500, if it will help, but I'm going to sell.

124½.

125.

125½.

In the front row at 125. It's your last chance. I want to sell.

It's a great buy, this. £125,000.

I'm going once at 125.

Then, for the second time, at £125,000.

-GAVEL BANGS

-Sold on the front row for £125,000.

Congratulations, you can go and have a drink now.

MUSIC: Get Lucky by Daft Punk

Cheers to that! They look pretty delighted.

Getting the semi for 125,000, that's under the guide price,

are Jessica and Sean.

Jessica, who works for an advertising agency,

and Sean, who is a data analyst for the same company, are engaged

and live with their parents.

They had set their wedding date for a year's time,

but now they've bought their first home together, that's on hold.

Jessica, Sean, great to meet you both.

-Nice to meet you.

-Nice to meet you too.

-Congratulations.

-Thank you.

Tell me why you wanted to buy the house.

I always loved this area and I said I really want to be in this area,

but we didn't think we could afford it.

Because all the properties around this area are well above our budget,

-so...

-Mm-hm.

-..I thought the only chance in getting it

would be auction, so that's why we went to the auctions.

Yeah, we did actually try to put an offer in for this,

but they said they were expecting more,

cos we were going to offer 130 for it, but they said they were

expecting a little bit higher, so just to see how it goes in auction.

But we ended up getting it for 125, so obviously it's better.

'That's great news for a couple with a tight budget,

'but the purchase wasn't without its risks.'

Literally an hour before the auction, we decided to go along.

-But you've seen it beforehand?

-No, we didn't.

-From the outside.

-What?!

-We saw it from the outside. We looked at pictures!

Have you read the legal pack?

-No.

-Oh, guys!

NERVOUS LAUGHTER

No, but we loved it and we thought,

"We don't care what it's like inside, even if it's just a shell,"

because we just really wanted to be in the area.

This is the area to be in.

-It's a lovely area, isn't it?

-Yeah.

-It really is.

'Heart ruling head here. These guys are taking a risk for sure.'

# Yeah, we're living on the edge!

# Living on the edge! #

'After falling for the location, how did they feel

'when they finally saw inside the house?'

When we first came in, and we saw the tilt... Ha!

..we were really worried and I remember we were panicking, but...

we got reassured off the neighbours and we had a structural engineer

that came out and the previous owner had one

and they had a document and we were able to get our names on the report

and he gave it the OK, I spoke to him on the phone

and he said it's cos the house was built in 1953.

I think there's about eight houses going down the street dropped,

with the river, and it was about 30 years ago and they've been there

28 years and it hasn't moved since, so it's settled now.

And the structural engineer confirmed that,

so we're relieved, but it was a bit extra work than we thought...

-Yeah, still a big job.

-..with the floorboards.

What was the period of time in between seeing this

-and getting yourselves reassured?

-Um...

-A couple of days.

-A couple of days, yeah.

-Did you sleep?

-Er, no.

-I was really worried, it was a stressful time.

-Yeah.

-And were you relying on a mortgage?

-Mm-hm.

-Yes.

So, if it had got real structural problems, that might have been

-an issue as well.

-Yes.

-Yeah. So, quite panicked.

'So, the good news here is that Jessica and Sean's gamble paid off.

'They've got themselves a fantastic house and garden

'in a lovely area for less than they originally offered.

'And they know the subsidence issue is nothing to worry about.

'Absolutely brilliant.

'Jessica's dad, Paul, is an electrician

'and all-round handy person, so he'll be doing the work.

'They have a £7,000-£8,000 budget,

'and that will also have to cover a complete rewire

'and central heating installation, not to mention total redecoration.

'The couple hope to get it all done in four to five months.

'But what about that postponed wedding?'

So, how far had you got down planning the wedding?

Well, I had bought my wedding dress. LAUGHTER

-You had?

-Yes.

-Yes.

But we didn't really have anything else sorted, so not too bad.

-Wow! But you hadn't booked a venue?

-No, we hadn't yet.

-No.

-We were close!

-We were about to, yeah.

-Close to booking one.

So the wedding's delayed by a year, so you can sort this place out

and also it financially helps a bit, to have a bit more time.

-And nice to come back to a nice house after our honeymoon.

-Yeah.

How great is that? Yeah!

Well, congratulations, I'm really delighted for you both.

-Thank you.

-Good luck with it. We look forward to seeing

-how you get on sorting it out.

-Thanks.

-Thank you.

Well, what a fantastic first home for Sean and Jessica.

They're delighted and I can completely understand why.

How will they get on turning this into their home?

You can find out later in the show.

MUSIC: Umbrella (feat. Jay-Z) by Rihanna

Leyton in East London is an area on the up.

Lying to the east of Hackney Marshes,

this diverse and bustling district also includes part of Olympic Park.

And with prices rising in nearby Bethnal Green and Bow,

this is one to keep your eye on.

Well, I'm here to see a ground-floor flat

in this end-of-terrace property.

Now, I think it's just great to be at the end

of a no through road like this, because it's so quiet.

It's got one bedroom, it had a guide price at auction of £170,000 plus.

Looks good from the outside. Let's take a closer look inside.

