Episode 40 Homes Under the Hammer

Hello. If you are looking for a good investment, you can't go far wrong

-with bricks and mortar.

-Yeah, and if you want your money to go further,

then you might be able to pick up a bargain at a property auction.

Whatever you do, make sure you do your research

first before you buy your home under the hammer.

If you are making your debut in the world of property development,

it is best to start small and crack on with a straightforward refurb.

Yeah, even just a lick of paint can often be enough to deliver a profit.

You don't have to start with that subsiding castle.

Let's find out what our buyers on today's show were willing to tackle.

A three-bed in Burnley has an odd layout and unusual decor too.

This, however, is a bit of an interesting design feature,

don't you think?

The view from upstairs in this Liverpool semi is completely normal.

Honest.

There is nothing unusual upstairs - three bedrooms and a bathroom.

And I have spotted some bizarre wildlife at a bungalow

in Littleover, Derby.

It almost looks like an enormous,

great turtle has fallen down and been squashed.

All these properties were bought at auction.

We will find out who got them,

how much they paid when these homes went under the hammer.

Well done, madam.

Well, as a general strategy,

you want to be investing in property in an area where somebody else

is spending loads of money on the infrastructure,

such as the government or local council or even the EU.

So they are piling millions into new roads

or shopping centres or schools or whatever.

And you can then benefit from the effects that it is bound to have

on the local community, and that is exactly what is happening there.

And the here in question is Burnley.

Hundreds of millions of pounds of public and private money,

and that means things are not only looking up for the town

but the property market too.

It is a dream scenario.

# My dreams are getting better all the time. #

Well, with lots of money and effort being spent on redeveloping

the area, the days of boarding up houses and properties you

could buy for a couple of thousand quid are probably behind us.

As a result, property prices are rising.

For instance, this. It is an end-of-terrace.

Guide price now - £20,000+.

Let's take a look.

So, fairly substantial on the outside.

What is it like once you step through the front door?

Well, it's all right, yeah. Your front room here.

Obviously needs a bit of - ha - renovation.

But it is a good size, nice high ceilings.

-HE SNIFFS

-Doesn't smell damp, which is good.

So, yeah, looks all right.

Open fire, which is a nice touch.

This, however, is a bit of an interesting design feature,

don't you think?

A bit of interior brick work forming a pillar.

Oh, well. Sends you up to your bedrooms there.

Through into a really nice sized rear lounge.

This is a good space, isn't it, here? We like this.

Lots of light coming in from two windows,

one of the advantages of being an end-terrace.

It looks like you've got central heating, so that is nice.

Unfortunately, the only thing that lets you down slightly

at the moment is this room here, which is the current kitchen.

And it is pretty small in relation to the rest of the property.

But given this room is so big, I'm wondering

if you should make this into a kitchen/living area, have

this as a utility and suddenly it is turning it into a very usable space.

And thankfully, there is not much kitchen to move.

So upstairs, and three bedrooms. They are all a good size, actually.

One, towards the front there.

Slightly smaller one towards the back.

And then a bit of a hiccup in the whole design.

This is the third bedroom. And, unfortunately,

you have to pass through it to get access to the only bathroom.

Clearly, that is not ideal.

I suppose the way around it is to try to get a bathroom downstairs,

perhaps so this then becomes an en-suite or probably...

I don't know, just try and work with the layout.

Corner baths don't suit everyone and neither do green suites.

It can be any other colour, as long as it is white. That is my motto.

It's access that's an issue, but -

and it is a big but - moving bathrooms and kitchens can cost.

Electrics and plumbing don't come cheap. Time to venture outside.

Well, at the back of the property, no garden to speak of.

Just this small sort of little courtyard area.

But one bit of good news - you have got this gated alleyway.

Now, when they introduced these gated alleyways several years ago,

one of the things they found with it is

it dramatically reduced things like crime.

So the fact that this is here, it is a good sign.

Another indication that the area is definitely moving

in the right direction.

And there is a local estate agent heading in our direction now.

What does he think of this property guided

at £20,000?

It is a great terraced property, nice finish.

Certainly, if it can be renovated to a very high standard,

it should be very popular on the local marketplace.

There has recently been a lot of properties on the market

within the area, so the vendor has to be very

confident that they are setting the price correctly

to make sure they get the sale in the quickest possible time.

So a competitive market around here

is one thing you'll have to consider.

What work would the agent advise you could do to give any developer

the edge with this property?

If this were my property, I would probably move the bathroom.

I'd also look at expanding out kitchen.

That would make it more popular with local families

and it certainly would sell a lot faster in the current marketplace.

So you need to factor in those layout changes to any budget.

But could there be a profit in a resale?

This could be a really good property.

I would expect it to achieve somewhere in the region

of £65,000 once the work has been completed.

And rental?

The rental market is very strong in this area, so I would suggest

it would achieve somewhere in the region of £425 per calendar month.

So clearly, a bit of work to be done.

But you are buying a good-sized property in an area that is

moving in the right direction. So an interesting one to go for.

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

Lot 55. Perfect family home. First-time-buyer,

or even buy-to-let investment.

20 is your guide. Start me.

20 here, at 20 I'm bid. At 20 I'm bid.

Now in ones.

At 20. 21 here. 22. 23.

At £23,000. 24, new bidder.

25. 26. 27. 28.

Here at 28. It is with you, sir, at 28.

Back in at 29. 30. One.

Here at 30.

One. Back in. 32.

Been with me all the way, sir. At £32,000.

I'll take a half.

OK then, at 32. Half I've got. 32.5. 33.

