Episode 35 Homes Under the Hammer

Hello and welcome to the show. Now, buying a property can be a long,

drawn-out process, full of delays and complications.

If you're in a hurry and want to get things moving, why not just pop down

-to a local property auction?

-Yep. Now, completion is usually 28 days.

Sometimes it can be sooner.

So do you want to buy your home under the hammer?

Now, the stories behind the auction purchases can sometimes be exciting,

electric and sometimes eccentric.

Yes. So, what made the people choose the properties they bought

on today's show and what are they going to do now they've bought them?

Yeah, let's find out. Here's what's coming up on today's show.

First up in Maidstone, Kent, I find a nice big bonus.

Do you know what? For a house of this size, this just isn't

big enough. So what have they done? They've built this - boom!

And in Stepney, in London, wait until you see what I've discovered.

Through here is just such an amazing surprise.

Come and have a look at this.

But in Newcastle-under-Lyme, what I find isn't so exciting.

Get damp checked out, because this place is wet, wet, wet.

All these properties have been bought at auction.

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

when they went under the hammer.

Sold.

Lying about 30 miles south-east of London is the county town of Maidstone in Kent.

With a thriving town centre,

surrounded by glorious Kentish countryside this area is known as

the Garden of England and for good reason.

Well, close to the centre of Maidstone in this really lovely

residential area is the property I'm here to see.

It's a three-bed semidetached.

Guide price £240,000 to £250,000

and judging from the outside, could well be a bit of a find.

Hopefully I'm not tempting fate here and the inside will be just as

attractive as the outside.

So, what's in store behind the door?

Well, into a little sort of entrance hall here. Stairs up to your

bedrooms. Quite a narrow little corridor through to the

rest of the house. I like open spaces, give me the range...

give me space. I want fields stretching into the distance.

With a house? What am I on? It doesn't matter. Look,

into the lounge area, it's a lovely feel here.

You've got a big bay window there.

It is dual aspect, which is really good.

I like the stripped floors.

Wouldn't have expected that necessarily in a house like this,

so perhaps that's just because the carpets have been ripped up.

Through into a little conservatory here.

Not much of a garden to speak of, to look out on,

but it's a useful space.

Although this plastic roof and all that kind of stuff -

not really ideal and then it all starts to get a bit strange,

partly because the house is in a state of - what shall we say? Flux.

I don't know what the cooker is doing there.

It's obviously part of what was originally the kitchen,

which is this area here.

But quite rightly, somebody has decided for a house of this size

this just isn't big enough. So what have they done?

They've built this.

Boom! A big extension.

Now, obviously it's not been completed, but the work so far looks

like it's been done to a pretty good standard.

Look at that RSJ!

Wow! That is a real big boy.

It looks like, at first glance, it's been nicely constructed, as I said.

Work to do to finish it off, but with this, combined with that,

this is a lot of space. Good house!

-# I'm special

-Special

-# So special

-Special

# I've got to have some of your attention

# Give it to me. #

Not only is there room for a kitchen here,

but there's space for a downstairs cloak room and a study.

The only proviso is I would recommend getting the structure,

the plumbings and the electrics checked.

Don't just assume it's OK.

Upstairs, there are three bedrooms.

The master is looking lovely, with a double-glazed bay window

and I'm just loving the original doors and handles.

The second bedroom is fine.

Though that plumbing on the wall may have to go.

Bedroom number three is really a box room.

The bathroom has echoes of an Art Deco period about it,

but I think you'd probably have to replace it.

Time to take a look outside.

I am quite intrigued, because when I first saw the house,

I didn't really realise it had a relatively new extension and that's

partly down to the fact that they've matched the bricks really,

really well. And if you are doing an extension on a property,

it's really worth taking a lot of time trying to find bricks that

absolutely match the original house.

Now, they haven't quite done it here.

If you look at these bricks here, they're very smooth on the surface

and these ones are kind of a bit more rustic,

but the colour is perfect. You know what? You need to go down to your builder's merchant,

take an actual brick from the house and, literally, match it up.

If you can get a match similar to this, what a difference it makes.

The house is full of surprises.

Under the garage is what looks like an inspection pit,

which might be great if you're a car enthusiast.

But for a family with kids, it might represent a hazard.

If you were into cars,

beside the garage, the drive would also take at least two vehicles.

I think this house, guided at £240,000 to £250,000

is a fantastic opportunity.

We asked a local estate agent along to see if he thought so too.

The kerb appeal is good.

It's a very handsome-looking house.

Sadly, inside it's rather neglected and needs a lot of attention,

but the potential is wonderful.

The extension, I think, speaks for itself.

It's unfinished, anyone can see that.

So once that's been incorporated into the house and the general style

that's adopted is modern and fresh,

I think there's not really a great deal more to do.

So, the place needs a cosmetic lift and the extension completed.

Does the agent have a budget in mind?

I believe, conservatively, £20,000 would just about cover any of the

variations that the owners might consider.

Well, property prices in the south and south-east

are without doubt high.

However, here in Maidstone, I think what you've got yourself

is a real good buy.

For that kind of guide price, £240,000 to £250,000,

as it is, yeah. A bit of a snip.

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

Lots of people around this one.

I would like to start at £240,000, if I may.