# But it's raining more than ever

# Know that we'll still have each other

# You can stand under my umbrella Ella, ella... #

Oh! A perfect place, look, to hang up my brolly.

So it's a little bit squeezed once you walk in the flat.

You've got a bathroom right ahead of you.

And into the lounge.

Now, fantastic, I'm excited straight away, because look what you've got!

Some shutters!

And they're not all stuck together with

a million years' worth of paint! Look! They actually work!

It's such a shame that underneath, of course, you've got UPVC windows

and not lovely traditional sashes, but I don't think it's worth

changing them, because, in a flat like this, well, they work

and they're clean and, well, they look all right, I think.

But you've got high ceilings, a little bit of cornicing.

And, if you look beyond this awful laminate

that's everywhere around the flat,

I think you might even be able to salvage these floorboards.

A bit of sanding, bit of staining.

So, bags of character in this flat, which is fantastic!

Let's hope the rest of the property is just as good.

So, next to the kitchen, at the rear of the property, well,

you've got the only bedroom.

Now, with a flat, you've always got to make the most of every single

square inch and here, well, look, you've got a big walk-in wardrobe.

Straight away, I'm thinking, is that a possible en-suite?

Obviously it depends on where the drains are

and how tricky it will be to plumb a loo and a shower in there,

but I think it's worth investigating.

Before adding an en-suite,

you may want to upgrade the current bathroom.

And much the same for the kitchen,

which is looking a little bit tired too.

But before you do any work, there's some lease legals to alert you to.

You could, of course, think about maybe rejigging

the layout in this flat. But flats are usually leasehold,

which means any major changes that you wish to make,

such as knocking walls through, like this, or changing the layout,

well, it has to be okayed by the freeholder of the building.

But in this case, buy this flat and you do buy a share of the freehold.

Now, it does mean, if you want to do anything major here,

then you'll need all the flat owners' permissions in the property.

They must all agree.

But often that's much easier than trying to track down

and persuade a distant and sometimes absentee freeholder.

# It's a complicated situation, Mama

# I'm a complicated situation... #

Dealing with a freeholder isn't always easy,

but you do need someone to take care of the communal areas

as well as the general fabric of the building.

They can set rules on things, like noise, pets

and what you can and can't do in the flat.

In a case where the neighbours all share the freehold,

then you arguably might have more freedom,

but you'll have to set up a formal agreement.

Either way, of course, it could end up complicated

and I'd recommend reading that legal pack to look at the detail.

In this case, there are three flats in the building

and the owners created a management company

to share the decisions and costs of any work.

So hopefully doing a major rejig will not be complicated after all.

Does a local estate agent

think it needs that much reworking, though?

Well, obviously it's a little bit tired.

It needs some work doing to it. It looks like somebody's had

a little go at the plasterwork and it's just tatty,

but actually, it's not beyond repair at all.

I think there's potential to perhaps reconfigure

the accommodation, possibly to even squeeze in two bedrooms.

Ooh, interesting!

How would the agent recommend getting that second bedroom?

There's potential for transforming the kitchen that we have here

into possibly a small bedroom, sacrificing the bathroom

and punching a hole through into the living room,

so you've got a kitchen-dining room.

So, you have a kitchen-dining room, you have no bathroom then,

you have a small bedroom here, a bedroom next door

but there's a walk-in cupboard,

possibly you can put a loo in there, a hand basin and a shower.

Should you squeeze in that second bedroom?

Easy way to answer - what does it add to values?

It's certainly a great area for renting.

I think, as a one-bedroom flat, you're probably looking -

refurbished to a reasonably good standard -

something like about £900-£950 per calendar month.

A two-bedroom flat, you'll probably get about 10% more,

so you're probably going to be looking over the £1,000 mark,

probably about £1,050-£1,100 a month.

As a one-bedroom flat,

I think we're looking at £245,000, perhaps £250,000.

Again, as a two-bedroom flat, you might be looking at 5%-10% more,

so I think you'd probably market it at something like 270,000,

but you might be achieving somewhere around 260-265.

So this is a one-bed flat that has bags of potential.

Oh, and those lovely shutters!

You could do up what's here or you could just rejig the layout

and make better use of the space. It's all up to the new owner.

So let's find out who bid for this one at the auction.

Unfortunately, we are unable to show you the bidding for this lot.

But I can tell you that you didn't miss much,

as the flat didn't meet its reserve price and the hammer failed to fall.

But Miles, who is a builder, bought it after auction for 187,000

and explained what happened when I went along to meet him.

-Miles, congratulations.

-Hey, thanks.

-So, tell me the story!

So, we were bidding, it went up to 186, another guy bid 187

and, er, so then we dropped out, the hammer didn't come down

and the auctioneer said it couldn't be sold cos it was under reserve.

Someone came straight up to me and said, "What's your maximum?

"We've got the seller on the phone."

and I said, "I've kind of gone over it a little bit,

-"so maybe that guy over there will be up for paying 187."

-Yeah.

He ended up having gone well over his budget by, like,

-seven grand or something.

-Yes!

So he'd got really carried away, I thought I'd gone over by two grand.

-He had even more so!

-I know, he'd gone nuts!

-Ha-ha!

