0:00:02 > 0:00:04Hello. Now, nobody can predict the future, and knowing how best to
0:00:04 > 0:00:08invest in property, well, it's always unpredictable.
0:00:08 > 0:00:11That's true, Lucy, but it doesn't have to be too overwhelming.
0:00:11 > 0:00:14My advice would be, how could you add value?
0:00:14 > 0:00:16Well, one way you could do that is to head down
0:00:16 > 0:00:19to your local property auction.
0:00:44 > 0:00:47Well, property auctions throw up all sorts of auction lots.
0:00:47 > 0:00:51Over the years, I've seen everything from public toilets to water towers.
0:00:51 > 0:00:54But what was in the auction catalogues for today's buyers?
0:00:54 > 0:00:57Yes, what did they walk away with? Let's find out.
0:00:58 > 0:01:02First up, in Stratford, London, I put my foot in it.
0:01:05 > 0:01:08Yep, floorboards need replacing.
0:01:08 > 0:01:12Whilst in Peterlee, County Durham, I can't really get my head around it.
0:01:12 > 0:01:14Checking the accuracy of instrumentation.
0:01:14 > 0:01:18That has just completely gone over my head, that.
0:01:18 > 0:01:22And in Newcastle-upon-Tyne, Lucy needs to watch her step.
0:01:22 > 0:01:24Well...
0:01:24 > 0:01:28Oh! Talk about literally falling in the front door!
0:01:30 > 0:01:33All these properties have been sold at auction, and we will find out
0:01:33 > 0:01:37who bought them and what they paid when they went under the hammer.
0:01:37 > 0:01:38Sold!
0:01:45 > 0:01:50Stratford in east London is about seven miles from central London.
0:01:50 > 0:01:53It's seen a lot of regeneration, with spin-offs from the Olympics,
0:01:53 > 0:01:56like the Queen Elizabeth Park,
0:01:56 > 0:02:00various sporting venues and one of Europe's biggest shopping centres.
0:02:01 > 0:02:03With all of that going on,
0:02:03 > 0:02:06it's bound to have a buoyant property market.
0:02:10 > 0:02:13Well, just down the road from West Ham Park,
0:02:13 > 0:02:15ten minutes' walk from the nearest Tube
0:02:15 > 0:02:17is the property I'm here to see.
0:02:17 > 0:02:22£360,000 was the guide price for this. It's a three-bed mid-terrace.
0:02:22 > 0:02:25As you can see, lots of shuttering on the outside.
0:02:25 > 0:02:29Not an auspicious start. Let's hope it's better inside.
0:02:31 > 0:02:34So, hopefully better, we come inside.
0:02:34 > 0:02:40And... Well, it obviously hasn't been lived in...
0:02:40 > 0:02:44Possibly lived in, but not updated for a while,
0:02:44 > 0:02:47which could be good, because there could be features...
0:02:47 > 0:02:50In fact, look at that. Some coving, very pretty indeed.
0:02:50 > 0:02:53A nice sort of feel the moment you walk through the door.
0:02:53 > 0:02:57A little corridor there and then into this room here,
0:02:57 > 0:03:00one of the main living areas here.
0:03:00 > 0:03:03A little bay window there. That could be quite nice.
0:03:03 > 0:03:07Ooh, Yes, lovely. Original features. A bit of a ceiling rose going on.
0:03:07 > 0:03:09Nice fireplace.
0:03:09 > 0:03:11Wooden flooring that looks to be in really nice condition,
0:03:11 > 0:03:13so you could strip at back.
0:03:13 > 0:03:16Large archway through to the rear sitting room and, yeah,
0:03:16 > 0:03:19it's going to take a bit of imagination,
0:03:19 > 0:03:23and it's a lot of money for a house in this kind of condition,
0:03:23 > 0:03:25but it's looking positive.
0:03:25 > 0:03:28# I am beautiful
0:03:28 > 0:03:31# In every single way
0:03:31 > 0:03:36# Yes, words can't bring me down
0:03:36 > 0:03:39# Oh, no
0:03:39 > 0:03:42# So don't you bring me down today... #
0:03:42 > 0:03:44OK, OK.
0:03:44 > 0:03:48So it's not beautiful in every way, and lots of stuff will be coming
0:03:48 > 0:03:51down, but there are some really lovely period features in here.
0:03:55 > 0:03:57Well, it's quite extensive, this property.
0:03:57 > 0:04:01Not so much at the front, but it goes back and back and back,
0:04:01 > 0:04:05and down this corridor here, you've got a little access to the rear
0:04:05 > 0:04:09garden area, and then this sort of what I imagine was originally...
0:04:09 > 0:04:11Well, I can't imagine...
0:04:11 > 0:04:13A kitchen, I guess,
0:04:13 > 0:04:16although it doesn't show any signs of having been a kitchen.
0:04:16 > 0:04:19What it does show signs of is, look at this.
0:04:19 > 0:04:21Not good.
0:04:21 > 0:04:24At all.
0:04:24 > 0:04:26Yep, floorboards need replacing.
0:04:26 > 0:04:30Perhaps even more than they did three seconds ago, but not to worry.
0:04:30 > 0:04:34Consider it a small token of thanks for allowing us to be here.
0:04:34 > 0:04:37Anyway, the kitchen. No, there is one. I was wrong. I'm so sorry.
0:04:37 > 0:04:40Here it is, and it's perfect, look.
0:04:40 > 0:04:43A little bit of cream cleaner on that, what's the problem(?)
0:04:43 > 0:04:47And we are delighted to say that this house comes with white goods.
0:04:47 > 0:04:49Well, they're not so much white...
0:04:49 > 0:04:51Oh, look.
0:04:51 > 0:04:54Lovely...
0:04:54 > 0:04:55No.
0:04:55 > 0:04:57Anyway... Yuck.
0:04:57 > 0:05:00What is more serious and is going to take slightly more time
0:05:00 > 0:05:02to resolve is this.
0:05:02 > 0:05:05A very, very nasty crack. That needs investigating.
0:05:05 > 0:05:07I wonder what's going on there.
0:05:07 > 0:05:11So, anyway, the joy continues because, just there,
0:05:11 > 0:05:14is the only bathroom in the property.
0:05:14 > 0:05:17And there is no running water either. Oh, dear.
0:05:18 > 0:05:21I wish I hadn't done that. Yeugh!
0:05:21 > 0:05:23# Don't do it
0:05:23 > 0:05:26# Baby, please don't do it
0:05:26 > 0:05:28# Don't...do it. #
0:05:28 > 0:05:32Yes, you'd think, after all these years, I'd know better than that.
0:05:32 > 0:05:36Anyway, back to the house, and just off the hallway there are
0:05:36 > 0:05:38stairs down to a useful little cellar.
0:05:41 > 0:05:44Upstairs, there is yet more space.
0:05:44 > 0:05:45Three really good-sized bedrooms,
0:05:45 > 0:05:48and all obviously need a lot of work,
0:05:48 > 0:05:52but the potential is there and... Well, I spoke too soon earlier.
0:05:52 > 0:05:56There IS a bathroom up here, albeit a rather small one.
0:05:56 > 0:06:00It might be an idea to use some of the space up here to make
0:06:00 > 0:06:02a bigger family bathroom.
0:06:03 > 0:06:06While you're at it, how about looking into the roof?
0:06:06 > 0:06:09I happen to know that several properties on this road have
0:06:09 > 0:06:12converted their attics into extra bedrooms.
0:06:12 > 0:06:14You'd need to get planning permission, of course,
0:06:14 > 0:06:18but in such a sought-after area, it's bound to add value.
0:06:20 > 0:06:23At the back, there is a modest garden and
0:06:23 > 0:06:27a very dodgy-looking lean-to type of thing that will need to come down.
0:06:27 > 0:06:31But in London, any outdoor space is a bonus, so another tick.
0:06:34 > 0:06:38There is a lot of house here in London terms for that guide price
0:06:38 > 0:06:42of 360,000, but it's going to take a really healthy budget to
0:06:42 > 0:06:44make it habitable.
0:06:44 > 0:06:47Time to get the thoughts of a local property agent.
0:06:49 > 0:06:51The size of the property is actually quite good.
0:06:51 > 0:06:54Evidently, it needs quite a lot of work, however,
0:06:54 > 0:06:56it's got quite a lot of potential
0:06:56 > 0:06:58and it's definitely worth looking at
0:06:58 > 0:07:00extending the property into the loft.
0:07:00 > 0:07:03Adding an additional bedroom to the property would add great value.
0:07:03 > 0:07:05Also, in addition to the fact that,
0:07:05 > 0:07:08if you were to rent the property out, you'd obviously be
0:07:08 > 0:07:11getting a much higher rental value on the property as well.
0:07:11 > 0:07:13OK, so that's something for the buyer to consider,
0:07:13 > 0:07:15depending on their plans for the property.
0:07:15 > 0:07:18What kind of values, sales and rental,
0:07:18 > 0:07:22would the agent put on the property if it stayed as a three-bed?
0:07:22 > 0:07:25As a three-bedroomed house, once the refurbishment
0:07:25 > 0:07:27has been done on the property, we would be confident in
0:07:27 > 0:07:31achieving anything between £525,000 up to about £550,000.
