Episode 47 Homes Under the Hammer

It's amazing how property developing can start just as a hobby

and can end up being a full-blown career.

Being your own boss brings with it loads of advantages

and it's great fun.

However, it can bring risks.

Yes. So, if you are thinking of dabbling, where do you start?

Why not buy under the hammer?

I know we say this a lot

but doing your research is the best way to avoid

unwelcome surprises, especially when you're bidding in an auction room.

So, did today's buyers follow our advice?

Let's see what they bought.

Today, it's the terrible twos.

Why has this two-bedroom semi in Ilkeston, Derbyshire,

got two front doors?

No idea.

This two-bed cottage in Margate, Kent, is filled to the brim.

Stuff everywhere, but not a bad kitchen.

It does have that, sort of, cottagey feel.

And this one-bed flat in Telford, Shropshire,

has too many stairs for some, including...

ex-professional footballers, like myself, that have got dodgy knees.

All of these properties have been sold at auction.

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

when they went under the hammer.

You bought it, madam. Well done.

Close to Derby and Nottingham, the market town of Ilkeston

used to have coalmining and ironworks at its heart.

In fact, right now, you're probably only a few hundred yards away

from a manhole cover made here and, like towns of its ilk,

Ilkeston's former council estates form a significant part

of its housing stock.

So, five minutes from the centre of Ilkeston,

is where I find myself.

What does £55,000 buy you around these parts?

Well, that was the guide price for this place.

It's a mid-terraced two-bedroom.

Let's have a look.

OK. So, what have we got?

A little entrance area here.

Front to back living room, although I have to say, first glance,

it doesn't look like it's very wide.

Hmm. Very strange.

Stairs up to your bedrooms there

and then through into your kitchen.

Surprisingly, the kitchen feels disproportionately big.

It's actually quite a nice space.

You've got a cupboard here... Oh! Well, it's not a cupboard.

Well, I didn't expect that.

It's another door. Another front door.

What was the design criteria here, do you think?

No idea.

One thing for sure, though,

I think that wall there needs to be taken down.

Obviously, get a structural engineer to check that it's not supporting.

Take that down, open the kitchen up even more

to create a really nice space.

But there is still this whole issue with the fact that...

Oh, I don't know... One, two, three, four,...

It must only be about four-and-a-half metres wide.

Wow!

Onwards and upwards.

I suppose you might say the kitchen's OK,

if you like a touch of the blues.

BLUES GUITAR

# You'd better come on in my kitchen

# Well, it's bound to be raining outdoors... #

Yeah!

Upstairs, the narrow width of the house is less noticeable.

So, upstairs, and two pretty decent-sized bedrooms,

a bathroom and loo that has been converted for disabled use

and, then, into this bedroom here

and...the only real big negative I've found so far with the property.

Look at this. On this wall.

Lots of signs of damp. Penetrating damp, obviously.

It doesn't take a rocket scientist to work out it's coming down.

It's a long way for it to come up.

And it's probably something to do with a few roof tiles

that have slipped. Maybe a gutter that's leaked.

What is a bit worrying is that it has actually come through

where there should be a cavity wall.

So, definitely, get in the loft, investigate that.

Get outside. Get somebody to check it out

and sort that out sooner rather than later.

# Sooner or later

# You're gonna have to stand up tall

# Sooner or later

# When your back's against that wall... #

The basic function of a cavity wall's air space

is to keep water and moisture away from the inner wall.

A porous outer wall

or, as I said, roof problems

are the most likely causes here.

But what the house lacks in damp-proofing,

it makes up for in the front door department.

It has a 100% increase in that category

but I am glad to report it's only got one back door.

So, out the back of the property, I wonder if we can

do anything about that feeling of slight...lack of width, basically.

I guess, you could contemplate some kind of an extension.

Next door certainly seems to be slightly deeper.

You are going to have potential issues

with the fact that there's a window there.

Next door haven't got anything going on.

I don't know if that's a starter for ten, or not.

But you have got a really nice surprise, which is this garden.

Look at that! It goes on for absolutely ages.

I'd like to see a slightly higher fence on either side

to make it a bit more private, but all in all, it's an added bonus.

I think, just think through about that whole extension issue,

whether or not it'd be financially and planning approval-wise possible.

We called in not just any local expert

but the auctioneer who sold the house.

He knows to use the left-hand front door.

I'm interested to hear what he thinks about the house

and that penetrating damp.

Well, we're standing in a lovely kitchen with 1980s tiling.

So the kitchen needs modernising.

The bathroom has already been done,

although it has become a wet room, effectively. It needs decorating.

The heating system would appear to be good.

The electrics, I think, are OK. It's double glazed,

although possibly not up-to-date specification.

There actually isn't a great deal to do.

A lot of it is superficial.

The only issue I'm aware of is some penetrating damp

in one of the bedrooms upstairs

and I think that's a guttering issue.

Hey! Ha-ha! I said it was probably guttering, didn't I?

What's the local market like?

Erm, the local market's quite buoyant.

There's always a demand for investment property.

So, this property is bound to appeal to somebody

who would buy it to rent it out.

That's encouraging. With the guide price of £55,000,

what would it be worth when modernised?

Ultimately, its value would be

something in the order of £80,000-£85,000.

So there could be room for a decent profit if you want to resell

and, given it's a good rental area, what could one expect there?

Again, once renovated, it would have a rental value

in the order of £475, £500 a calendar month.

In that sort of area.

So, pleasant location, pleasant little property.

Nice little project for someone.

Let's see who fancied taking it on when it went under the hammer.

Lot 18. Closer to home.

A two-bedroomed, PVC double glazing, gas centrally heated accommodation.

A very sensible guide price of 55-plus, designed to sell it.

