Episode 60 Homes Under the Hammer

Hello, welcome to the programme.

I don't know about you guys, but I love unusual properties.

The more character, the better for me.

Yes, and no matter how quirky a house is, there is

usually somebody out there who is absolutely perfect for it.

Yes, out there your perfect property could be waiting for you,

and maybe you could buy it under the hammer.

When you open the auction catalogue,

the sheer range of properties surprises you.

And if you're after something popular,

-sometimes bidding can be a real battle.

-Yes.

But who was successful in the battle for their perfect property?

Let's find out the properties we are featuring on today's show.

First up, in Peckham, a ceiling has me hopping mad.

Low ceilings. Look, I'm a shortie and I can even touch the ceiling.

Whilst in the borough of Cadishead in Manchester, I need to watch

where I'm stepping.

That'll need to be sorted as soon as possible.

Don't like that at all.

And in the snowy Rhondda Valley, Wales, I venture

outside to find positives.

Actually, coming out here, it gets really interesting, doesn't it?

All these properties have been sold at auction.

We will find out who bought them and how much they paid

when they went under the hammer.

Well done, sir.

We all know about Peckham in south-east London

as the setting of the popular comedy Only Fools And Horses.

But far from the urban gritty home of Del Boy

and Rodney, Peckham has changed dramatically over

the past 30 years or so, with 3,000 high-rise flats

demolished in the late 1990s to make way for new housing.

It now has a new library,

town square, and efforts are being made to renovate the streets.

A vibrant multicultural area.

There aren't many Reliant Robins driving around these days,

but it does have a unique buzz about it.

MUSIC: Only Fools And Horses Theme

This is a convenient spot.

It is a ten-minute walk to Peckham high street

and it is a six-minute walk to Peckham Rye station.

Although the railway bridge, well, it is just over there,

so you will have a little bit of train noise to contend with.

Now, I am here to see a one-bedroom flat

and it had a guide price of £250,000-plus.

But, unfortunately, it is down there on the lower ground floor,

which immediately says dark and dingy to me.

But at least it does have its own front door.

Oh, glad there is a nice wooden floor in here...not!

It is exactly as I'd expect. Such a shame.

It is in a bit of a state, it is a bit smelly, as well,

I don't think it has been lived in for a long time. Low ceilings.

Look, I'm a shortie and I can even touch the ceiling. Strip lighting.

You have got this sort of bay window,

but you look out onto some fantastic rubble, just all piled up outside.

So you need a good old clear up with this property.

I hope the rest of the flat is a little bit better.

Onwards along the corridor.

The only bit that feels like it has a sense of space is this hallway.

Look, you have got this little area here which is quite nice,

and the bedroom through here.

It is not the biggest of bedrooms,

but it has got some little wardrobes that are built in.

So that is handy.

You have got a nice window as well, loads of light coming in there.

And right at the back of the property is the kitchen.

Oh, dear, big hole down at the bottom.

You have got a boiler there, I suppose that looks

like it is in good condition, but you would certainly need to change it.

And look what is through there, the bathroom. Grotty.

You're going to need to change that.

I am just thinking, with my developer's head on,

could you turn this into a two-bedder?

Could you add that much value by taking this kitchen out

and putting it into the lounge area,

and then turning this into a bedroom?

I don't think so, because then you have got the bathroom leading off.

I think I would leave this as a one-bedder.

Spend a bit of money on it and it could be quite a nice surprise.

# Just give me a chance

# Just give me a chance... #

The key to transforming a dark, dank and dingy basement flat is lighting.

Maximising daylight opportunities and, when all else fails,

work a bit of light magic with lamps and down lighting.

What you sometimes lose on the light front with a basement flat,

you gain with outside space. Mmm, I wonder.

There is something else you get with this flat.

You should never take this for granted in London

because you get your own back garden here.

This is definitely a bonus, it being on the lower ground floor,

and you get direct access straight out here, as well,

as well as a lovely spot to bask in the sunshine

in our lovely English summers - this adds value and desirability.

Definitely a big bonus for this flat.

And you could improve it further with some patio doors leading

out to the garden.

So this one-bedroom basement flat does have potential.

What does a local property agent think about this Peckham pad, then?

My first impressions of the property are that it did require

modernisation, it required new flooring, in my opinion.

The walls also needed to be redone, re-plastered, what have you.

A new kitchen, new bathroom, the usual things.

And if you carried out these works,

what kind of values could you expect against that 250 grand guide price?

Once renovated, this property could sell for £415,000 or it could

rent for £1,300 per calendar month.

OK, I take back some of my initial reservation.

This flat, well, it certainly is more spacious than I was expecting.

Yes, it needs a lot of work, but, done up

and in a fantastic location, who thought this Peckham palace

could pop them on the road to becoming a millionaire?

Let's see what happened when it went under the hammer.

One-bedroom lower ground floor flat, in need of modernisation.

Who wants to give me a start on this, lot 77? 290 anywhere?

If not, you tell me. What about 270? I'll try and help. Start it off.

270, thank you. 275, thank you.

280? 285? 281, then? 281. 282.

283. 284. 285.

Anybody else, for lot 77?

If not... 286.

More competition. 287. 288. 289...

Two bidders had locked horns and neither one was willing to give up.

We rejoin the action with the bidding at £310,000.

311, 312.

313. 314.

315? No?

It is with you, sir, with the scarf, £314,000.

314, for the first. 314, for the second.

314, for the third and final time. Sold, 314.

The two successful bidders are Justin and Andy.

Justin, here on the right, is an experienced developer,

whilst this is Andy's first development.

And while the hammer fell at 314,000, that is

not the price they paid.