£240,000 to start me.

Give me £230,000, then.

£230,000.

Can I say 230? 230 I have.

235 now. 235.

235. 235. I'm obliged. 240 now.

240. Thank you. 240. 245 now.

245 at the back of the room.

250 now, can I say?

250, you're coming back in.

245 I have. 250 now.

255.

250 I have. 255 now.

260.

After a slow start, the property is now past its guide price.

We return to the auction when the bids are at 306,000.

£306,000 I have.

I shall sell for the first time.

Have a think. 307 in a fresh place.

308 for either of you?

307, you saw him bid in the aisle.

308, can I say? With all that time, it's come in one bid.

He's going to take it from you.

308. 309.

310.

£309,000.

The gentleman's bid in the aisle.

£309,000 for the first time,

unless I see one more? For the second time.

£309,000.

Three, two, one.

Sold, sir. Thank you very much.

Fantastic.

Evelyn and her husband Arjuna looked very chuffed with their

winning bid of £309,000.

Unfortunately, Arjuna couldn't make it to meet me,

so Evelyn teamed up with her sister-in-law Priya to tell me

about their investment project.

-Evelyn, Priya, great to meet you both.

-Thank you. Hi.

-Congratulations.

-Thank you.

Tell me why you wanted to buy this place?

Well, it's closer to our place.

My husband just retired.

So we thought we can have a little, you know, hobby, like.

-Keep ourselves occupied.

-Is it something you've done before?

-No, this is my first time.

-Really?

Wow. So, Priya, where do you fit into all this?

-I'm an architect by training.

-Oh, great.

I retired as a project manager from Manchester City, so here I am,

helping my brother and sister-in-law to do the design and, you know,

-get the building on the go.

-Well, that's an ideal combination, isn't it?

Are you going to be involved in all of the projects from now on?

-Totally, yeah.

-Yeah.

Financially as well,

or are you just being drafted in and paid a huge amount of money?

-No, they're giving me loads of lovely food.

-Food!

-Love.

-Lots of love and family affection.

Who needs money in those instances?

-Exactly.

-How lucky, though, you've got a sister-in-law that's an architect.

Yes, when it comes to property development, having a sister-in-law

who's an architect is as handy as it gets.

But exactly what do they plan to do to the property?

-I'll leave it to Priya.

-OK.

-She will go along.

OK, so the extension, it's just a shell at the moment,

so we're going to fit a beautiful kitchen and then we're going to

convert part of the extension into a bedroom/family room.

-OK.

-With the toilet downstairs and then we're going to redecorate

right the way through - new carpets, new flooring.

New light fittings and fixtures.

-So that's the plan at the moment.

-Wow.

So, what's the budget for all the work?

Have you done a bit of a costings on it?

We have. About £25,000.

Sounds reasonable.

That is a healthy budget to do the work and they're hoping to have it

completed in around 12 weeks, after which they plan to sell.

So, what's your involvement going to be?

I will do, helping out Priya and choosing all the tiles and the...

She's learning, so she's going to do the next project on her own.

Right. So, this is going to be the first of many, is it?

I hope so.

Hope so. You never know.

-Yes.

-Well, look, congratulations.

-Thank you.

-Lovely to meet you both and good luck with it all.

-Thank you very much.

-Thank you, Martin.

-Thanks.

Well, how lucky is Evelyn having a sister-in-law who will do all she's

going to do for some food and a bit of love?

Oh, boy. If only we all had somebody like that.

How are they going to get on sorting this place out?

Well, I think it's a great project and they've got the right ideas.

You can find out how it all turns out later in the show.

East London's Stepney area is often overlooked as the poor relation to

surrounding fashionable spots, like Shoreditch, or Bow,

but cool doesn't come cheap and plenty of buyers are now turning to

the more affordable Stepney where you certainly get more bang for your buck,

and there's also that buzzword regeneration

with more than 800 homes being built

and more than 1,000 homes to be refurbished.

So it certainly appears to be an area on the up.

Well, I'm here to see a three-bed flat.

Now, it had a guide price of £200,000 plus,

which by London standards, well,

it sounds like it could be good value.

It's not one of the pretty period properties over there. Mm-mm-mm.

Instead it's over on this side of the road and it's up there.

Can't have everything, can you?

OK, well, this side of the street might not be the prettiest,

but it does seem to get more sunshine.

# From the dark end of the street

# From the dark end of the street

# To the bright side of the road... #

This ex-council flat has 92 years left on the lease, which is nothing

to worry about for now.

The building has been recently refurbished with the

roof renewed, a new entry-level phone system and a new lift,

which is good news as we're looking at one of the flats on the fourth floor.

Though the bad news is that this flat comes with an outstanding bill

of £3,500 for the work that was carried out.

Something I do hope any buyer is aware of.

I'm up here on the fourth floor and before we've even got into the flat,

I've got to share this with you. Look at the views of Canary Wharf.

Aren't they absolutely fantastic?

So straight into the flat.

Oh, two doors to contend with and the stairs going straight up

and that's because this is a split-level flat.

Some space has been stolen from this hallway,

which I don't like, because it feels rather cramped in here.

And, hmm, what I think was the kitchen is now being used as a bedroom,

but I don't think that's working.