And, um, so then there was a bit of back and forth

between me and the owner and he said,

"If you want to exchange today, like right now,

"we can take it for 187," so I said, "Sure, let's go for it."

-You see, that is luck on the day, Miles.

-Yeah, pretty good.

And it's things like that that I love so much about buying

property at auction, because you never quite know what is going

to happen and when you follow the journey of a property, it's great!

-I know, exactly.

-So it's your flat!

-I know, it's wicked!

'Miles has been in the building trade for three years

'and he'll carry on with other projects in parallel with

'doing this flat up to sell on.

'So what was it that attracted him to this flat?'

Like, it's an all right-looking brick building on the outside.

Um, not like nasty, little, sort of

prefabricated on the outside-looking building, so it's pretty nice.

I'm not sure about these, like, UPVC put-ins,

but if we can change that, yeah, it could be really nice.

-So, the UPVC...

-Yeah?

-Do you think you're going to change them

-for some traditional sashes?

-Maybe.

-Which I would love!

Yeah, maybe, it just depends whether, I, like...

met my Punjabi mates, so if they can hook me up with a good deal.

-Did you literally meet some guys outside today?

-Yeah, yeah, yeah!

Yeah, just saw a guy with a turban out there,

I thought he looked like my grandad, so I'll chat to him.

-So he may be able to put some nice windows in here?

-Yeah, maybe.

'Ha-ha! But beyond potentially having the windows replaced

'by a few passing tradesmen,

'Miles has far more extensive layout plans.'

I'm actually pretty set on what I think I'm going to do.

-I'm going to take this wall out in the living room.

-OK.

-Make this a lounge-diner.

-OK.

-A bit of a kitchen L-shape over there.

Then I'm going to push the bathroom back just a tiny bit

into the kitchen and then leave the bedroom where it is.

That seems like a bit of a luxury,

to have the kitchen in this room, which is going to be smaller,

and have the bathroom in the room which is currently the kitchen,

-which is going to be huge.

-Yeah.

-Don't worry, I've got it sorted.

-I am worried about that!

I've got it all sorted! I'm going to push a little bit,

-put a prefab door in there...

-OK.

-..to make the kitchen a bit smaller,

so the bathroom won't be the full size of the kitchen and then

have a kind of...plumb in some place for a washing machine and, er,

-a little bit of storage in that area there.

-Ah, good!

-So that will be a sort of walk-in utility area as well.

-Exactly.

I really feel like, living in London, there's

-never anywhere to put stuff...

-Yes!

-..when living in a one-bedroom flat,

like your bike or the washing machine is kind of in the living room

somewhere and you're just thinking there's no space for anything.

Yeah, so I think make the kitchen and bathroom a little bit smaller

and then have a sort of utility area on the entrance to the bathroom.

When you first get somewhere, you've got all these different options,

but moving the soil pipe for the bathroom to the back of the house

is too much, so leaving the bedroom there is the easiest thing.

I was going to say you could have a cheeky little walk-in shower room

-right at the back.

-I know, it does seem like that could be that,

but soil pipes, plumbing and everything.

-It's not going to be worth it?

-Yeah.

'Just as well there'll be no en-suite, as that's

'a lot of layout changes and all on a budget of 10-12 grand.

'Miles has been developing for several years and

'with his experience and skills,

'his two to three month timescale should be less of a worry.

'Miles is looking to flip the flat and has a profit goal in mind.'

I'm not trying to make, like, megabucks out of it,

but if I can make sort of 30-40 grand, something like that...

I mean, if I can do it in sort of three, four, five months,

it's not bad if I can do two houses a year like that.

-So, tell me a little about your family and wife.

-Yeah.

I know you've just had a little baby!

-Yeah, we've just had a little kid called Brave.

-Oh!

-And how old is he?

-He's five weeks.

-Wow! So you're a new daddy.

-Yeah.

-You've got a new flat.

-Can't you see the bags under my eyes?

-How hard is it being a dad?

-It's all right!

Yeah, it's all right, we're loving it, a real little bliss time of just

-being together and the baby and a bit of sleep deprivation as well.

-Aw!

Do you think this is a perfect job

-while you can sort of combine fatherhood?

-Exactly. It's perfect.

We're just finishing a bit of stuff on our flat before we move

back in there and, um, this is not very far from where we live,

so I can kind of be flexible, so I can pop home if she needs me.

So, tell me about what else you guys do.

So, we've just come back from India, which is why we're just waiting

to get back into her flat, because it was rented.

My wife is a lawyer, she used to work for an organisation

that sort of supported women's legal rights in India,

vulnerable women and vulnerable people groups,

and we set up a little business that, um, makes blankets

out of sort of second-hand saris, which have been reused and recycled.

So then those saris become these beautiful blankets and then

now we're sort of bringing them back to the UK and selling them.

The blanket business is something my wife can carry on with now

in the first couple of months of maternity leave and then,

I don't know, we'll see what happens once we finish this place.

Miles, lovely meeting you today. Good luck with this project.

-I can't wait to see the outcome.

-Cool, thanks.

-Thank you.

-See you later.

-Good luck with the baby!

-Yeah.

Well, Miles made the move back to London from India and started

property developing a few years ago and now he's a new dad - brilliant!

But how will he cope doing this place up and fatherhood?