0:07:31 > 0:07:34We would be confident in getting £1,800 a month
0:07:34 > 0:07:37up to about £1,900 a month,
0:07:37 > 0:07:40subject to whether the property is furnished or unfurnished.
0:07:40 > 0:07:43And what about if it did get turned into a four-bed?
0:07:43 > 0:07:46We would be confident in achieving around the region
0:07:46 > 0:07:49of £600,000 up to about £625,000.
0:07:49 > 0:07:51With the additional fourth bedroom in the property,
0:07:51 > 0:07:55we would be looking to achieve about £2,100 per month.
0:07:55 > 0:07:58Well, it's got no windows downstairs,
0:07:58 > 0:08:00the kitchen is horrendous,
0:08:00 > 0:08:03the bathroom... Don't even talk about it,
0:08:03 > 0:08:08It's got rot, it's falling to pieces, it's got that massive crack,
0:08:08 > 0:08:10you don't know what it's all about.
0:08:10 > 0:08:13Honestly, what a fantastic opportunity!
0:08:13 > 0:08:16You are in a really good location with this one,
0:08:16 > 0:08:19and all those big problems that could make people go,
0:08:19 > 0:08:22"No way," make this a really interesting investment opportunity,
0:08:22 > 0:08:24because it could put people off.
0:08:24 > 0:08:28Let's see who saw the opportunity, rather than the mess,
0:08:28 > 0:08:30when it went under the hammer.
0:08:30 > 0:08:33I'm going to start at 430 on this one.
0:08:33 > 0:08:36So 430 down here, 430.
0:08:36 > 0:08:38435?
0:08:38 > 0:08:41435. 440.
0:08:41 > 0:08:43445.
0:08:45 > 0:08:47450?
0:08:47 > 0:08:49455.
0:08:49 > 0:08:53New spot. 455 standing up. 455.
0:08:53 > 0:08:54460.
0:08:54 > 0:09:00The property got off to a flyer, and we re-join it at 480,000.
0:09:01 > 0:09:03480. 485.
0:09:03 > 0:09:06485. 490.
0:09:07 > 0:09:09490.
0:09:09 > 0:09:10495.
0:09:11 > 0:09:13495.
0:09:13 > 0:09:14499.
0:09:14 > 0:09:16500.
0:09:16 > 0:09:17500?
0:09:17 > 0:09:19If not 499.
0:09:19 > 0:09:22First time. Second time.
0:09:22 > 0:09:25Third and last time, if you're done...
0:09:25 > 0:09:28No, it can't quite sell at that.
0:09:30 > 0:09:33The bids didn't quite meet the reserve, however, after a little
0:09:33 > 0:09:39bit of negotiating, the seller did agree to a final figure of 476,000.
0:09:39 > 0:09:42The successful bidders were
0:09:42 > 0:09:45married couples and friends Kawal and Savita,
0:09:45 > 0:09:47there on the left,
0:09:47 > 0:09:48and Rags and Richa.
0:09:48 > 0:09:51This was their first project together,
0:09:51 > 0:09:55and it fell to Kawal and Richa to tell me about their plans.
0:09:55 > 0:09:58- Kawal, Richa, good to see you both. Congratulations.- Thank you.
0:09:58 > 0:10:01Tell me why you wanted to buy this house.
0:10:01 > 0:10:04Basically, we saw the potential in this property,
0:10:04 > 0:10:06kind of an investment,
0:10:06 > 0:10:09- because we've known each other as family friends.- OK.
0:10:09 > 0:10:12She's a good friend of mine
0:10:12 > 0:10:14and of my wife as well,
0:10:14 > 0:10:17and they have good skills of interior designing,
0:10:17 > 0:10:19so that's the reason we thought,
0:10:19 > 0:10:22"Let's do some business together and see how it goes."
0:10:22 > 0:10:25What was it particularly about this house that you liked?
0:10:25 > 0:10:28We liked that it has got big scope,
0:10:28 > 0:10:32good ceilings and, at the moment, this is a three-bedder.
0:10:32 > 0:10:35We can convert it into five if we want, or, if not,
0:10:35 > 0:10:38four is the minimum we could do there.
0:10:38 > 0:10:39What was it you liked about it?
0:10:39 > 0:10:42We plan to do the loft conversion, basically.
0:10:42 > 0:10:45So, right now, it's three beds so, the loft, we'll see how it goes.
0:10:45 > 0:10:48We could put two bedrooms or maybe one with an en-suite in it.
0:10:48 > 0:10:51So, was that one of the big things that appealed,
0:10:51 > 0:10:55the fact there is this potential to extend upwards?
0:10:55 > 0:10:59Yeah, it opens so many avenues,
0:10:59 > 0:11:03so we are just going to expand on it and see how it goes from there.
0:11:03 > 0:11:06What is the conversion going to involve?
0:11:06 > 0:11:09Right, so if we are going to have, like,
0:11:09 > 0:11:13five bedrooms, then we might put a dormer in,
0:11:13 > 0:11:14otherwise we may not.
0:11:14 > 0:11:19It depends on whether planning permission gives us approval.
0:11:19 > 0:11:23Having a fourth and maybe even a fifth bedroom is ambitious
0:11:23 > 0:11:25and will definitely depend on planning.
0:11:25 > 0:11:29This new property team are certainly not afraid to take on
0:11:29 > 0:11:32a challenge, and their plans don't end with the loft extension.
0:11:32 > 0:11:35We just applied to open the kitchen,
0:11:35 > 0:11:39to knock down all the walls to the end of the house and just make it
0:11:39 > 0:11:42open plan, a big kitchen-diner sort of thing.
0:11:42 > 0:11:43Nice.
0:11:43 > 0:11:46And then bringing the WC from the behind of the house to
0:11:46 > 0:11:49the middle of the house, and then adding another toilet upstairs,
0:11:49 > 0:11:51- and the loft conversion.- OK.
0:11:51 > 0:11:53So, what budget have you got set aside?
0:11:53 > 0:11:57Overall, it's going to be 70K, if we include the loft,
0:11:57 > 0:11:59plus 10K contingency,
0:11:59 > 0:12:01so it's 80K we have budgeted for.
0:12:01 > 0:12:04Adding bedrooms and opening up the kitchen is bound to increase
0:12:04 > 0:12:08the value, although, at the moment, they are planning to wait
0:12:08 > 0:12:11and see how the market is before they decide whether to rent or sell,
0:12:11 > 0:12:14and they're hoping the work to get it ready for either market
0:12:14 > 0:12:16will take around two months.
0:12:16 > 0:12:21So, who is going to do the work, in terms of the physical work?
0:12:21 > 0:12:23Of course we'll not be doing it.
0:12:23 > 0:12:26We've lined up a few builders and I've got some quotations
0:12:26 > 0:12:29- with them. We have shortlisted, in fact, two builders.- OK.
0:12:29 > 0:12:32We still need to finalise, you know...
0:12:32 > 0:12:34At the beginning,
0:12:34 > 0:12:36everything looks very perfect.
0:12:36 > 0:12:39When we get there, we might have some issues with the builder
0:12:39 > 0:12:43and all, so we're just thinking which one's good, which one's bad
0:12:43 > 0:12:45and we just need to take a call on that.
0:12:45 > 0:12:48- Well, listen, congratulations. - Thank you very much.
0:12:48 > 0:12:51- Look forward to seeing how you get on.- Thank you very much.
0:12:51 > 0:12:55Well, it seems like there could be money to be made
0:12:55 > 0:12:57on this house in Stratford.
0:12:57 > 0:13:00How will the team get on sorting it out,
0:13:00 > 0:13:03and will they go for four bedrooms or five?
0:13:03 > 0:13:05You can find out later in the show.
0:13:09 > 0:13:13Today, I'm in County Durham, and it's a place of contrasts.
0:13:13 > 0:13:16This is the pretty seaside town of Seaham
0:13:16 > 0:13:21and yet I'm only six miles away from former coal-mining villages
0:13:21 > 0:13:24like Easington on the outskirts of Peterlee.
0:13:24 > 0:13:28Both towns have plenty of amenities, so you've got loads of choice.
0:13:28 > 0:13:32So, not far from the town centres of Peterlee and Seaham
0:13:32 > 0:13:35is the property and I'm here to see, and here it is.
0:13:35 > 0:13:38And it looks in really good condition.
0:13:38 > 0:13:40This wall actually looks pretty new as well.
0:13:40 > 0:13:44It has got three bedrooms, a guide price of £20,000,
0:13:44 > 0:13:48and you get yourself a bit of a yard area as well.
0:13:49 > 0:13:51Not bad.
0:13:55 > 0:13:56Nice.
0:13:56 > 0:14:00As soon as you come in, you've got the bathroom right in front of you.
0:14:00 > 0:14:02It looks like a brand-new bathroom suite,
0:14:02 > 0:14:04it looks like it has been painted.
0:14:04 > 0:14:06New flooring as well.
0:14:06 > 0:14:11Down a small step into what should be the kitchen.
0:14:11 > 0:14:14There isn't a kitchen in here as yet.
0:14:14 > 0:14:17Now, if you were looking to get a mortgage on this property,
0:14:17 > 0:14:21you'd find it difficult, because mortgage lenders won't lend
0:14:21 > 0:14:24on a property that doesn't have a kitchen.