You could have bought a house with that half. 32,500 with you, madam.

First time.

Back in at 33. And a half?

You know you want it.

33 here. First time.

Second time then.

Third and final time at £33,000.

Are we done? Half.

34. Nearly. 34?

33,500 on my right.

For the first time. Second time.

Third and final time if you are all done.

Well done, madam.

Wow! Tense or what?

Friends Rebecca and Tracy made that successful bid of 33,500.

And it was Tracy who came along to tell me their plans.

Tracy, good to meet you.

-Hi.

-Congratulations. Tell me, why did you buy this place?

We had been searching for a property for a little while now.

And this was not the first one we had seen,

but it was certainly the first that we'd liked.

And where were you searching? In this area or farther afield?

-Yeah, this area at the moment.

-What attracted you to Burnley?

The house prices at the moment in Burnley are quite low.

And the rental, there's a lot of good rental value around here.

There is a lot of regeneration work being

done by the council at the moment.

-So it is definitely up-and-coming.

-Right.

-So you get in there right at the start of all this stuff.

-Hopefully.

So tell me about you, is this what you do? Is this your job?

-This is our first one.

-OK.

-First property.

So it is something we look to hopefully do in the future,

make a business out of it.

Rebecca couldn't come along to meet me as she was at another auction.

She had two properties on her list. But one thing at a time.

Why do the duo want this one?

It is a good size.

Potential three bedrooms, three good-sized bedrooms.

The area is not bad for a three bedroom

rather than a two, obviously. It will bring more rental value in.

And we got it at what I thought was the right price

-on the day at the auction.

-And in terms of the renovation,

have you got property experience or is this fairly new?

Only through my own properties, like tiling and floors

-and things like that. Nothing major.

-Right.

But we have got a few builders we are working with.

And what were you doing before you sort of started doing this, then?

-Shabby chic-ing is what I do by day.

-Shabby chic-ing, what is that?

I buy furniture at a cheap price and I restore it.

-Repaint it and then age and distress it.

-Oh, wow.

-And then sell it on?

-Yeah.

Brilliant. What kind of things do you do? Sort of...

-Tables, chairs, beds, wardrobes. Anything woody.

-Right.

-If it is wood, I will paint it.

-Right.

And how did you get the effect?

Well, you paint it so it looks brand-new

and then you age it with a sander.

And wax.

So you have a pristine, nice piece and then you destroy it.

-But you age it and it adds value.

-Oh, great.

So are you going to kit this place out with that kind of stuff or not?

Uh... I've certainly got furniture pre-painted that we can put

in here if it helps to make it, you know,

so people can visualise how it will look and how things can fit.

-You're quite handy, then.

-I like to get things for next to nothing.

-OK.

-I like all the painting and things like that.

-Right.

So I'll do a bit of a bartering and buying and selling.

Tracy sounds like she knows how to strike a deal

and get a good value for money.

And when it comes to buying materials for the renovation

of the auction purchase, she doesn't hang around.

-I bought most of it before I bought the house.

-What do you mean?

Like tiles - floor tiles, bathroom tiles, bathroom suite.

-HE LAUGHS

-My garage is full of the stuff.

Because if you're going to buy something that cost 99p,

then...yeah. And I bought tiles - £50 for 700.

And then sold 300 of them for 450.

-Oh, wow!

-Enough to pay for the bathroom suite.

And I just do things like that.

My friends call me a female Del Boy, really.

-Oh, yeah!

-A more successful one, I hope.

HE LAUGHS

-LAUGHING:

-Yeah, I can really see Tracy

and Rebecca in the old yellow Reliant Robin.

But is she a good wheeler dealer? Time to put her skills to the test.

So have you developed a sort of acting shocked about the price

that he is suggesting face yet?

-Yes.

-Would you give me your acting shocked...?

"It is going to be £10,000 for your kitchen, love."

Oh, we need it half that price, definitely.

Not that money in the bank.

I'm afraid.

And I always go in with,

"I've got a quote for at least 2,000 less than that."

And Rebecca's there, "Yeah, it came in this morning."

We have to get her along with us, but she is getting there.

So what are you going to do to this place?

Talk me through exactly the project plan.

You know, plastering throughout. Just a clean finish. New kitchen.

Obviously, we'd like to give a wow factor to the kitchen.

Possibly new.

I've done a bit of haggling to get the new prices as low as I can

get, but it's still a bit higher than I'd like.

But the fitting of the kitchen, it is trying to find a builder

who'd want to put the time into a second-hand kitchen.

Cos I understand that it can then outweigh itself

cos you are putting more into a builder spending that time

than it would if I were just to buy a brand-new kitchen.

Bathroom needs moving.

Obviously, to create that third bedroom without having to walk

through it to go to the bathroom.

-OK.

-Get rid of the green suite.

Add a nice white one.

And then, yeah, just creating the three bedrooms.

I don't think it's got much needs doing to it.

The six windows need replacing to double glazing.

And a new front door and back door.

-So, what is the budget?

-7,000 top.

-OK.

-That sounds reasonable.

-Yeah. I am thinking five,

but six, seven, yeah.

No, Rebecca thinks seven, I think five.

# Oh, little lady, little lady

# You sure drive a hard bargain. #

She is quite a haggler, is Tracy. But you have to be in this game.

And in property development, it also helps to be hands-on.

Tracy is planning to skim the walls

and do lots of other jobs over their 8-to-12-week timescale.

Well, listen, lovely to meet you. Congratulations.

-And good luck with it.

-Thank you.

Well, something tells me that Tracy and her partner are going to

do very well at this property developing lark.