Time to find out a little bit more.

Andy and Justin, lovely to meet you today.

Now, my question to you guys is, this has completed recently,

but the auction was such a long time ago.

-What has been going on?

-Unfortunately,

we had some issues with our solicitors and,

due to that, we had a notice to complete issued

and we found out a day after the notice expired.

Unfortunately, because it is an auction property,

we were then into a situation where we had to go back to the seller

and they wanted another £20,000,

otherwise we forfeit our deposit of 30,000. So it was lose 30, pay 20.

So...nightmare.

You have just got to deal with it and if you want to complete

and keep this property, you have just got to pay it.

Yes.

Justin has overseen many projects, from his clients'

multi-million-pound developments to his own property renovations.

But it goes to show, buying at auction can be hazardous,

even for the experts.

And Andy is a newbie to the developing game,

but he has got plenty of practical building skills.

So how did they come together on this one?

-We have known each other for what...?

-Two years.

-Two and a half years now?

-Yes, we met on a gas course.

I did my gas safety with Andy.

I had been doing pretty well on the developments and I said to him,

"Look, come in with me, two heads are better than one."

-This is his first one now.

-So, Andy, what has he promised you?

-Come on, tell me.

-He has promised me riches and gold and millions.

-So this is your first project together?

-It is.

Have you bought this property as a joint venture?

I am funding this one.

This, as it is my first venture, he is the experienced head on this one.

-OK.

-He is holding my hand through this.

I sold my house, currently in a rented place now.

So that is funding this.

So that's a bit of pressure for you, Justin,

-that he really is hoping to do very well on this property.

-Yeah, it is.

Now, what are you promising him?

A speedy completion of this.

It's not overly bad.

It just wants...strip out, kitchen and bathroom gutting,

new central heating system, which we'll do, cos we're plumbers and gas engineers.

I'm a chippy, I'm also a tiler. All our mates are in the business.

We'll spin it around, get it on the market.

So how long is it going to take you to turn this place around?

-What's your timeframe?

-Five weeks.

Yeah. Six absolute maximum.

-Five weeks.

-So you're saying you're going to allow...

He's saying five weeks, but you're giving him a week

-in case he goes over?

-A week's grace, yes.

But if it's not done after five...

-I'm fired.

-Yeah.

-THEY LAUGH

So Andy really is putting his money where his mouth is

by selling his house to get the capital to work with Justin.

And they hope a £12,500 budget

can make them a whopping 100 grand profit.

Sounds impossible?

Not for captain confidence Justin.

I actually think I've sold it already

-to a client who walked in...

-Oh!

-Yeah.

Hold on a minute. Justin, you're uber-uber-confident here,

and I can tell little old Andy is, like, quivering in his boots.

-I'm shaking.

-You're emotional. You're worried.

-I've been through everything over the last month.

-Tell me, like what?

Right from the auction, walking in there, you know,

you get the flat, it's like,

"Yeah, we've got it, we've got it!"

But then you've got the paperwork and you start to think,

"I've just spent all that money on this."

-There really is a lot riding on this for you.

-Yes.

-You've got to get this right.

-We will.

And you're doing this purely and utterly to make a bit of money

-to better your future.

-Not just for me - mainly it's for my kids.

You know, my kids are young and I don't want them

to go through all the bad jobs that I had to go through to get here.

It's going to be a lot of hard work, a lot of early mornings,

late nights, but we'll get there.

It would seem confidence is rubbing off from Justin to Andy.

Both of them plan to do most of the work themselves,

and in addition to the changes Justin just mentioned,

they're going to try and raise the ceilings and get more light in.

-Guys, I'm really excited for you. Good luck.

-Thank you.

-I hope you...

I'm looking at him! Good luck.

I hope you learn a lot, and, between you both,

-I hope it goes really, really well.

-Thank you so much.

And you know, I think this is an exciting time for you

-and I think Peckham really is moving along.

-Definitely.

-Thank you very much.

-Thank you.

-Thank you.

With this purchase, Andy has sacrificed so much,

and he really needs to turn a profit here.

Will Justin deliver that £100,000 profit?

Join me later on in the programme

and you can find out how the boys get on.

Lying about 26 miles from Manchester

is the Salford suburb of Cadishead.

With excellent links to Manchester city centre,

this little suburb is a popular place for commuters

looking for affordable housing.

And talking of affordable, get this -

the property I'm here to see is a two-bed mid-terrace house

with a guide price of £50,000.

It looks OK to me from here -

let's take a look.

OK, a long hallway, actually.

Wasn't expecting that at all.

Some original features still left in here.

Some nice cornicing, as well.

Some old-fashioned wallpaper there, some blown vinyl,

and the stairs up to the bedrooms.

Into the front room area.

Well, into an open-plan area.

Couple of double doors.

More original features in here, as well.

No fireplace, which I'm surprised at.

So if you wanted to create a little bit more space,

you could potentially take that chimney breast out

into this room here.

A lot of people do like to take the whole wall out,

but maybe they wanted a bit of privacy on some occasions.

Fireplace here, which looks like

it's got a bit of DIY.

That's kind of my DIY -

poor. Not the best DIY.

Golfer, maybe. Maybe there was a golfer in here.

Not the best at golf - but darts

I'm not bad at.

OK, anyway, into the kitchen,

which looks a decent size.

A bit dirty, a bit messy, but you could clean this up quite easily.

Everything seems to be OK in here.

You could add some more cupboards there,

maybe take this sink that's on a bit of a skew whiff here

and just maybe place it so it's nice and symmetrical.

Get rid of this old-fashioned '90s breakfast bar.

