Episode 53 Homes Under the Hammer

Hello and welcome to the show.

Now, if investing in property tickles your fancy,

then it's really important to know what's going on in the market.

Yep, it's important to do your homework and brush up on your local knowledge, as well.

Yes, and once you've done that,

why not pop along to your local property auction and see what's on offer?

Well, it goes without saying

that people are always looking for value for money -

and auctions certainly provide that.

Yeah, correct, Martin. A lot of people get carried away

in the auction room - and don't take it for granted.

Mm. Did that happen on the show today? Let's find out.

This former public house in Folkestone sets Lucy's heart racing.

-I love the exterior of the building...

-Me, too.

-..I love the windows...

-Me, too!

In North Birmingham,

another cracking property, but not in a good way.

There's no getting away from the fact that that is

an issue that needs to be resolved.

And prepare to get your hands dirty

in this three-bed terrace flat in Telford.

You can actually see where the pictures have been,

cos that's, er, nicotine stains.

All these properties have been sold at auction,

and we'll find out who bought them

and what they paid when they went under the hammer.

It is yours, sir. Well done!

This is Folkestone,

a regenerated and rejuvenated Kentish seaside town

with wonderful views and equally wonderful train links to London.

A place to invest?

I think so.

When the tide is high, the harbour is picturesque.

The Leas Promenade has views over to France

and is a great place to take a stroll.

There is also the town centre, which buzzes with creative energy.

Oh, yes, Folkestone has changed.

So what does it hold in the way of property opportunities?

Not far from the town centre and the harbour

and very close to Folkestone West train station

is the property I'm here to see.

And what a lot of property it is!

Look! It is this massively huge former grand pub,

which was sold with planning permission to convert into flats -

all for the guide price of £200,000 to 220,000.

It really is imposing,

with beautiful sandstone mouldings on the facade.

The road is busy, but there is plenty of parking to the side,

which is a very good start.

Oh, wow!

Wow! What a space!

I absolutely love it. Somebody's done all the ripping out for you,

how fantastic!

Now, before we go any further, let's go through these plans,

because what we're viewing here is a development site with walls.

So, you've got two two-beds on the ground floor, here and here,

and two one-beds, all with open-plan living-kitchen areas,

which is lovely. Now, on the first floor, you've got two more two-beds,

and on the top floor, in currently unused attic space,

you've got two further flats up there, one one-bed and one two-bed.

So that is a total of eight flats,

five with two bedrooms and three with one.

You know, it's a sizeable development,

with every ounce of space utilised to its max.

Very impressive.

There's tons of square footage to play with here.

There's even a cellar designated as a photographic studio on the plans.

Potentially some more resale or rental pennies to be earned here.

But it is important at this stage

to try and picture the flats that have been planned.

So where I'm standing now is going to be a one-bedroom flat,

and the good thing about having the plans

is that you can see it on paper,

but it's even better being able to actually pace it out.

So, I'm imagining a wall going up along here, a wall going along here.

You're going to have a bedroom over there, a bathroom in this corner,

then you've got to have a kitchen, the living area.

I mean, this is going to feel like a lovely, spacious one-bedroom flat,

and the best bit are the beautiful windows.

I mean, they really are stunning and letting in loads of light.

So this one, fantastic, I really like this property.

Next door? Well, I don't know, it just feels a little more...

It's a bit more squeezed, it doesn't feel as big,

it's certainly not as wide.

Again you've got to imagine the wall here,

you've got a wall going up there, a bathroom,

you've got the bedroom at the back,

a much smaller kitchen and living area.

A lovely big window, though, there.

Now, I'm sure because this flat's smaller,

it will be reflected in the price.

There's eight flats going up in this great big pub.

It's certainly going to be an interesting development.

When you're converting an old building like this,

you have to work with the space available.

This is not a new-build with identical units,

and that will be part of its appeal.

Some flats will be bigger, some will have more character,

but as long as they are a decent standard,

there shouldn't be any problems selling or renting

in this part of town.

Upstairs, there will be a rear two-bedroom flat

with its own roof terrace

leading off the kitchen-living-dining area.

The stairs will be moved to come up from the side entrance,

so this landing will be fully utilised into the rear flat.

And at the front...

Come on, then. I'm going to let you in to have a look around

what I think is going to be the best flat upstairs.

Now, this is just going to be such a wonderful space to live in.

Open-plan kitchen,

you can have a living area here, lovely views out there,

going to have a bedroom here, bathroom in the middle,

bedroom to the side.

It's going to be the whole width of the entire building.

It's going to be quite an exciting development,

and I think this is going to be the best flat of them all.

Well, that's what Lucy thinks,

but let's find out a local estate agent's opinion of this development.

I love this building. It's got great style, the facade is wonderful,

and there's a lot of space in here, so a lot to be worked with.

It's a very good idea to put money into Folkestone at this time.

The regeneration plans that are under way

and are on the table at the moment

are such that I think Folkestone is, in five years' time,

going to be somewhere where

it's going to really pay back on people who've invested now.

This is a huge development with many possibilities,

so it is time for everyone's favourite subject - maths!

As far as potential for resale,

they've got two bedrooms on the plans

and one bedroom units on the plans.

Two-bedrooms, depends on the finish that they've given to them,

but it would be in the region of

between £85,000 and £105,000 in this area.

As far as the one-bedrooms are concerned,

between £60,000 and £80,000. Depends on quality.

So that's a total end value of between £605,000 and £765,000.