Start me at 55. 55?

54? 52?

Bid me where you like. 52,000.

Thank you.

At £52,000? 53 in front of me. 53 is bid. 54 on the left.

55? 55, 56.

Once started, the bidding climbs rapidly.

We rejoin the action when we reach £67,000.

At £67,000, for the first time.

500.

67.5, 68.

68.

500. It's going to go. 69.

Is that it? £69,000. For the first time.

Second time. 69.5.

It's worth another shot.

He's at the end of his leash. 70,000. Well, he may not be.

70,000. 500, sir? Prove me wrong.

£70,000. 500.

At 70 and a half. Nothing more?

£70,500. Once...

twice...

third time.

Sold at 70 and half. Number 11, thank you.

And it was first time lucky at auction for couple Trevor and Marie.

I feel a tad responsible for their venture into property,

as they say they got their inspiration

from watching Homes Under The Hammer.

So, I'm glad to meet them at their first auction purchase

to find out their plans for their £70,500 house.

-Marie, Trevor, good to meet you both.

-Likewise.

-Good to meet you.

-Congratulations.

-Thank you.

-Tell me why you wanted to buy this house?

We decided that that the 2% we're getting just isn't good enough.

-Not enough.

-So we're going to try...

-Dip our toes in the water.

Dip our toes there. Yes. This'll be...

the first of many on our portfolio.

-Brilliant. Good.

-Hopefully.

-So, why this area?

-Are you local?

-Tamworth.

-OK.

-We come from Tamworth.

So, what tempted you to Ilkeston?

Erm...

I think the prices of the houses was cheaper here

than they were where we are. So...

And why this particular house?

-The least amount of work.

-For us to have to do, yeah.

And...er, this would be the one to start off with.

But, when we've got here today, we've realised

-there's just a little bit more work than we thought.

-Really?

-Yeah.

How come you missed it on first viewing?

-Oh...

-It's only a ten-minute window, wasn't it? Really.

-It just seemed a bit quick.

-So, what did you miss?

I missed the size of the garden.

It's quite good, isn't it?

-Yeah. It's too big.

-Oh.

-There's a few damp issues.

-Quite a bit of damp.

We did see the damp, but we didn't realise there was...

Probably got to be replastered, so we'll be going down the line of...

I've got to go on a skimming course, I expect, to do that.

-Oh, right.

-Yeah.

-Yes.

Or we get a plasterer in, one or the other.

Probably get a plasterer in,

-because Marie actually wants it done yesterday, not today.

-Aah!

-Should be finished now. Is that right?

-It is.

-Yes.

Right. Wow.

So, apart from those small things you didn't see,

-are you still quite happy?

-Yes.

-We're excited about it, yeah, yeah.

-Yes, apprehensive but excited, as well.

-Yeah.

The auction must have been good fun.

She was there to control me and she was going, "Go on. More, more, more."

-Are you happy with what you paid?

-Yeah, yeah. I think so.

-Just about.

-I don't think we'd have gone any more, would we?

-No, that was the last.

-That was the last bid.

So, tell me, what you are planning to do to it, then?

-We will have an electrician coming, won't we?

-Yes. Checks.

-Check all the wiring. Um...

-The gas. For the gas.

-The gas.

-Then have a new bathroom, new kitchen.

-Yeah.

Just plaster and tidy up, really.

We're going to have a look at the kitchen.

Thinking, maybe, knocking that wall out, making the kitchen a bit bigger.

We're going to have to have a structural engineer in,

as we've seen you say on the TV before.

Because it looks like it's going to fall down.

If were going to knock it out.

Check it first, then knock it down.

Thinking of doing that. Hoping we can make that a bit bigger.

Get rid of the rail out of the front. Tidy the gardens up.

Hopefully, be able to rent it out when it's finished.

-That's the plan, is it? You've bought it to rent.

-Yeah.

Well, Marie and Trevor seem to be giving all the right answers here.

Their plan to rent ties in with what the auctioneer said.

Trevor is approaching retirement,

so he's hoping to do a lot of the manual work himself,

but they will get in specialists when it comes to plumbing,

electrics and knocking down walls, but all that will come at a cost.

So, what's the budget for the work?

-We say about five.

-OK.

-Pounds.

If only. New kitchen, new bathroom. Plumbing work, skimming.

-Mm-hm.

-Electrics, if it needs it. Five grand, could be tight.

Yes, going to be tight, but we are going to do it. We will do it.

Who's going to do the work?

I'm going to do some of the work, obviously.

You know, I will mainly be taking the wallpaper off.

And Marie will be mainly moving the heavy stuff out.

THEY LAUGH

-Because she is very well built.

-Ah, well, that's useful.

A bit of a workhorse. Excellent.

-Get the whip out.

-OK. And what's the timescale?

Well, I was hoping something between six to eight weeks.

-Marie was more going eight to 12 weeks.

-I say 12 weeks.

Listen, congratulations.

-Thank you.

-Good luck with it. Nice to meet you.

-Thank you.

-Thank you.

-We've inspired you along the way.

-Thank you.

-Thank you.

It's always nice when Homes Under The Hammer inspires people

to enter the world of property, and that's certainly what we seem to

have done with Trevor and Marie, and I think they've chosen well here.

A few unexpected things they're going to have to do

to sort the place out,

but really, I don't think it's going to be too much of a challenge.

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

Where might you find an art gallery celebrating landscape artist

Turner's work,

the UK's oldest rollercoaster ride and original pleasure park,

and other seaside attractions?

Yes, it's Margate, on the Kent coast.

Just a leisurely five-minute walk from the beachfront

is this leafy little hideaway.

Now, one of the big bonuses is that you've got a cul-de-sac here.