0:14:24 > 0:14:25Believe it or not,
0:14:25 > 0:14:29most mortgage lenders set a minimum amount you can borrow.
0:14:29 > 0:14:31It varies from lender to lender,
0:14:31 > 0:14:36but anything below 40 grand can be tricky to get a mortgage for,
0:14:36 > 0:14:39so this looks like it's going to be a cash buyer.
0:14:39 > 0:14:43In the house itself, there's central heating throughout,
0:14:43 > 0:14:47and the master bedroom has generous proportions.
0:14:47 > 0:14:50In fact, all three bedrooms are a reasonable size.
0:14:52 > 0:14:55And as like downstairs, new carpets,
0:14:55 > 0:14:57and it's recently been painted.
0:14:57 > 0:15:02Now, let's say you got this place for £20,000,
0:15:02 > 0:15:04which is the guide price,
0:15:04 > 0:15:07and you rented out for £400 a month.
0:15:07 > 0:15:11You could have this place paid off in four years.
0:15:11 > 0:15:13This is an absolute bargain.
0:15:16 > 0:15:20If I leave now, I might just make that auction.
0:15:20 > 0:15:21See you.
0:15:21 > 0:15:26Yes, I know, I've missed the boat on that potential 24% yield.
0:15:26 > 0:15:28Now, joking aside,
0:15:28 > 0:15:31in order to combat antisocial behaviour and low demand,
0:15:31 > 0:15:34the council have brought in a selective licence scheme in
0:15:34 > 0:15:35this particular area.
0:15:35 > 0:15:39The downside is, the landlords have to apply and pay for the licence,
0:15:39 > 0:15:42but the upside - it's definitely worth it.
0:15:42 > 0:15:46Landlords get support on vetting and dealing with tenants and, overall,
0:15:46 > 0:15:50the licensing scheme has helped to improve the values in this area.
0:15:50 > 0:15:53So, I'm out the back...or out the front, I'm really not sure!
0:15:53 > 0:15:56On that side of the property, you've got a paved area,
0:15:56 > 0:15:59a bit of a back yard on that side,
0:15:59 > 0:16:01and here, you've got a small grassed area.
0:16:01 > 0:16:04It needs a bit of weedkiller, a bit of grass seed,
0:16:04 > 0:16:05this would be fine,
0:16:05 > 0:16:08but what I have noticed is the local authority must have
0:16:08 > 0:16:10spent a few quid in the area,
0:16:10 > 0:16:12because the bricks have been re-pointed,
0:16:12 > 0:16:15there's a brand-new door on, and almost all the houses have
0:16:15 > 0:16:19got brand-new double-glazed windows, so this place has got everything...
0:16:19 > 0:16:22apart from the kitchen sink.
0:16:23 > 0:16:26We called in a local estate agent to see if she could shed
0:16:26 > 0:16:28some light on the area and this property.
0:16:28 > 0:16:30She might be able to tell us
0:16:30 > 0:16:33which is the front door and which is the back.
0:16:33 > 0:16:37# Back to back, back to front
0:16:37 > 0:16:40# Will you come backwards with me? #
0:16:40 > 0:16:44Well, the area has been the subject of local authority
0:16:44 > 0:16:47regeneration over the last five, ten years, which has worked
0:16:47 > 0:16:49really well, you know,
0:16:49 > 0:16:51brought it up quite a bit from where it was.
0:16:51 > 0:16:55You have a lot of people who will rent the properties,
0:16:55 > 0:16:59but they're also good investment for potential landlords.
0:16:59 > 0:17:01What about this property?
0:17:01 > 0:17:04Well, first impressions are, the property has had
0:17:04 > 0:17:08a lot of work done to it, which is only beneficial,
0:17:08 > 0:17:11and I think you would get landlords who would be interested,
0:17:11 > 0:17:15have minimal work to do, in consideration to some
0:17:15 > 0:17:18properties where they've got to come in and do a total refurb,
0:17:18 > 0:17:21and I think it'll be attractive for them.
0:17:21 > 0:17:24The return and everything would be good. It would tick boxes.
0:17:24 > 0:17:27Apart from the kitchen box, that is.
0:17:27 > 0:17:31But is this just landlord territory? Could it interest home-buyers?
0:17:31 > 0:17:34I think the property would appeal to both landlords,
0:17:34 > 0:17:37investors and for people to live in.
0:17:37 > 0:17:42It's cheap, affordable housing, not bad-size housing for the area,
0:17:42 > 0:17:45and a good return for a landlord.
0:17:45 > 0:17:49But before they can rent it out, potential landlords will need
0:17:49 > 0:17:54to apply to the council for the licence, which costs around £450.
0:17:54 > 0:17:57So, what rent could they expect to achieve?
0:17:57 > 0:18:00If you were to put this property on the rental market,
0:18:00 > 0:18:04with the kitchen installed, I would expect to achieve somewhere
0:18:04 > 0:18:08in the region of £425 per calendar month
0:18:08 > 0:18:11to £475 per calendar month.
0:18:11 > 0:18:15Wow. That rental figure is even higher
0:18:15 > 0:18:17than the one I used for my calculations.
0:18:17 > 0:18:20So it's a rental machine, or it's a good, affordable home.
0:18:20 > 0:18:23But what if you wanted to fit a kitchen and
0:18:23 > 0:18:25a general refurb to sell it.
0:18:25 > 0:18:28Would it be worth it, bearing in mind that guide price of 20 grand?
0:18:30 > 0:18:33We would probably look to marketing the property anywhere
0:18:33 > 0:18:36between £25,000 to £30,000.
0:18:36 > 0:18:40All in all, this house has a lot going for it, but it might take
0:18:40 > 0:18:44a landlord with a bit of cash to recognise the real potential here.
0:18:44 > 0:18:47Let's see what happened when it went to auction.
0:18:49 > 0:18:52OK, we're moving on now to lot number 18.
0:18:52 > 0:18:55I've got a telephone bid on this one. £20,000.
0:18:55 > 0:18:59What can you buy for £20,000? At £20,000... 15, then?
0:18:59 > 0:19:03Let's move it away quickly. 15 I'm bid.
0:19:03 > 0:19:0716. 17. 18. It's against the phones, with you.
0:19:07 > 0:19:0918, 19, 20.
0:19:11 > 0:19:14Here at 19, 20 on the phone. 21. You're out.
0:19:14 > 0:19:15You're at 20.
0:19:15 > 0:19:18At £20,000. Are we done?
0:19:18 > 0:19:21Phone's getting it at £20,000. As you sure? You're away.
0:19:21 > 0:19:27At £20,000, then. First time. Second time. All done, then?
0:19:27 > 0:19:28To the phone.
0:19:31 > 0:19:35So, the telephone bidder won the day with a bid bang on the guide price.
0:19:35 > 0:19:39The bidder was Steve, who came along to tell me about this bargain.
0:19:40 > 0:19:43Steve, nice to meet you, sir.
0:19:43 > 0:19:45- And you.- Congratulations.- Thank you.
0:19:45 > 0:19:48What was it about this property that you liked so much?
0:19:48 > 0:19:51- I think the starting bid initially...- Is that what it was?!
0:19:51 > 0:19:54Yes, that's what it was. It was the starting bid initially.
0:19:54 > 0:19:57I had looked at other various other properties at the same time,
0:19:57 > 0:19:59round about similar sort of values.
0:19:59 > 0:20:02This was the last property that I saw,
0:20:02 > 0:20:03and I basically couldn't believe it,
0:20:03 > 0:20:07compared to what I had seen, so I thought, "I'm need go for this one."
0:20:07 > 0:20:09What were the other ones like?
0:20:09 > 0:20:11The other ones were in a right state.
0:20:11 > 0:20:13A lot of money needed spending on them,
0:20:13 > 0:20:16just to correct other bad workmanship, in a sense.
0:20:16 > 0:20:20Of course, there is one thing other houses have that this one doesn't.
0:20:20 > 0:20:24- A kitchen.- I had a good look round, realised it didn't have a kitchen.
0:20:24 > 0:20:26That wasn't an issue to me. I was a cash buyer, so...
0:20:26 > 0:20:30OK, so you knew it would have been difficult to get a mortgage...
0:20:30 > 0:20:33It is difficult to get a mortgage without a kitchen...
0:20:33 > 0:20:35Not a problem to you.
0:20:35 > 0:20:37- Not a problem to me, no. - Ready to go.- Yes.
0:20:37 > 0:20:38What are your plans, Steve?
0:20:38 > 0:20:41Tell us what you are going to do with this property.
0:20:41 > 0:20:43I've had a good look round the place.
0:20:43 > 0:20:45I've looked at everything that needs doing and, really,
0:20:45 > 0:20:48it is just the kitchen. Everything else is in good order.
0:20:48 > 0:20:51The kitchen, it's not a big problem to fit in.
0:20:51 > 0:20:54It's more or less, "What are you not going to do?"
0:20:54 > 0:20:57- Because it's all more or less been done for you.- Yes, it is.
0:20:57 > 0:21:00The last person that had the property has obviously done
0:21:00 > 0:21:03a bit of decorating themselves and, for whatever reason,
0:21:03 > 0:21:06they haven't fitted the kitchen. That's fine.
0:21:06 > 0:21:08It's a blank canvas for me. I can fit whatever.
0:21:08 > 0:21:11So, have you done this many times before, Steve?