But it's a decent space in here. Tidy it up,

bit of TLC, you'd be fine, and you could use this no problem.

# If that's the biggest problem I've got

# No problem. #

So far this property is looking in really good shape.

Open-plan living is still very popular,

so should appeal to lots of people.

Hopefully upstairs is just as good.

Oh, dear. That is very dodgy -

that bottom step there has just collapsed.

That'd need to be sorted as soon as possible.

Don't like that at all.

# Every little step I take

# You will be there... #

Oh, and it started so well.

That one needs some investigating,

and hopefully it won't involve that dreaded rising damp.

Upstairs at the front of the house,

there's a good-sized master bedroom

with what looks like some cosmetic damage.

And a smaller second bedroom which also needs some work.

But overall, it's bright and spacious.

Through to a large bathroom just here.

I would imagine this was possibly two rooms at some stage,

maybe a smaller snug bedroom at some stage.

But there are more signs of damp and condensation.

You see there's a bit of damage here in the ceiling, as well.

Over here, there's more damage. Maybe that's come from outside.

Might be guttering damage, as well.

Or it could have been condensation from the shower being used -

nowhere for it to escape at all, heating hasn't been working.

And any forms of damp at all,

any forms of moisture, can be costly.

What I would advise is get them sorted as soon as possible.

I know this property has been sat empty for some time,

and with that comes a lack of ventilation and, of course, heat,

which is the perfect recipe for damp.

Out the back, there's a good space,

but, like everything with this house, it needs some care and attention.

And the outside seating leaves something to be desired.

Time to hear from a local estate agent

on what he thinks about this property,

which is guided at £50,000.

For a mid-terrace property, it feels damp all the way round.

However, it was sold with the central heating not working,

and I believe it hasn't worked for some time.

It has got very cold, and that's obviously made internal walls -

which is quite rare for a mid-terrace property -

retain some moisture.

So it might just dry out with new central heating,

or, alternatively, you might actually have to put

a new damp-proof course in. But I would be...

I would err on caution and put a whole new damp-proof system in.

Well, that could prove costly, but well worth it if it's needed.

Just make sure you get the experts in to assess what the cause is

and the best solution to the problem.

Let's talk numbers now. Rental first.

Rental-wise, once renovated to a good standard

which is a good polished example,

I would expect it to achieve between £500 and £550 per calendar month.

And resale value?

Once renovated, this property would achieve between

£90,000 and £95,000 if it was done to a good standard.

Not a bad property for that guide price of £50,000.

But that damp and rot is a hefty concern.

Is it damp or is it rot?

Not one for the faint-hearted, not one for the inexperienced.

Let's see who was brave enough to take it on

when it went under the hammer.

Two-bedroom mid-terraced house.

Anybody here? 50?

Looking for £50,000.

45, then.

At £45,000.

45 here. At 45 I'm bid now.

In ones. 46.

47. Stood to the rear, can you?

47? 47 I'm bid.

Seated, 48, can you?

At 48 I'm bid.

49. 50.

50 I'm bid.

51. 52.

53. 54.

55. 56.

57. 58.

59. 60.

60 I'm bid. One.

62.

62 I'm bid. 63.

Shake of the head here. At 62, seated.

At £62,000, with you, sir, seated.

First time.

Second time.

If you're all done at £62,000...

New bidder, just beat you to it, madam. With you now at 63.

64, anyone?

64 at the back.

65. With you, sir.

Against you, seated. Against you, madam.

At £64,000, to the rear.

First time.

Second time. Are you done?

At £64,000,

all out, selling away, then.

-GAVEL BANGS

-Well done, sir.

That successful bid of 64 grand

went to property developer Andrew.

Andrew give up his career in online advertising three years ago

to pursue property developing full-time.

I met him back at the house to find out more.

-Andrew, nice to meet you. Congratulations...

-Thank you.

-..on your fourth property in your portfolio.

-Yes.

Why particularly this area, and this house?

Erm, well, there are a few reasons.

It's within about half a mile or so of the local train station.

There are good transport links to Manchester,

so those are the sort of things I was looking at when I bought this.

It's obviously quite cheap for what you were getting.

What are your plans for it now you've got it, pal, and it's yours?

I'm going to go through it, sort out the electrics,

new gas central heating.

There's a bit of a problem in the floors -

there's a bit of rot over on this side.

Be some joists need replacing, floorboards need replacing.

New bathroom. Re-plaster the upstairs.

Just go through and decorate it.

There's a bit of work to be done on the kitchen.

Sort out the outside. So going to be a bit of work done on it.

So what do you mainly do, then? Do you normally buy your properties

and sell them, live in them, rent them, or...?

No, I tend to rent them out, yeah. Tend to rent them out.

I bought it to rent out,

so I'm not really looking for any capital appreciation in it,

I'm looking more at the rental yield on it.

Andrew, you mentioned you're going to sort some of the floor out.

What do you mean? Tell us what you're going to do.

Well, in the hallway, there's the bottom stair - that's moving.

There's definitely a rotten joist under there.

I did actually feel that as I came in the house. They should've warned me

when I came in, but they didn't warn me about that bottom step.

Yeah, there's definitely a rotten joist there, some rotten floorboards.

We need to get all the laminate, rip all the laminate floor up.

We need to properly have a look and see what's going on under there.

There might be a bit of standing water under the floors, as well

-which is causing the...

-The movement, yeah.

..the movement and the damp. It has had a damp-proof course,

but it's probably that there's rising damp coming up

and eating away at the joists underneath.

But we need to get the floor up and have a look and see. Can't see at the moment what's going on.

Is it going to be a big cost for you?

Erm, it could be up to a couple of thousand. It depends.