Likewise, your kitchen is now in here.

Again I don't really think it's a great use of space

putting the kitchen in here.

This whole flat is just really dated.

It needs new decor, new carpets, the laminate is all a bit tatty.

I mean, it really does need a big load of TLC in this flat,

but you know, I could get over that, because what's awaiting me

through here is just such an amazing surprise.

Come and have a look at this.

Well, you get Canary Wharf out the front,

but out the back, you get the Shard and you get the Gherkin. Ta-da!

# How sweet the view from here... #

While the view might be great,

the same can't be said for the layout

and I do feel the third bedroom is really too small.

I'd be tempted to move the kitchen back and return it to a two-bedroom

layout and have a big lounge space

with that fabulous balcony and its view.

With its split level, two of the bedrooms are up even higher,

so views, well, they just keep on coming.

I'd knock the separate bathroom and toilet into one large room.

You really need to up your game for the demanding London market.

It certainly might be worth spending a bit here,

if the newspapers are to be believed.

Purpose-built blocks like this can sometimes have a stigma attached to

them. They're not that attractive and they don't always have the best

reputation. However, don't turn your nose up at them too quickly, because

this article in here, well, it tells me that recently the first ex-local authority

London flat went on the market for more than a million quid!

OK, so it was along the desirable Fulham Road,

but it shows that these sort of flats, they're in demand and their

value is certainly on the up, so the guide price here, well,

it seems pretty good value, doesn't it?

A £200,000 guide price in an up and coming market,

I wouldn't say the sky's the limit,

but my investor's antenna is certainly twitching.

# Boy, you know you've got me Cos you're wanted

# Oh, you're everything I ever wanted

# Now all I've got's a memory I'm haunted... #

So how best to move this flat up a notch or two?

What does the local estate agent think?

I would suggest converting it back to its original state as a two-bedroom property,

which would appeal to a lot of prospective buyers.

If they intend to keep the property and rent it in the long-term,

I would probably look to make adjustments to try to get a bit more

room for the kitchen and the third bedroom.

Of course, all subject to permission from the local authority

and the freeholder.

So we seem to agree it would work better as a two-bed flat.

But losing a bedroom can be costly,

so what effect would it have on this flat, guided at £200,000 plus?

As a two-bedroom maisonette, the property should go on the market

for £350,000 and it would rent for

between £1,400 and £1,500 per calendar month.

As a better-laid-out three-bedroom than it currently is, it will go on

the market to sell for around £380,000 and it would very likely rent somewhere

between £1,700 and £1,800 per calendar month.

So as a rental, three is always better than two, but resale may be a balance

between the cost of rejigging the layout versus the return.

Well, as it stands, this flat needs a complete refurbishment and the

layout definitely needs some attention too,

but those gorgeous views really are the selling feature for me.

So who was prepared to take it on?

Let's go to auction and find out.

Start at 220 on this.

Going to 220. 220 down here.

225. 225. 230. 230.

235. 235.

Well, after a slow start,

bidding intensified and we rejoin the auction with the lot now at

£305,000.

305. 307.

309. 311. 313.

315. 317. 319.

321. 323.

321 in the aisle. First time, second time.

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

Sold, 321.

And so the hammer fell at 321,000 and the successful bidders were Yuri

and his daughter Paulina.

Yuri is a retired banker and daughter Paulina has followed in her

father's footsteps and also works as a banker in nearby Canary Wharf.

It was Paulina who joined me back at the flat to tell me more.

# Just like money in my pocket Baby love

# Take that to the bank. #

Paulina, congratulations.

-Thank you.

-This has got to be one of the best flats with a view

that I have seen in a long time.

I hope so.

-That's what I fell in love with.

-Need I ask why did you want to bid for this?

-The view.

The location. I rent about five minutes away from here.

I do have the same view and I love that view and every time I come home

from work, no matter how stressed I am, no matter how tired I am,

I just look at the skyline and it goes away.

Have you bought this so you don't need to rent any more,

you can move into your own property?

We bought this actually as an investment project with my father

and our family friend Dmitri, to rent it out.

Then perhaps extend the lease on it and look at the market and see if we

can sell it. I have said to my father, if worst comes to worst,

if we can't sell it, if we can't rent it, I will come and live in it.

Which is fantastic.

You've got the fallback that you can come here and live yourself.

This is the investor planning.

-It's plan A, plan B and plan C.

-I love it.

Yep, there's no doubting Paulina has thought this through carefully and

living nearby, she'll be able to keep an eye on progress and, most

importantly, keep a check on the purse strings.

How much do you think you're going to need to spend on this?

Well, I have set a hard budget...

of £20,000.

Oh! OK, it all depends on what you're going to do here.

So let's now talk about that.

Right, so my big idea is to do a living-kitchen and then turn the living room,

the current living room, into a third bedroom.

-So this would be the bedroom.

-This would be the bedroom.

Upstairs we've got one bathroom and one toilet, which are separate,

and I would like to take a little bit off storage space from

a bedroom and split these into separate shower rooms,

so we'd have two toilets with two showers.

Do you really think you'll be able to stick to your 20 grand budget,

I mean, realistically?

-I don't know. Do you?

-I don't think so.