And you're not going to have loads of traffic roaring past.

So what have we got? Well, it's a mid-terrace house up for auction.

It's in need of modernisation and improvement. You can see that.

And the guide price, £40,000-£50,000.

Now, that suggests that there may be a fair amount of work

needing to be done inside. Let's go and have a wander about.

Oh, OK, house is slightly full up with lots of stuff.

Yes, bags everywhere, so whoever takes this on is really going to need

to think about getting all the stuff out so you can see beyond it all.

You've got a good size lounge through there.

The kitchen, again, stuff everywhere,

but not a bad kitchen, it does have that sort of cottagey feel.

There is a downstairs bathroom through there.

So, with a lot of reorganising, tidying, cleaning,

polishing and skips, could have quite a nice little cottage here.

Well, I know they play bingo at the seaside,

but this place takes the term "full house" to a whole new level.

I keep telling myself not to look at all the stuff

but to see through it into the space beyond.

That's what makes the difference between a developer who can see

the potential and a frightened novice.

So I'm going to stay positive with this property,

I'm looking through the disrepair and the peeling wallpaper, and

I am looking at this really lovely little banister and staircase.

I mean, it is really cottagey.

How nice is that? I can imagine, painted and sanded back,

this will be a really nice feature.

But something I've got to show you. Look! Look at that jungle!

That needs to be sorted out, quickly.

So upstairs, we've got much of the similar sort of vein

of what's going on downstairs, lots of stuff everywhere.

But a good size room here, another one to the front of the property.

And something I can really, really notice.

There's lots of bubbling and peeling wallpaper.

You can see right through to the rafters, daylight is coming in.

I think there's been some water damage

to the front of the property through there.

So whoever takes this on really should have a good old look,

up there in the roof.

We asked a local estate agent to come and look past

all the negatives in this house and give us his assessment.

My view on the property is it needs quite a lot of work.

It's going to be worth the while, though,

because it is a nice little house in a reasonable area.

Once it is renovated,

I'm sure it will provide a very nice little home for someone.

Given a full renovation, what's the demand for a property like this?

Within the area, there's very good demand

for this type of property, both as a purchase,

as a buy-to-let investment, or for first-time buyers.

Also for rental, there's very high demand.

High demand usually translates into good valuations,

and is that the case with this house, guided at £40,000 to 50,000?

If the property were fully refurbished to a good standard,

I think it could sell for about £120,000,

or it could achieve in the region of £600-£625

per calendar month rental.

Well, the property inside leaves a lot to be desired.

A lot of skips and a lot of clearing out needs to be done.

I wouldn't blame you if you wanted to spend most of your time

down at the beach looking at the skies, rather than in there,

but with some imagination, a splash of paint and some budgets,

I could see this place being turned into a masterpiece.

So who wanted to jump on the rollercoaster of redevelopment

when it went under the hammer?

Lot 3 we go to now. In Margate.

It's a mid-terrace house for improvement.

And it really is here to be sold.

It's got a guide of 40 to 50. Do I see £50,000?

I've got a few telephone bids on this one, I think.

Can I see £50,000 to start me? £50,000, I'm on the way.

60,000. 55 I will take. 55 do I see?

55, and 60, Ben. And five.

65. 65 and 70.

The packed auction house ensures that the guide price

of 40,000 to 50,000 is soon left behind.

We rejoin the bidding at £84,000.

First time at £84,000.

Second. Third.

85. Oh, on the internet.

I thought you were going to pull my leg then.

85, 86. It's on the internet.

With internet and telephone bids,

it's difficult to keep up with the action.

We rejoin again as the internet bidder takes it up to £89,000.

89. And a half.

89,500. And 90.

If not, at 89,500 for the first time.

89,500 for the second time. Third and final time.

Have they had enough time to come through if they wanted to?

At 89,500, all done.

Now, we didn't catch the bidder on the day,

but it was Michael, who's been on the show before.

He's an estate agent and developer based in London.

Last time, he bought this three-bedroom terrace in 2013,

also in Margate.

And as you can see,

Michael is no stranger to properties needing more than a lick of paint.

This time, I arranged to meet him at his latest purchase,

that cost £89,500.

Lovely to see you again.

-Lovely to see you again, yes.

-Congratulations.

-Thank you.

-Tell me what you've been doing recently.

-I've been quite busy.

We like to concentrate on social housing, renovating,

upgrading, enhancing. But we are fans of Margate.

We think we can really make it swing,

and we want aspirational people to move in here.

And how do you go about finding those people that are aspirational?

Well, fortunately, because we've been working here

for the last ten, 12 years,

there are people asking us for properties all the time.

And it is very sad to, you know, like with Oliver Twist,

saying no when they're coming up asking for something.

Michael is of course developing and letting property as a business,

but he's keen to create decent housing that benefits

the area as a whole and makes it a reasonable place to live.

The most important thing, though, is to have settled communities,

improved accommodation and a situation where people feel

that they can stay for one to three years.

This is very important, if kids are going to a school,

that they don't have a disrupted education.

And for people, in terms of employment.

Employment has changed a great deal.

Although there's less opportunities than there were

in the sort of area, there's now many more chances for people

to work at home with broadband internet IT,

and this is the sort of thing we'd like.

OK. Now, that all moves me on quite nicely to talk about

what you're going to be doing here.

For starters, I know you'll be getting a few skips outside the door.

This here is going to give the skip industry of Margate a field day.

-Just a bit.

-There's so much ephemera.

But there's a lot of stuff here you could maybe give to somebody else.

There's loads of kids' books around.

It needs to be, you know, gone, out of the door

so you can see what the house is like.

We are going to be careful in any personal effects,

which we'll try to pass on to whoever used to live here.