0:21:11 > 0:21:14What's your day job first of all?
0:21:14 > 0:21:18- Metrologist.- OK, you might have to explain that to me.
0:21:18 > 0:21:19I'm not quite sure what that is.
0:21:19 > 0:21:22Well, basically it's calibration work.
0:21:22 > 0:21:26It's to do with weights and measures in various fields - electrical,
0:21:26 > 0:21:27pressure, temperature -
0:21:27 > 0:21:31and it's checking the accuracy of instrumentation.
0:21:31 > 0:21:34That's just completely gone over my head, that.
0:21:34 > 0:21:38I'm actually still none the wiser on what's Steve's job is here,
0:21:38 > 0:21:40but, anyway, he also rents out a pub
0:21:40 > 0:21:43and has some residential developing on his CV.
0:21:43 > 0:21:46Having rented and sold in the past,
0:21:46 > 0:21:49he hasn't made up his mind on what to do with this one.
0:21:49 > 0:21:52OK, so, in regards to the property, what's your budget going to be?
0:21:52 > 0:21:55I know you have got to put a kitchen in,
0:21:55 > 0:21:57but what is your budget for this property?
0:21:57 > 0:22:011,000 to 1,500, depending on the type of quality of the kitchen
0:22:01 > 0:22:04that I'll be putting in. There's obviously a sink, taps going in.
0:22:04 > 0:22:08There is a little bit of work on the boiler as well.
0:22:08 > 0:22:12One of the pipes is broken there, so I'll have to fix that as well.
0:22:12 > 0:22:16How long is it going to take you just to turn this place around?
0:22:16 > 0:22:19I'm going to turn it around within two weeks but, mainly,
0:22:19 > 0:22:21it'll be just a full weekend.
0:22:21 > 0:22:23So, who's going to be doing the measurements in the kitchen?
0:22:23 > 0:22:26I'll certainly be doing the measurements in the kitchen.
0:22:26 > 0:22:29- Please don't get them wrong, whatever you do.- Yes.
0:22:29 > 0:22:32What I did notice, Steve, as I was walking down the street,
0:22:32 > 0:22:35all the windows in the street seem to be brand-new.
0:22:35 > 0:22:37They do. That surprised me as well.
0:22:37 > 0:22:40When I saw the starting bid of the property,
0:22:40 > 0:22:42that intrigued me first of all,
0:22:42 > 0:22:46but when I came to see the property, I noticed all the windows,
0:22:46 > 0:22:49and there had been other exterior work that had been done to
0:22:49 > 0:22:52all the properties prior, which, again,
0:22:52 > 0:22:56obviously added extra interest to make sure I got this property.
0:22:56 > 0:23:00- And you've got a little bit of garden at the front as well.- Yes.
0:23:00 > 0:23:03The back garden, or back yard,
0:23:03 > 0:23:06is more favoured to the residents round this area but,
0:23:06 > 0:23:09you know, it does have a front garden as well,
0:23:09 > 0:23:12which is a nice little size, easy to maintain.
0:23:12 > 0:23:15And this has got to be one of the easiest, surely,
0:23:15 > 0:23:19- that you'll be turning around? - It is unbelievable. Unbelievable.
0:23:19 > 0:23:23Were you surprised when you... Well, you got it for 20 grand, didn't you?
0:23:23 > 0:23:26I was notified that I won the bid. I just couldn't believe it.
0:23:26 > 0:23:29I was absolutely speechless. Still can't believe it.
0:23:29 > 0:23:32It looks like we will be coming back very quickly to
0:23:32 > 0:23:34see how you got on with this one. I wish you all the best.
0:23:34 > 0:23:37- Thank you very much. - Good luck, pal.- Cheers.
0:23:37 > 0:23:40So, metrologist Steve has only got the kitchen to put in,
0:23:40 > 0:23:42because everything else has been done for him.
0:23:42 > 0:23:45But when we come back, will that kitchen be made to measure?
0:23:45 > 0:23:49You can find out how he gets on later in the programme.
0:23:49 > 0:23:52Still to come, in Lemington, Newcastle-upon-Tyne,
0:23:52 > 0:23:54Lucy comes up against a familiar foe.
0:23:54 > 0:23:59First things first, it absolutely stinks of damp.
0:24:01 > 0:24:06And in County Durham, sometimes everything just falls into place.
0:24:06 > 0:24:09Everything just went according to plan.
0:24:13 > 0:24:17We return to the booming area of Stratford in east London.
0:24:17 > 0:24:21After the 2012 Olympics, Stratford has undergone something of
0:24:21 > 0:24:24a renaissance, although the three-bed mid-terrace
0:24:24 > 0:24:27I was here to see looked more likely
0:24:27 > 0:24:29to pick the wooden spoon than Olympic gold.
0:24:29 > 0:24:31Look at this.
0:24:31 > 0:24:33Not good.
0:24:33 > 0:24:36At all.
0:24:36 > 0:24:38Yep, floorboards need replacing.
0:24:40 > 0:24:43With a guide price of 360,000,
0:24:43 > 0:24:47this property was damp and dingy, although there were some positives.
0:24:49 > 0:24:52We're delighted to say that this house comes with white goods.
0:24:52 > 0:24:55Well, they're not so much white... Oh, look.
0:24:57 > 0:24:59Lovely...
0:25:01 > 0:25:05Yes, a property like this needed vision and imagination,
0:25:05 > 0:25:08so four heads were bound to be better than one.
0:25:08 > 0:25:11Buying the property for 476,000
0:25:11 > 0:25:14were married couples Kawal and Savita
0:25:14 > 0:25:16and Rags and Richa.
0:25:16 > 0:25:18The foursome have been friends for ten years,
0:25:18 > 0:25:21and this was to be their first property investment.
0:25:21 > 0:25:23They certainly didn't lack ambition.
0:25:23 > 0:25:26We plan to do the loft conversion, basically,
0:25:26 > 0:25:30so, right now, it's three beds, so the loft, we'll see how it goes.
0:25:30 > 0:25:33We can put two bedrooms, or maybe one with an en-suite in it.
0:25:33 > 0:25:37So, was that one of the big things that appealed,
0:25:37 > 0:25:40the fact that there is this potential to extend upwards?
0:25:40 > 0:25:44Yes, I mean, it opens so many avenues so, yes,
0:25:44 > 0:25:48we're just going to expand on it and see how it goes from there.
0:25:50 > 0:25:52Including a loft conversion,
0:25:52 > 0:25:57they had a budget of £70,000, plus a £10,000 contingency,
0:25:57 > 0:26:00and they hoped to get the work done in three months.
0:26:00 > 0:26:04Well, we've returned three-and-a-half half months later
0:26:04 > 0:26:07to see if they've managed to turn this property from bog standard
0:26:07 > 0:26:10to Olympic gold standard.
0:26:10 > 0:26:11# Gold
0:26:11 > 0:26:14# Always believe in your soul
0:26:14 > 0:26:19# You've got the power to know you're indestructible
0:26:19 > 0:26:22# Always believe in
0:26:22 > 0:26:24# You are gold
0:26:24 > 0:26:26# Gold... #
0:26:26 > 0:26:30Talk about transformation. It was dirty, dilapidated and depressing.
0:26:30 > 0:26:33Now it is a huge kitchen-diner.
0:26:33 > 0:26:36Kawal explains exactly what they've done.
0:26:37 > 0:26:40What we have done is, we have knocked all the walls.
0:26:40 > 0:26:44There was a loo there and there was kind of storage space there,
0:26:44 > 0:26:45and there was a wall here,
0:26:45 > 0:26:48so what we have done is we have extended it to make
0:26:48 > 0:26:53the open, wide kitchen, and we have put everything literally brand-new.
0:26:53 > 0:26:58We have done everything - rewiring, re-plastering, so, in the end,
0:26:58 > 0:27:01we are pleased with the results, really.
0:27:02 > 0:27:05Yes, it's stunning, and it doesn't stop there.
0:27:14 > 0:27:18The living area at the front of the property is really beautifully done.
0:27:18 > 0:27:21They've maintained the period features, while bringing it
0:27:21 > 0:27:25up to date, and the new flooring is a real touch of class.
0:27:27 > 0:27:31The idea to add a door into the garden also shows they've really
0:27:31 > 0:27:34thought about how best to use the space they had.
0:27:37 > 0:27:41Of course, the big question here was always whether they would
0:27:41 > 0:27:44convert the loft, so time to find out.
0:27:53 > 0:27:57Wow, they really went for it. A really nice loft extension.
0:27:57 > 0:27:59We'll need Rags for this.
0:27:59 > 0:28:01Quite a lot has changed here.
0:28:01 > 0:28:04Well, it's a brand-new floor, as you can see.
0:28:04 > 0:28:06This initially was only a three-bedroom and we
0:28:06 > 0:28:09converted it into a five-bedroomed house. A brand-new big bedroom.
0:28:09 > 0:28:13We have a Juliet balcony, which is always an asset because,
0:28:13 > 0:28:15again, it lets more light into the house.
0:28:15 > 0:28:17On the other side,
0:28:17 > 0:28:21we have a brand-new bathroom with shower and a skylight window.
0:28:21 > 0:28:23It gives a lot of light.