She has definitely got a fantastic attitude.

And I think she will get things at the best possible price,

don't you? You can find out how

she gets on sorting this house out later in the show.

Welcome to the North West of England

and a city best known for its cultural contribution.

From Alan Bleasdale to Leighton Baines,

Edwina Currie to Elvis Costello,

Liverpool has produced some of the UK's most diverse and famous names.

Today, I am in Huyton, only six miles from this lovely city centre.

# In my Mersey paradise. #

The property I am here to see is in this quiet cul-de-sac.

It is a three-bed, detached house with a guide price

at auction of £80,000+.

Now, it is in need of a bit of modernisation,

but one positive is all this off-street parking.

Let's take a look.

And no, I have not lost the plot. This is not a lawn, it's a driveway.

Honest. The outside does leave a bit to be desired.

OK, straight into the hallway area.

Very much an '80s feeling,

'70s feeling in here as soon as you come in.

'80s wallpaper - three types of wallpaper.

And you have got a '70s banister here.

I haven't seen one of those in a long time.

Down the hallway to the kitchen area, which is a nice size,

a good space, it just needs a complete modernisation in there.

I'd start from scratch in the kitchen.

Into a lounge sort of dining area, which is...

There's a lot of floor space in here. It is quite big.

But big in this case is not beautiful.

Apart from being a wallpaper catalogue from a bygone era,

the whole thing is dated and dilapidated.

You know what I'm going to say.

# Rip it up and start again

# Rip it up and start again. #

You know me, I like a beer in the garden.

But there is a fair bit of work to be done before that can happen.

There is plenty of space out here and out the side,

where maybe this place could be extended.

I'd plump for a conservatory. That will be a nice addition.

But perhaps best focus on the more visible issues first.

There is nothing unusual upstairs - three bedrooms and a bathroom.

Apart from this strange hole.

# Mind the gap, mind the girl

# Have another drink on me

# Mind the gap, mind the girl. #

Holes in the floor are not the kind of space we are looking for.

Once the gaps are fixed, you'll be left with two good-sized double

bedrooms and a third single bedroom.

Just like downstairs, the walls all need to be stripped back

and the carpets replaced. On the plus side, the bathroom isn't too bad.

And there is even a downstairs loo.

But will that be enough to convince a local estate agent that this

is a good investment?

We have asked one along to find out.

It needs to be refurbished, yeah.

It needs a new bathroom, new kitchen.

Just decorating, basically.

It would add value by putting in a conservatory.

It has got a nice, big garden. So that would be a bonus to it.

So we both think adding a conservatory would add value

to this house. But how much could it be worth once refurbished?

The resale of this would be £175,000 to £185,000.

And if you opted to let it out,

is there a good demand for this type of property?

Yeah, it is a good rental area.

It would bring in between £650

to £750 per calendar month.

This is a detached property in a good area with off-street parking.

Basically, it has a lot going for it. It does need a bit of work.

Let's see who is ready to tackle that work when it went to auction.

Up to Liverpool.

A three-bedroom, detached house, in need of modernisation.

80,000 anywhere?

80,000 at the back of the room. 81 anywhere?

81. 82.

83. 84.

85.

This lot came at the end of a long auction.

However, there was still two very competitive bidders,

one of them on the phone.

We rejoin the action with the bidding at £130,000.

131.

Long way back. 131. 132.

No? 131. Been there all along.

And I do want to sell it to you. Lot 131 for the first.

131 for the second.

131 for the third.

-132.

-132, I'm sorry.

Gentleman at the back of the room, one more bid?

Thank you. 133. Against the telephone.

So we go again.

133 for the first. 133 for the second.

For the third and final time.

Sold to the gentleman in the white at the back of the room.

After that mammoth battle,

the very relieved-looking buyer getting the property for

133 grand was Chris.

The Manchester-based businessman already owns several properties,

but this was the first time he purchased at auction.

And what a purchase. 53 grand over the guide price.

So not surprisingly,

I wanted to find out how he felt about his auction experience.

-Chris, nice to meet you.

-And nice to meet you.

-Congratulations, well done.

-Thank you very much.

-So, how was the auction, Chris?

-Hectic.

We just got in there at the last minute, just before the lot was due.

So it was a bit of a panic. But we got in there, got the winning bid.

-And all was well.

-Who did you go with?

I went with Josie, my partner,

and I went with Christian, my little boy.

OK, was Josie any help?

-Was she any help?

-HE LAUGHS

You'll see her shaking her head

as I was making the last few bids, yeah.

Was she holding you on, not letting you go?

She has got me on a very short lead.

-Was it at the right price?

-It was at exactly the right price.

I wouldn't have paid much more for it.

Well, that is a relief.

Even though he has gone over the guide price by so much,

he seems pretty happy.

And it turns out that Chris is just revving up in the property business.

I buy and sell camper vans.

That is your job at the moment?

That is what I've been doing for the past ten years.

And now you are moving away from that slightly, you've been to auction.

Probably moving away from it completely.

We had a baby about a year ago. Wife has given up work.

And I've got to, you know, generate a bit more

income now that she has given up work.

And we've got more time to spend with the baby as well.

So hence the reasons for moving into property.

-Yes, priorities, priorities.

-Priorities.

Chris already has two properties - one he lets out

and one he uses as his office.

This is his first full-time venture,

so what are his plans to bring in the bucks?

It is mostly just decorating.

There is no structural work to do.

So it should be very quick and easy.

It is going to be a very, very light renovation.

Just basically redecorating, rejuvenating.

-We will probably put a new kitchen in.