And anything that is of any innate value, we wouldn't want

to throw away because we live in a cosmetic society

where there's too many things thrown away, so let's make use of them.

# Oh, yeah

# I got the empty tidy bag blues... #

Yep, I have to agree, it's a utopia of ephemera. Upstairs...

# Oh, yeah

# I got the empty tidy bag blues... #

..and downstairs as well actually.

# Well, I've been sleeping on the job

# And I wish I had a better excuse. #

So Michael will be recycling or upcycling as part of this project,

but he's also aware of a very interesting plus with this house.

I think the nicest thing about this is actually the title deeds,

it is a freehold. So essentially we can do what we want.

Quite a lot of property, certainly in London and the south-east,

is leasehold, and it is very, very tricky.

There are managing agents, there are freeholders.

Here, you're in control of your own destiny

and you can make it into a really nice cottage home.

My concerns are, you know,

you don't know to what extent the damage of the roof.

You've got problems outside, you can't even get into the garden.

I mean, are you worried the more you unpick,

the more problematic it may be?

I'm not a doctor, but I sometimes need a second opinion.

I'll be getting my builders to have another look at it

because there are issues with the roof,

and I know there is a downpipe that needs attention.

So, yes, there will be things, but that's life, isn't it?

-# That's life

-That's life

# That's what all the people say... #

As well as Michael getting builders in, I think he's going

to have to get landscape gardeners in too.

Tackling this lot isn't going to be a walk in the park.

More like a rumble in the jungle, and Michael is planning on

doing this house and the garden in just six weeks.

Good luck with that one.

What sort of money do you think you may have to sink into this?

What budget have you got?

I know it's the unknown and the unseen at this stage,

-but what do you think?

-We are looking at about 12,000 to 15,000.

-Oh!

-But, as I've said, there could be things.

We'd have, of course, a new bathroom, a new kitchen.

With the bathroom, we're hoping to put some nice marble tiles down.

Not exactly a wow factor, but something a little bit different.

Otherwise it'll be a reasonable finish, of an average standard,

but safe, secure and hopefully pleasant.

And you really think you can get it all in on budget for around 15,000?

Never say never, but one always...

Hope springs eternal in the human race.

I think there could be things that we find, such as details about

the roof, that could cause problems, but let's hope for the best.

What about things like windows?

I'm looking there and I'm feeling that that may need replacing.

A lot of the frames are decayed.

I mean, how far are you going to go? The boiler, for example.

There are lots of things around here that may need updating.

Well, the government is changing regulations

so that all private rented accommodation quite soon

will have to pass a particular thermal insulation standard.

We will make sure this passes it now, before the regulation changes,

and if that means changing the windows, so be it.

And of course if the boiler is no good, we'd have to change that anyway.

Now, you've mentioned marble tiles. Is that the aspirational look and feel you want for the property?

Well, the tenants here won't be living in Marble Arch.

It would be particularly nice if they have some nice tiles in the bathroom.

It's only a very small bathroom,

and the cost is not going to be enormous.

We can't give them gold, but marble, I think, would be a nice substitute.

There's a few bits and pieces. Nice doors, you've got little fireplaces.

There is a certain amount of character, not too much,

it doesn't hit you between the eyes, but there's something that's

-quite cottagey about this place, isn't there?

-I think it's cosy.

You know, some people use that as a euphemism for small.

But I think this is a nice, traditional family home,

where you can actually enjoy the ambience and the pleasure,

but not in its current condition certainly.

When it is redone, it will be lovely.

Oh, I look forward to seeing it clear, I really do.

Lovely to see you again, Michael.

Thank you very much indeed. Thank you.

It may seem like this is a standard two-up, two-down property,

but Michael plans to turn this into a desirable family home,

but that budget of £12,000-£15,000 is low,

considering there could be a lot more to uncover in there.

Join me later in the programme

and you can find out how Michael gets on.

Still to come, in Telford, I show how to make

this one-bed flat's kitchen fit for gourmet dining.

Bit of elbow grease, tidy it up, pop a cooker in.

And Michael's taking the gourmet chef approach himself

when it comes to managing his budget.

You can't sort of make an omelette without cracking eggs.

Earlier, I was in the market town of Ilkeston, Derbyshire,

where I took a look around this former local authority

two-bedroom, semi-detached house,

which was sold at auction for £70,500.

And there was a surprise in the kitchen.

Got a cupboard here.

-Oh, it's not a cupboard.

-HE LAUGHS

Well, I didn't expect that.

It's another door. Another front door.

What was the design criteria here, do you think?

No idea.

Yes, at a time when many of the houses we featured on

Homes Under The Hammer were having bifold doors fitted at the rear,

the previous owners at this house

had simply made do with "bi-front" doors.

# It takes two, baby

# It takes two, baby... #

The duo taking on the challenge as the proud new owners of their first

property development were husband and wife team, Trevor and Marie.

Tell me what you are planning to do to it, then?

Have a new bathroom, new kitchen, and just plaster it.

Thinking about knocking that wall out and make the kitchen bigger.

We are going to have to have a structural engineer in, as we've seen you say.

-Check it first, then knock it down.

-Yeah. We are going to do that.

Tidy the garden up. Hopefully be able to rent it out...

-And that's the plan, is it? You bought it to rent?

-Yes.

-Yeah.

Marie and Trevor felt 12 weeks would see the house refurbished,

but we're back five months later to see their progress.

The kitchen is a much more usable and bright space, with new flooring.

In place of front door number two,

there's a window above a space for a small table.

Trevor and Marie are hoping that all the hard work

has given the house a clear message

to send out to all potential renters in the area.