0:28:23 > 0:28:26And another bedroom there, which is a good double-size bedroom so,
0:28:26 > 0:28:29all in all, it is a pretty spacious one and, you know,
0:28:29 > 0:28:32a very bright house, I'd say.
0:28:32 > 0:28:36Down a level, the three pre-existing bedrooms have been completely
0:28:36 > 0:28:40renovated to the same standard that runs throughout.
0:28:44 > 0:28:47They've extended the bathroom into the landing to make it large
0:28:47 > 0:28:49and family friendly.
0:28:49 > 0:28:53Downstairs, they've moved the WC under the stairs.
0:28:54 > 0:28:57Outside, they've made the most of the space they had.
0:28:58 > 0:29:01Extensions, conversions, renovations, you name it,
0:29:01 > 0:29:03they've done it.
0:29:03 > 0:29:07It was fantastic, really. It was a really great experience.
0:29:07 > 0:29:09We went along together, no issues at all,
0:29:09 > 0:29:12because we've been, like, family friends for ten years now.
0:29:12 > 0:29:15This is an addition to that, so it's a really great journey,
0:29:15 > 0:29:17a great experience.
0:29:17 > 0:29:20We actually help each other out so when I was busy,
0:29:20 > 0:29:22Kawal stepped in and vice versa,
0:29:22 > 0:29:24so that's how it works on the project,
0:29:24 > 0:29:26and the same with the wives as well.
0:29:26 > 0:29:29Structural decisions, architectural decisions,
0:29:29 > 0:29:31it's all their contribution.
0:29:31 > 0:29:33Unfortunately they couldn't come today but there we go.
0:29:33 > 0:29:37In fact, financial issues also, they were the main contributor.
0:29:37 > 0:29:39We thought, "OK, we'll save money here".
0:29:39 > 0:29:43But they said, "Let's not do that, cut the corners and save money,
0:29:43 > 0:29:45£because it's a big time investment".
0:29:45 > 0:29:48So wives Savita and Richa were pulling the purse strings
0:29:48 > 0:29:52and I'm glad to report that they've stayed within their budget,
0:29:52 > 0:29:55spending £75,000 in total.
0:29:55 > 0:29:58They only overran their three month timescale by two weeks.
0:30:03 > 0:30:05The couples plan to sell the property,
0:30:05 > 0:30:07but they are also open to renting.
0:30:07 > 0:30:12An ideal time to hear the opinions of two local estate agents.
0:30:14 > 0:30:17A loft extension to the property adds value to the house
0:30:17 > 0:30:21and also brings in the family market which presumably the vendor
0:30:21 > 0:30:23is looking for, to sell this particular property.
0:30:23 > 0:30:26It's not your typical refurbishment.
0:30:26 > 0:30:30He's obviously set it out so he gets the maximum either a rental
0:30:30 > 0:30:32or sale price on it. I think he's done a very good job.
0:30:32 > 0:30:35You certainly have a demand for five-bedroom properties in this area as well.
0:30:35 > 0:30:39And obviously for him to achieve the maximum for his investment
0:30:39 > 0:30:42five bedrooms definitely would be the right decision to make.
0:30:44 > 0:30:47Well, let's find out if it was a wise move financially.
0:30:47 > 0:30:51The couples ended up spending a total of £551,000 here.
0:30:51 > 0:30:55So what kind of a rental return could they expect?
0:30:56 > 0:30:59I think we should be quite confident in achieving
0:30:59 > 0:31:01a minimum of about £2,750 per calendar month.
0:31:01 > 0:31:03You are looking to achieve
0:31:03 > 0:31:07within the region of 2,750 per calendar month to 3,000.
0:31:07 > 0:31:10That top rental figure would equate to a rental yield of
0:31:10 > 0:31:12around 6.5%. Not too shabby.
0:31:12 > 0:31:15But what about resale valuations?
0:31:17 > 0:31:20This property should be put on the market at £650,000.
0:31:20 > 0:31:24If I had this property on the market I would have it at a
0:31:24 > 0:31:28valuation of £650,000-£675,000 with a view to achieving the maximum.
0:31:28 > 0:31:32That top valuation would mean a whopping pre-tax profit of
0:31:32 > 0:31:40£124,000, which makes their maiden property project a stunning success.
0:31:40 > 0:31:42So what does the future hold?
0:31:44 > 0:31:46If we put the property on the market we'll see how the response is
0:31:46 > 0:31:49and then possibly, if you sell the property, then possibly we will move
0:31:49 > 0:31:51on to the next one.
0:31:51 > 0:31:55If not, also we might just rent it out and move onto the next one.
0:31:55 > 0:31:57Yeah, that's a plan.
0:31:57 > 0:32:00We might take a short break maybe and go on a cruise.
0:32:00 > 0:32:02THEY LAUGH
0:32:02 > 0:32:04- You know?- Yeah. That's a good idea.
0:32:11 > 0:32:15Lemington in Newcastle-upon-Tyne is Lucy's destination today.
0:32:15 > 0:32:18It's an area steeped in industrial history,
0:32:18 > 0:32:23illustrated by the great brick glassworks cone built in 1787.
0:32:23 > 0:32:28Around the area, there are the remnants of the arteries of industry
0:32:28 > 0:32:31from coke ovens to ironworks.
0:32:31 > 0:32:35But the heart of Lemington is still beating strong as an ideal
0:32:35 > 0:32:37commuter area close to the A1.
0:32:38 > 0:32:42Well, the property I'm here to see is just over here.
0:32:42 > 0:32:45It's got two bedrooms, and the guide price £36,000 plus,
0:32:45 > 0:32:47so not bad really.
0:32:47 > 0:32:50But to tell you one thing I really do like, well,
0:32:50 > 0:32:53you can see it's off the main road here so there'll be
0:32:53 > 0:32:57hardly any traffic noise, which is a real bonus.
0:32:57 > 0:33:00Let's see if there's more good news on the inside.
0:33:00 > 0:33:03Looks like you might have to do some work out here.
0:33:03 > 0:33:05That fence has seen better days.
0:33:05 > 0:33:08And the garden hasn't seen a mower for some time.
0:33:10 > 0:33:12Well... Ooh!
0:33:12 > 0:33:16Talk about literally falling in the front door!
0:33:16 > 0:33:20That does not look safe. Goodness me.
0:33:20 > 0:33:24I'd want to investigate underneath that lino.
0:33:24 > 0:33:28So walking in the hallway, first things first, it absolutely
0:33:28 > 0:33:30stinks of damp.
0:33:30 > 0:33:33I'm sure a lot of the walls are wet to the touch, but look at this.
0:33:33 > 0:33:37I mean look. There you go. Just peel the wallpaper off.
0:33:39 > 0:33:43Not a good start. So through here we've got two reception rooms.
0:33:43 > 0:33:46Now, you can see there's a little door divider here.
0:33:46 > 0:33:50I'm just wondering, this probably would have been two separate rooms
0:33:50 > 0:33:51because if you come in to here
0:33:51 > 0:33:53and you give the walls a little knock, well, you
0:33:53 > 0:33:56can see originally there would have been a doorway there.
0:33:56 > 0:34:00So you could reinstate that doorway, close this up and have
0:34:00 > 0:34:01a nice cosy little room.
0:34:01 > 0:34:04And actually there's some nice cornicing in here.
0:34:04 > 0:34:07Then you've got a second reception room, which, if it were mine,
0:34:07 > 0:34:10I would probably open up the kitchen to have
0:34:10 > 0:34:14a nice open plan kitchen-diner and have that as a separate entity.
0:34:16 > 0:34:20It's a real house of the senses, this one.
0:34:20 > 0:34:22You can see some nice original features
0:34:22 > 0:34:24and the potential for a new layout.
0:34:24 > 0:34:28You can hear it crying out for modernisation, but there is
0:34:28 > 0:34:31a scent in the air that suggests a lot of work ahead.
0:34:31 > 0:34:36# And I smell trouble
0:34:38 > 0:34:44# I smell trouble ahead of me... #
0:34:44 > 0:34:48But before even thinking of any changes to the kitchen or the
0:34:48 > 0:34:51layout, Lucy needs to follow her nose to the source of the damp.
0:34:51 > 0:34:54So let's have a look around upstairs.
0:34:54 > 0:34:58It still absolutely stinks of damp up here. And the bathroom...
0:34:58 > 0:35:03leaves a lot to be desired, don't you think? And it's a bit too small.
0:35:03 > 0:35:06Bit of a shame because the further up the property you come,
0:35:06 > 0:35:09the most spacious it feels. But that is the culprit I think.
0:35:09 > 0:35:13You can see a big old damp patch up there. And millions of cobwebs.
0:35:13 > 0:35:16They're everywhere. In my hair. Ugh! I don't like cobwebs.
0:35:16 > 0:35:21So bedroom number one, a really good size but in a terrible state.
0:35:21 > 0:35:24But right at the front of the property, the master bedroom,
0:35:24 > 0:35:30look at the space in here. What a luxury to have a bedroom this big.
0:35:30 > 0:35:34You've got a lovely view out to the park just out there,
0:35:34 > 0:35:37but I'm wondering how you could utilise this.
0:35:37 > 0:35:40Is it worth putting in a partition and creating that third bedroom
0:35:40 > 0:35:44or do you want to maybe install an en-suite bathroom in here?