If the property was bought at the top end of the guide, at say 220,

and 300,000 spent on the work,

there's still a profit of between £85,000 and £245,000,

depending on spec and the market conditions.

And as for rental...

The one-bed flats would let

for something in the range of £385 to £500 per calendar month,

and the two-bed flats

in the range of £600 to £650 per calendar month.

Are you following all of this?

Working with the same figures,

that's an annual income of around £50,000 up to 57,000

and a yield of 11%.

Does that float your boat?

So, I reckon this is an attractive and exciting conversion

with profit built in.

Let's see who went for it at the auction.

On into lot 113, super looking detached building and car park,

used to be a pub.

200 would be a good place to start me, 200.

At 200,000.

180?

180, don't mind where we start. 180,000, I'm on the way, 180.

I've got a gentleman sitting down at 180,

can I take 185 from you at the back?

185 I have. And 90.

190, and five, 195.

At £190,000 I'm bid, 195 I'm looking for.

195. 195.

Just one bid, at 195. 200 I've got. 200, 210 now, if you like.

220, it's against you.

220. 220, it's with you, madam, at the back, at 220,

just raise your card again to make sure, 220.

25 if you like, it's in the room to sell it for £220,000,

make no mistake.

Now is the chance to bid again if you want it.

At £220,000 we've got, then. For the first time...

You're all out at the moment, at £220,000 for the second time.

If you're sure you're all done, 220 for the third and final time,

right at the back.

It's yours at £220,000.

And that bid of 220,000 was bang on the guide price.

It was made by siblings Wendy and Chris.

They are not from the area,

but all of Wendy's five brothers are involved in the building trade

in one way or another, so she is well placed to take on this project.

Some people get all the luck.

Lucy met them back at the pub to find out more.

Wendy and Chris, congratulations. This is a lovely pub!

-I'm so glad you bought it!

-Lovely, isn't it?

-Thank you.

What is it you loved about it enough

to want to buy it on auction day, Wendy?

-I love the exterior of the building...

-Me, too.

-..I love the windows...

-Me, too!

I think there's a big wow factor

that could be brought into this building.

I just fell in love with it.

So, are you both in the property developing business?

I've done a bit, yes. Yeah, yeah.

I've got quite a few properties that I rent out,

and I've also renovated quite a few properties in the past.

-So is this a project for both of you?

-Yes.

This is the first time we've actually ever...

-Worked together.

-..worked together.

So, who's going to be playing what role?

OK, well, I'm all about the finance,

-and Chris is all about project management of the property.

-That's it, yeah.

I do a little bit, but most of it should be project management.

It comes with planning permission, a lot of hard work

with this development has already been done,

so it must have been much more of an attractive buy for you on auction day.

Definitely, definitely.

Cos now we can sort of move straight in

and start doing the work straight away. Um...

And you could actually walk round the place

and relay it to the plans

and your mind just goes "wow", doesn't it?

"I can do this, I can do that, I can do that."

It is an inspiring development.

Wendy is right,

there are lots of nice, well-designed spaces here

that will make lovely homes.

But these developers must be planning some changes?

One of them toilet blocks

was going to be used for the photographic studio down below.

Which was going to be down in the basement.

That's right, yeah, so what we're going to do now,

now we're not doing that and making it into storage, we're going to...

utilise that to make it a bigger bedroom.

So you're stealing the loos to add to the floor space,

-which is a great idea.

-That's right, yeah.

So, are you going to make it into a three-bed,

or just a really workable, spacious two-bed?

A lovely two-bed.

I think that's a great idea.

-Yeah, it's going to be a beautiful room.

-And you're no longer going to be

having the photographic studio downstairs in the cellar.

That's correct,

we're just going to turn that into storage now for everybody

that lives in the apartments.

Great idea.

Wendy and Chris are losing the possibility of making a profit

from the space below to create storage,

but somewhere to keep your bike, or whatever,

can be a real bonus for buyers

and make them so much easier to sell.

So, what's their budget?

The budget at the moment is set at 200,000.

OK.

-So...

-I'm quite surprised by that.

That is only for the structural work, for getting them there.

The finishing and the furnishing of them,

with the kitchens and bathrooms,

-there's another budget for that.

-Yeah.

So, come on, I want your overall budget.

What are you going to be throwing at this? How much money?

-We're probably looking at about 270...

-OK.

-..to 300, something like that.

-270K to get it where you want it.

-Yeah.

Guys, I'm so excited for you, good luck with this project,

and I cannot wait to check out each individual flat

-and see which one I like the best!

-Cheers.

-Lovely to meet you.

Lovely to meet you, too.

Wendy and Chris have a fabulously exciting project here,

and I don't think these will be your run-of-the-mill boxy new-builds.

I am hoping they will be interesting, unique, plush pads.

You can find out if they are later on in the programme.

Let's head to north Birmingham now,

and this area is close to Sutton Park.

With trains from nearby Sutton Coldfield station

taking just 20 minutes to Birmingham city centre,

this is a very popular area.

Well, through Sutton Park brings you to an area known as Kings Standing.

And very nice it is, too.

So... Whoa, good news.

110 to 115,000 quid for this...

semidetached three-bed, around here? Mmm!

For a sought-after area like this,

that guide price sounds suspiciously good.

Well, it's looking from the outside like a classic 1930s,

and, you know what? You come inside and it is,

surprise, surprise, from the '50s. No! It's a 1930s, absolutely, 100%.

There's even, as you walk through the door, just a classic layout here.

This little hallway area, stairs up to the bedrooms.

Front living room area there, with an open fire, which is good news.