It depends how bad it is.

We don't know till we pull the floor up and have a good look at it.

# Looking good, looking fine, looking so pretty

# So rotten to the bone... #

Well, hopefully Andrew will find out that this property isn't rotten to the bone.

There are lots of other cosmetic things to do,

but Andrew seems to know his stuff, so hopefully nothing will faze him.

But costs will mount up, so how is that budget looking?

I'd like to do it for around 10,000.

But between 10 and 15,000,

depending on if the roof needs replacing, as well.

Need to look at that.

So I'd be happy with about £10,000.

Most of that 10,000 budget will just be evenly balanced

-among certain things?

-Yeah, well, I would say

the central heating will probably be a couple of thousand.

The electrics will be a couple of thousand.

Plastering, bathroom, maybe a couple of thousand.

So it's quite evenly spread out over the work. Yeah.

So tell us a bit more in-depth what you're actually going to do.

Are you knocking down walls, are you... What have you got in mind?

Well, upstairs there's quite a big bathroom at the moment.

-It's huge, isn't it?

-It is.

For the size of the house it's a large bathroom,

and it's got a split level floor.

It's not really good to have a different level floor in a bathroom.

Originally there would have been a small bedroom

at the back of the property, so I'm planning on reinstating

that partition and putting that small room back in.

It'll still be big enough to have a full-size bath,

-full-size sink.

-OK.

-It'll be a good enough size for the house,

and then there'll be a small box room, as well.

You going to whizz it through, or are you going to take your time with it?

I'd like to get it done in three to four months.

-That's quite quick, eh?

-Yeah, quite quick.

Have you got people that are sort of standing by, waiting to help you?

Have you got a normal group of builders and helpers?

Yeah, I've got a group of people that I normally use,

and they're coming in and starting tomorrow.

-HE LAUGHS Really?

-Yeah, so...

Yeah, there's a group of people I normally use

-and they're all lined up.

-They're not messing about, are they?

-Nope. No, not at all.

Andrew, I wish you all the best, and I hope you stay within that budget of yours

and you don't find anything too bad below the feet.

-Good luck.

-Thank you very much.

-Take care, good luck.

-Thank you.

So Andrew's change of career has served him well so far,

but this is not going to be a straightforward project.

He's got to rip up those floors - what's he going to find?

You don't know, it might eat into that budget.

And he's got to sort that damp out, as well.

Will he keep within his timescale?

You can find out later on in the programme.

Still to come in the Rhondda Valley, Wales -

what's that saying about best-laid plans of mice and men again?

It wasn't anywhere near as straightforward as we'd hoped, no.

Whilst in Cadishead, Manchester,

three things you don't want to hear when renovating.

There's woodworm, there's dry rot, there's wet rot.

Back to south-east London now,

in the popular borough of Peckham.

It was in this up-and-coming area,

famous for its association with Only Fools And Horses,

that I came across this lower ground floor one-bedroom flat

that had a guide price of - wait for it -

250,000.

It was dark and dingy, and the ceiling height -

well, I couldn't Adam and Eve it!

Low ceilings.

Look, I'm a shortie and I can even touch the ceiling!

# Come on get up high as the ceiling

# Get up on the floor... #

I'm sorry, but Del Boy himself

would have been hard-pressed to find the positives here.

It wasn't helped by a grotty bathroom, either,

and a wholly underwhelming kitchen.

And just when I was about to give up...

You should never take this for granted in London,

because you get your own back garden here.

This is definitely a bonus, it being on the lower ground floor,

and you do get direct access straight out here, too,

as well as a lovely spot to bask in the sunshine

in our lovely English summers.

This adds value and desirability -

definitely a big bonus for this flat.

Well, plenty of people thought this property was lovely jubbly

on auction day, with it eventually selling at 314,000.

Sold, 314.

The successful bidders were seasoned developer Justin,

on the right, and his friend and property novice Andy,

who would be funding the project.

Unfortunately for Andy, due to a complication,

they didn't complete in the required 28 days,

which resulted in him having to pay 20 grand on top of the original

£314,000 purchase price.

Not a great start.

-What's been going on?

-Well, unfortunately

we had some issues with our solicitors,

and, due to that, we had a notice to complete issued.

And we found out a day after the notice had expired.

And, unfortunately, cos it's an auction property,

we're then into a situation where we had to go back to the seller,

and they wanted another £20,000.

Otherwise we forfeit our deposit of 30,000.

So it was lose 30, pay 20.

-Oh!

-So, nightmare.

Yes, ouch - a £20,000 nightmare!

Thanks to those legal shenanigans and red-tape confusion,

the property ended up costing £334,000.

But despite some trepidation, the boys weren't put off,

and, hoping that Justin's experience and their combined skills

could save them money, they planned to create a high-end apartment

with a budget of 12,500,

and within a timescale of six weeks.

We returned three months later,

hoping that that bad luck was behind them.

Modern, slick and bright.

Kitchen and bathroom - done.

Well, it's almost unrecognisable from its previous state.

New flooring throughout,

re-plastered, re-painted walls,

and just a general sense of...

Yeah, well done!

And we haven't even seen the best bit yet.

This lovely decked area is the icing on the cake

of this ideal one-bed flat.

I just hope for Justin and Andy

the waters have been a little less choppy than they were at first.

Overall, we're both very happy, extremely happy with the outcome of the flat.

I knew what it was going to look like, cos I'd done obviously quite a lot of these,

and I think Andy is happy now we've come to the end of it

and he can see the fruition and what's been achieved.

When you come into this, you know it's going to be hard work.

But cos you've never done it before, you just don't know how much hard work there's going to be.