0:35:44 > 0:35:46It's great you've got so many options
0:35:46 > 0:35:49and I love it that it's so spacious upstairs.
0:35:51 > 0:35:54Before thinking about turning this big bedroom into two
0:35:54 > 0:35:57or altering the bathroom, you'd need to focus on that roof
0:35:57 > 0:35:59and getting a damp proof course.
0:36:01 > 0:36:03It might be less wet outside.
0:36:05 > 0:36:08With these workmen's houses, you don't always get
0:36:08 > 0:36:12a back garden and sadly with this one you just get this back yard.
0:36:12 > 0:36:15But I suppose you have got a little bit of outside space.
0:36:15 > 0:36:17But quite a lot needs to be repaired here.
0:36:17 > 0:36:20The wall needs to be tidied up.
0:36:20 > 0:36:25And, well, I've seen a roof garden before, but never a drain garden.
0:36:25 > 0:36:28# Watch my garden grow
0:36:28 > 0:36:30# Watch my garden grow
0:36:30 > 0:36:33# Watch my garden grow
0:36:33 > 0:36:35# Let the seasons come and go... #
0:36:35 > 0:36:38The greenery and the guttering, and the fact that some of it
0:36:38 > 0:36:41seems to be unattached to the building, might just be
0:36:41 > 0:36:44a clue to one factor in the damp issue.
0:36:44 > 0:36:47We asked a local estate agent along to have
0:36:47 > 0:36:51a look at this property guided at 36,000.
0:36:51 > 0:36:53The properties needs a complete refurb throughout.
0:36:53 > 0:36:57It's in not the best condition so certainly with the time and effort
0:36:57 > 0:37:00and care spent with a potential buyer
0:37:00 > 0:37:02it should make an attractive purchase.
0:37:02 > 0:37:07I'd estimate to spend between £15,000 and £20,000 on this property to get it fully up to speed.
0:37:07 > 0:37:12What does the agent think of the idea of adding a third bedroom?
0:37:12 > 0:37:14In my opinion, I'd be looking
0:37:14 > 0:37:18to keep this property as a two-bedroom terraced property.
0:37:18 > 0:37:21It should attract more potential buyers and tenants that way.
0:37:21 > 0:37:24Third bedroom could be a costly exercise,
0:37:24 > 0:37:26so two bedroom is probably the way forward.
0:37:27 > 0:37:30OK, in that case, what would the house be worth
0:37:30 > 0:37:32as a two-bed for sales and rentals?
0:37:35 > 0:37:38If this property was refurbished throughout, I would expect it
0:37:38 > 0:37:40to achieve somewhere in the region of £65,000.
0:37:40 > 0:37:43In my opinion, if this property was fully refurbished, I would expect
0:37:43 > 0:37:47it to rent for figure of £500 per calendar month.
0:37:47 > 0:37:50And the agent believes the three-bed might sell
0:37:50 > 0:37:55for £75,000, or rent for £650 per calendar month.
0:37:55 > 0:37:58Whatever you choose to do, there is some serious graft ahead.
0:38:02 > 0:38:04Now, there's no getting away from the fact
0:38:04 > 0:38:06this house needs a lot of work.
0:38:06 > 0:38:10I don't think you could or would want to salvage much in there.
0:38:10 > 0:38:14But I do think there's a great little property lurking somewhere.
0:38:14 > 0:38:17And the fact it's opposite a park means it could really appeal
0:38:17 > 0:38:18to the family market.
0:38:18 > 0:38:21And that guide price should also spark a fair bit of interest.
0:38:21 > 0:38:25Let's see what happened when it went under the hammer.
0:38:25 > 0:38:31We move over the page to Lot 43 and we have telephone bids in on
0:38:31 > 0:38:35this property. 38,000 to start me? £38,000?
0:38:35 > 0:38:4036. 36,000. 36, I've got by the back. Thank you.
0:38:40 > 0:38:48At £36,000 the opening bid. At 36, 37 somewhere? 37 is bid. 38.
0:38:48 > 0:38:52On the phone at £38,000. 39 is bid.
0:38:52 > 0:38:57At 39. At 40? 40,000. £40,000. 41 quickly?
0:38:57 > 0:39:00The auction battle was locked between the phone bidder
0:39:00 > 0:39:02and the bidder in the room.
0:39:02 > 0:39:04We re-join at 46,500.
0:39:04 > 0:39:0947, on the phone at £47,000.
0:39:09 > 0:39:15Five? 500? £47,500. 48. 48,000.
0:39:15 > 0:39:19One more, sir? 49. 49. 500 again?
0:39:19 > 0:39:2549,000 on the phone. 500? Yes?
0:39:25 > 0:39:2949,500. £49,500.
0:39:29 > 0:39:35Once, twice, third time. Sold at 49,500. Thank you.
0:39:36 > 0:39:39So in a ding-dong battle between the phone bidder and the room
0:39:39 > 0:39:43Chris prevailed with a bid of 49,500.
0:39:45 > 0:39:48He's an experienced full-time developer
0:39:48 > 0:39:50and he knows this area very well indeed.
0:39:50 > 0:39:53Time to find out his plans for this soggy property.
0:39:53 > 0:39:57- Chris, congratulations. Well done.- Thank you.
0:39:57 > 0:40:00Why did you want to buy this property?
0:40:00 > 0:40:03Well, I've got two in the street there that I'm currently working on.
0:40:03 > 0:40:08And I'm buying the houses in this area for about £20,000 less
0:40:08 > 0:40:10than I buy in other parts of Newcastle.
0:40:10 > 0:40:13Is this an area that is probably due to come up,
0:40:13 > 0:40:15but it hasn't quite reached its peak?
0:40:15 > 0:40:18Well, I'm hoping so because it's close to the A1, the main route,
0:40:18 > 0:40:21it's not far from the airport. It's handy for Newcastle.
0:40:21 > 0:40:23I don't think there's going to be
0:40:23 > 0:40:26a great capital appreciation immediately,
0:40:26 > 0:40:27but maybe long-term it might.
0:40:27 > 0:40:29How long have they been doing this?
0:40:29 > 0:40:32Have you got a collection, a portfolio of these properties?
0:40:32 > 0:40:36- I've got 25 now. - You've got 25?- Yes.- Wow!
0:40:36 > 0:40:39And how long has it taken you to accumulate all of those properties?
0:40:39 > 0:40:40About '91 I started.
0:40:40 > 0:40:42I used to work for a company from London,
0:40:42 > 0:40:44shop fitting all over the UK.
0:40:44 > 0:40:46So you were shop fitting. What were you, a joiner?
0:40:46 > 0:40:47I'm a joiner by trade, yeah.
0:40:47 > 0:40:50You are a joiner, so you were doing it for everybody else
0:40:50 > 0:40:53and you thought, "Hold on a minute, I'm going to do it for myself".
0:40:53 > 0:40:56Yeah, well, it was just on the side when I bought the first one.
0:40:56 > 0:41:02And I just continued from there. But since 2011 I've bought ten.
0:41:02 > 0:41:05So with this property here, the thing that really smacks you
0:41:05 > 0:41:09- in the face is the smell of damp. - Mm-hmm.- I mean how bad is that?
0:41:09 > 0:41:12I've done a lot worse properties than this so it doesn't really...
0:41:12 > 0:41:15I'll just strip them out completely now on the inside.
0:41:15 > 0:41:17- So you're going to completely gut this place?- Yeah.
0:41:17 > 0:41:21- You're going to really take it back to the bare brick almost?- Yeah.
0:41:21 > 0:41:24Chris is clearly not fazed by the problems here,
0:41:24 > 0:41:26so once he's got his dry house, then what?
0:41:26 > 0:41:30- French doors in the back there, probably.- OK.- New kitchen.- Yeah.
0:41:30 > 0:41:34- I'm not sure about this. I might make this back into two rooms.- Yeah.
0:41:34 > 0:41:37And I might put the bathroom at the front
0:41:37 > 0:41:41and just use that small thing as a study.
0:41:41 > 0:41:45Why are you going to change the bathroom that's already upstairs to a different location?
0:41:45 > 0:41:50Just to get a bigger bathroom with more facilities in. I'll probably put a shower cubicle in as well.
0:41:50 > 0:41:53I was thinking that you might have put a stud partition up somewhere
0:41:53 > 0:41:56and told me that you were thinking of converting this
0:41:56 > 0:41:58into a three-bedder, but you're not going to do that?
0:41:58 > 0:42:03I might consider that, but... I've done other ones, but I think I'm
0:42:03 > 0:42:06probably going to put the bathroom at the front.
0:42:06 > 0:42:07You'll see when you come back.
0:42:07 > 0:42:10We will certainly see.
0:42:10 > 0:42:13The space where the bathroom is currently would probably be
0:42:13 > 0:42:16too small to be classified as a bedroom but an additional
0:42:16 > 0:42:18study is usually welcome.
0:42:18 > 0:42:21And a good bathroom and kitchen might be more appealing to
0:42:21 > 0:42:24people renting, which is what Chris plans to do.
0:42:25 > 0:42:30- What sort of budget have you got to spend here?- 10,000. 10,000-12,000.
0:42:30 > 0:42:33Do you have to be really strict about that or can you afford to go over a little bit?
0:42:33 > 0:42:37It has to get finished, so it takes whatever it takes.