A classic design flaw of these kind of era of houses,

a kitchen which is way too small for the size of house.

I don't know where that came from in this era,

but it was always like that, from my experience.

There is an easy solution, though.

Because when you come through into here,

which is a rear living room area, there's always that wall over there,

knock that down to create a really nice...

sort of through-flow kitchen-living space.

This room benefits from that, a lovely view out to the garden...

Even want to increase the size of that door, perhaps,

in that bay there, to make even more of that.

And you might have to do a little bit of jiggery-pokery

around this area, anyway, because, as you can see,

there's a few signs of cracks -

one down there, some up on the ceiling, and a little one there.

It could be that has started to drop, causing that problem, but if

you're going to do some playing around with this area anyway,

taking out that wall, you're going to have acrow props,

you're going to have people with large hammers...

It'll all be done at the same time, so not a problem.

OK, it is a problem, but it's not an insurmountable problem.

# If that's the biggest problem I've got, no problem. #

I'm not saying that cracks are always no problem.

If they're wider than 3mm diagonal and wider at the top,

or visible inside and out,

that could be the telltale signs of subsidence.

So, upstairs, it's all very dated, as you might have expected,

and whoever was here last had a real love of flowery wallpaper!

All the bedrooms have got... Yeah, well, exactly that.

Flowery wallpaper. But it's nicely proportioned.

Two... A very small box room, medium-size front bedroom there.

Half-decent bathroom. Needs completely redoing.

And then your rear bedroom here, with the bay, as at the front,

and here the issue, again, is that crack.

It obviously, and not surprisingly, extends up here,

and, in fact, has affected some of the ceilings in here as well.

There's no getting away from the fact that that is an issue

that needs to be resolved. However, the good news is, in some ways,

it's there, because it will put a lot of people off, perhaps,

who viewed it before the auction.

And if you can factor in the cost of actually doing the work

to sort it out, and that's less than it would have cost you to buy

a house round here which didn't have that problem, then you kind of...

Yeah, stacking things in your favour.

If you know what I'm talking about.

# Oh, do you know Do you know what I mean? #

As well as the cracks in here,

there are cracks in this front bedroom too,

so get them looked at pronto.

At the back, there is a really good-sized garden,

so perhaps you could look at extending to the back

to create a bigger kitchen.

Or, as a lot of people have done in this area,

how about extending to the side,

to create a garage and an extra bedroom and bathroom?

It would depend on planning, of course, but you could potentially

add a bathroom and a bedroom, which, if you didn't spend too much on

in the build, could add to the property's value,

especially if you get it for anything like the guide price

of 110-115,000.

We asked along an agent from the auction house who sold it

to get his opinion.

Having looked around this property, it's got great potential.

It's got a large area at the side where a garage could be built,

with one or two bedrooms over.

It needs generally refurbishing throughout.

I've seen some cracks, which I'm not too worried about,

apart from the one in the back bedroom bay,

which will need attention.

If you were to extend, you're probably talking 50-60,000,

and with fitting out, it could go to a lot more than that.

Well, let's listen to some figures, then.

Without an extension and a full refurbishment,

including knocking through the kitchen,

what rental and sales figures could be expected?

As a three-bedroom property, this could sell for £195,000,

and as a three-bed on the rental market,

somewhere in the region of £700-750 per calendar month.

OK, so what if you did do an extension,

and add that fourth bedroom?

As an extended four-bedroom property,

this could sell in the region of £250-270,000,

and could rent for around £1,000 per calendar month.

Well, this is a classic auction property, isn't it?

A house that could definitely benefit from improvement,

but in a really nice area.

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

Vacant freehold, semidetached property, in need of modernisation,

but with three-bedroom accommodation.

Start me where you will on that one.

Ought to be about 130 to start, hadn't it?

£130,000 to start.

Thank you, sir, £130,000 is on my left, I'll take 140 now.

Your bid, sir, at 130,000.

Do I hear 140?

140, sir? Thank you, 140.

150 now, sir?

145, if you like, sir?

145,000. 150, sir?

150 bid. 155, sir?

The property got off to a flyer, with plenty of bidders interested.

We rejoin the auction at 170,000.

170. 172, sir?

Where are you? 172?

172 bid. 174?

At 170...?

No? 172?

I'll draw a line under, for the first time, second time,

third and very last time, the bid is there.

174, just in time.

176, I have another one.

Have another one, sir. At 170...

176, well done, sir.

178, now, at the back.

£176,000.

Being sold this time.

176. One, two, three...

You're out at the back. The bid is there...

It is yours, sir, well done.

After a hard-fought battle,

the successful bidder was part-time property developer Inderpal.

He hails from London,

and has chosen to invest here in the Midlands with two friends,

Gurinder and Kurinder.

I met Inderpal at his latest acquisition.

Inderpal, nice to meet you.

-Same.

-Congratulations!

-Thank you.

-Tell me why you wanted to buy this house?

We buy this house because this area is very nice,

the schools are very good here,

and good location, nice three-bed semidetached, and side-spacious,

so that's why I bought this house.

And did you come up to see it beforehand?

-No.

-GASPS

-No.

-When was the first time you saw it?

-Today.

-Today!

-Yeah.

-So just now?

-Yeah.

-So, what do you think?

It's OK. It was very good, nice,

very good area. Nice house.

Good size of garden. I am very happy.

Why didn't you come to see it beforehand?

Because I don't have the time.

Yeah, that's why.

Was it not a bit strange, spending all that money on a house

but not having seen it?

You know, in the past,

I bought a couple of property in the Midlands area without seeing it,

and I made good money from that, right?