# Come and get it if you really want it

# Come and get it if you really need it

# Come and get it if you really want it

# Come and get it if you really need it. #

Upstairs, the bathroom was more of a wet room

with tired fittings and tiling.

Now, there's a white suite with crisp tiling

and complementary flooring.

# Come and get it if you really want it

# Come and get it if you really need it

# Come and get it if you really want it... #

There's new flooring throughout,

and the damp problem in the bedroom has been cured.

The other bedroom, like the majority of rooms in the house,

has been replastered, and finally the lounge looks different again

after a clear-out and a new paint scheme.

One delay in the workflow was due to

their builder sustaining a back injury,

but their roofer did find a cure for their leaking guttering.

Unfortunately, what we had to do was some...

Actually lengthen the tiles on the roof, over the old guttering,

The concrete guttering.

New fascias, new plastic gutterings put down, new downpipes

and everything to make both the front and back good.

And that has stopped the damp.

Originally, Trevor felt the garden was too big,

so how did he get on with that?

We've dug the garden and strimmed it all back to make it look

presentable for whoever comes in and rents the place from us.

We think it looks good, we've had pebbles all put down where the concrete was all cracking.

We've had all that removed. And we've had sleepers all put in.

All the garden rubbish was bagged and then taken

through the house by Trevor, who did all the labouring.

His retirement date was delayed, which also contributed to

the delay in the schedule, but sometimes his help turned out to be

more of a hindrance, especially when he tidied up what he thought

were old wires after the electrician had fitted the new shower units.

Unfortunately, after he had fitted it all,

I cut several wires, and we had to have him back to redo the wiring.

-I'd actually...

-Cut.

-..cut and spoiled. So...

that put the cost up a bit as well. I'm pleased with everything.

Hopefully, who owns it will.

Speaking of costs, the refurbishment budget was £5,000.

-How's that looking?

-£9,640 exactly.

-Exactly.

Even though we might be spending a few more pennies.

The main overspends have been on the new guttering,

the higher-end kitchen and the replastering.

Trevor and Marie intend to rent,

so we called along two local estate agents to find out the valuations.

They paid £70,500 at auction and nearly another £10,000

on refurbishment, so anything above £80,500 would be good news.

If I was to place this property on the open market,

I'd recommend an asking price of £94,950.

In terms of sale, really ought to be asking

somewhere between £95,000 and £100,000 for the house.

-I'm amazed.

-Yes, me too. Shocked.

-Yeah.

-A nice shock.

Really, really good.

-If we get anywhere near 94,000, we'll be over the moon.

-Yes.

They're in shock. £94,950 was the lower valuation,

which looks like a potential profit of £14,000 upwards.

This could be a game changer.

Trevor and Marie originally wanted this to rent

as a way of improving on the 2% interest or so

they were getting at the bank, so rental values are key here.

I'd recommend a figure of £425 per calendar month.

There'd be a good market between £475 and £500 per calendar month.

-Well, the first rental value I think was...

-A little bit low.

A bit lower, yeah.

The other one I think is probably dead on what was expected.

Taking the higher figure,

that calculates as a yield on their investment of around 7.5%,

so they've achieved their goal. But which path will they be taking?

-We're going to put it on the market, see what we can do...

-Test it.

Test the market, as Mary says, and hopefully we can sell it,

have a little bit of a rest and then, believe it or not,

buy another one and have another crack.

Great. But maybe don't be as eager

with the wire cutters next time, eh, Trevor?

Telford in Shropshire is a new town

named after the Scottish civil engineer, Thomas Telford.

Close by is a settlement, Ironbridge, credited with heralding the dawn

of the Industrial Revolution.

# But you won't fool

# The children of the revolution

# No, no, no... #

But I'm here to view something a bit more up to date.

Not too far from the centre of Telford

is this 1970s housing development and the property I'm here to see.

It's a one-bed apartment in this quite smart block

and is guided at £33,000.

Formerly a local authority development, many of these flats

are now owned by housing associations or private landlords.

So, we're up on the second floor.

So it's not ideal for elderly folk or ex-professional footballers

like myself that have got dodgy knees, but good for security.

What have we got?

Bathroom just here. Needs a lick of paint and new flooring

but the suite itself you'd get away with keeping.

We have the bedroom just there.

That's a good-sized bedroom for a one-bed flat.

Needs a lick of paint again and some flooring...

and into the kitchen,

which again is a decent-sized kitchen.

If you're looking to rent it, I think you'd get away with

keeping how it looks at the moment.

A bit of elbow grease, tidy it up, pop a cooker in just there.

If you're looking to sell, you may have to spend

a little bit more money, put a brand-new kitchen in altogether,

but it's worth doing a bit of research.

Find out how much properties like this are selling in this area.

But there's a boiler there, so there is central heating in.

There's double glazing, as well.

Lick of paint and I think you'll be all right.

Let's check out the lounge.

So we're through into the lounge. Spacious again.

I do like the way this flat is proportioned.

For me, definitely a rental property.

It's a one-bed.

Normally you have a high turnover of tenants.

Families don't tend to rent out one-bedroom properties,

so in between tenants you tend to have a lot of maintenance.

So look for things that are easily maintained,

like this laminate flooring.

And if you are looking to replace anything in here,

I'd tend to recommend you didn't spend top dollar.

If you're thinking of buying to let, you have to factor in

the turnover of tenants, which means frequent painting and refreshing.

You've also got to consider any empty periods.

On top of that, you do have to think about the shared cost

around the fabric of the building and who looks after it,

otherwise, things like flat roofs can be a thorn in your side.

I've come out the back.

I just want to have a look up at that roof,

see if it's had any recent maintenance done to it,

and from what I can see, it has, which is great news.

And as I look around as well I can see that neighbouring buildings

have had the same work done, as well.