We'll find out how he gets on later in the programme.

Coming up in Gainsborough, a two up, two down has a low guide price,

but it's all looking good.

This seems OK, I'm quite impressed.

And in London, Miles is impressing too, with a new layout.

It just seems like it suits the sort of person who would buy this flat

much more than how it was before, all sectioned off.

Earlier in the show, I was in Cochrane Park,

a popular suburb of Newcastle,

and I was here to see a three-bed semi guided at £130,000 plus.

Dated decor, but a bright, spacious and well-kept interior.

This seemed brilliant.

Spoke too soon! Come and have a look.

HE WINCES

It's the floor! It's sloping back into this corner.

That ain't good!

# Standing in a slide zone

# Stepping in a slide zone

# He told me where a river flows

# He showed me how the apple grows... #

Yes, a dried riverbed had created some movement in the house.

But it was all smiles at the auction

for recently-engaged couple Jessica and Sean.

Sold on the front row for £125,000.

The couple hadn't viewed the house or read the legal pack

before buying it for 125 grand! Yikes!

We thought, "I don't care what it's like inside, even if it is

"just going to be a shell," because we just wanted to be in the area.

But then they did all the right things -

talking to the neighbours

and reading a structural surveyor's report.

We were panicking, but we got reassured off the neighbours and we

had a structural engineer that came out and the previous owner had one.

He gave it the OK. I spoke to him on the phone and he says it's all...

It's cos the house was built in 1953.

They hoped to make this their dream home in six months.

18 months on, we went back to meet them and find out how they got on.

MUSIC: I Love It (feat. Charli XCX) by Icona Pop

# I love it! #

It took a while, but the couple's first home together looks great!

So, when did they finally move in?

And what work was needed to bring it up to standard?

We moved in around four months ago.

We've had an electrical rewire and a full heating system put in.

And then, obviously, the main thing was the raising of the floors,

cos once we raised the floors, we realised the ceilings

looked like they ran out a little bit, so we then straightened

the ceiling, so everything was perfectly straight, so we could

lay the laminate and get the carpets and everything down that we wanted.

-So it was a bit scary at one point.

-Yeah.

-Cos you could look

right through to the bedroom! SHE LAUGHS

-Just being a case of kind of redecorating and...

-Yeah.

..after all the structural stuff's down.

But the structural work did take time, as it was fairly extensive.

Well, when we first bought the house, there was

a structural engineer who came out and he said there was

a bit of historic subsidence, but there'd been no movement since.

It wasn't really much of a problem,

but you could see with your eye and we kind of wanted to raise it,

just so it looked, like, straight and had a nice finish to it.

Stripped it right back down to the joists

and got the joists straightened and levelled out and then

the rock on top of that and then the floorboards down

and got it all raised up, with a large help from Jessica's dad.

Jessica's handy dad, Paul, is an electrician by trade,

so how did he help on the house?

-SHE LAUGHS: My dad has done a lot of the work.

-Yes.

But we've tried to help where we can.

He's just such a handyman, he can do most jobs around the house,

so we're trying to learn.

He came up with the idea of putting some insulation, things like that,

just to keep the house warmer, things like that,

so it's been really interesting.

Jessica and Sean now have a fabulous home

and they've tackled all the issues that need tackling.

But that has cost them in time.

So has it had an impact on their budget?

The original budget was £7,000. We did stick to budget.

-It's mainly little jobs now.

-Snagging, yeah.

I feel like the bulk of it's done, cos we had quite a lot to do.

But we'd like to get the third bedroom made into, like,

an office or something and then eventually

we would like to extend, but that's a little while off after the, um,

the wedding and things. We can't afford to just yet.

Excellent budgeting for structural work,

central heating and a new bathroom.

But is that the wedding fund all gone, then?

We were going to get married last year, but then money,

and also we didn't want to take on such a big project

with the house and then plan a wedding at the same time.

We were going to put it off for about two years,

but we're actually getting married in a few months, so...

Just put it off a little bit, just so we could afford

to do the house how we wanted it and a bit more

of a stress-free wedding planning, if there is such a thing.

Well, there's lots of people

who would tell you there are no such things

as stress-free weddings. Let's hope two local estate agents

don't get cold feet with this property.

Let's start with the agent who saw it the first time.

I think the property has been refurbished to a good standard

and has a contemporary finish to it, so I think it should

really appeal to the first-time buyers and the young family market.

I think the property's been decorated to a nice standard,

um, quite modern, neutral,

er, shouldn't have any problems on a resale.

The purchase and renovation cost £132,000.

So, while they'll be here for the foreseeable future,

what's the property's value now?

I would hope to achieve £175,000.

In the current market, I think I could achieve

in the region of £174,000.

-Whoa!

-Whoa, lots of money.

That's higher than we thought. I'm over the moon with that.

-That's a lot higher than we thought.

-That's really good, yes.

Wow indeed!

But that potential pre-tax profit of £43,000 could be even higher.

Jessica and Sean have mentioned they may extend in the future,

so what would that do to values?

Family buyers are really looking for a nice-sized dining kitchen.

So if I was to do this property, personally I would

take the property out and extend it over the back of the garage

and I think I would look to achieve in the region of £185,000.