0:42:37 > 0:42:40Is this a process that's going to take you quite a long time or
0:42:40 > 0:42:43do you just get in, do the work, get out, put it up for rent?
0:42:43 > 0:42:47It takes 10 to 12 weeks I would think. 10 to 12, in that region.
0:42:47 > 0:42:49But it doesn't matter because it's my full-time job anyway.
0:42:49 > 0:42:52The quicker the better, but it takes however long it takes
0:42:52 > 0:42:54and probably a little bit longer.
0:42:54 > 0:42:58Chris is now reaping the rewards for steadily building his portfolio
0:42:58 > 0:43:01and doing most of the hard work himself.
0:43:01 > 0:43:05He's also overcome some big challenges along the way.
0:43:07 > 0:43:09I had cancer in 2011.
0:43:09 > 0:43:14And thanks to the wonderful staff at Freeman Hospital, I'm pretty good.
0:43:14 > 0:43:17- I feel like I've had a new lease of life.- Do you really feel like that?
0:43:17 > 0:43:20- I feel great.- Do you feel like a totally new person?- I do.
0:43:20 > 0:43:24- I feel great, yeah.- Do you?- Aye. Fantastic, aye. I've got a fantastic team round us who help.
0:43:24 > 0:43:27I've got a lad works for us.
0:43:27 > 0:43:30Everybody, my old friends all help and...
0:43:30 > 0:43:34it's thanks to them I'm probably where I am.
0:43:34 > 0:43:37It's been lovely meeting you today and it's brilliant to see you
0:43:37 > 0:43:40- looking healthy and fit and really enjoying your work.- Thank you.
0:43:40 > 0:43:44And I look forward to having a look at how fabulous you can make
0:43:44 > 0:43:45this place when we come back.
0:43:45 > 0:43:48- Thank you very much. - No pressure.- Thank you. Thank you.
0:43:48 > 0:43:49THEY LAUGH
0:43:49 > 0:43:53Well, it's pretty obvious that Chris isn't going to be fazed by
0:43:53 > 0:43:55anything that this house throws at him.
0:43:55 > 0:43:59He's been there, seen it, done it, bought the T-shirt.
0:43:59 > 0:44:02Although I do think there's an awful lot of work
0:44:02 > 0:44:04for that 10 to 12 week timescale.
0:44:04 > 0:44:07Do you think it might be too much to achieve?
0:44:07 > 0:44:10You can find out if Chris manages it later on in the programme.
0:44:14 > 0:44:18One property down, but we're not done yet. Still two more to see.
0:44:18 > 0:44:22Will we witness creative changes or catastrophic chaos?
0:44:22 > 0:44:26That's a bit dramatic, Lucy. Whatever. Let's find out.
0:44:27 > 0:44:32Earlier in the show, I was just outside Peterlee in County Durham.
0:44:32 > 0:44:33The property I viewed was
0:44:33 > 0:44:37a smarter than average three-bedroom terraced doer-upper.
0:44:37 > 0:44:39And, when I did my sums on its potential,
0:44:39 > 0:44:42they produced some impressive results.
0:44:45 > 0:44:49Now, let's say you got this place for £20,000,
0:44:49 > 0:44:54which is the guide price, and you rented it out for £400 a month.
0:44:54 > 0:44:58You could have this place paid off in four years.
0:44:58 > 0:45:00This is an absolute bargain.
0:45:02 > 0:45:06Absolute bargain is right for anyone who's got the readies to part with, because there was
0:45:06 > 0:45:10no great hope of getting a mortgage as there was no kitchen,
0:45:10 > 0:45:12just an empty room where one should be.
0:45:15 > 0:45:18The man with the money was metrologist Steve.
0:45:18 > 0:45:22# It's raining men Hallelujah
0:45:22 > 0:45:25# It's raining men... #
0:45:25 > 0:45:29OK, guys, I said metrologist, not meteorologist.
0:45:29 > 0:45:31Metrologists measure and calibrate things,
0:45:31 > 0:45:35and Steve got his measurements spot on with his phone bid.
0:45:35 > 0:45:3620 grand, bang on the guide price.
0:45:38 > 0:45:40Normally at this point I would give you
0:45:40 > 0:45:42a list of things that need to be done.
0:45:42 > 0:45:47So here goes. He's got to fit the kitchen and... And that's it.
0:45:47 > 0:45:49Well, I've had a good look round the place.
0:45:49 > 0:45:53I've looked at everything that needs doing and really it is
0:45:53 > 0:45:56just the kitchen. Everything else is in good order.
0:45:56 > 0:45:59The kitchen is not a big problem to fit in.
0:46:00 > 0:46:04So here's the jeopardy. Steve had a kitchen to fit and thought it
0:46:04 > 0:46:07wasn't going to be a problem and should take only two weeks.
0:46:07 > 0:46:10I get the feeling the next programme after us might be starting
0:46:10 > 0:46:12sooner than scheduled at this rate.
0:46:12 > 0:46:16But we're back three weeks later to see how he did.
0:46:16 > 0:46:18Are you ready for the big reveal?
0:46:18 > 0:46:22Remember this is what the empty room looked like.
0:46:23 > 0:46:25And this is it now.
0:46:25 > 0:46:28MUSIC: Fanfare for the Common Man by Emerson, Lake & Palmer
0:46:42 > 0:46:45Steve's agreed to take us through
0:46:45 > 0:46:47some of the finer points of the design.
0:46:47 > 0:46:52Kitchen layout is a conventional U-shaped kitchen based on the actual
0:46:52 > 0:46:56general design of the kitchen, of where the actual window is
0:46:56 > 0:46:58and where the door is.
0:46:58 > 0:47:02The sink has been located slightly differently to where it was
0:47:02 > 0:47:06initially, or where it would have been, to try and maximise the
0:47:06 > 0:47:11amount of light in. Fitted cupboard units.
0:47:11 > 0:47:16The hob and oven has been more centralised as well to where
0:47:16 > 0:47:19the actual gas point was, which was over to this way.
0:47:19 > 0:47:23And we've actually fitted an extractor hob as well.
0:47:23 > 0:47:29We've also fitted a new LED panel light which is low energy
0:47:29 > 0:47:31which looks quite good.
0:47:32 > 0:47:35Steve says the kitchen took two weekends to complete.
0:47:35 > 0:47:38The first weekend to order the bits and the second to fit them.
0:47:39 > 0:47:43But, whatever the size of the project, often unforeseen snags
0:47:43 > 0:47:45come to light to frustrate developers.
0:47:46 > 0:47:49I haven't experienced any challenges or problems at
0:47:49 > 0:47:52all with this project. Everything just went according to plan.
0:47:52 > 0:47:53How about the budget?
0:47:53 > 0:47:58In Steve's case it was £1,000 plus a £500 contingency.
0:47:59 > 0:48:01The overall kitchen pricing
0:48:01 > 0:48:06was £1,388 for the actual kitchen units themselves
0:48:06 > 0:48:10and all the auxiliary components to go with that,
0:48:10 > 0:48:13including the hob, sink and oven.
0:48:13 > 0:48:17There was some extra work that wasn't really planned,
0:48:17 > 0:48:20like the lighting and the tiling as well.
0:48:20 > 0:48:27That cost an additional £130. And then the extra building work
0:48:27 > 0:48:29from a professional builder was an extra £220.
0:48:29 > 0:48:33What was actually spent was £1,750.
0:48:33 > 0:48:39Actually, for the sake of accuracy, I make it £1,738.
0:48:39 > 0:48:44Which is more or less £250 over the maximum budget.
0:48:44 > 0:48:47Oh, well, to get the valuations since the improvements,
0:48:47 > 0:48:49we've called in two local estate agents.
0:48:50 > 0:48:52First with an opinion on the kitchen
0:48:52 > 0:48:55who better than the agent who saw it before the work began?
0:48:58 > 0:49:00The kitchen's been fitted out really well,
0:49:00 > 0:49:03and I think, for a developer, he's done well.
0:49:03 > 0:49:05He's done what he's needed to do.
0:49:05 > 0:49:08It's clean, it's tidy, it's neutral, and it works.
0:49:08 > 0:49:11Steve's decision to sell or let
0:49:11 > 0:49:15is going to be guided by the valuations.
0:49:15 > 0:49:18So far, he's spent £21,750.
0:49:18 > 0:49:21So what's the property worth now?
0:49:21 > 0:49:24If I was to put this property on the market, I would recommend
0:49:24 > 0:49:27an asking price of offers around £39,950.
0:49:27 > 0:49:30If this property was to be entered to the rental market I would
0:49:30 > 0:49:34recommend an asking rent of £450 per calendar month.
0:49:34 > 0:49:37The resale for this property would be anywhere
0:49:37 > 0:49:41between £30,000 and £35,000.
0:49:41 > 0:49:43For the rental market, I think you would achieve somewhere
0:49:43 > 0:49:49around about £475 per calendar month to £500 per calendar month.
0:49:49 > 0:49:53Taking the top valuations, that's a potential profit
0:49:53 > 0:49:57in three weeks of £18,200 before taxes and expenses.
0:49:57 > 0:50:03On the rental side, the top value equates to a whacking, wait for it,
0:50:03 > 0:50:0627.5% yield. So what's it to be, Steve?
0:50:07 > 0:50:13I think going off the two figures, the resale value and the potential
0:50:13 > 0:50:17rental income. I think it's best option to go for the rental income.