I think you're going to have to be really, really stringent on what

you do, but I know you need to create a new kitchen, a new bathroom.

I actually like to do things on a budget.

They look good, but...

I know how to find things that don't cost a fortune.

You're a financier. Of course you do!

Being the financier she is,

Paulina also read the legal pack, so she was well aware of the additional

£3,500 charge

and she has factored it into that tight budget of £20,000.

And she's hoping to get the work done in three to four months' time.

What part are you all going to play?

My dad is the coordinator of the project.

He's done a lot of...

legal things around the auction.

He's set up sort of the financing of this.

Dmitri, our friend, he is...

being a plumber by profession, he's going to be the technical director.

So he will sort of...

-Project manage? Be on site?

-Project manage, he's going to be on site.

He's going to find

all the builders to do the right things.

Myself, I've budgeted, so I've kept an eye

on the planning and the budget.

Also I'm taking the creative role in this, so I will

try my best to do the interior designs, to

sort of make it look nice.

Paulina, it's been great talking to you today.

Good luck with the project and I hope you can stick to that budget.

-Hope as well. Thank you very much, Lucy.

-Congratulations.

-Thank you.

So being a banker,

well, I'm hoping Paulina will be able to keep to that £20,000 budget,

although this is the first project for her and her team,

so we'll have to see.

Join me later on in the programme

and you can find out how they all get on.

Coming up - in Stepney, London, it's a pretty unpredictable business.

The circumstances have changed.

Something happened that we didn't think would be possible.

And in Newcastle-under-Lyme, some opinions are best left unsaid.

We've been a bit snappy, so...

Time to head back to Maidstone in Kent now,

where earlier, I looked around this three-bed semidetached property

that had a guide price of £240,000 to £250,000.

The property was in a sought-after area of Maidstone, but first impressions

were that it wasn't realising its potential, until I found this.

Boom! A big extension.

Obviously, it's not been completed,

but the work so far looks like it's been done to a pretty good standard.

Look at that RSJ.

Wow. That is a real big boy.

It looks like, at first glance, it's been nicely constructed, as I said.

Work to do to finish it off, but with this combined with that,

this is a lot of space.

Good house.

The extension was just a shell, but it had room enough for a bigger kitchen

as well as an extra bedroom or study and a downstairs cloakroom.

It had plenty of attention on auction day and sailed past its guide price,

eventually selling for £309,000,

almost £60,000 over its guide price.

Sold, sir. Thank you very much.

The happy couple who bought it were first time renovators Arjuna and wife Evelyn.

With Arjuna otherwise engaged,

it fell to Evelyn and her sister-in-law Priya to reveal their secret weapon.

I'm an architect by training.

-Oh, great.

-I retired as a project manager from Manchester City,

so here I am helping my brother and sister-in-law to do the design

and get the building on the go.

With plans to make the most of the extension downstairs,

Evelyn had given herself a timescale of 12 weeks and a generous budget of

£25,000 in order to get the property ready for the sales market.

Well, we've returned just over five months later and I can't wait to see

what they've achieved.

Well, I said, "Boom!" earlier.

That must make this double boom!

Half the extension has been turned into a modern,

sleek kitchen that will have the buyers swooning.

And the other half of the extension?

Well, have a look for yourself.

Yes, as planned, this has been turned into an extra bedroom with its own cloakroom.

Priya is on hand to explain exactly how they did it.

So we opened up at the entrance hall and formed the fourth bedroom and

an attached shower room.

Further down the corridor, we opened up again,

to create the utility space and flow into a large kitchen,

that flowed naturally into the garden.

So there was connection between the inside and the outside.

Yes, the kitchen leads into the much-improved conservatory.

And that lovely dual aspect living room has been enhanced by the

addition of some lovely bifold doors.

Upstairs, the layout has remained the same.

With the existing three bedrooms neutrally decorated to a very high standard.

The bathroom has remained the same size,

but it's looking a lot more modern.

They have also gone the extra mile by improving the exterior

with a lovely new driveway, a new fence,

a new roof for the garage and yes, the inspection pit is no more.

So, with the project complete, how has Evelyn found the experience?

It was interesting and it's kept me going

and yeah, obviously we had our ups and downs,

but it was... In the end, it was nice, yeah, it was enjoyable.

Working with Priya was absolutely brilliant, because she had all the

knowledge and everything and she was so helpful to me and any problems

I called her and she gave me advice,

I have to do this and that...

Without her I couldn't have done this project.

Yeah, Priya was brilliant.

So Evelyn is delighted how things worked out on this project,

but was Priya?

My sister-in-law is amazing to work with.

My brother is more demanding.

But they had a vision and I had to deliver the vision.

It is a lot harder working with the family.

It's not like a client, is it?

No, but it was wonderful. It was really nice.

A lot of food.

Evelyn is an amazing cook, so she gave me wonderful meals.

Even after we'd been working here all evening,

she'd go and produce something wonderful.

With Priya on hand to lend advice and guidance,

Evelyn oversaw the work here

and due to some problems finding reliable contractors,

plus holidays in between, things were delayed.

But in the end, they did meet their target of 12 weeks once it began.

So what about the budget of £20,000?

Well, we underestimated the amount of work that was involved,

so 25 was nowhere near enough.