I think if it was turned into a four-bed property,

I would be looking to achieve £185,000, maybe, to £190,000.

-Wow! That's really good.

-It is really good. Yeah.

I bet a pre-tax profit of £63,000

wouldn't go amiss in the wedding fund right now,

but the couple are settling in for their future here.

It could have all been so different, though,

as they said "I do" to the property before they'd even seen it.

And they have had to live elsewhere for over a year. So, any regrets?

-Definitely no regrets.

-Definitely no regrets.

I mean, we knew as soon as we bought the house it was perfect.

Just to get a house in this area for the price we did,

we're just over the moon and there's definitely no regrets after...

-hearing the valuation we just had.

-THEY LAUGH

It's been a good experience as well. We've enjoyed every minute of it.

Situated on the River Trent in Lincolnshire,

and 18 miles from the city of Lincoln itself, is Gainsborough.

So, the property I'm here to see is not far for the centre, but it does

have good bus and train links into the city centre of Lincoln.

Now, it's a two-bed mid-terrace with a guide price of £28,000.

Let's take a look.

Nice, bright.

And these floorboards seem to be in decent condition.

Now, you've got options with floorboards.

For me, I like to have a nice carpet underfoot, but you could actually

sand these down, spruce them up, you could make a feature of those.

I have noticed over here, though, which did catch my eye,

there's a huge crack in this wall here.

That would have to be sorted out. Get it checked out as soon as possible.

There's a few period features there,

a bit of coving around the side there, which is quite nice.

All in all, a good start, a nice big bay window as well.

Go through here. Stairs up to the bedrooms.

Into the kitchen area, and the bathroom is just through there,

on from the kitchen, which is

a feature that you do get with this kind of property.

They usually put the bathroom downstairs on from the kitchen,

in the extended part of the property, but this kitchen seems

to be in good condition and these units seem to be OK.

You could actually maybe keep them.

It depends on what you want to do with the property.

This seems OK. I'm quite impressed.

And as for the bathroom, well, the suite looks in good nick

and almost ready for a nice relaxing soak.

The only worrying sign is a patch of damp on the kitchen ceiling.

So, along with that front room crack, that will need looking at.

Upstairs, two bedrooms of decent size, by the looks of them.

This is the one at the front of the property.

Nice high ceilings again and some really nice floorboards in there.

Keep them as they are or carpet it, your choice.

Into this bedroom here at the back

and it looks like somebody's already started to put some pipework in

under the floorboards, but again, a decent bedroom.

And now I'm here, I can look through the window here and see

the extended part of the property has got a flat roof.

Now, I'm not a big fan of flat roofs,

but if you keep them in good condition, they will be fine.

And just at the back, over there, I can see that's the railway track.

Now, if you get something like this,

you are on the right lines to making a decent amount of profit.

The garden is a reasonable size

and I note that the neighbours

have extended the properties by much more than this one,

so there is a precedent if you wanted to go bigger.

However, I for one would be happy with things the way they are.

There are definite plus points with this property.

Good inside and outside space and there's double glazing

at the front and the back and no obvious structural work needed.

It's a two up, two down mid-terrace,

which, for a guide price of £28,000, has very few issues.

But what does a local estate agent think of this place?

Positives with the property -

closeness to the town centre,

good-sized rooms, good-sized rear yard.

Negatives to this property - situated on a fairly busy road,

there's a lack of off-street parking

and the property also backs onto a railway line.

To get the property up to scratch,

I think you need to spend in the region of £5,000-£7,000.

So, if it goes for anything like its guide price of £28,000,

then getting it into good shape

could set the new owner back around £35,000.

So what could it sell for?

Once renovated, I believe this property could achieve

between £45,000 and £50,000 in the current sales market.

And how do the rental figures sound?

Rental-wise,

I believe this property could achieve £350 per calendar month.

This is an easy one for me. A bit of a no-brainer.

If you can get it for anywhere near the guide price of £28,000,

a solid structure like this with little to do

could be a great investment.

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

Lot number 23 is guided

at £28,000 for this one.

In the room at £20,000. Who...? 21 anywhere?

At £20,000. At 20... 21. 22.

22. 23.

24. 25.

At 25. 26? 26.

27. 28.

29. 29. 29½?

29½.

30. At 30.

500, sir? 500.

31? 31.

£31,500.

32.

32. Are you sure this time?

500? At £32,000?

No. At £32,000 once. £32,000 twice.

Third and the last time I'm asking at £32,000.

-GAVEL BANGS

-Got it. Well done. 451.

And the successful bidder, getting the lot for £32,000,

was Jeremy and his wife Nicky.

'What a great price and a great buy for Jeremy, who's actually from Essex

'and has chosen Gainsborough to start a property developing career.

'I met Jeremy back at the house to find out his plans.'

-Nice to meet you, Jeremy. Congratulations.

-Thank you.

Tell me about the auction experience. How was it?

It was a good experience. We did a lot of research before we went

and the prices were about what we thought they would be.

Tell me why have you decided to go into the property world.

-Well, the reason was, er, I worked for a large IT company...

-Mm-hm?

..and unfortunately got made redundant, so I thought

I'd use that redundancy money to get my first property.

So, now you're buying property, are you renting it out or selling it?