-OK.

But other than that, it is pretty easy work.

Have you got people that you normally use?

Have you got decorators and builders?

Are you going to do it yourself?

I think on this particular property,

I am going to do a lot of the work myself.

Because it is so easy.

-Basically.

-Yeah, true.

-I used to be a decorator many years ago.

-There you go, you see?

-Very easy.

-The skills are already there.

-There we go.

No conservatories, no extensions, just keeping it simple

and decorating and bringing this place bang up-to-date.

However, as regular viewers will know, it is

very rare that a property doesn't throw up some problems.

I really hope Chris hasn't underestimated the work here.

So tell us, what is your budget, first and foremost?

I would think we'd be able to sort the property

out for probably under a couple of thousand pounds.

That little?

-That little, yeah.

-What are you going to get for that?

Cos you've got to fill a few holes in.

You are thinking a new kitchen, maybe.

Well, the new kitchen is going to be the major expense,

but other than that, it's just decorating.

# Spending money

# Spending money. #

A couple of thousand? I think Chris could be pulling my leg.

I know this house isn't in terrible condition

and Chris seems a pretty confident chap, but a new kitchen,

carpets and paint and certainly - well, I'm hoping - new wallpaper.

And there is bound to be re-plastering,

re-plumbing, electrics.

And then there is that garden.

Two grand?!

He may well have splashed out at the auction,

but he's certainly not splashing the cash year.

Even with his decorating skills, wow.

And let's not forget travelling costs,

because Chris does not live in the area.

Will you camp in?

I'm going to be on the short lead, I'm going

to have to go back home every night,

I'm afraid, and help with the offspring.

So I will be coming here every day to work.

I think probably a month or two should see it through.

What are you going to do with it?

Have you bought it to let it, to live in it, to sell it?

No, it's going to be put straight back on the market

and resold as soon as it is done.

-OK. So you want to carry on buying properties?

-Absolutely.

It is the way forward.

-It is a future for me and for the family as well, yeah.

-Good man.

I like that. Good luck to you. I know it is going to work out, pal.

-Good luck to you, Chris.

-Thank you very much indeed.

-Take care.

So Chris thinks this is a perfect house to get him

into the property developing world.

Now, he doesn't think there is much work to be done and he also

hasn't given himself much of a budget and a very small timescale.

Will he get it done? We can find out later on in the programme.

Coming up, in Littleover, Derby,

this bungalow's price is bargain brilliance.

For that £58,000, it is looking pretty good!

And Chris was keeping it cheap with a two-grand budget in Liverpool,

but plans always change.

We decided we would do much more than just decorate the property.

Back to Burnley, in Lancashire, now, where earlier,

I saw this three-bedroom, end-of-terrace property

bought for £33,500, over half as much again as the guide price.

Your front room here - open fire, which is a nice touch.

This, however, is a bit of an interesting design feature, don't

you think? A bit of interior brick work forming a pillar.

Oh, well.

A few bedrooms there

that are through into a really nice sized rear lounge.

This is a good space, isn't it? Yeah, we like this.

Unfortunately, the only thing that lets

you down slightly at the moment is this room here,

which is the current kitchen.

And it is pretty small in relation to the rest of the property.

The house was bought as a new joint venture by friends

Rebecca and Tracy.

One problem they hope to solve was the access to the large

bathroom, which was via a bedroom.

Their aim - to sell if they could generate enough profit.

It is a good size, potential three bedrooms,

three good-sized bedrooms. And we got it at what I thought

was the right price on the day at auction.

Well, it turned out Tracy is used to getting things at the right price.

I bought tiles for £50 for 700.

And then sold 300 of them for 450.

-Oh, wow!

-So that's paid for the bathroom suite.

I just do things like that.

-My friends call me like a female Del Boy, really.

-Oh, yeah!

A bit more successful one, I hope.

THEY LAUGH

Well, we are back four months later to see

if this Del Girl has stuck to their £10,000 budget.

# Starry-eyed

# Hit, hit, hit, hit Hit me with lightning. #

While Tracy was away on holiday, Rebecca widened the kitchen.

The solid beech worktops took a long time to fit

and they had two new windows installed.

# Oh, everybody is starry-eyed

# And everybody glows

# Oh, everybody is starry-eyed. #

Upstairs, the oversized bathroom has moved,

trimmed down and changed colour. But more of that later.

Tracy's bargain basement purchase of bulk tiles are out of the garage

and onto the walls, making for a much brighter backdrop.

# Into colours, colours And carousels. #

A bright, modern colour scheme makes for a welcome change

to the magnolia palette.

New carpets in all but the bathroom give the house a fresh

feel to the bedrooms and landing.

# Oh, everybody is starry-eyed

# And everybody glows. #

All of the rooms have had various stages of re-plastering.

The bedrooms have all been skimmed

to cover the textured paint on the ceilings.

Tracy and Rebecca have done most of the donkey work themselves,

hiring in specialist trades when needed.

# Oh, everybody is starry-eyed

# And everybody glows

# Oh, everybody is starry-eyed

# And my body goes. #

Like most of the rooms,

the front reception room has a feature wallpaper.

Making a welcome change from the once feature wall.

And for more explanation of the layout changes, over to Tracy.

You remember last time, to get to the bathroom,

we had to go through the bedroom.

To solve this issue,

what we have done is we've taken out the entrance to the bedroom here

and we have created a corridor down here and put the bathroom here.

It did involve quite a lot of work

because we had to move the waste pipe and things.

But overall, I think the results have been fantastic.

So this room, this used to be the bathroom.