Eventually we ended up spending 60,000.

Yeah. But I'm pleased with the outcome, you know, yeah.

Wow. That's over twice their original budget

and it means that they've invested a total of £369,000 into this property that they hope to sell.

So will two local estate agents think it's a wise investment?

We first asked the agent who saw it originally.

Well, on my second visit,

the property's transformed.

It was nothing more than a shell when I first saw it.

They've done absolutely everything that you could imagine

to bring the property up to the fantastic spec that it is.

First impressions of the property,

it's been finished to a very high standard.

This space on offer here is very good

and it will definitely suit a family, for sure.

Both agents think this house would rent for £1,300 per calendar month,

giving a yield of just over 4%.

However, the intention was always to sell,

so let's hear what this £369,000 investment could be worth.

On the open market, I predict this property would achieve

£390,000 to £400,000.

I believe this property will achieve somewhere between

£390,000 and £400,000,

but we could probably stretch the asking price to £415,000.

Well, if they can achieve that 415,000,

that would mean a pre-tax profit of 46,000.

So, Evelyn's first project is complete, and Priya?

Well, she can't wait for her next culinary payday.

She's great. She really does make some amazing food.

If you ever want a fantastic meal, she's the one.

Oh, dear! Thank you!

Newcastle-under-Lyme in Staffordshire

was supposedly named after a new castle bought in the area

in the 12th century, and the forest of lime trees

that covered the area in medieval times.

Today, I'm just outside the town in the village of Wolstanton.

So, just a short walk away from the centre of Wolstanton,

which is just at the top of the road there,

you've got all the amenities you need.

Restaurants, doctors, pubs, whatever you need.

And here's our property with off-street parking

which is a great start.

It's got three bedrooms, it's a semidetached,

and it has a guide price of £80,000.

Let's get inside out of the rain.

It is damp outside.

And, as you come in, you can smell a bit of damp as well.

And there it is. Some bubbling just there.

More signs of damp.

Some kind of water leakage coming into the house.

Very red in this hallway.

Stairs going up to the bedrooms there.

A decent sized reception room to the right-hand side there

with central heating. Across the hallway,

you've got another second reception room, which is a good size as well.

More signs of damp in the corner just there.

And over there.

The windows don't look too bad.

And this is not a bad-sized room at all.

So, you've got two good-sized reception rooms just there.

OK, let me just take a step back.

I'm thinking, firstly, could you take this wall out

to have a nice, big kitchen/family area?

Or keep it in, and you have a kitchen/dining area

completely separate.

This kitchen doesn't actually look too bad from here,

and you might be able to resurrect most of what's in here.

It's a good-sized room.

And, just there, you've got a downstairs toilet,

again with signs of damp just in the corner as well.

Not a bad-sized kitchen at all.

Not a bad downstairs but the damp is concerning me.

Let's hope there's no more upstairs.

Well, hope springs eternal, as they say,

as does the damp, it would seem,

in this place. Signs aren't good in the bathroom...

..the first bedroom...

..and the second bedroom.

And into bedroom three, and like the other two, it's a decent size,

but, also like the other two and the bathroom,

there's even more signs of damp.

Now, on your to-do list, number one, get damp checked out.

Cos this place is wet, wet, wet.

# Yes, I'm walking on water

# And you know you're by my side... #

I did mention it has off-street parking and it's a large piece of

off-street parking as well.

Comes all the way to the back of the house and when you get round

the corner, you've got even more garden space.

But the first thing I would do is get rid of that shed there,

which looks like it's seen better days.

I also thought could you extend out the back as well

cos there's enough space to do so.

But, as I look around,

I can see that houses nearby haven't done that

so it's probably a waste of money.

On a safety issue, I'd put a fence just at the end of the house there,

just so you've got a separate garden and driveway.

Just keep it safe for young children and pets.

All in all, it's a good space out here.

We asked a local estate agent what his advice would be.

The first thing I would do is recommend

that a damp specialist comes out and inspects the property...

..in order to ascertain how much damp there is.

And then we would be looking at replastering and skimming the walls.

Once that's done and renovated,

what would the property command on the open market?

Once renovated, I would expect the property to achieve

in the region of £135,000 to £140,000.

Not a bad price, bearing in mind the guide of £80,000.

So, what about the rentals?

I would put the property onto the rental market

at £600 per calendar month.

Let's get these wellies off.

I wasn't joking. Seriously damp in there.

This is a good-sized house, well-proportioned,

with loads of potential,

but, on a serious note,

you would have to get that damp sorted out ASAP.

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

We now move to lot 14. Ladies and gentlemen,

a three-bed semidetached house and it's guiding at 80,000.

Who's here at 80?

Thank you. 82 anywhere?

82.

What are you doing? You were getting your jacket on!

That's a dangerous thing to do at an auction, isn't it?

There we go. That big arm in the air as he stretched

nearly won you a nice house in Wolstanton! So...

Meanwhile the bid is with the lady at the front at 80.

82 anywhere else?

Nearly a costly misunderstanding there.

We rejoin the bidding at £103,000.

103 is bid. 104? 105.

Six? Seven?

No. All right the bid's 106.

All the action right at the front of the room for now.