Right, the initial plan is to do perhaps two or three properties,

probably in the North, because they're cheaper to buy,

um, then gradually move south.

'Jeremy has chosen to start in the North,

'because buying is cheaper than in the South.

'But it could mean tighter profit margins when he sells,

'so why this property?'

Well, we looked at several on the viewing days

and we split them roughly into two camps -

those that we felt were a rentable property

-and those we thought we could actually sell on, or flip.

-Mm-hm.

And this was possibly in the best location of the ones we saw.

Now, if you hadn't got this one in particular,

-would you have maybe gone for one of the others?

-Yes.

-Yes, there was two definites...

-Oh?

-..that we were after.

But this one, when we bid on it,

we were bang on target, so we knew it was the right one.

# You're the right one

# Yes, the right one

# I have never been so sure of anyone before... #

'In fact, without further ado,

'Jeremy's already got to work on this place and it sounds like

'it's going to be home sweet home for the next few weeks.'

-Initially, I've repaired some of the outside areas.

-Mm-hm.

There was a gas meter hanging off the wall,

so I've had to rebuild a wall, put the gas meter back on.

Fuel services back on, so it's a workable house.

And before the winter closes in, I hope to get

the outside areas complete and then start decorating inside.

-We'll be keeping the kitchen.

-OK.

-The kitchen looks quite serviceable.

-Mm-hm.

The bathroom we'll probably replace.

Initially, we thought we'd keep it, but having looked at it again,

-I think we'll update that, put a shower in maybe.

-OK.

Who'll do that for you? Is it all down to you,

on your shoulders, or have you got friends?

That is down to me.

-All of it?!

-All of it.

I'll be actually living on site, cos I'm not from Gainsborough.

I'm actually from Essex, so it's a 2½ hour drive, so, er, I'll be

living on site during the week to keep the costs down there as well.

That's a bit of a trek.

2½ hours travelling backwards and forwards is five hours a day.

-It's not really feasible, so...

-No.

-It's a bit too much, that, isn't it?

-It seems pointless paying

for a hotel when you've actually got a house and could just camp in it.

'Well, it won't get a five-star rating, but it makes sense.

'Less time spent on the road commuting

'means more time getting this place ready to sell on.

'Jeremy will be going back to Essex for the weekends, but how long

'does he reckon he'll have to put up with kipping on the camp bed?'

I think between eight and 12 weeks.

-But as we're now entering the winter period...

-Yes.

..it depends on the weather, really.

'It's not the most comfortable solution for that period of time,

'but it does make financial sense.

'Jeremy was at the auction with his wife Nicky

'and she works in medical research.

'So is she going to be getting her camping gear out too?'

She's paying for the food bills and things

while we get the first one done.

What budget are you going to try and keep all that within?

Right, I'm going to try and do it for between probably

-£5,000 and £7,000.

-Small budget.

-I think that's possible.

-Really?

Um, I've costed everything from bathrooms to kitchens, um,

and actually gone into fairly fine detail and I think that is possible.

'Jeremy does have to keep his costs down on this

'if he is to make a profit.

'And not replacing big expensive items like the kitchen will

'certainly save the pennies and, given he's doing all that graft,

'that sounds realistic.

'Jeremy, it would appear, is prepared to make sacrifices

'beyond just camping in the cold to get his property portfolio underway.'

I've got an interest in classic cars

and I've currently got two vintage cars.

A Flatnose Morris and the other one's a 1937 Morris Eight.

-OK.

-So a little light car.

-We may have to sell one...

-OK.

-..to assist the, er, property buying,

um, so, as...as an investment, we possibly may have to sell one.

-Is that going to hurt slightly?

-Er, just a lot, yeah.

-Yes.

-Whose idea was that? Let me think!

-Um...

-Yeah, it was the wife's.

-HE LAUGHS: It was your wife!

-Yeah.

-Obviously!

-But it makes sense. It makes sense.

You seem to know what you're doing. All the best.

-Thank you.

-Good luck, sir.

-It'll be a success, well done.

-Thank you very much.

How cool is Jeremy?

He knows what he wants to do, he knows how he's going to do it

and he's got his wife on the phone to pass on the boss's instructions.

He's going to camp out here

until he gets this place exactly how he wants it.

Now, all the research he's done is going to pay off. I can just feel it.

We'll find out how he gets on later in the programme.

Well, we've waved one property off into the sunset,

but what about the other two?

Yeah, for some people, well, it's just a walk in the park,

but for others - Mm-mm! - it can be rocky road.

I think it's time to find out how they got on.

Earlier in the show,

I went to see a one-bed flat in the area of Leyton in London.

It had some great original features,

like these shutters and this cornicing.

But it also had a layout which needed reworking

and a complex lease situation,

where the buyer would take a share of the freehold.

And that buyer was Miles, who bought it after auction for 187,000.

And while he had done some projects before,

this was his first major solo project.

At least he didn't have much else going on in his life, right?

Ha! Wrong!

And I know you've just had a little baby!

-Yeah, we've just had a little kid called Brave.

-Aw! And how old is he?

-He's five weeks.

-Wow! So you're a new daddy?

-Yeah.

-You've got a new flat.

Can't you see the bags under my eyes?