So everything on the luck,

so that's why I'm not interested to see the property before that,

-before the buying.

-This is not a strategy we recommend

for you watching at home, OK?

But it, hopefully, has turned out all right.

One thing, obviously - have you seen the cracks?

-No.

-Oh, right.

Well, after we've finished,

there's a few cracks in some of the bay windows,

and possibly a bit of subsidence going on.

Is that a problem, or...?

No, it's not a problem, because my partner is a builder.

He lives in Oldbury, in the Birmingham area,

and he's a builder, and we can sort it out. It's not a big deal.

So whatever the issues are, he can sort it?

Yeah, because he's in construction the last 20 years, right?

-OK.

-And he is a professional. It's not an issue.

# Don't worry 'bout me... #

Yes, do not try this at home, folks.

Inderpal has got a background in building,

but viewing properties before you buy them is very important,

no matter your experience or confidence.

What's the plan for it?

The plan is to make five-bed, with garage.

-Five?

-Yeah.

-How?

We are thinking to side extension, and rear extension,

and side double-storey.

-Oh, wow.

-So that is our plan,

and after that, it depends on planning permission.

If we will get the planning permission, then it is a five-bed.

If we will not get the rear double-storey,

then the plan is to make a four-bed.

With the help of his partners, along with his brother,

who just happens to be a builder,

Inderpal estimates of the work will cost 55-60 grand,

and 16-20 weeks to complete,

after which he and his partners plan to sell.

So, have you always been a property developer?

Actually, I'm on the property because of Homes Under The Hammer.

-Really?

-Yeah. It's my favourite programme.

Every day, I'm watching.

And I've seen so many programmes, people are making money.

But on that time, I don't have much money, and always thinking, one day,

if I have money, definitely I'm going to buy a house from auction.

-OK!

-So, because of the Homes Under The Hammer,

I have four properties now.

-Four?!

-Yeah.

-Oh, great!

-Yes.

-Good to hear.

I'm glad it's going well.

Yeah, everything because of Homes Under The Hammer.

Aw, well, that's really nice to hear.

Good. Listen, congratulations.

Good luck, and I'm glad we've helped out in some way.

Thank you.

So, another Homes Under The Hammer-inspired success story.

That said, how can such a fan of Homes Under The Hammer

ignore one of our basic principles,

that you must always view a house before you buy it?

Sometimes, I despair.

Anyway, it seems like he has got a good project here,

and a team of people who can turn it into a success.

How will he get on? You can find out later in the show.

Still to come - Mum knows best with this Telford property.

I like to get her seal of approval. I wouldn't want to

go and buy a house that she didn't think was a good house.

And, in Sutton Coldfield,

Inderpal knows a lot more about building extensions.

It's very hard to make the side double-storey.

Back now to Folkestone in Kent,

where time had been called on this former pub.

It was sold with plans in place to turn it into

eight residential flats, and straight away, Lucy was impressed.

Oh, wow.

Wow! What a space!

I absolutely love it.

Somebody's done all the ripping out for you. How fantastic!

The plans were already approved,

with four flats on the ground floor

to be made up of two two-beds and two one-beds.

Then, on the first floor, you'd have two two-bedroom flats, and,

in the unused loft, there would be another two-bed and another one-bed.

All this for a guide price of £200-220,000.

But, with a property in this condition,

only the brave need apply.

Step forward, brother and sister Chris and Wendy,

who paid £220,000 at auction for this battered boozer.

Wendy recently decided to become a property developer full-time,

and Chris is one of five brothers, all involved in the building trade.

So, a pretty good team, and Wendy was eager to get going.

I love the exterior of the building.

-Me too!

-I love the windows...

-Me too!

-I think there's a big wow factor that could be brought into

this building. I just fell in love with it.

With Chris project managing, they wanted to build and sell on

the eight flats in accordance with the plans.

They had a budget of 270,000 and a timescale of seven to eight months.

Well, fast-forward -

not very fast, to be fair, because it's nearly three years on -

to see if this former pub will be popping the champagne corks.

Yes, they have been true to their word and built eight new flats.

Plans have changed slightly -

they now have four two-bedroom flats and four one-bedrooms.

Down on the ground floor, there are four flats - two at the front,

both of which are one-bedroomed.

And at the back, two which have two bedrooms.

All these properties have been built virtually from scratch,

with a lovely open-plan living aesthetic running through each.

It's also great to see that they have restored and maintained

those wonderful windows that really give it that wow factor.

Up on the first floor, there are a pair of two-bedroom flats.

And flat number six benefits from a rather lovely roof terrace.

Up to the previously unused top floor,

and there are a further two one-bedroom flats.

They have certainly made the most of the space they had.

As promised, in the basement,

they have created storage space for each resident.

They've also created a gated car park - another winner.

What was essentially a derelict building that had stood vacant

for five years is now a beautiful, highly desirable, eight-flat unit

that's a real triumph.

With Chris otherwise engaged, we caught up with Wendy

and husband Tim, who has been helping Chris

with project management for two years,

and it's certainly not been plain sailing.

We completely underestimated the drainage that would need to be

put into the car park. We just thought the existing drainage

would be acceptable, but we've had to put in

a pretty severe drainage solution.

So there's 36m of 900mm storage pipe under that car park.

And that cost a lot, and took a lot of time.

Some of the joists weren't attached when we cleared the building out,

so there was quite a few things like that which took a lot of time

before we could actually get onto the renovation itself.