And as you can see, it has had a total makeover.

We took out the suite. But we obviously had it replastered.

And the result, I think, is really nice.

And not to be outdone, Rebecca has got her own story.

The kitchen is my favourite room in the property.

We purchased a second-hand kitchen from the internet.

We were quite lucky, it had a lot of units with it -

a lot of base units and wall units as well.

We actually found that fitting the base units was relatively easy.

We did that work ourselves.

We tried to fit the wall units ourselves,

but we actually found that that is something we are not very good at

and we didn't really have the right tools to do that job.

So we got somebody in to fit the wall units for us.

And what else did the girls learn from the experience?

Moving bathrooms is very expensive.

With, like, waste pipes and things like that, we have

gone from having it on an outside wall to an inside wall.

But we needed to do that to maintain the good-sized three bedrooms.

And what sort of impact did the unforeseen costs

have on the £8,000 to £10,000 budget window?

The budget hit is now at £8,000.

Oh. Not too bad then.

But then again, Tracy does have a reputation in negotiation.

We bought second-hand solid doors that would have been £60 each

to buy brand-new, we bought 13.

We ended up paying £30 for all of them.

So it is just about shopping about and getting a better quality

but at a cheaper price.

We called in the advice of local estate agents with first-hand

knowledge of the area.

They are also aware of the impact of the area's regeneration,

so they should give an up-to-date valuation for the intended

sale price of the property,

starting with the chap who saw it before work began.

The change in the layout upstairs has been a great

addition to the property.

Now being able to access

the bathroom is a real positive. So, yeah, very impressed.

The property's decor makes the property stand out

from other properties in the area.

The fact they've gone

for bright, modern colours

will again make it appeal to a variety of different people

instead of the norm, maybe the magnolias and creams of this world.

I am rather partial to the custard creams myself.

The agents thought this house could rent for between £425

and £450 per calendar month, giving a yield of around 12%.

But it is resale the girls are interested in.

With just a bit of outside paint work and some final fixes,

let's round it up to £42,000 they've spent, to make the maths easy.

My estimation of sale price, this property would be £60,000.

We would expect to achieve

approximately £50,000 for the sale of this property.

-Yeah, the top one seemed good.

-Yeah.

-Yeah.

So a potential pre-tax profit of £18,000,

based on that top figure.

So what is next after the sale of this one?

So the next venture is to find a rental.

That can be done in a quick timescale as well.

Yeah, like a week or two.

-HE LAUGHS

-Well, good luck with that one.

Well, this is Littleover,

about two miles from the centre of Derby.

It was formerly a village owned by Edward The Confessor.

Well, let's hope the property I'm here to see

doesn't have too much to confess itself.

Up for auction was this.

It is a two-bedroom bungalow at a guide price of £58,000.

It looks all right. Let's have a look.

So, what have we got? Nice little entrance area there.

And then into the main part of the bungalow. Classic sort of design.

A sort of central-ish area here, off which the various rooms go.

Toilet and bathroom facing you.

Your bedroom is there. Yeah, reasonable size.

This is your main living area.

You've got this corner window

throwing lots of light into the room.

It is not huge, but a few good things.

Looking like a relatively new central heating system,

which is going to save you a few thousand quid. That is good.

The kitchen at the back here.

As you walk around, the floor feels a little bit springy in places,

which would definitely want to be investigated.

But the kitchen... It's dated.

But overall, it is not a bad size,

bearing in mind it is only a two-bedroom bungalow.

I mean, for that £58,000, it's looking pretty good!

The two bedrooms are a pretty neat size.

And the loo is not bad either.

There is also a very pleasant sunroom.

Now, a popular style of house, such as a bungalow,

in pretty good order,

just needs a bit of fresh decor

for a guide price of 58,000.

So far, so good.

However, there is something of a big issue we have not addressed.

# There is an elephant

# Standing in the room. #

And that is almost the elephant in the room,

if you want to use that expression.

Which is that this bungalow is non-standard construction,

probably made of concrete blocks. Is that a bad thing? Well...

Yes and no.

The yes is that it is very hard to get a mortgage, almost impossible

in some cases when it comes to non-standard construction properties.

The good news, though, is that the price you pay is considerably lower.

If you are looking at it from the point of view of yields,

the rent you are going to get on this place,

non-standard or otherwise, it is going to be about the same.

So your yield is going to be a lot higher.

Clearly, you have got to be a cash purchaser.

You can do things like put a brick skin around the outside to

potentially make the property mortgageable but not always.

Is it worth doing?

Well, if you have got the cash to invest, then...probably not.

I mean, if you have the cash to buy this outright,

then the smart move could be just to take the yield

with a straight renovation.

Building a brick skin could cost at least ten grand.

Time to take a look round the back, where again,

we may have to use the non-standard word.

Or is that two words?

Well, at the back of the property, there is a sort of garden.

I say sort of cos it is mostly this kind of weirdo concrete stuff.

It almost looks like an enormous great turtle has fallen down

and been squashed to create this really odd kind of thing.

Well, what you can say about it is it is low-maintenance for sure.

People from the turtle preservation society will be on the phone,

I just know it.

Anyway, more seriously, out the back, there is this garage.

Well, that is useful apart from the fact that garages of a certain

age often have construction issues.

One, they can often be quite unstable. This one feels all right.

But the roofs are often made of asbestos,

so that is definitely something to be checked out by a professional.

But lots of space, quite surprising. At least you wouldn't need a mower.

I can assure you, dear viewer,

that no giant turtles were squashed in the making of this show.