I'm looking round the rest of the room now for £107,000.

If not, with the lady right at the very front in row one at £106,000.

For the first time. I'm taking half if you're quick, sir.

Second time at £106,000.

I'll only give you another 500. Both say no.

Third and final time. Anybody else?

Are we all done at £106,000?

Well done, it's yours at 106.

And if you recognise the top bidder,

it's because Donna-Marie's been on the show several times before,

including back in August 2014,

when she bought this three-bed terrace in Tunstall in Stoke

with the help of her mum, dad and partner Stephen.

This time, Donna-Marie is aiming to make some profit on her £106,000

purchase in order to finance her new business -

developing properties for clients.

I met up with her to find out a little bit more.

-Donna-Marie, nice to see you again.

-Nice to see you again, too, Dion.

Congratulations again on another purchase.

-Thank you.

-What was it about this particular property that you liked?

I was buying one to flip so, put simply, it was maybe not the worst,

but one of the worst houses in one of the best streets.

What are you going to do to this property?

Right, it just needs to be brought right up to date, really.

So there's quite a lot of internal damp issues

that need to be resolved. And, following those,

there will be plasterwork and replacement woodwork.

And I'm planning to keep the existing bathroom

but enhance that slightly.

The kitchen in here will be removed and hopefully reused,

but upgraded with better worktops,

coving, hopefully under-cupboard lighting,

that kind of thing.

-Pretty.

-Just to bring it back to being a nice, saleable family home.

-There's a lot of damp.

-There's a lot of mould

and what looks like there's been a moisture issue.

Within recent years, the outside of the property has been re-rendered.

-OK.

-So we could easily chip it all back, re-plaster,

make good and walk away.

But, as I'm looking to sell this on, and wanting to...

It's not that much more to get the damp work done.

-OK, yeah, yeah.

-So I'm going to get that done while

the work's being sorted. And it looks like I'm probably

going to have to pay for scaffolding to go up, so I might as well

get it all done and sound so that once somebody puts an offer in,

they've put an offer in, it's a sound proposition.

And there's not going to be any issues

when we come to survey or anything, because we've got everything

in place and guaranteed, etc.

Donna-Marie is really on the ball.

So, what's the budget?

-The least it's going to cost me is 11,000.

-OK.

-The most it should cost me is 16,000.

-Is that because

you've done your... You've done all your figures already?

Yeah, I mean, I had a damp survey

done on the property before I bought it.

-Oh, OK.

-So I was relatively confident, you know,

-I wanted to get this one.

-Quite a few things that need to be done.

-Yeah.

-How long will it take you to do all the work?

Unfortunately, because of the particular damp person

that I've decided to go with,

being so good and reputable, they're pretty booked up.

So even though I got him in before I'd even bought the house,

we've got to wait two weeks from now before that can get done.

-So it might take, you know, eight to ten weeks.

-OK.

But I just want to kind of get in here,

do a reasonably good job to bring it to a habitable state again,

so that somebody can buy it. There's still money in it for them,

they've still got room to make their own mark.

You know, make my small little bit of profit,

and move it onto the next people, really.

-Talking about the profits...

-Yeah.

-You got it for 106,000?

-That's right, yeah.

-Correct? What are you hoping to get back off this?

You're going to spend 16 maximum?

-Yeah.

-That will take you to 120,000.

Yeah, I want to get at least ten to 15 grand out of it,

-otherwise I won't sell it.

-And if you don't get what you want,

-you'll...?

-Rather than rent it,

if we do spend that bit extra to bring the spec up...

-You're hoping!

-..me and my partner might move in here

if we can't make the money on it.

And live here for a short period of time,

until the market allows for us to make the profit on it.

Cos renting it, obviously, people don't look after their, you know,

rental home perhaps as well as they might if it was their own.

Of course, yeah. Is there anything else in the building

that you've seen that has surprised you, or frightened you,

-or you've thought, "Oh, I didn't realise that was there," or...

-Um...

Not yet. Not yet.

A few things have cost a bit more than I originally thought,

but then the value is a little bit stronger than I originally thought

-as well, so it's counterbalanced them.

-Listen,

-you've never failed as yet.

-Not yet.

-And we can't wait to see the end result.

-Thank you.

Good luck to you, Donna-Marie.

-Cheers, thanks, Dion.

-Good luck to you.

So, eight to ten weeks might be a long turn around for Donna-Marie,

but I think that's still going to be a little bit tight considering

all that damp that needs to be sorted out.

But you can find out how she gets on later in the programme.

Well, making renovation decisions can be tricky.

Do you go for the best finish ever but risk overspending

on fixture and fittings?

Yeah, or do you go for the bargain basement approach and perhaps

not achieve the best price possible?

So far, we've seen how one set of buyers dealt with this dilemma.

But what about the other two? Let's find out.

Back to East London now and the area of Stepney.

It was here that I looked around a three-bedroom maisonette

on the fourth floor of this ex-council block,

which had a very attractive guide price of £200,000.

Despite having great views of the city from the front and back,

the view of the interior... Well, it was less of an attraction.

And this whole flat is just really dated.

It needs new decor, new carpets, the laminate's all a bit tatty.

I mean, it really does need a big load of TLC in this flat.

The property was crying out to be reconfigured.