So there have been a lot of early mornings, a lot of very late nights.

Not much sleep in the last couple of months.

We've ended up spending exactly what we said we would - £12,500.

Which, considering what we have done, is incredible.

But the majority of that is down to

good sourcing of materials,

obviously doing most of the work ourselves to keep the cost down,

because we've got trades and experience.

And, yeah, it's proven really good,

and we're very happy.

This place has been refurbished from top to bottom, inside and out.

Plus they replaced the gas and water pipes

as well as a new kitchen and bathroom.

All for around 12,500.

Well done, boys.

What about their ambitious six-week timescale?

It's taken us about seven weeks to do.

In total. There were a couple of weeks where we had a pause

cos Andy went on holiday.

I went on holiday, as well - I was sick for half a week,

unfortunately, food poisoning.

But other than that, we're bang on time,

bang on schedule, and bang on budget.

So, overall, happy with everything.

Yes, and so they should be.

With people queueing up to view this flat,

it seems like the ideal time

to hear the thoughts and opinions of two local estate agents

on this property that Justin and Andy

have invested £346,500 in.

Having had a look at the flat, the changes are very nice, I believe.

I like the neutral decor.

I like the flooring that's been placed in

the kitchen and the bathroom, done to a contemporary standard also.

My thoughts on the property are, they've made a lot of effort

in making sure that it's actually nice and bright.

Being a lower ground floor flat, that can always be an issue

when coming to try and re-sell or re-rent.

So you look around and there's still a nice feeling of light,

which is going to be very important

when you're looking at lower ground floor.

Well, the agents are impressed,

but with several people already interested in the property,

will their valuations impress Andy and Justin?

The property, if it were to sell,

would be somewhere between

£375,000 to £400,000.

Looking at the finish, I expect this flat to sell for

up to £450,000.

We're definitely going to get

the 450, or close to 450, certainly.

With the pair only interested in selling,

the valuation of 450,000

would equate to a pre-tax profit of £103,500,

which isn't too shabby for seven weeks' work.

So now Andy has one property development project

under his belt, how is he feeling about it?

Very difficult, very challenging.

But it's been great fun, it's been very rewarding.

And I can't wait to go back to the auction

and get another one and do it all again.

20 miles south of Merthyr Tydfil in the Rhondda Valley

is the small village of Maerdy,

and with that dusting of snow on the hills,

it really does look a picture.

Walking down these streets of terraced houses,

it's easy to be transported back in time

to the period in history when this was a thriving mining community.

So you can imagine almost the men in their flat caps

heading off to work down the pit.

They probably would have lived in one of these type houses.

Mid-terrace, two bedrooms, this one I'm here to see.

Guide price £26,000.

Looks all right from the outside. Double glazing. Let's pop in.

Oh, that's a nice start.

Often when you walk into these kind of properties,

you go straight off the road into your front living room,

and that's obviously not ideal. It's noisy, cold, etc.

In this case, you've got this little corridor, which is good.

And your front living room area is there.

You know, it's not in bad condition.

Obviously needs a bit of a paint job and tidied up

and a bit of modernisation, but it's there.

And then through to a really nice feature at the back of the property.

It's very open-plan. The moment you walk in here, you go,

"Oh, that's nice."

It's a small terrace, but it feels big here.

Issues with the walls. That's interesting.

Hm. It's not plaster, actually.

That looks like it's some kind of cement. Wow.

OK, one little tip, before you do forget.

If ever you are going to re-plaster, do remember,

do all your electrics and your plumbing first

so you can actually bury it within the plaster,

rather than stick it on the outside afterwards.

But it's a nice little sort of living area at the back,

and then through into the kitchen.

As I said, it's got this really nice open-plan feel to it.

Kitchen itself - well, you'd want to spend a bit of time and money

sorting this out, but it's a nice-sized space.

Lots of light coming in, which is good.

And then I would normally expect to find the bathroom at the back there,

but, actually, that looks like it's just some kind of a utility room,

which means one of two things.

A - the property doesn't have a bathroom, which is unlikely.

Or B - which is a good thing - perhaps the bathroom is upstairs.

That would be a bonus.

A-ha, you have to get up early to beat Inspector Roberts'

sharply-honed deduction skills!

But am I right?

Yes, the bathroom.

However, this isn't ideal, is it?

Having a boiler just there.

I mean... Wow. It's a lot of effort,

but I think it's definitely worth trying to move that.

But the good news is, it's a decent size.

Probably converted from what was previously a bedroom,

so you have sacrificed a bedroom,

but you've got a nice family-sized bathroom upstairs.

Yeah, it's probably worth doing.

The two bedrooms you have got left, thankfully, are a pretty decent size.

One to the left there,

even big enough to have a little sink in it.

And another one to the right.

Not massive, but, you know, you'd get a double bed in here, I think.

One thing which is perfectly apparent, of course, is some

signs of damp on that front wall.

Also on bits of the ceiling, around that loft hatch access there.

If you just want to check out the roof, is it coming down,

is it coming in? Maybe a combination of both. Usual thing.

Is it the guttering or anything like that? Anyway,

just sort it out, nothing too much to worry about, I wouldn't say.

And all in all, it's a solid little house.

Yes, I do think this house has a lot of positives,

and it seems lots of room for improvement.

Well, at the back of the property,

of course the garden is cut into a fairly steep hill, as is common

with most of the properties built into the Valleys, not surprisingly.

But you can also see some potential.

Look at what some of the other houses in the street have done.

They've built an extension, a double-storey extension, at the back.

Our property has only got a single-storey extension,

so that's something you could contemplate.