I didn't think I would ever say that sentence. Anyway, moving on,

let's ask the auctioneer who sold his property

what his impressions are of it.

First impressions of this property - it's double glazed,

it has got a modern heating system in it.

They have all got their limitations because of the way

they were built, but this one actually is better than most.

On the subject of those limitations,

can the auctioneer shed any light on why they were built this way?

These bungalows were built in 1946.

The intention was that they would have a very limited lifetime.

They are low on insulation.

There would be problems with mortgageability.

Some of them have been bricked round,

which obviously puts that problem to bed.

But you are talking about a major investment

in the property to do that.

So would it be worth that investment?

One way to know is to look at its resale value.

Because of its construction,

there is always a cap on the value of these places.

I would say you would achieve about £85,000.

Now, if they brick round, obviously,

you are improving the mortgageability of the property

and therefore saleability, which has an affect on value,

but you are not going to push its value very much greater.

You might add £6,000, £7,000, £8,000

to the figure I have just quoted.

So is it worth bricking round? Probably not.

But rental could be the path for this bungalow.

If you spend modest money on this with a view to renting out,

you'd achieve a rental value of upwards of £500 a calendar month.

Probably not quite as much as 550, but 500, 525.

Well, the non-standard construction is obviously going to cause

a few issues. The bungalows like this are eternally popular.

And that low guide price, I'm sure, attracted bidders at the auction.

Let's see what happened.

Lot 51. We are onto the last couple of pages, ladies and gentlemen.

Start me where you like with

that one. May I say 60,000 for it?

58 to start me. Good value, these.

56. Bid me where you will.

Thank you, 56,000 is the starting bid.

At £56,000.

57, I've got.

57 is bid. 58.

58. 59.

59. At 60. 60,000.

61 somewhere else?

61. At 61,000.

62? 62 is bid.

At 62. 63.

It may have been near the end of the auction,

but two determined bidders were going to slug it out -

one obscured from our view behind the pillar

and the other dead centre in the room.

We rejoin the bidding at £69,500.

69.5. 70,000.

70,500.

71. £71,000.

500 elsewhere?

71,000, right in front of me.

At £71,000, once.

Twice. Third time.

Sold at 71, sir, well done. Thank you.

I thought I recognised the successful bidders who

paid £71,000. It is Dawn and John.

We first met couple back in 2012

when they bought a property...

that looks remarkably similar

to this one and, in fact, was on the same estate.

And it wasn't their first of these little prefab bungalows.

-So why this particular property, then?

-We have already got one.

-Oh?

-Just like this.

-Right.

-Which is at the other end of the estate.

-Oh, OK.

-And it was very successful.

# What if I had to do it over

# Over again?

# I'd do the same all again. #

And now they have another Littleover post-war prefab.

So they know these properties well. So what are the plans for this one?

-Dawn, John, good to see you again.

-And you.

-And you.

So why are you such a fan of these little bungalows?

They rent fairly easily.

Our experience has been that they rent fairly easily.

And we are buying them for investment purpose

-rather than resale.

-So the fact that it is non-standard construction

wasn't an issue to you at all?

You obviously knew about it cos you knew the properties.

No, I don't think it is an issue.

Although I believe they are probably difficult to borrow against.

People that have got them seem to like them.

And Dawn and John like them for their rental potential.

They have a portfolio of properties

which are part of their future retirement fund.

John is a charted accountant and Dawn is a financial director,

so if anyone is going to watch the pennies, it has to be them.

So what will they be splashing the cash on here?

This one has got double glazed windows,

which do need a little attention.

We shall need soffits, fascias, gutterings.

But that is probably the majority of the stuff

on the exterior of the building.

Internally, it is a matter of how far we go.

-The last one, we gutted it and we insulated all the walls.

-Oh, wow.

I think we shall insulate the walls here.

And how do you insulate, with a board on the inside?

Yes, we put plasterboard.

But on the inside of the plasterboard, there is

-about half an inch to an inch of polystyrene.

-Right.

And batten that off. And it has made a big difference.

So we shall do that, and then we will go from there.

We're in debate on the kitchen being replaced at the moment.

So, how will you decide on the kitchen?

What will make you make the decision there?

Well, I suppose we didn't take that much notice of it because

it wasn't in as bad of condition as the other two we had taken over.

So I came away with the impression that it would be OK.

-John came away with the impression it would need replacing.

-To go.

-So that you will find us later on inspecting.

-Right.

So you will have to make a decision between you

whether or not you do it. OK.

So what about the garage?

The trouble with the garage is possibly the roof.

It has got a broken panel in it, so we'll look at it at that point.

But at the same time, we shall get expert advice on it as to

whether we can make it safe because of the material it may be made of.

And if not, we shall remove the roof.

The big unknown at the moment is the floors.

There is some movement in the floors.

I suspect we could overboard them, but when we get the copies,

we will just see what is required.

Right. They are springy in certain places, aren't they?

A bit more than springy in certain places.

THEY LAUGH

Off the top of your head,

do you have any idea what might be causing that?

It is possibly a joist that is gone.

Or it may be that the floorboards are laid the wrong way.

So mostly structural work for Dawn and John.

And then a bit in the kitchen, maybe.

They have certainly saved a few bob by not bricking round,

but how much will they spend?

-I don't think it should exceed 15,000.

-Mm-hm.

And how hands-on are you? Remind me.

-We are excellent, we pick people to do it.

-Right, OK.

So completely hands-off, then.

And in terms of the timescale for this one, then?

Three months, possibly four.

So will there be more properties that you will be buying?

-I don't know. There will be one more, I think.