We had to go back to planning, mainly for some changes

to the car park - landscaping, for instance, putting in

a barrier for the car park that we thought was pretty essential.

Also the way we changed the layout in one of the top-floor flats,

the smallest flat. I wanted more living space rather than a corridor.

And in doing that,

we had to then put in a misting fire-suppression system, and

we needed to get building control to sign off for that as well.

Along with the unforeseen structural and drainage issues,

they also had to replace the whole of the roof,

all of which contributed to the timescale swelling from eight months

to the best part of three years.

All that extra work can't have been good for the £270,000 budget.

Erm... We've gone over budget by - just for the building -

by about 200,000.

Again, there was a lot of things that we had to do

that we didn't realise we were going to do. The drainage, the flooring,

things like that - they cost an awful lot of money.

Time-wise as well, they took a lot of time,

but they also cost a lot of money.

But without those things... They were the foundation of the building,

so they had to be done.

All and all, then, along with the purchase price,

they've invested a total of a rather eye-watering £690,000.

But will two local estate agents think these flats

are a wise investment?

I think what they've done with this building is quite amazing.

They've done way beyond what I expected them to do when I saw this,

quite a long time ago.

So, really good finish. I'm very, very impressed.

I think the flats here are pretty special, really.

I mean, to take on a building of this sort of age and convert it

is never an easy thing to do.

I think the finish is absolutely amazing throughout,

and I think it's very successfully done.

The fact that all the flats have got the basement storage area

is a great bonus.

The parking, the bicycle area - really well thought out.

Excellent, agents are impressed.

But what about those valuations? Will there be a profit?

Regarding the two-bedroom flats, they're all different,

and some of them have got outside space,

so I would put the range somewhere between £165,000 and £190,000.

The one-bed flats, in the range £125,000-140,000.

So, I would say, for the two-bedroom apartments in this building,

that we'd be looking between £170,000,

up to £195,000 per unit.

The one-beds, well,

some of the one-bedroom apartments in the top of the building,

where we have the lovely views, but they are obviously smaller

than the one-beds lower down in the building.

So, the top end of the building, around the £130-140,000 mark.

And the bigger ones on the ground floor,

heading up to about the £160,000 mark.

OK, so some varying prices there, but let's try and take an average.

If we say the one-bed will, on average, sell for around 140,000,

and the two-beds will be in the ballpark of £180,000 per unit,

that would mean a humongous pre-tax profit of £590,000

for what was just a battered old boozer.

I think that deserves a drink!

I'm very happy with the profit that we'll get.

Obviously, we've still got some fees to come out from the estate agents,

the solicitors, but, apart from that, yeah,

I think that's a good day's work.

Now to Telford, in Shropshire, one of the New Towns.

13 miles from Shrewsbury, and it's in a popular commuter zone,

close to the A5 and the M54 to the West Midlands.

The property I'm here to see is not far from the centre of Telford.

It's got three bedrooms and a guide price of £65,000 plus,

and here it is. Before we even go inside, you've got a garage.

You've got off-street parking,

and you've got a bit of a garden as well.

As you can see, like most of the gardens I've been in,

there is an absence of teddy bears going round and around it.

OK, so, we're coming in through the back door,

into a really nice-size hallway.

Got a little bit of storage,

and you can actually see where the pictures have been.

Because that's nicotine stains - somebody's been smoking in here.

Stairs up to the bedrooms.

And a really good-size lounge.

Really big lounge, actually.

More signs of nicotine staining here.

Double glazing, though, which is good.

This is a really good start.

It does feel as though it's got lots of space in here,

as soon as you come through the door.

Here, you've got a little bit of storage.

And in here, we have got...

downstairs toilet.

That being the front door,

and then into the kitchen-dining area.

Again, it's really a good size.

You can get a dining table and chairs just there.

The kitchen area does look a little bit tired,

but I think if you were to give this a clean,

depending on what you want to use this house for,

you'd get away with keeping this.

I'm happy. I'm really happy.

Oh, hold it a minute!

Central heating as well.

Thumbs up, only if it's working properly.

By law, you need a competent and qualified tradesperson to carry out

checks and repairs to gas and central heating.

And while you're at it,

get the electrics checked as well, because...

# Well, I'd rather be safe than be sorry... #

Easier to put right are those nicotine stains.

Painting over them is no guarantee they'll disappear,

so I suggest a good clean with some sugar soap before decorating.

Now, I am liking downstairs. Up here, we've got three bedrooms,

and a family bathroom just here.

Yes, it's not huge, but it's in OK condition.

You could easily give that a bit of a clean up and keep it if you were

looking to rent this place out,

but it has got a feeling of space, just like downstairs.

Two bedrooms over here.

Good-size bedroom there.

A smaller one to my right,

but you could get a double bed in either of those,

and they have both got central heating.

What have we got here, before I go in there?

We have got good storage, and into bedroom number three, which, again,

you could get a double bed in here.

There is a little bit of

a fitted wardrobe as well.

I do like this place,

and I don't think it would take much to get this place back up to speed.

But you don't just have to take my word for it.

We've invited along a property expert from the auction house

that sold the property.

My first impression of this property,

I do feel it needs quite a significant amount of work.

It is looking at a full redecoration throughout, as well as appliances,

kitchen, etc. It's a full, top-to-bottom refurbishment.

If the purchaser did a lower-grade makeover,

what are the chances of renting out?

The main appeal of this area is buy-to-let landlords.

They can get a very good rental yields with the properties

at the purchase price.

If selling was the goal after refurbishment, what would it fetch?