Another bit of good news, and another possibility,

is the idea of adding a garage, as, again, next door have done.

Because you've got a lane with vehicle access at the back there.

So, take down that wall, build a garage here,

accessed via the lane, sorts out the problem of the parking on the front.

Actually, coming out here, it gets really interesting, doesn't it?

It's part of the fascination I have with houses, but sometimes it

takes a step away to see the full potential.

# In another way

# From another point of view

# Yeah, yeah, yeah... #

In this case, you get a real sense of how you could make this

property bigger and better.

# In another way

# From another point of view. #

But would that be worth doing?

Time for another point of view from a local estate agent.

Properties in this area tend to have quite a low ceiling, so

if the new owner was looking to do the renovations themselves, it might

be cost-effective that way. But if you're going to get a builder in

to do the work, I'd probably just leave it as a two-bedroom property.

Interesting. So what type of values are we looking at for a house that

was guided at £26,000 plus?

As a two-bedroom property, I would anticipate a rental

income of £375 per calendar month.

If I was to market it for sale, I would put it on for £55,000.

And what would the values be if it was extended?

If the property was converted into three bedrooms,

I would market it at £65,000,

and the rental income would be in the region of £400 per calendar month.

Those increases aren't huge, so, as an investment,

the extension probably wouldn't add up.

Well, I love these traditional terraced properties.

They're good, solid houses, which make either a really good

investment or a potentially very appealing family home.

A bit of work to be done, but nothing too daunting.

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

Two-bedroom, mid-terrace house.

Start me, will you, I don't know, somewhere near the guide price?

25, will you? Make it 20, then, just to get me started, please.

£20,000, somebody. Thank you, got you at 20. 21 can I see now?

Thank you, 21 by the side. 21. 22.

23. 23. 24. 25.

25, back to you. 25.

26. 27.

27. And eight. 27.5, then.

27.5. 28. 28.5.

With the bids picking up pace, we leave and rejoin at £31,500.

31.5.

31,750. 31,750.

32, sir. 32. 32,250.

32,250. 32.5. 32.5.

32,750.

I've got 32,500 with you, sir, for the first time.

Second time, third and last time. At 32,500.

Well done, sir, it is all yours, your number, please.

Number 52, thank you very much.

So, after quite a battle, the two-bed house in Maerdy,

South Wales was bought by Owen and his brother Geraint.

I met up with Owen back at their new property to find out their plans.

-Owen, good to meet you.

-Nice to meet you, too.

-Congratulations.

-Thank you very much.

-Tell me why you wanted to buy this place.

Erm, well, a couple of reasons, really. One was affordability,

because we had a tight budget of sort of 30, 35,000, which this was.

And the other one was a lack of major problems.

We've bought property before.

It was actually this time last year, and we still have issues with water coming in the roof and things.

-Oh, no.

-Yes.

So we fixed it last year, thought it was fine,

-weather has come in and it has gone again.

-Oh, no.

So this place, luckily, it was nice and wet when we looked around.

There are a few issues with damp, but in this age of property, you'd expect that.

-Other than that, it looks pretty sound.

-You say it was damp when you came around.

Sometimes it actually works very well to visit a property

-when it is raining, isn't it?

-It was hammering down.

-It was a Welsh winter.

-Was it?

-It was properly wet, yeah.

So are you doing this on your own, or...

No, it is kind of a family affair, really, because I am doing the

sort of organisational, financial type things in the background.

Then my brother is doing more of a hands-on-type work on the ground.

-Is he a builder?

-He's not a builder. We are both kind of...

-We are OK at trying our hands at things.

-What do you do?

-I'm a psychiatrist.

-Oh, wow.

-Yeah, nothing...

nothing I can relate to this at all, unfortunately.

But I watched some YouTube videos previously

and learnt how to put a kitchen in,

-and that's how I installed a kitchen in the last house.

-Right.

So we are quite hands-on, but things like the plastering

and the plumbing and things we leave to professionals.

-They're the kind of things you don't want to mess about with, I don't think.

-No.

-But, financially, it is between you and your brother?

-Yes, that's right.

-Oh, that's nice.

-Yeah.

Although the financial burden might be between Owen and his brother

Geraint, they also hope to get some help from their parents.

But having analysed the house, what is his overall assessment of it?

There is some potential. Like I say, there's not huge problems.

Somebody has already taken the time to put the bathroom upstairs,

-which has saved us doing it, obviously.

-You're talking about the bathroom upstairs.

That was at the expense of a bedroom.

-Did that bother you or not?

-Not really.

There's possibilities of extending, depending on finances.

What, a double-story extension at the back?

Yes, maybe above the kitchen, possibly up into the attic.

There are some houses on the streets that have done both of those

things, so planning permission should be OK.

But we probably won't have the finances to do it.

But having said that, two bedrooms around this area is fine anyway,

and it is better to have the bathroom upstairs, I think.

The downstairs is quite sweet, isn't it? Are you going to keep that pretty much as it is?

-We are probably going to open up the front two rooms a bit.

-The wall here?

The wall there, yeah. Because the back room is a little bit dark.

So that will get the light flooding in from the front room.

-We've done that previously.

-So this will be one huge open-plan downstairs.

-One huge open-plan downstairs.

-That'll be great.

-It will be very nice. Hopefully.

And in terms of budget?

The budget is going to be about 17 to 18,000, if we extend.

-If we don't extend, we are probably looking at more the ten mark.

-Right.

So that's where we need to look at how much the extension would cost.

Owen hopes to get it refurbished in three to four months,

and they planned this as a rental property,

to be part of his and his brother's property portfolio.

But how many houses do the brothers have?

-We just planned on one initially. This is now the third.