-One more, yeah.

One more would take the couple to their target of 20 properties.

However, John's fondness for these bungalows is not an entirely

recent thing.

-Many years ago, I used to drive for a rock group.

-A rock group?

-The drummer of this group...

-What was the group called?

-It was The Heralds.

-The Heralds.

-Were they national?

-Not really, very local.

And the drummer lived in one of these.

And I remember collecting him one night, going into the house,

looking at it and thinking how surprised

I was, the amount of room in it and what we could...

What it was, in fact.

-Some 30 or 40 years later...

-THEY LAUGH

Brilliant.

-And congratulations with this.

-And good luck with it.

-Thank you.

Onwards and upwards. Nice to see you both again.

-Thank you.

-Thank you.

So, John and Dawn sticking with what they know

and buying another one of these little bungalows.

And the whole issue of that non-standard structure not

being a problem for them. The only things they need to resolve...

The kitchen, will it be replaced?

The garage roof - what will happen to that? And those floorboards...

Ugh! How bad is that problem? Well, we can find out later in the show.

So, the hard work is over for our first buyer,

but what about the others?

Yes, has it all gone to plan?

Will they see the fruits of their labours?

Let's find out.

Time now to return to Huyton, in Liverpool, and this

three-bed, detached house with a guide price of £80,000+.

We were off to a good start downstairs with a good

spacious layout.

So then I took a look upstairs.

Nothing unusual upstairs - three bedrooms and a bathroom.

Apart from this strange hole.

Aside from that little oddity, structurally, the house seemed OK.

But when it came to decoration,

the whole thing was going to have to be redone.

# And I just hope that you can forgive us

# But everything must go! #

On the positive side, redecoration on that scale will always add value.

And having paid £133,000 for the house at auction,

that is exactly what new owner Chris was hoping.

I just wondered if he had given himself enough money for the work.

I would think we would be able to sort this property

out for probably under a couple of thousand pounds.

-That little?

-That little.

-The new kitchen is going to be the major expense.

-Yeah.

But other than that, it is just decorating.

# Back to life, back to reality. #

Well, Chris was a former painter and decorator.

But even doing all the work itself, two grand didn't seem a lot to me.

He had given himself one to two months,

and I was sure he'd bring this house back to life.

But was the budget realistic?

Seven months later and we have returned to see how Chris got on.

The dated decor has disappeared.

And the house now feels like the bright,

spacious family home it should be.

He has still got some jobs to finish,

but it looks like Chris has been an incredibly busy man.

We have replastered all the walls and all the ceilings.

We've replaced all the floors in every room.

We have put new cabinets in the hall. We have replaced windows.

We have replaced the patio doors behind me.

And we have done the gardens at the front and rear.

And what a transformation it is.

I have got to confess, I was worried about Chris's budget.

However, it looks like he has found

some interesting money-saving techniques.

I think initially we had doubts as to whether

we were going to need to replace the kitchen,

but when we went round, had a closer look at it,

it most definitely needed replacing.

So rather than buying a cheap, new one, we went for a quality,

reasonably priced, second-hand one.

And it's just as good as a new one.

You wouldn't know the difference.

# And you're just a brand-new second-hand

# No man no want fool

# You're just a brand-new second-hand. #

Tut-tut, Chris, we don't say second-hand nowadays.

Pre-loved is the jargon now.

Seriously though, it is

always worth keeping an eye out for bargains like this.

You can look on the internet, in your local paper or even sometimes

kitchen showrooms sell off display kitchens.

It might all take a little longer to track down the right thing,

but it can save you lots of cash.

More money-saving has been going on in the bathroom.

He saved the suite that was there and updated the decoration.

Chris hired contractors to carry out the skilled work

such as plastering and electrics.

But as a former painter and decorator,

did he get stuck in to the rest as he'd hoped?

The rest of the work was done by myself.

My son Aaron

did all the painting and decorating.

A fantastic job.

And my partner, Josephine,

she provided all the decoration

for the property after it had been renovated.

A good team effort.

And Josie has added to the appeal by dressing the house.

It helps some buyers see how the space can be used

when there is furniture in place.

What is Chris's favourite bit?

I am most pleased with the flooring that was laid, actually.

It is quite unusual and it is very, very glossy, the floor.

And I had never seen that before. But, yeah, I like that very much.

# She She, she, she, shine on

# She, she, she, shine on. #

They are impressive.

I mean, I would bet they are the shiniest floors in the world.

I suppose I can't confirm that.

Anyway, are you thinking what I am thinking? Two-grand budget?

Come on, Chris, you have been clever with the dosh, but...

No, no way.

The original budget we set ourselves was quite low

at just £2,000, and that

is because we believed that it was just decoration that was required.

We decided, though,

we would do much more than just decorate the property.

And we have now spent a total of around £5,000.

They may have spent a lot more and taking seven months rather

than the intended two, but it is still a pretty reasonable timescale.

I think the house looks all the better for the extra work.

But what do two local estate agents think?

I like what the gentleman has done.

It is compact.

It is easy to decorate.

Easy to fill with furniture and make it look lived in.

So all those convenient factors.

I think the standard of finish is very good,

although there are some jobs to be done yet.

And I think the neutral style is just right, spot on.

Having now spent a total of five grand on the renovation on top of

the £133,000 he spent at auction,

will there still be some profit for Chris?

Let's get those all-important figures.

I would say sale wise, £170,000.

And I would say rental wise, £850 per calendar month.

I would expect to achieve a sale price of £173,000

and a rental valuation of £750 per calendar month.

I think that is excellent.