If this property was renovated,

I would put a price on it of around £85,000.

And on the rental market?

Once refurbished,

this property would rent for £550 per calendar month.

I can't really find anything wrong with this place.

Yes, it needs cleaning up, it needs painting, and it needs new carpets.

Apart from that, you've got a decent-sized kitchen,

downstairs toilet, upstairs bathroom, three bedrooms,

off-street parking and - one more -

you've got a garage as well.

All for a guide price of £65,000 plus.

It's a bit of a no-brainer to me.

Let's go to the auction house, and see who was lucky enough to get it.

Lot 39, back to Telford.

Three-bedroom midtown house, with a garage. It does need modernising.

60 to start me?

60 bid, thank you. At £60,000.

62, can I see now?

At £60,000.

Looking for 62 now.

62. 64.

66. 68. 70?

At 68,000, my right.

I'll take one, if it helps.

69?

70?

69,000. My left, then, at £69,000.

70, anywhere else?

70, seated.

71?

Quick, quick. No?

At £70,000, the bid seated, no mistake, another one, anywhere else?

If not, £70,000 once, £70,000 twice, third and final time,

all done? At £70,000...

You bought it, sir, well done.

Although we didn't catch them on camera,

a successful bid of £70,000 came from Mike.

He's a Homes Under The Hammer regular,

along with his wife, Annette.

Last time they appeared on the show, they bought this flat in Newport.

-Are you disciplined in the auction house?

-Yes, I'm very disciplined.

I get a list of prices, and then I go, and I never go above the list.

See, clever. You've got him well-trained, you have?

-Yes.

-I like that.

Well, I give him the list, you see.

This time, Annette's list featured this property,

which she lined up for her son, Lewis.

He's following in his mum's footsteps.

Annette, good to see you again.

-And you.

-And Lewis, nice to see you.

Congratulations, yet again.

What was it about this property that attracted you in, then?

Well, I think what we liked about this property is that we don't think

there's too much work to do here.

Clean the walls and then paint them, put some new carpets down.

Isn't it amazing how a bit of nicotine

can change the whole look of a property?

-Yeah.

-And you can see where the pictures have been!

Actually, you could just leave it, and call it magnolia.

DION LAUGHS

Who's going to do all the work with you?

We're going to do the work ourselves,

so I'll be doing it in the evenings and the weekends.

And my mum will help as well, and my mum's husband, Mike,

will be helping as well with the plumbing, especially.

-That's his speciality.

-Who actually found this property?

Well, I suppose I found it.

I always check the auction catalogues for this area,

and I saw this one, and it seemed to be a good, solid house.

It's got its own parking space and a garage, which is what we like.

We think that a three-bedroom house like this is going to be appealing

to families, and they're going to want the parking space

near to the house, and this house has got that.

And we thought that houses in this area often go for

quite a good price, so we thought we'd give it a go.

It does seem quite a solid house, doesn't it?

-Yeah.

-It's very good.

-I like houses from the '70s,

because it's when they had worked out how to stop them getting

too much damp, and they'd insulated them, so they're nice and warm,

and comfortable houses to live in.

So where are you going to start, Annette?

Where are you starting on this one?

Well, I will let Lewis start on this one.

I did say I wasn't going to do any more, so...

Good to see you again!

And I think that everything here is well within his capabilities,

so I might come occasionally and do a bit of cleaning for him,

and certainly the painting, probably.

So how does this working relationship work, then?

I usually find the houses, and then I suggest the house to my mum.

I like to get her seal of approval, I wouldn't want to

go and buy a house that she didn't think was a good house,

because if I did that, she wouldn't help me,

and Mike wouldn't help me.

Well, you know...

The viewing is usually during the week,

so usually Mike and I go and do the viewings.

-Because I'm at work.

-We did view, probably ten, I suppose,

in that auction.

And I bring the catalogue with me,

and when we viewed this one, I put a little marker in the catalogue.

This one, I put three stars, and wrote "very good".

That was because it had the things I require, or like,

which is a downstairs toilet - I think that's really a bonus.

-I agree.

-Somewhere to park your car,

and space in the kitchen to sit and eat your meal.

Yeah, there is enough space in here, you could put a dining table

in here, and chairs and stuff.

So, that's probably why I've put "very good".

It falls within your parameters. Now, where are you going to start?

Tell me the first thing you're going to do.

The first thing I'm going to do is clean the kitchen,

because it's in a filthy state.

Give it a really, really good clean.

Then I'll clean the nicotine off the walls,

and then start painting the walls.

-I'll sand the skirtings down.

-Mm-hm.

-With a house like this,

cleaning it is probably the most important thing.

And then, after that, it should be ready to decorate.

And who's going to do the decorating?

Are you going to do the cleaning on your own, or...?

Yeah, I think my mum and I will both do a bit of the decorating.

The first job you've got to do is get the central heating working,

-that's the very first job.

-Mm-hm.

Make sure it's working, and leaks on the radiators.

You don't want to paint your walls,

and then you've got your radiators leaking on them.

So you start with the checks first.

How long is it going to take the three of you to turn this round?

We think it's going to take about two months, because

we are just working evenings and weekends, so it takes a lot longer.

So, apart from the nicotine,

have you noticed anything else that really needs to be done?

Well, the boiler does seem to be quite old.

There's a date on it of 2001, so that's quite old for a boiler.

So we will get that working, or hopefully get it working,

and then decide if we think it needs a new boiler.

But we're hoping to keep it.

So what's the budget?

The budget will be about £2,000 for the decorating,

carpets, flooring, fencing, that sort of thing.