So, it fell to the buyers on auction day to fight it out.

Sold, 321.

The successful bidders, with £321,000,

£121,000 over that guide price,

were retired banker Yuri and his daughter, Paulina,

who herself is a banker.

Being a banker, she had a firm idea on the budget.

I have set a hard budget

of £20,000.

Do you really think you'll be able to stick to your 20,000 budget?

I mean, realistically?

-I don't know, do you?

-Do you know what?

-No.

-No.

-I don't think so.

Yep, I certainly had my doubts.

After all, Paulina and her father, Yuri,

were first-time developers and had big plans for this property,

which included turning the living room into a bedroom

and turning the current bathroom configuration

into two shower rooms upstairs.

Plus, there was a sting in the tail in the form of a hefty £3,500

maintenance bill that Paulina would have to factor in

to her already tight budget. Thankfully,

she had a secret weapon in the form of her business partner and plumber

Dmitri, who would oversee the work

which they had hoped would take three or four months. After then,

they plan to rent the property with an eye on selling in the future.

So, here we are six months later.

And I can't wait to see what they've done.

Wow! Unrecognisable.

From cramped and dated to bright and contemporary.

This living area is stunning.

I love it.

Paulina is here to tell us how this was achieved.

So we have taken down a wall which was separating the kitchen

and the living space from a tiny little bedroom in the back.

We have opened up the entire space.

We have put in a new kitchen.

We opened up the staircase...

to bring in more light.

And put in a new window to maximise the view.

The upstairs is just as impressive, with two lovely, bright bedrooms.

As Paulina planned, they've rejigged that split bathroom and toilet,

and used some cupboard space to create a shower, and with a loo

and a bathroom.

They really have transformed this property.

And doing away with that third bedroom was,

in my opinion, a masterstroke.

So, originally we were meant to have three bedrooms.

We wanted to do it as a...

..to maximise the rent yields.

The circumstances have changed.

We... Something happened that we didn't think would be possible.

My husband and I, we bought a house in London.

And while we're renovating the house,

we decided that we will live here.

So we went back to the original layout of the flat,

having two bedrooms upstairs,

so we would enjoy the nice living room downstairs.

So, Paulina's moving in,

but what about business partners Yuri and Dmitri,

and their investments?

I own a part of the apartment, so on that part I'm not going to pay rent.

And, with my father, I'm going to strike a favourable deal.

And with Dmitri, I think we'll reach an agreement.

Excellent. And, after all, this is a temporary arrangement.

They'll be renting and possibly selling in the future.

So, with this 99% complete, how is Paulina's budget looking?

My original budget was 20,000.

My father, being more realistic, said 25,000.

And I think he was right.

We spent closer to 25.

We didn't want to compromise on quality.

So I think we spent a little more to bring this place to life.

Well, I'm impressed with what she's managed to achieve for the budget.

How about the timescale?

In terms of timescale, we initially planned three months.

It took...

quite considerably longer, so, closer to five months to finish.

Just because we started

before the holiday season.

And then we were taking some time to decide what to do with the place.

And, so, the first two months were a little bit idle.

So, Paulina and partners have invested a total of around 346,000.

But will two local estate agents think it's a wise investment?

Let's start with the agent who saw it originally.

I think the owner of the property has definitely gone the right route.

Reverting it back to a two-bedroom.

Increasing its volume by having it open-plan

brings a lot of natural light into the property.

It shows off the best aspects of the property,

which are, of course, the views.

Overall, the flat looks very nice.

I like the extra shower room.

The separate bathroom as well.

And, yes, I like... I'm very impressed with the flat.

So, the agents are onboard.

Time to hear valuations.

Rental first.

If we would rent this property, in its present condition,

we would then put it on the market for a price between

£1,500 per calendar month

up to £1,600 per calendar month.

I think, based on the improvements they've done to the property,

they should be looking at least £1,500 to £1,600

per calendar month in rental.

It's a little bit on the lower side of what I expected.

So, a little disappointment with that 5.5% yield.

But with the £346,000 invested,

perhaps the resale valuation will impress more.

If we were to put the property on the market to sell,

I would suggest an asking price of £375,000.

I would suggest marketing this property in the price range between

£370,000 to £380,000.

Once again, I think it can be worth more.

We're not planning on selling it just yet.

I think a couple of years down the line,

we can extend the lease and get that figure to a higher level.

That top figure of 390,000

would mean a pre-tax profit of around £44,000.

So, a successful first project for Paulina and her team,

although I get the feeling it's going to be a while

before Paulina is ready to let go of that lovely view.

Back to the Newcastle-under-Lyme area and the village of Wolstanton.

It was here that I had a poke around this three-bed semidetached property

that had a guide price of £80,000.

Straight away, I was impressed.

Especially with the off-street parking.

Unfortunately, inside wasn't as nice.

HE SNIFFS

And as you come in, you can smell a bit of damp.

And there it is. There's some bobbling just there and some more signs of damp.

Or some kind of water leakage coming into the house.

I'm beginning to think a big, damp cloud follows me around.

So here I am saying it again.

Now, on your to-do list -

number one, get damp checked out.

Yeah, the damp was a worry, but the house was well-proportioned,

in a good area and full of potential.