-Oh, right.

The other two are not rented out yet. But, yes, possibly.

-So when did you buy the other ones?

-First one was this time last year, and...

-Ah! Stop. This time last year?

-Yes.

-And you bought it to rent out?

It was rented out and then we've had the roof problems.

So the people have moved out. So this is the issue at the moment.

-So it is costing you money.

-It is costing money.

And the second one has just gone on the market this week, and we've had a lot of interest.

Hopefully, within a month or so, the other two will be rented out.

So this is property number three. Any aspirations for many more?

At the moment...

A fourth would be nice, and then I'm sure when we get the fourth, a fifth would be nice.

So we've not really put a cap on it, or we've not really said

we'd be disappointed if we only get a certain amount. It is just kind of...

It is a side thing, we take it as it goes, really.

-Well, listen, congratulations. Good luck with it.

-Thank you very much.

-Look forward to seeing how you get on.

-All right, take care.

Well, Owen and his brother discovering that things don't

always go to plan in the world of property.

Three projects on the go.

How will they get on with this one?

Will it be easy enough to get it sorted out?

You can find out later in the show.

We've seen how one of the properties has turned out, but what about the other two?

Yes, it's been a while since we've visited, so there might be a few surprises.

-What do you think?

-Well, let's go back and find out.

Back now to the Salford suburb of Cadishead.

It was in this popular commuter belt that I first had a look around this

two-bed mid-terrace house that was guided at £50,000 plus.

It looked in pretty good shape at first,

but it wasn't long before I had to watch my step.

Oh, dear, that is very dodgy.

That bottom step there has just collapsed.

That would need to be sorted as soon as possible.

I don't like that at all.

# You'd better watch your step... #

No, it wasn't because I've eaten too many pies since retiring.

That sunken step may well be a sign of the dreaded rising damp.

More signs of damp upstairs showed this house had been unloved

and unlived in for some time.

Thankfully, help was on the way.

With several people interested on auction day,

the property eventually sold for £64,000.

Well done, sir.

The successful buyer was budding property developer Andrew,

who was unfazed by the property's condition,

and could see plenty of room for improvement.

So tell us a bit more in depth. What you are going to do?

Are you knocking down walls, are you... What have you got in mind?

Well, upstairs, there's quite a big bathroom at the moment.

Originally there would have been a small

bedroom at the back of the property, so I'm planning on reinstating

that partition in and putting that small room back in.

It will still be big enough to have a full-size bath, full-size sink.

It'll be a good enough size for the house.

And then there will be a small box room, as well.

Andrew was planning on renting the property once complete,

so adding a third bedroom made sense.

But would it be big enough, and, not to mention, cost-effective?

He planned to get all the work done here within

a budget of £10-£15,000 and a tight timescale of thee to four months.

We've returned six months later to see how Andrew has got on.

Very nice.

The downstairs is looking much fresher, cleaner and brighter.

And if it looks like it was just a spot of replastering

and a lick of paint, you couldn't be more wrong.

One of the major problems of the property was there was very

bad rot to the floors on the ground floor.

You can see from this piece here, there's woodworm,

there's dry rot, there's wet rot, so there's the whole full spectrum

of, you know, damp damage to the timber.

I knew when I purchased the property that the floors were rotten.

As you went to the corners of the room, there was

a lot of movement and it was obvious the joists were rotten.

So we totally ripped out all the joists, all the flooring.

We renewed everything, and now the floor is all brand-new

and it should be good for another 100 years.

Well, it would have been a big, dirty job, but it's really well done.

And as we head upstairs,

there's something else in this house that is brand-new.

Yes, that big bathroom was split,

and this former two-bed house is now a three-bed.

Nice one, Andrew.

The back is also vastly improved, with new fencing

and a freshly rendered and weather-protected outside wall.

For me, this property really has had its potential realised.

The property has had a complete renovation.

It's had full uPVC double glazing installed.

It's had a full damp-proof course installed on it.

All new carpets on the stairs and landing and bedrooms upstairs.

The rear of the property has been reroofed,

I've landscaped the rear garden.

Gas, central heating has been replaced, all the pipework,

all the water pipework has been replaced.

The kitchen has been fully renovated.

We only really saved the existing units,

so new tiling, new counter tops, new appliances.

The property has been redecorated entirely.

There was a number of reasons that the property had such bad damp.

One of the main reasons was that they had filled in an air

brick under the hallway, at the front of the property,

they had built a step over it.

There were also not enough air bricks when the property was

built, so we increased the number of air bricks and we removed the step.

And that will greatly improve the airflow under the floor.

Air bricks are essential for keeping a house well ventilated

and damp free, so make sure none are blocked up in your house.

Because Andrew replaced all the windows here,

as well as the roof at the rear,

he ended up spending around £21,000,

but I do think it is money well spent.

And he did manage to get it done in four months, which is

a pretty fast turnaround.

Including purchase price, Andrew has invested £85,000 here,

and the good news is that he managed to find a tenant

within 24 hours of putting it on the market. But did he get a good price?

And did adding a third bedroom increase the value?

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

What I do like about the property is the fact that it's got a really

good appearance with the kitchen, a well-designed kitchen, bathroom.

-They are what sell a property.

-The third bedroom is a really good idea.

It is going to add significant value to the property,

somewhere in the region of £10,000. So a great move.

With that in mind, then, let's hear the sales valuations.

If I put this property onto the market, I'd expect it to sell for £85,000.

I think as a sale property, you are probably looking around £100,000.

Between 85 and 100,000 sounds about right. 85,000 is low.

HE LAUGHS

You wouldn't find one like this here.