Cos costs like that can fall on the owner's shoulders

and can set you back a few quid.

In this case, it's thumbs up.

We called in a local estate agent to give the flat the once-over

and share his opinions and tell us what it's worth.

Remember, I said it really just needed a lick of paint?

I wonder if he'll agree.

# Here in my deep purple dream... #

There's not an awful lot to do to the property, really.

Purple walls and black walls don't really suit most kitchens

these days, so really it's just decoration.

Floor coverings pretty much to most of the rooms might be needed

but the living room floor I would leave as it is.

It's laminate flooring, so that's in pretty good order.

But it's double-glazed, gas-fired central heating,

pretty good for a house.

So, a quick spruce-up of the walls, floor coverings

and a few kitchen appliances if it's going to be a rental

and it should be good to go.

What would he say the values are?

Once the works have been carried out to the property

I would suggest this goes on the open market for £50,000.

And if the new owner decided to let the property out,

I would be suggesting to them a rental income

of around £400 per calendar month.

I do like this flat.

I think it's well-proportioned and spacious,

and I don't think it would take much to get it back up to scratch.

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

Lot 46. Back to Telford.

Let's say 30 to get it going.

28 then. Can we get it going at 28?

28 bid, thank you. At £28,000.

Can we say 30 now? The bid's at £28,000. Looking for 30. At 28.

30 bid, thank you. At £30,000. 32?

1, you're saying, 31.

32, 33,

34.

At £34,000 then to my right.

At £34,000. 35 anywhere else?

35. At 35 left. 36?

No. At £35,000, lady's bid standing right. 36 anywhere else?

If not, I'm selling it at £35,000 for the first time.

£35,000 for the second time.

Third and final time at £35,000...

-GAVEL BANGS

-You've bought it, madam, well done.

The successful purchasers with their £35,000 bid were Helen and Nick.

They live in the Telford area

and already have one rental property in their portfolio.

I met up with them to find out their plans for this one.

-Helen, nice to meet you.

-Hello, and you.

-Nick, nice to meet you.

-Hi.

-Congratulations, by the way.

-Thank you.

-Thank you.

Tell me, why this particular flat?

The price, I guess.

And it's going to be easy to do up and we're going to rent it out.

This area is pretty good.

We live in Telford, so anywhere in Telford's good, really.

Did you do a bit of research

in where's best to find a property, Nick?

We looked to find something that was reasonably cheap

that we felt we could do up and perhaps make some money off.

And from what I can see, I think you've chosen a good one,

-haven't you?

-Yeah.

-Yeah, there's not much to do here, is there?

First and foremost, tell me what actually got you into property

and what were you doing before property?

Well, I was a manager for a big warehouse

and Helen was a chef in the canteen.

Yeah, we worked in the same place and the warehouse shut,

-so we were both made redundant 15 years ago now.

-Really?

-We got married about five years ago.

-Good on you.

-Captured him, didn't you, sharpish?

-Yeah, yeah.

-Got a good catch there.

-Found a good 'un. Yeah.

And when did the property bug get you and who did it get first?

Oh, I don't know.

We've done up our own houses in the past

and we've moved from house to house for various reasons

and we've made good profits in that sort of thing,

and I think that's probably where the bug came from.

-It's a result of it, yeah.

-Yeah.

And we thought as soon as we were made redundant

it gave us an opportunity to move to this area, where it's a bit cheaper

than where we were, and do it for a living.

Where were you? Where were you living before?

In Surrey or Berkshire and it's very busy down there.

We wanted to move to live somewhere quieter as well, so... Yeah.

-We came up here, we found Telford's quite nice, haven't we?

-Yeah.

Bought a place for ourselves and one to do up,

and this is number two.

Having had the experience of doing up their first property

and renting it out, Nick and Helen were hungry for more,

and so they satisfied their appetite here at Brookside Development,

so-called because it was built beside a brook.

A six million pound regeneration scheme started here in 2014,

which should be good news for property prices.

So, what are you going to do?

We were going to change the kitchen and make the bathroom nice

and do it all, but we've recently had one of the neighbours

enquire about the place. Her son is interested in it.

-Well, that's handy, isn't it?

-It is, yeah.

-Yeah.

-That might keep your budget down a bit, as well.

-Well, yeah.

-Well, yeah.

We're not going to do as much as we were before.

We're going to make it look nice and liveable for him.

Yeah, he seems quite happy with it as it is, really,

-but we want to make it nice for him.

-Yeah, of course.

And how much are you hoping to get away with spending on your budget?

Well, we were going to spend up to about 5,000

but possibly only one or two thousand now.

-It's generous, 5,000, isn't it, from what I can see?

-Yeah.

What's that money going to be spent on?

Where's most of it going to go, in your opinion?

Well, if we were to do the whole job, the kitchen, really,

and the bathroom.

So what will you do if he does take the property?

Just a lick of paint really

and some flooring down in the kitchen

and the hallway and the bedroom, and that's pretty much it, actually.

A simple turnaround, this one. This is going to be a simple turnaround.

Obviously we'll get the boiler checked and the electrics

and everything like that but, yeah, apart from that it's just painting.

It's just a bit of elbow grease, isn't it?

-It's a bit of time, isn't it?

-Yeah.

-Yeah.

-That's all it is.

-If there's any tiling, Helen does that.

-Yeah.

-Is that right?

-Yeah.

-She loves tiling.

-I love tiling, it's great.

In the nicest possible way, Nick,

I'll take your number cos I need some tiling done myself.

-If that's all right with you?

-Yeah, I love it.

-If you don't mind travelling?

-Yeah.

# I spent a night on the tiles... #

Joking aside, I think the tiling in here could be vastly improved.