If we have to add a new boiler, that would be money on top.

-How much will that be on top of the budget?

-About 1,700-2,000.

What are you going to do with it when it's all finished and complete?

I'm going to rent it out.

Is this going on your portfolio?

-It is, yeah.

-Good man.

Right way to go, sir.

-Annette, good to see you again.

-And you, thank you.

-And good luck. Good luck to you, Lewis.

-Thank you.

So, Lewis has got another property to add to his portfolio,

and I think it's a bit of a beauty.

There's hardly anything that needs to be done here.

If he takes his mum's advice, I think he'll be OK.

When we come back, I think this place will be spot on.

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

So, don't go anywhere,

we've still got another two properties to show you.

Yes, will the champagne corks be popping, or will they be lacking

-a bit of sparkle?

-I think we should find out.

For our next stop, we're heading back to North Birmingham,

and this three-bed 1930s semi,

which went under the hammer for a tempting guide price of between

110,000 and 115,000,

and it didn't take long to figure out why.

# Please forgive us if we're cracking up... #

As you can see, there are a few signs of cracks.

There's no getting away from the fact that that is an issue

that needs to be resolved.

Signs of movement weren't the only drawback.

A classic design flaw of these kind of era of houses -

a kitchen which is way too small for the size of the house.

Would lack of space and worrying cracks put off a potential buyer?

Not on this show.

It was Inderpal who, together with his friends, Gurinder and Kurinder,

bought this house for £176,000.

And they had big plans.

We are thinking side extension,

and a rear extension and side double-storey.

And if we will get the planning permission, then it's a five-bed.

If we will not get the rear double-storey,

then the plan is to make a four-bed.

London-based Inderpal was leaving the building work to Gurinder,

and he estimated it would take no longer than 20 weeks,

with a spend of 60,000.

Well, it's been eight months since our first visit, and, my goodness,

things have changed.

Encountering no problems with planning permission,

the house has been extended, both to the side and to the back.

All that extra space has allowed for a transformation inside.

Remember that modest kitchen?

Ha! Not so modest now.

There's in an extra 4.2m to the back, and 3m to the side.

That is a lot of kitchen, and as the side extension is double-storey,

this has allowed Inderpal to make two extra bedrooms upstairs.

There are now five bedrooms in total, and no shortage of bathrooms.

The original has had a smart makeover, making full use of

the extra metre that has been added to the first floor.

Inderpal has added two shower rooms,

one upstairs and one on the ground floor.

However, extending sideways created problems for the build, as erecting

scaffolding was hindered by a lack of access at the side of the house.

It was very hard to make the side double-storey.

We are doing four, five courses at the one time,

then we do the pointing, then we left our bandstands up.

Then we make another four or five courses.

The bandstand Inderpal refers to isn't somewhere where

the local brass band would play, but a builders' term for a trestle

you can put scaffolding board on.

This time-consuming process,

where they were effectively building from inside the new structure,

meant extra hands were needed to keep on schedule.

What we were thinking before was 16-20 weeks, right?

And we finished the job before that, because we got extra staff.

He didn't start any other job, he's concentrate on one job,

so that's why he finished it quicker then.

Inderpal managed the project from London,

but it was builder Gurinder who did the hard graft.

# Work, work, work. #

He's the main man who did all the construction work, right?

My role is only in this property to discuss a few things with me

on the phone, right? The rest of the work, he did it, everything.

One of Gurinder's many tasks was to sort the numerous cracks

-at the rear of the house.

-The cracks is only minor cracks,

only on top of the plaster, right?

We take off all the plaster, and after that we board the mesh,

and we re-plaster it to fill the crack.

So we did that.

This has been a comprehensive refurbishment, but the original

£65,000 budget couldn't keep pace with their ambitious plans.

We are thinking before it is a small kitchen, and after that we had to

add a little extra amount onto the kitchen because it's

a big kitchen now. And before we are thinking two bathroom,

and now we make it three bathroom.

So we spend nearly £85,000 on this one.

Despite being 25 grand over budget,

Inderpal and Gurinder are pleased as punch with the finished project.

But what will two local property experts think?

It's a very impressive property. Obviously, there has been

a considerable amount of extensions that have taken place here.

The layout, with four double bedrooms and a single fifth bedroom,

and three bathrooms or toilet facilities, is great for a family,

and they will welcome the space that it has.

Selling features of the property - it's now got good off-road parking.

It's got very good accommodation downstairs,

but I do think en-suite bathrooms would have helped.

Will the layout niggles affect valuations?

Inderpal and his partners have spent a total of £261,000,

and are looking to put this house in the resale market.

I would think it's likely value would be in the range of

£350-370,000.

I think the property could sell somewhere between

325,000 and £350,000.

325 is very low.

370 is OK, because we have another two private buyers,

they are looking to buy a property, right?

And they are happy to buy at 375.

If Inderpal manages to sell for 375,000, that would net

the partnership a profit of 114,000, before fees and taxes.

The agents both agreed that a likely rental figure could be

as high as £1,200 per calendar month,

which would give Inderpal a yield of 5.5%,

but the plan is to cash in the equity and start another project.

It's our aim to sell this property and buy another one

and come again back onto your show as well.

Well, we look forward to seeing you guys sometime in the future.

We're back in Telford, where earlier I visited this three-bed terrace,

up for sale at auction with a guide price of £65,000 plus.

From the outside, it looked pretty promising.

You've got a garage, you've got off-street parking,

and you've got a bit of a garden as well.