Well, if he did sell for £100,000, it would

have mean a pre-tax profit of 15 grand.

But it's always been the rental market that Andrew has been

interested in.

I think as a rental property, you'd be looking somewhere around

£495 to £525 per calendar month.

For rent, I would expect this to achieve £550 per calendar month.

I think on the rental values, it's about right.

I rented it out straight away for £550 a month,

pretty much the first person to view it took it, so...

it's about right.

Renting for £550 per calendar month means that Andrew will make

a yield of over 7.5% and, having already rented the property out,

there's no doubt this project has been a success.

It was in the snow-dusted South Wales

village of Maerdy that we came across a traditional two-bed

mid-terraced house that seemed pretty solid,

both structurally and as a potential rental investment.

Yes, it needed work, and there were signs of damp.

Though there was a bathroom upstairs,

it was at the expense of what would have been a third bedroom,

leaving just the two bedrooms.

But with space to the rear to extend if you wished,

this house had a lot to offer.

With all that in mind, it was bought for £32,500 by psychiatrist Owen

as a joint project with his brother Geraint,

as part of a growing rental portfolio.

-This is now the third.

-Oh, right.

-The other two aren't rented out yet.

So, when did you buy the other ones?

-First one was this time last year and...

-Stop. This time last year?

-Yeah.

-And you bought it to rent out?

Well, it was rented out and then we had a roof problem,

-so they've moved out. This is the issue.

-Oh. So it's costing you money?

-It is costing money.

-And the second one has just gone on the market this week and we've had a lot of interest.

-Right.

So, hopefully, within a month or so, the other two will be rented out.

And with neither of the brothers having building backgrounds,

it was a constant learning curve for them both.

# Hey, brother

# There's an endless road to rediscover... #

And for this latest voyage of discovery,

they had set a budget of up to £18,000, if they decided to add

an extension, and given themselves a three to four month timescale.

And they were really hoping it would be third time lucky.

Six months later, we're back, and winter has turned to summer.

The new door suggests progress, but how much progress?

Wow! That's impressive!

It really integrates the two rooms together

and gives a much better flow to the house.

And they've boxed up under the stairs to create some useful

cupboard space.

We've put in a brand-new kitchen.

I like it! This is fantastic and that touch of colour just lifts it.

Then, upstairs, we've put a new bathroom in.

By turning the bath 90 degrees,

they've made the bathroom feel much more balanced.

And the two bedrooms are now spick and span.

It's all looking good, Owen, and trouble free?

It wasn't anywhere near as straightforward as we'd hoped, no.

There was a lot more damage to the plaster than we thought there would be, once the wallpaper came off.

So pretty much every single room needed to be replastered completely and there was a bit

of a leak with the roof outside. We had to have a new roof put on that side, as well.

So, there were a few issues we weren't expecting.

# Oh, trouble, trouble, trouble... #

So, underneath that layer of snow, there was a leaking roof.

Perhaps the house wasn't as solid as it seemed.

Why is it never straightforward? So, who sorted it out for them?

# Trouble, trouble, trouble. #

So, most of the work was done by builders.

They came in to do the construction work, knocking down the walls and the re-plastering.

Then myself and my brother fitted the kitchen ourselves

and most of the other decoration work was done by my brother,

with the help of our parents.

And this teamwork seems to have paid off.

The plan was always to try to get tenants in to this property,

and we actually got tenants in within a week of it

being on the market and they moved in a few days ago.

And not only have they sourced a tenant for this one, but

they've at last found tenants for their other two properties, as well.

# Whoa, boy, that's good news

# Whoa, boy, that's good news... #

But is it good news about their budget?

We were hoping to spend around 10,000 on the property,

but we'd budgeted for having between 15 and 19,000.

With all the extra work, like I said, with the plastering

and the new roof, it came to just under £15,000.

A £15,000 spend on top of their £32,500 purchase price takes

Owen and his brother Geraint's total spend to £47,500.

But has this been money well spent by the siblings?

What do two local property experts think?

The property's been renovated to a really high standard.

They've opened up the lounge/diner to give that nice open living space.

Two good-size bedrooms upstairs, as well, and a modern family bathroom.

The standard of finish overall is very good.

He's got a very good specification bathroom and the kitchen is

a lot better than you would normally find in a tenanted property.

This property was bought as a buy to let, but they plan to

remortgage the house, so its current market value is important.

If I was to put the property on the market for sale,

I would market it at £65,000, with a view to achieving around £60,000.

If I was to be marketing this property, I would be putting

on the market from £65,000 to achieve around £60,000.

That's actually a little bit higher than we were expecting.

We've only spent about 47,500 on the property.

But, still, I think it wouldn't be enough of a profit to go

away from renting the property out, which is what we planned originally.

So, Owen wasn't really tempted by a potential pre-tax profit of £12,500.

They have got a tenant, after all.

But are they getting the current market rate for this two-bed house?

If I was to put this property on the market for rental purposes,

I would ask for £400 per calendar month.

I think if you're going to put this property on the rental market

now, you'd be looking to achieve around £400 per calendar month.

Yeah, that's exactly what we were expecting.

We're rented the property out for £400 per calendar month and I had to actually turn a few

people away, as well. So that seems about right.

£400 per calendar month would generate a healthy

yield of around 10%, so is that encouragement enough to push on?

Actually, we're already doing this again because we're raising

money on this property to now buy our next property.

Our offer's been accepted on the new house, paperwork's going through as we speak.

It's not easy, this property-developing lark!

And we have seen a lot of hard work on today's show.

Yeah, buyers are lining up at the auctions to do more.

Yeah, come and meet more of them here on Homes Under The Hammer.