Episode 79 Homes Under the Hammer

Hello, and welcome to the show.

It doesn't matter if you're a seasoned property developer

or a first-time buyer - we all want value for money.

Yes, but how do you get that in an ever-fluctuating property market?

Well, one way could be to head down to your local auction house.

So, what's stopping you buying your next home under the hammer?

Well, when it comes to auction purchases,

sometimes you just know you've bagged yourself a bargain.

Other times you're not so sure, and doubts can creep in.

Yes, and the best way is to test the market.

Did the buyers on today's show make the right moves?

Let's find out.

I'm at the seaside in Devon

at this ground-floor flat with views to die for.

Oooh. That's what we're after.

At this three-bed semi in Crewe, I'm trying my hand at interior decor.

I'm pretty sure nowadays they are called industrial chic,

I'll have you know.

And it's continental chic for Lucy

in this one-bedroom flat in London.

Change the kitchen into a much bigger bedroom

and, voila, you've got a much nicer living space.

10, 12...

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. Sold.

I'm in Devon, in an area known as the Jurassic Coast.

This World Heritage Site spans 96 miles,

and the rock face dates back 185 million years.

It's hardly surprising that tourists make a beeline

to see this iconic cliff.

MUSIC: Summer Holiday

And where better to have your holiday than Seaton,

a seaside town in East Devon.

Holiday properties to the south of here can command very high prices,

making property here likely to be on the up.

Well, coastal properties, without doubt,

attract a big premium

when it comes to comparisons with other similar sized places.

It's where everyone wants to be, isn't it?

The idea of owning a place overlooking the sea, absolutely ideal.

Well, here in Seaton,

an opportunity to get that kind of space without too much cost.

?65,000 to ?75,000 was the guide price

for a one-bedroom flat in a building with other flats.

Let's have a look.

Facing out to the side of the building, unfortunately,

this ground-floor flat won't enjoy the views

of its loftier neighbours in the block.

So, through the front door

and straight into the little entrance area there.

And then...

Straight away you get the impression this is not a huge flat.

It is just a one-bedroom flat, however.

Kitchen there - doesn't seem to be in too bad condition.

And then a sort of central little area here.

You've got your bedroom down that end, your loo and bathroom there.

And then through into, really, the only other room in the property,

which is currently your living room.

It looks to be in pretty good condition.

I mean, lots and lots and lots of woodchip wallpaper to get rid of,

but some nice features.

It's obviously been lived in relatively recently,

doesn't smell too damp.

And, of course,

what you're looking for in this, without a doubt, is a view

and, thankfully, out of that window, we get the sea, we get the horizon,

and we get a fairly dramatic cliff view.

Oooh. That's what we're after.

Another thing you get with this flat

is a share of the freehold along with the other flat-owners,

so there are no worries about leases.

However, there is something on the horizon that could be a worry.

Of course, living right on the cliff has advantages.

That's the advantage. Imagine waking up to that view in the mornings.

It does have disadvantages, though.

Some cliffs are, obviously, very prone to erosion,

and that's certainly the case here.

So you need to be very, very sure

that you're buying something which is pretty solid,

and that means employing the services of some good surveyors

and people who know the area.

Talk to the locals, find out what's going on.

For some people, though,

whatever price they have to pay and whatever the dangers are,

they still want to live somewhere like this.

Unfortunately, beautiful places like this, all around the country,

are being affected by erosion.

One forecast suggests

that Devon will lose nearly 300 homes in the next century.

So you do need to keep a cool head

when you see a relatively low guide price in an endangered spot.

Time to find out from an agent from the auction house

that sold this property what the pros and cons are of buying here.

The pros of the area are certainly that

it's an up-and-coming regenerated town.

There's been a lot of investment,

particularly down on the harbour-side and seaside areas,

so it is a place to be buying

if you're looking to invest money into the area.

Cons, I suppose, realistically,

this property is located conveniently for the town centre,

but it's also convenient for the cliff side,

and that is getting ever so closer with the sea coming in,

so erosion could be a big factor.

It's certainly a serious issue to take into account,

but let's look at the flat itself.

What does the agent think of it?

It's a nice little bolthole.

Yes, you may want to do some cosmetic refreshment

but, generally speaking, it's almost ready to go.

Obviously for sale,

there may be an issue with, of course, mortgage purposes.

With the cliff being so close, would they allow it, would they permit it,

would they lend against it?

So certainly the lettings market

would be the most strongest and more favourable.