-How hard is it being a dad?

-It's all right.

Yeah, it's all right, we're loving it. It's a real bliss time of just

-being together and the baby...

-Aw!

-..and a bit of sleep deprivation.

But it wasn't going to be baby steps for Miles!

He had big plans for the layout.

And four months later, we went back to see how the new dad was coping

with all the changes in his life, and what he'd done to the flat.

# So-oh-oh, if you're tired of the same old story

# Oh, baby, turn some pages!

# I will be here when you are ready

# To roll with the changes, baby! #

So, in here is where probably

the biggest change and the most work has gone on in the flat.

Along this line here was where a wall was

and this section here was the bathroom.

We took all that out and now it's the kitchen.

And there was a door here as well and we sort of plastered that up.

And I think it's good, it works.

There's, like, space for a fridge, a built-in washing machine...

It just seems like it suits the sort of person who would buy this flat

much more than how it was before, all sectioned off.

-# Keep on rollin'

-Oh, yeah

-# Keep on rollin'

-Ooh!

-Ooh, ooh!

-Roll with the changes... #

Hmm, now I did have my doubts about Miles' plan

of bringing the kitchen in here, but it really does work.

So what else has he done?

On the other side of the wall was a bathroom, er, so we just got rid

of that, moved the bathroom to the next room, where the kitchen was,

and now the kitchen is in here, so it's like a lounge-diner.

Miles has done a fair amount of reconfiguring here,

so the fact that all the neighbours share the lease means he was able

to get agreement to the changes without any hassle.

So, how does that shared lease work?

You still have a lease, but the lease is amongst the three flats

which are in the building, so we all re-lease it to ourselves.

If we want to renew it, then it's just a matter of going to solicitors

and writing to Land Registry.

You don't have to go through guessing

how much it is to renew the lease, because you're paying each other

and it's a little circle. That worked well.

Everybody was really chilled and we did, like,

a little bit of work to the outside of the house and I got

a few quotes and then ended up doing the work myself, with a builder mate.

It was really easy being a share of freehold,

I'm glad it was like that and not leasehold.

Well, glad that all worked out OK.

But how is fatherhood working out for him?

I mean, when we first filmed, I was so tired, even on that day,

I don't know if I managed to hide it, but it's got so much better

as time's gone on, just that he's slept a bit more

and I've got a bit more used to things

and the best thing about doing this sort of work is that,

when he has his injections, or Becks just needs my help,

I want to be there a lot and be, like, a really around dad,

so, you know, even days like today,

I'm going to go home at lunchtime and just be there in the afternoon.

And somehow, despite juggling this renovation and a new baby,

Miles will be finished on schedule.

But will he finish under his 12 grand budget?

We've definitely gone under 12. I haven't totted everything up yet.

I think I just need to pay for the carpet, that's like 500 quid,

so easily under ten and I think

I've spent, like, a bit of money that I haven't collected receipts for,

so, like, 10,000 is pretty much how much we've spent.

We're definitely going to sell it.

I think we've added a little bit of value, um, enough anyway to

make it worth my while working on for the last couple of months.

And as long as it's an all right little profit for sort of

three months' work, then I'm pretty happy with that.

Time to find out how "all right" that profit might be, Miles.

We've asked along two local estate agents for their opinions.

So let's start with the agent who saw it the first time.

It's fantastic.

It's bright, it's light, it's airy, it's a complete transformation.

Changed the area there to make a bathroom, with a small utility area,

and they've put the galley kitchen into the living-dining area,

so really you've got an all-in-one encompassing property.

This is the first time I've seen the property.

I believe it to have been done to quite a high standard. I think

that the alterations that he's made within the property have benefited,

because you've opened up this front bit to the bay window

and the bathroom is now further back in the property,

en-suite to the bedroom, really.

So a thumbs up from the agents on the reconfiguration.

But what about his profit?

Miles will have spent a total of 197,000

upon completion of the property.

He's keen to sell, but could it be a strong rental prospect?

I believe, as a rental property, um, because of the area that it's in,

you would be able to achieve £950-£1,000 per calendar month.

Well, it's a very popular area around here,

a lot of professionals live around the area and are moving in.

I think a couple would like to take this and they would probably

be prepared to pay something like £1,000 per calendar month.

Happy with that. That's fine, that's what I thought it would be.

That would mean a 6% yield.

Certainly not an attractive enough prospect

for Miles to change his planned course - to sell.

I think you'd put it on at around about £250,000

and hope to accept something close to that figure.

I would put this property on the market as it is today

for £240,000-£245,000.

Yeah, that's pretty all right.

I think that's kind of around the price we were thinking.

We've had an offer at 260 already.

But that was before the carpets were down, it was all finished,

so what we're thinking is just putting it on at 260,

offers in the region of 260, and see if we get, like, 265.

The lowest agent valuation would give Miles

a pre-tax profit of £43,000,

while his hoped-for £265,000

would mean a pre-tax profit of 68,000!

All right for three months' work.

# All right now!

# Baby, it's all right now! #

So, having made a success of this one,

and now that he's getting some sleep, what words of advice

would he give to any new parent with a penchant for property?

I really like being self-employed.