This didn't go unnoticed on auction day,

where the property had plenty of interest.

Well done, it's yours.

Nabbing the property for £26,000 over the guide price was seasoned

landlord and renovator Donna-Marie, who has been on the show before

and, as ever, was on the ball.

Yeah, I want to get at least 10 to 15 grand out of it,

otherwise I won't sell it.

Donna-Marie doesn't mess about.

And despite all the damp, as well as the cosmetic issues here,

she felt a budget of between £11,000 and £16,000

and a timescale of eight to ten weeks would get the property

ready for the sales market.

We're back two and a half months later to see if

Donna-Marie has managed to turn this place from damp and dull

to dreamy and desirable.

Bright, fresh and welcoming.

Donna-Marie promised a thorough job.

And so, from top to bottom, the house's damp issue has been sorted.

All the walls have been stripped back to brick and replastered.

They've refitted the original kitchen units,

but given it a face-lift with retiling and lighting added.

And the downstairs cloakroom has had a makeover, with a new toilet.

Upstairs, and the three bedrooms have been neutrally decorated

to a very high standard.

The bathroom has been cleaned up,

and a new toilet suite has been added.

And outside, they've done a little bit extra.

Yes, Donna has decided to re-landscape the garden,

as well as improving the drive.

And very wisely, to protect against damp, they've re-felted the roof,

and re-tiled where necessary.

There may have been no restructuring in this property, but Donna,

with a little help from mum Christine,

has truly transformed this house.

Although it's not been all plain sailing.

So the biggest problem we had with this project

was keeping to the timescales and being let down by workmen -

we've got a really reliable workforce,

but a number of them have been changed through this project -

and people not doing what they say they'd do,

within the timescales they said they'd do it in,

so A can't follow B can't follow C.

And so that's been the biggest stress and the biggest challenge.

-You found that frustrating, didn't you, love?

-Yeah, yeah.

We've had challenges... It's part and parcel of the deal with any

development, but we just seemed to have had a lot this time.

Or maybe the fact that I'm pregnant and I've got a little bit

less patience might have something to do with it, as well.

She's been a bit snappy, so...

Apparently.

# Tell me, baby, baby, baby, what can I do? #

Congratulations, Donna-Marie. And to you, too, Granny-to-be.

But best keep your opinions to yourself for, I don't know...

the next few months seems a safe bet.

With all that toing and froing with the workforce,

how has it affected Donna's timescale?

I think the timescale I originally gave was eight to ten weeks.

And in actual fact, despite the hiccups that we had,

I sort of picked things up where I could and managed to pull things

together with the help of a lot of the new contractors.

I think we finished in about eight to nine weeks.

-About nine weeks in total, wasn't it, sweetheart?

-Yes.

-From keys to ready, complete.

-Yeah.

Good stuff. But with all the work here,

as well as the landscaping outside, how is their budget looking?

OK, so the original budget I gave myself was 11 to 16,

depending on the roof and various factors.

And that's excluding obviously legals and finance costs, etc.

And I'm going to come in at around about the top end of that,

so between 16,000 and 17,000 when the last bills come in.

So she's bang on time, bang on the money.

Clever little thing, really!

Christine, I think voicing that opinion is allowed.

And it's one which we are all agreed.

So if we assume it's going to be closer to 17 grand all-in,

that means Donna-Marie has invested around 123 grand on this property,

that she plans to sell on.

Has it been a wise investment?

We've asked two local estate agents along to get their opinions,

starting with the agent who saw it originally.

The rooms have been replastered.

It's been re-carpeted. It's in great condition now.

I think the overall standard of finish has been done very neutral,

to a good standard, but also

people can put their own mark on the property when they come in to buy.

So it ticks a lot of boxes.

But how would it fare in the rental market?

To place the property on the rental market, we would look to achieve

somewhere within the region of £575 per calendar month.

If we were to let the property,

I would recommend a figure of £600 per calendar month.

That top figure of £600 per calendar month would mean a rental yield

of just under 6%.

But it's the sales market Donna-Marie really has her sights on.

And remember, she hoped to make £10-15,000 profit or she wouldn't

sell, and would even think about moving in herself. So?

We would be happy to place the property on the market for £135,000.

Yeah, I would recommend a figure in the region of £140,000.

Yeah, that's what I originally thought

when I started doing the project.

But the other four valuations I've had from other estate agents

that I know in the area have all said between 150 and 165.

So it's going on the market at 155 with an aim to achieving 150.

If I don't achieve that,

bearing in mind the extra work and care that's been taken,

I will just put it back...

I will put it on as part of the rental portfolio.

Well, if Donna-Marie did sell it for 150 grand,

that would mean a healthy pre-tax profit of 27 grand.

And with this one done and dusted,

Donna-Marie's plans for the future are really rather simple.

Yeah, baby next. Then another house.

Or several other houses.

THEY LAUGH

Hopefully we've given you a little bit of inspiration,

especially if you haven't been to a local property auction.

Yes, perhaps that little nudge you needed to head down to your local auction house.

But don't worry if you just want to stay curled up on the sofa

and watch it from the comfort of your own home.

But make sure you tune into more Homes Under The Hammer.

-Bye-bye.

-Goodbye.