I'm not keen on the black window reveals,

which I think would be better tiled

and the bathroom could do with more than one row of tiles

around the bath.

If it were to be fully tiled, you'd get a shower above the bath, too.

How long are you hoping this work is going to take?

It's not a lot to do, is it?

-Two weeks to a month maybe.

-Four weeks, I think, yeah.

What are you hoping to get per calendar month?

He's happy to pay us about £400 a month, I think, isn't it?

That's right, yeah.

Is that the normal going rate? Have you done research round on rentals?

-Yeah, that's about what it is. 375 - 400 normally, yeah.

-Yeah.

And have you checked on any additional fees

as well as buying the place?

Well, there's a management fee, which is about 25 quid a month,

something like that,

and I think just the nominal ground rent fee per year,

and that's it, really.

-Not too big then?

-No, no.

-Should be all right.

-Not going to smash your budget?

-No.

-I don't think so, no.

-I like that. I like that. Good luck.

-Thanks very much.

-I wish you all the best.

-Thanks very much.

-Good luck. Cheers.

-Cheers.

This is only Helen and Nick's second venture

and it looks like they've landed on their feet.

They could have a tenant who is willing and waiting

to take on this flat in more or less the condition it's in at present,

which would save Helen and Nick time and money.

But will it be that simple? You can find out later on in the programme.

So, we've seen the outcome for the first of today's buyers.

But how did the other two get on?

Mm. Now, time has passed.

Do they reap their rewards? Let's find out.

Back now to the seaside, and Margate on the Kent coast,

where we met Michael, a property owner and landlord

who bought this two-bedroom mid-terrace for £89,500.

From the outside, this property had some cottagey charm.

But that charm soon wore off when you got to the back garden.

It was a jungle out there and it was a jumble inside.

For starters, I know you'll be getting a few skips

outside the door.

This here is going to give the skip industry of Margate a field day.

-SHE LAUGHS

-Just a bit.

Ever the optimist, Michael's hoping to empty and renovate the house,

and tidy the garden, and fix the roof and the windows

all in just six weeks,

all for a conservative figure.

And you really think you can get it all in on budget for around 15,000?

Never say never.

There could be things that we find, such as details about the roof,

that could cause problems but let's hope for the best.

We're back 14 weeks later and from the outside, things are looking up.

Inside the front door...

Well, it used to look like this.

Now, neutral shades surround the banister

and I do like a big mirror in the hall.

It looks like someone has already taken a shine to this house.

# Yeah, I'm ready for the good life!

# Hey! #

The reception room was, well, a bit unwelcoming.

Now, it's cosy with a new contemporary fireplace

and hard-wearing laminate floor.

# Ooh, yeah!

# I'm ready for the good life... #

The kitchen has undergone one of the most dramatic transformations.

New kitchen units, appliances

and a new boiler all make it a functioning kitchen now.

# I'm ready for the good life.

# Ah, ah, ah, ah, ah

# Ah, ah, ah, ah

# I'm ready for the good life... #

The old bathroom was very tired and tatty.

Now a new, clean, white suite with marble-effect floor tiles,

slightly more subdued than the pink predecessors,

make the room much fresher and cleaner.

Next is the front bedroom's turn.

All of the rooms look so much bigger now they've been cleaned out

and I'm glad to see the feature fireplace has been restored,

giving a little bit of character.

And a similar story in the smaller of the two bedrooms.

# Let me hear you say yeah

-# Yeah!

-Yeah!

-Yeah!

# Yeaaaah!

# Ah, ah, ah, ah, ah

# Ah, ah, ah, ah

# I'm ready for the good life! #

And what of the rear jungle? Sorry, I meant garden.

I bet Margate's skip industry hung out the bunting when it was cleared.

The garden was cluttered full of junk and rubbish and debris,

and it took us about four skips to get rid of it.

And then we put these nice pebbles down

and it now exposes a lovely stone wall and there's a great tree here,

so it's a nice place for there to be a barbecue. It's really lovely.

As well as the garden, other major costs were the roof repairs

and replacing the windows.

So, how did the £10,000 - £15,000 budget pare up?

In the end, it went up from 15 to 24,

so we did go above budget

but you can't make an omelette without cracking eggs

and ultimately you're doing this for the future.

Clearing the personal effects

and having non-standard size window frames

meant a delay of three weeks on top of the targeted six weeks.

Once we started, we essentially had to gut the place,

replaster it, refurbish it, new kitchen, new bathroom

and redecorate it,

and clear the junk in the garden, which was a lot.

What about all the clutter in the house?

We did make arrangements for someone who knew the previous occupants

to try and come and collect any personal effects

but the remaining stuff, we sold for a charity and raised £174,

which was nice because it's silly.

We don't want to get rid of kid's toys and so on

if someone can use them, so that was a nice gesture.

The rest of the stuff just had to be thrown away.

We called in two local estate agents to give us their thoughts

and valuations on the property.

Being local, they should have a good knowledge of the area,

the market, and the pros and cons of the property.

The kitchen and the bathroom, they've done a good job

on the refurbishment there.

It appeals to the market that they're obviously looking for.

Very clean and tidy again. Quite impressed with that, actually.

I think, with this type of property, there's not an awful lot

that you could have done differently.

I think the layout is very good, and I also think

there's plenty of space which has been made the most of.

Michael paid £89,500 at auction

and then a further £24,000 refurbishing,

taking his total spend to £113,500.

What is its market value?

I think on the sales market this property would achieve

between £120,000 and £125,000.

I think for this type of two-bedroom property

you're going to be looking at around about £125,000.

That could mean a potential pre-tax profit of £11,500,

but this was always for rental and as you can see from the furnishings,

Michael's already got tenants.