That is pretty much in line with what we expected.

The rental value is excellent for this area, but we won't be renting

the property out, so it'll just be straight on the market for sale.

Chris isn't interested in the yield on his 138 grand investment,

which would be just over 7% on that top rental figure.

Instead, he will be aiming for that potential 35 grand pre-tax profit.

So things have gone pretty well for Chris on his first auction purchase.

And by the way, just in case you were in any doubt

about that floor thing...

This is actually the shiniest floor in the world. That is a fact.

Earlier in the show, I was in Littleover, in Derby,

where I met Dawn and John.

They had already built up a portfolio of rentals

including similar bungalows to this one they just purchased.

In fact, John went quite a way back with these bungalows.

Many years ago, I used to drive for a rock group.

The drummer lived in one of these.

And I remember collecting him one night, going into the house

and looking at it.

And thinking how much, how surprised I was at the amount of room in it.

And this property was certainly spacious.

But Dawn and John's £71,000 purchase had issues,

like it's non-standard construction,

a potential asbestos roof garage

and a few other oddities.

The big unknown at the moment is the floors.

There is some movement in the floors.

I suspect we could overboard them, but when we get the copies,

we will just see what is required.

Right. They are springy in certain places, aren't they?

They're a bit more than springy in certain places.

THEY LAUGH

The other big debate for the couple was over

whether or not to renovate the kitchen, which was tired

but still serviceable, as they intended to rent the property out.

So six months on, how is it looking?

Looking rental-ready, I'd say.

But what about those challenges with the floors and the garage roof?

We haven't had the problems which we have had with others.

We hadn't had problems we anticipated,

so the experience has been good.

The floors and the garage roof were absolute bonuses.

I didn't think we should escape costs on both items,

and we have done.

So that was a bonus for the place.

Yes, it turned out that the springiness in the floors was

caused by hatches that hadn't been braced after the central

heating had been put in.

And the garage roof? Well, thankfully, it wasn't

asbestos after all.

So what changes have been made?

-We started on the exterior by doing the soffits, didn't we?

-Yeah.

Gutterings were OK.

Checked the windows and made sure they were all right.

Did the garage roof and put plastic cladding all around the garage.

And a plastic door in there.

All the concrete work outside has been steam cleaned.

And in the premises, we ripped out all of the cabinets that

were in, replastered, redecorated,

retiled the kitchen, the bathroom.

-And of course, it was re-carpeted, naturally.

-Naturally, yeah.

That finishes it up.

And finished off nicely, in my opinion, Dawn.

What did they decide to do with the kitchen in the end?

We have replastered the kitchen and totally retiled it.

The fittings were fine, there were no problems with them at all.

We were pleased to find that once we had taken

the tiling from the kitchen floor,

the timber floor underneath was fine.

And we've put cushioned flooring on it as well.

So now the place is looking much improved.

And having dodged the dangers of structural work,

they must have saved a few bob.

I thought our repair bills

would be somewhere between £13,000 and £15,000.

But in fact, we have come out at 12.

The project took six months, a good bit over their four-month

timescale as their team were working on other properties for the couple.

But after such a good finish, they must be happy.

Well, I think we will tell you how happy we are after

we have had the valuation of the rental.

Bang on cue, John, it's two local estate agents.

Almost like we planned it, eh?

What do they think of the property

and the changes the couple have made?

The best selling points of this property are clearly the detached

garage and the off-road parking, cos it is quite difficult

to park round here.

Other items to note are

the standard of the finish on the interior. The only thing that

I would have liked to have seen is perhaps a new kitchen.

Everything else is way above the standard of the kitchen.

So it would have been nice to see something a little bit new

and sparkly in there.

The standard of finish is very good. New decor and carpets throughout.

Always makes a nice feel to have it neat and fresh and tidy.

Initial thoughts are very good.

The main selling points, really, would be the low-maintenance garden,

something that somebody needs to come into and do very little to.

John and Dawn have spent around £83,000 so far. They want to rent.

But let's see what the resale values might be.

Sales, I would recommend a sales valuation of around 90,000,

possibly £95,000.

These properties are particularly difficult to sell cos

of their non-standard construction. Taking that into consideration,

I would put this on the market at up to £80,000.

They are difficult to sell,

which is why I am reluctant to go any higher than

that on the sale price.

I wouldn't want to sell it for really less than 100,000.

And I didn't buy it for that purpose anyway.

But it is nice to know, at least it is on the right side.

Yes, the right side, John.

At that £95,000 valuation,

where there could be a £12,000 pre-tax profit.

But the £80,000 valuation would be...

Well, let's just call it the wrong side.

Proof that non-standard construction creates problems for sales

if you ever need it.

Just as well the couple want to rent.

I would estimate a rental valuation for this property to

be £525 per calendar month.

I would recommend a rental valuation of £525

per calendar month.

I think they are a little bit low.

They are probably right for the bungalows generally around here,

but bearing in mind that this has got off-road parking -

most of them haven't - and a garage,

and a conservatory, I think it will make a little bit more than that.

John thinks the valuations are low, but it would still give them

a yield of 7.5%, that is all good money for the retirement fund.

And that retirement fund started out when John was a rock star's roadie!

Any plans to get out of the property game

and back to the music business, John?

No, I've had to give it up. I think it is something to do with age.

THEY CHUCKLE

Property developing has its highs and it has its lows,

but more often than not, it is a rewarding process.

When all is said and done, it is always great to see the end result.

Yes, and we've got lots more to show you next time,

here on Homes Under The Hammer.

-See you then.

-Bye-bye.

-Bye.