I feel like it's the best way to manage work-life balance,

so if you can do this sort of stuff, go for it, but don't compete with me.

Earlier in the show, I was in Gainsborough in Lincolnshire

to see a two-bed mid-terrace guided at 28 grand.

Aside from the crumbling plasterwork and the usual conundrum

of a downstairs bathroom, everything was in good nick.

This seems OK. I'm quite impressed.

And upstairs, the same story - everything looking good.

Well, sort of.

Although at the back of the long garden was a railway line,

which might put some people off.

'But with the low guide price and potentially little work...'

Now, if you get something like this,

you are on the right lines to making a decent amount of profit.

'Potential profit was one of the reasons

'Jeremy made a career switch to property.

'The first property set him back 32 grand at auction,

'but his future portfolio was possibly going to be funded

'in a way that sounded a bit sore.'

I've got an interest in classic cars

and I've currently got two vintage cars.

-We may have to sell one...

-OK.

-..to assist the, er, property buying.

-Is that going to hurt slightly?

-Er, just a lot, yeah.

-Yes!

-Whose idea was that? Let me think!

-Um...

-Yeah, it was the wife's.

-HE LAUGHS: It was your wife!

-Yeah.

'So, four months on,

'has Jeremy restored his classic two up, two down

'or were there some surprises underneath the hood?'

This house needed a real refresh

and Jeremy certainly has achieved that, and some.

So what work has been done?

The work that's been done largely is plastering.

That was quite a big job.

It's taken a lot of time.

Um, we've had the ceilings in the kitchen

and the bathroom replastered.

I think the... We've changed all the doors, replaced the bathroom,

the kitchen, largely, we've left alone.

We've retiled and put the new flooring in.

So, in general, the actual job's gone fairly smoothly.

'But while Jeremy did all his research before auction,

'there was an unexpected surprise.

'If these walls could talk, they'd be asking for help.'

The plasterer, um, climbed up, er, to the top and

when he pressed his hand against the wall, he found that the wall

moved by about half an inch or, say, two centimetres.

But we found out that, er,

the plasterboard wasn't actually fixed to the party wall behind it.

So what we've had to do is actually pin all the way along to...

to actually hold the wall back in its correct position

and make it a firm wall again.

# And the walls came down! #

'And he took steps to prevent damp in the living room.'

We took out a very ugly little electric fire that was there

and we vented the...the chimney,

because that was showing slight signs of damp,

but it was simply because there was no ventilation.

And over in this corner, where previously we found a large crack,

that turned out to be the render behind the plaster.

The render had actually dried out too quickly and pulled the plaster

and render away from the wall, so that's been re-rendered

and replastered and it's now good.

'Despite the unexpected work,

'Jeremy finished right on his four-month timescale

'and kept a meticulous eye on his budget.'

We're about £1,370 under budget.

Finished to schedule and every penny counted,

but can that money spent become more money made?

Two local property experts can tell us,

starting with the agent who saw it the first time.

In general, the standard of finish is very good.

I'm impressed with what the seller's done.

Nice flooring, nice decor throughout and brand-new bathroom suite,

which will help the saleability of the property.

It's been modernised to a good standard throughout

and everything has been taken care of, giving the new owners

the benefit of a finished property.

It would appeal to the sales market and to the rental market.

The market's strong for both sales and lettings locally.

I would feel that the lettings market is

slightly stronger than the sales market.

Food for thought, as Jeremy was open to either renting or selling,

depending on the price.

Jeremy paid £32,000 for the house

and we'll round up his renovation costs to £5,700, which means

a grand total of 37,700, so how has his first investment fared?

I would market this property, in the current market, for £50,000.

If I was to put the property on the rental market,

I would look to achieve a return of £375 a calendar month.

I believe this property should achieve £370 per calendar month.

The area is popular for first-time buyers

with property values being lower than nearby areas.

I would recommend putting the property on the market for £50,000.

The agents agree,

and £50,000 at resale would net a £12,300 pre-tax profit,

while £370 per calendar month

would result in a very impressive 11.9% yield.

A rental of £375 is exactly what I was expecting.

375 would be very good.

A valuation of £50,000 - Eugh! - is a little bit low!

Um, to cover the work that we've done, um,

adding that to the purchase price, I would expect that to be at least

£5,000 more and I was hoping for a valuation of between 55 and 60,000.

We'll try it on the market a little bit higher than those valuations

and, if we don't get anywhere with that within perhaps two months,

well, we'll probably look to renting

and trying to sell it on with tenants actually in place.

Buy-to-let investors love tenants in situ,

particularly with that high yield,

so Jeremy may not have to sell his vintage car quite yet and he knows

what it's like to live here - he did it while he was doing the project.

I tended to spend probably a fortnight on site,

living on a put-you-up type bed, which is very uncomfortable.

It's project planning all the way and it tends to take your life over.

I think my wife will be very happy that, er, I'm back at home now.

And, in fact, Jeremy's wife might be happier still

as, two days after filming, he sold the house,

making himself 13 grand profit after costs and legal fees.

I've got a feeling we'll be seeing this first-time property developer

on Homes Under The Hammer again.

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

We'll see you next time with more stories from the auction rooms.

-See you then for more Homes Under The Hammer.

-From us, it's a goodbye.