We immediately found a family who wanted to live here.

It was a situation where they were living in overcrowded circumstances.

They're quite aspirational and will contribute to the economy

but this is now great for them and it's really looking super.

What do the agents think the property should rent for?

Rental-wise for this property I would be expecting to achieve

round about £650 - £700 per calendar month.

On the current market I would suspect that this would achieve

between £600 and £625 per calendar month.

So, what did Michael agree with his new tenants?

That sounds about right.

I think we've agreed 650 a month, so that's excellent.

That's really good.

At £650 per calendar month, Michael is getting a yield of nearly 7%.

So, would he do it all again?

I'd want to repeat this if possible in the future.

It's really good to help regenerate housing stock,

make places habitable and then house families.

Back now to Telford in Shropshire where I looked at

this former local authority one-bed flat

and I was grumbling before I knew it.

So we're up on the second floor, so it's not ideal for elderly folk

or ex-professional footballers like myself that have got dodgy knees.

# I can't stand up

# For falling down... #

Seriously though, if you had a problem with that,

there was very little else to take issue with.

OK, it needed a good redecoration, but with gas central heating,

great room proportions and a guide of £33,000,

I thought this was a good investment.

And husband and wife team Nick and Helen obviously agreed with me.

They bought the flat for £35,000.

They are full-time developers

although this is only their second property.

Any work needed doing, they were going to get stuck in themselves.

-If there's any tiling, Helen does that.

-Yeah, I like that.

-Is that right?

-She loves tiling.

-Yeah, I love tiling.

-It's great.

In the nicest possible way, Nick,

-I'll take your number cos I need some tiling done myself.

-Yeah, I love it.

-If that's all right with you? If you don't mind travelling.

-I love it.

# Call on me

# Call on me

# Call on me

# Call on me... #

What can I say, viewers? Perks of the job.

Nick and Helen hoped to spend just £1,000 - £2,000

and turn it around in four weeks.

They already have someone interested in renting,

so things were looking up.

# I'm the same boy I used to be. #

Things can change quickly in property though.

A month has passed and we've returned.

Will everything still be on track?

# A new sensation

# New sensation

# Hey

# A new sensation... #

I didn't think this flat needed much work, but Nick and Helen

have managed to give this place a new lease of life.

So what have they done?

We've redecorated,

put flooring in three of the rooms,

aside from the living room.

We were planning to leave most of the units here

and just replace the doors and spruce the kitchen up a bit,

but we decided that once we started taking things down,

we wanted to make a better job of it,

so we changed the units completely.

We had the boiler checked.

And put in a new washing machine and cooker, as well.

And the kitchen looks much improved.

But hasn't something else changed

that you're not telling us about, Helen?

We've re-grouted some of the tiles that were here

and put some extra ones up.

Yes, Helen indulged in her favourite part of DIY - the tiling.

And, to be fair, I think she's done a great job.

The kitchen looks so much better for it.

She didn't just stop there though.

In the bathroom... Retiled, put new flooring down,

just cleaned everything, really, and repainted, really.

Oh, we put new taps on, with a shower attachment, as well.

# Don't stop me now

# I'm having such a good time

# I'm having a ball... #

There's no stopping her,

and thanks to the new tiles, they can fit a shower above the bath.

Even better.

Nick and Helen had a tenant interested

before they even began this development.

But has he seen the fruits of their labour?

Yeah, our proposed tenant came and saw the property

just two days ago and he loved it.

So he's going to be moving in with the rent we were asking for.

I don't blame him.

I think this is a great flat with landlords that clearly care

about their properties.

Originally, they were going to spend up to £5,000

and completely redecorate,

including replacing the kitchen and the bathroom.

When the potential tenant liked the flat as it was,

they revised that down to £2,000.

What have they ended up spending?

Excluding all the fees and expenses, we spent about £2,200.

-Most of the money, I guess, went on the kitchen.

-Yeah.

I don't think that's bad at all

but what do two local property experts think?

We've asked them along to get their opinions.

This is the second time that I've been to this particular property.

The work carried out to the property I would say is a very good standard

for this property type.

Nice to see a nice, new, fresh kitchen in the property

and the rest of the decoration is about right

for sale and for letting.

The selling point of the property is definitely the new kitchen

and the fact that it's very neutral living throughout.

For a first-time buyer and investor, it's a perfect opportunity.

At the moment, there is quite a lot currently for sale and rent

in the local area, so at least doing the work inside

will hopefully have the advantage over the other competition.

Having bought the property for £35,000

and spent £2,200 on development, what could the flat be worth?

If this was to go on the open market today for sale purposes,

I would expect this to achieve around about £50,000.

If the vendor was to put this property on the open market today,

I believe it would achieve in the region of £40,000 - £45,000.

If this was to go on the rental market today,

I would suggest achieving around about £400 per calendar month.

If the vendor was to put this property on the market for rent,

I believe it would achieve in the region of £375 per calendar month

and £395 per calendar month.

That's what we were expecting, as well. We actually got 390, so...

-Quite good.

-Yeah, what we were expecting. That's good.

With a total spend of £37,200,

that rental figure of £390 per calendar month

that they've agreed with their tenant will give them a yield of 12.5%.

Not bad for a month's work.

Have they both enjoyed the experience?

It's been really enjoyable, actually. I've enjoyed it.

Yeah, I think we'd buy again at auction, wouldn't we?

Yeah, definitely. Yeah, you get good value for money.

Yeah, yeah. We'd like to do it again if we can.

Well, we hope you've picked up some valuable information

on today's show.

And enjoyed seeing what our buyers did

with their new-found knowledge.

So, make sure you join us next time on Homes Under The Hammer.

-Goodbye.

-Goodbye.

-Goodbye.