Inside, it didn't disappoint,

with good-sized rooms and central heating.

I reckon it wouldn't take much cash to get this place up to scratch.

The only downside was the state of the walls and ceilings.

You can actually see where the pictures have been.

Most houses are decorated with wallpaper or paint,

but this layer of nicotine stains was very unappealing.

# Golden brown Texture like sun... #

It was purchased by Annette and her son Lewis for £70,000.

And it's no surprise what they thought the biggest job would be.

With a house like this,

cleaning it is probably the most important thing.

And then, after that, it should be ready to decorate.

In a hurry to get this property ready for the Telford rental market,

Lewis and Annette set themselves a deadline of two months,

and if all went smoothly, aim to spend no more than two grand.

We've come back ten weeks later to see how they've got on.

# But I'm clean, yeah

# Friends with Mr Sheen, yeah

# Don't have to wean myself off of nothing

# Two minutes' clean, and that's not very often, stroll on. #

From nicotine-stained to bright white -

the house certainly looks much more presentable.

It's amazing how much bigger a property feels when it's been given

a good clean and a coat of fresh paint.

New carpets throughout add the perfect finishing touch,

but it's cleaning that's taken up most of Lewis's time.

To get rid of that nicotine,

he had to wash the walls with a solution based on sugar soap,

and a gallon of elbow grease.

I had to do that at least two times,

because the water started to go an orange colour.

So I did it once, and then with clean water, did it a second time.

Then we painted the walls, using a good-quality white emulsion.

It's taken quite a few coats.

Then had to clean the units, inside and out,

and then I replaced the kitchen unit handles with these modern ones

to give it a more modern feel. So it's taken me a lot of effort

to clean these kitchen units up,

but I think they look really good in the end.

I'm really pleased with how it's turned out.

And so you should be,

but just remember to read the manufacturer's instructions

when using cleaning products.

Lewis has done the lion's share of the work,

but mum Annette has been on hand to help,

although there has been some family friction.

We argue about the order that you do the painting.

When you paint the gloss on the skirtings,

the order that that should be done.

It's minor stuff. The end result looks pretty much the same.

I'd done the painting in one room,

and then I come back the next day and he'd put the second coat on

or something like that, and I didn't like that at all!

So I thought, "Right, I'm not doing any more!"

So I went outside, then. Worked outside.

And thanks to Annette's efforts,

the garden has undergone a bit of a chocolate-coloured makeover.

-# Choco choco

-Clap clap

-# Choco choco

-Clap clap

-# Everybody say it - chocolate!

-Here we go! #

I painted the fence a nice sort of dark brown.

And then I got some masonry paint mixed,

and I painted the paving slabs

with chocolate-looking paint. It's lovely!

So, after that, I wanted to paint all the slabs chocolate,

-but Lewis wouldn't let me!

-Wouldn't allow it, no.

Well, exterior paint is expensive,

and Lewis had his eye firmly fixed on the budget.

One unknown cost for this project

was the boiler and the central heating system.

Well, when we bought the house, the boiler had been turned off,

so obviously, we didn't know if it was going to work or not.

But when we got the gas turned on, the boiler worked first time.

We've had no problems with it at all, so that's good news.

I've just given it a good clean.

With one big expense spared,

did that help them keep within that two grand budget?

It's ended up costing us £3,100,

which is a bit more than we originally thought,

but we haven't really spent any money that...

We haven't splashed out on anything in particular.

-Only on too much sugar soap.

-Mm.

With the work completed just one week over the two-month deadline,

the property is ready for a tenant to move into immediately.

But first, we've asked two local property agents to pop over

to hear what they think of the work that's been done.

I think the changes to the property are very positive.

They've done it to a good level for rental purposes, and for resale.

I think they couldn't have done any better with it.

The standard of finish, I would say, is average,

but, for this sort of property, I think it's perfectly fine.

General makeover and tarting up,

which is perfect either for resale or for letting purposes.

Hmm. Mixed opinions about the standard of finish

but both agree that this could be an ideal rental property.

How much do they think Lewis could make in rental income?

I would say this property would rent for around £525 per calendar month.

However, I do feel you might be able to try about 550 per calendar month.

If this was to go on the rental market,

I would suggest a rental value of £550 per calendar month.

With a total spend of £73,100, a monthly income of £550

would mean a return on investment of just over 9%.

We hopefully have a tenant moving in fairly soon,

and they are going to pay about 575 a month rent,

so we will be meeting with them shortly to iron out the details.

With a tenant almost ready to move in,

Lewis hopes to have a long-term rental future for this property,

but have the improvements increased the house's resale value?

If this was to go and the open market, I would be suggesting to

our vendors to accept an offer of around the £80,000 mark.

I think the property would sell for around £85,000.

I would suggest a marketing price of £90,000.

I think those resale figures are OK.

I think we'd definitely want the 85, and not the 80.

I have seen houses like this on the market for 90-85,

so I think I would want 85 for this.

Achieving a sale of 85 grand would generate a pre-tax profit of

just under 12 grand, but selling isn't on the agenda for now.

My plans for the future are to work on the next house which I bought,

which is also in Telford.

So I'll be starting on that on Monday, after the weekend.

Having the weekend off.

That will probably take about three months,

because it needs a lot more work than this house.

And hopefully will go OK, and I'll try and buy another one after that.

Well, there you go - property developing is not always easy.

The challenges can be many and varied.

Yeah, but there are rewards to be had - if you get it right, that is.

Yep, so make sure you join us next time for more thrills and spills

-from the auction room.

-ALL: Goodbye.