0:50:18 > 0:50:22Steve will have to shell out £450 to the local council to become
0:50:22 > 0:50:26a landlord here with the property being in a selective licensing area.
0:50:26 > 0:50:30He intends to keep developing and hopes one day to build his own home.
0:50:39 > 0:50:44Back now to Newcastle-upon-Tyne and the area of Lemington.
0:50:44 > 0:50:47It was here that Lucy had a look around this two-bedroom
0:50:47 > 0:50:51property that had a guide price of £36,000.
0:50:51 > 0:50:54From the outside, it didn't look in great shape
0:50:54 > 0:50:59and it held no false promises because inside it wasn't any better.
0:51:01 > 0:51:05First things first, it absolutely stinks of damp.
0:51:05 > 0:51:08I'm sure a lot of the walls are wet to the touch but look at this.
0:51:08 > 0:51:13I mean look. There you go. Just peel the wallpaper off.
0:51:13 > 0:51:18# It's no good, no good It's no good
0:51:18 > 0:51:20# Baby, it's no good... #
0:51:20 > 0:51:23Yes, our old friend damp ran throughout this property.
0:51:23 > 0:51:26But the spacious upstairs gave pause for thought.
0:51:28 > 0:51:31But I'm wondering how you could utilise this?
0:51:31 > 0:51:35Is it worth putting in a partition and creating that third bedroom
0:51:35 > 0:51:39or do you want to maybe install an en-suite bathroom in here?
0:51:39 > 0:51:41It's great you've got so many options and I love it
0:51:41 > 0:51:43that it's so spacious upstairs.
0:51:45 > 0:51:48But the buyers were keen on auction day
0:51:48 > 0:51:50with two bidders battling it out.
0:51:50 > 0:51:52Sold at 49,500. Thank you.
0:51:53 > 0:51:57The successful bid of 49,500 belonged to Chris,
0:51:57 > 0:51:59a seasoned developer and local man.
0:51:59 > 0:52:03He already has 25 properties in his portfolio,
0:52:03 > 0:52:06including several properties in this area.
0:52:06 > 0:52:08But, for his latest acquisition,
0:52:08 > 0:52:12he was keeping us guessing about his plans.
0:52:13 > 0:52:16I was thinking that you might have put a stud partition up
0:52:16 > 0:52:19somewhere and told me that you were thinking of converting this
0:52:19 > 0:52:21into a three-bedder, but you're not going to do that?
0:52:21 > 0:52:23I may consider that but...
0:52:23 > 0:52:26I've done that in other ones, but I think
0:52:26 > 0:52:29I'm probably going to be put the bathroom at the front.
0:52:29 > 0:52:30You'll see when you come back.
0:52:32 > 0:52:35Make no mistake, inside and out, top to bottom, this property
0:52:35 > 0:52:39needed a lot of work to get it ready for the rental market that
0:52:39 > 0:52:41Chris was aiming for.
0:52:41 > 0:52:43He had estimated a budget of 10,000 to 12,000
0:52:43 > 0:52:47and a timescale of 10 to 12 weeks to get the job done.
0:52:49 > 0:52:51We returned ten months later
0:52:51 > 0:52:54and straightaway there is a great improvement
0:52:54 > 0:52:56to the front of the property.
0:52:56 > 0:52:58But what about inside?
0:53:11 > 0:53:15Unrecognisable. The transformation here is phenomenal.
0:53:15 > 0:53:21From damp and dated and dreary, to contemporary, cool and clever.
0:53:21 > 0:53:23He created a singular kitchen-diner
0:53:23 > 0:53:27by sealing the doors leading into the front living room
0:53:27 > 0:53:31and opening up the once poky kitchen, and it works a treat.
0:53:46 > 0:53:49The living room now has its own entrance from the hall
0:53:49 > 0:53:53and, like the rest of the property, it's had a damp proof course.
0:53:53 > 0:53:56It's been decorated to a high standard whilst also keeping
0:53:56 > 0:53:57the original features.
0:54:01 > 0:54:05Time to head upstairs where I can't wait to see what Chris has done.
0:54:14 > 0:54:17Chris did decide to split the large front room into two,
0:54:17 > 0:54:19making this a three-bed property.
0:54:24 > 0:54:28The bathroom stays where it was although it's completely new
0:54:28 > 0:54:29and looking great.
0:54:32 > 0:54:34Out the back and it's looking much better.
0:54:34 > 0:54:38A brand-new roof, not to mention the new guttering will safe-proof
0:54:38 > 0:54:40the property against any future damp.
0:54:41 > 0:54:44Chris has really gone the extra mile here.
0:54:44 > 0:54:48He's created a property ready and waiting to be moved into.
0:54:49 > 0:54:53I'm particularly pleased with the kitchen-dining area, and the
0:54:53 > 0:54:57whole house I'm pleased with, but in particular the downstairs.
0:54:57 > 0:55:00I think the rooms look really nice.
0:55:00 > 0:55:03It took about 16, 17 weeks or something.
0:55:03 > 0:55:07Obviously, I just look at these houses. I have a walk round.
0:55:07 > 0:55:09I don't have surveys done
0:55:09 > 0:55:13and that threw up a few more things than I thought.
0:55:13 > 0:55:18It's took a bit longer because of the extra work with the roof
0:55:18 > 0:55:23and the damp. To be honest, it was more work than what I envisaged.
0:55:23 > 0:55:24It's been quite a tough one.
0:55:24 > 0:55:29# So take care of your homework, fella
0:55:29 > 0:55:32# If you don't, somebody will... #
0:55:34 > 0:55:38Yes, Chris didn't have a survey done, and the damage to the roof
0:55:38 > 0:55:40was much more than he originally thought.
0:55:40 > 0:55:46Plus he was also working on not one, not two, but three other properties.
0:55:46 > 0:55:49So his timescale didn't quite go as planned.
0:55:49 > 0:55:52What about his £10,000-£12,000 budget?
0:55:54 > 0:55:58It's probably in the region of £17,000, £18,000 I've spent on it.
0:55:58 > 0:56:02The extra money incurred was the cost of the new roof
0:56:02 > 0:56:08and the floors, extra floors, the renewal of the floors.
0:56:08 > 0:56:14And probably a bit time and labour, that took a bit longer.
0:56:14 > 0:56:18But I'm still happy with the outcome.
0:56:18 > 0:56:23And hopefully the return will still be decent.
0:56:25 > 0:56:27Well, let's find out.
0:56:27 > 0:56:31Chris has invested a total of £67,500 in this property
0:56:31 > 0:56:34that he hopes to rent out.
0:56:34 > 0:56:37But will two local estate agents
0:56:37 > 0:56:39think he's made a wise investment?
0:56:39 > 0:56:41This is my first time in the property and my first
0:56:41 > 0:56:44impressions are that I'm really impressed with the standard
0:56:44 > 0:56:47of finish throughout the whole of the property.
0:56:47 > 0:56:49It's been a while since I've seen this property, but I'm really
0:56:49 > 0:56:51impressed with the quality of the finish.
0:56:51 > 0:56:53He's done a fantastic job throughout
0:56:53 > 0:56:55and the property really looks great.
0:56:55 > 0:56:57The property has been converted from a two bedroom
0:56:57 > 0:56:59to a three bedroomed house.
0:56:59 > 0:57:02And the layout works really well because you've still got
0:57:02 > 0:57:05a double bedroom at the rear of the property whilst the two bedrooms
0:57:05 > 0:57:07at the front are really good proportions.
0:57:07 > 0:57:11OK, so the agents are impressed, but what kind of value would they
0:57:11 > 0:57:14put on the property now it's complete?
0:57:14 > 0:57:18I'd expect to achieve a place somewhere in the region of £75,000.
0:57:18 > 0:57:22I would hope to achieve in the region of £80,000 for the property,
0:57:22 > 0:57:26potentially a little bit higher, due to the standard of finish.
0:57:26 > 0:57:31A sale price of 80,000 would mean a pre-tax profit of 12,500.
0:57:31 > 0:57:34But for now Chris has his eye set on the rental market.
0:57:36 > 0:57:38I would think it would achieve
0:57:38 > 0:57:40in the region of £600 per calendar month,
0:57:40 > 0:57:43but because the standard of the accommodation is so high,
0:57:43 > 0:57:46I would be prepared to test that a little higher
0:57:46 > 0:57:49with a maximum of £650 per calendar month.
0:57:49 > 0:57:53We'd be looking at the figure of £650 per calendar month.
0:57:53 > 0:57:58I'm going to try for 650. But 600 still gives an OK return.
0:57:58 > 0:58:00A man of few words is Chris,
0:58:00 > 0:58:05but that top rental of £650 per calendar month would mean
0:58:05 > 0:58:09a rental yield of a whopping 11.5 %. And, with numbers like that,
0:58:09 > 0:58:12you can afford to let your work do the talking.
0:58:17 > 0:58:20Well, from Scotland, England, Northern Ireland to Wales,
0:58:20 > 0:58:24there are property auctions going on all the time.
0:58:24 > 0:58:27We like to try and capture the action whenever we are.
0:58:27 > 0:58:31- Yes, so please join us again here on Homes Under The Hammer. - Goodbye.- Goodbye.- Bye-bye.