What sort of income would you expect if you rented the property?

Once renovated, the property would fetch somewhere in the region

of ?525 to ?550 per calendar month.

If rented as a holiday let,

it could make ?500 per week in high season.

So what about on the sales market?

The property, once renovated,

could fetch somewhere in the region of probably ?85,000 to ?95,000.

Well, definitely a property that you'd need to do your research on

before you buy, but...

the chance to get that bolthole by the sea

for comparatively not very much money.

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

East Devon's Jurassic Coast at Seaton,

a one-bedroom ground-floor flat in a period property.

A 999-year lease from 1986.

A bit of updating and you're ready to go.

65 somewhere?

60, then.

55 for the flat.

55. 55, front row.

56 at the back.

At 56. At 56. At 56.

7 if you'd like it. 57.

Say 60.

No? OK. 58. At 58. At 58.

59. At 59. At 59.

At 59. A funny place to stop. At 59.

At 59. But it's a free country.

At 59. Front row.

First time.

At 59, second time.

At 59. Here we go. At ?59,000. And done.

59,000. Well done, you.

And your number is...

P429.

P429 on that day was held by Barry,

smiling as he got the flat for six grand less

than the lower band of the guide price.

I met up with him at his ?59,000 fourth refurbishment project

with his trusty canine companion.

Barry, good to meet you. And you. Congratulations.

Thank you. Tell me why you wanted to buy this flat.

I've worked for many years in Devon.

I live now in Milton Keynes, north of London.

Right. I work up there. But all my long-term friends are down here.

Oh. I spend a lot of time up and down the M5, M4, visiting.

So I thought it would be nice to have a bolthole

that I could stay in when I'm down here

and then let out when I'm not using it.

So that's exactly what you bought this for.

Yeah. What were you looking for, then?

Somewhere by the sea, or didn't it matter?

Yeah, I've always lived by the sea

and, of course, being in middle England now,

it's not conducive to the way I've lived for all these years

so, yeah, I've been looking for a year

for somewhere on the coast that I could afford. Right.

And, you know, it's difficult in Devon.

Of course. So... But finally found this.

Right. I'm very pleased I got it now. Yeah, for sure.

Were you happy with what you paid?

Well, certainly, yes. It was under the guide price, so very happy.

You know, the views... Yeah. ..are just amazing.

And Seaton's a nice town. Yeah.

It's a shame it's not on the front, isn't it? Yes.

But if it had been on the front of this block,

I guess it would have been a lot more expensive.

I think so, yeah.

The size appealed to me. I know it's quite small, but this is a bolthole,

I don't want to have to be doing a lot of maintenance.

It's in quite sound condition, quite nice order,

but just very old-fashioned,

and I think I can sort of make it... bring it up-to-date quite quickly.

Right. I didn't want somewhere big

that would take me months and months of work, really.

I would like to have this done quite quickly

and be able to use it and let it.

Makes perfect sense. What do you do when you're not doing this?

I'm a gardener. Oh, OK.

So you don't want to garden here, then, do you? I don't!

Yeah, it's what I do all the time, yeah.

Talking of gardens, that's probably where that little fella

is going to end up spending a lot of his time.

Tell me about him. Harry? Yes.

He's a little rescue dog that I took on four weeks ago.

Oh! I had a fox terrier, he died last year, he was 18,

and it was the first one I'd ever had, and such a great breed,

I'd been looking for another one for a year since.

He's a fox terrier? Yeah. Right.

And why Harry?

I think a dog should have a name with an "E" sound on the end,

so I went through all the E-sounding names and...

We liked Harry.

'Hm - wait a minute.

'So, given Barry's "E-sound" philosophy,

'what could you have called Harry?

'Let's see - Charlie?

'Benji?

'Monty? No, that's a bit full-on.

'Micky? Hm...nah. Buddy?

'How about taking inspiration from the movies or TV?

'Could have been Rocky. Or Scooby.

'Or Snoopy.

'What about Skippy?

'Uh-uh, no, that's a marsupial.

'Anyway, back to the flat.'

So tell me what you're going to do to it, then.

Strip the walls off, cos it's woodchip throughout apart from this.

Yeah, lovely. Get it all off, but it is...

I don't know what the plaster is going to be like underneath.

Hopefully it's reasonably sound.

Just light colours throughout. All that old pine, I shall paint.

New carpets.

Some new fittings in the bathroom - not a new bathroom suite,

I think it's quite OK as it is.

And a tidy-up in the kitchen, really, perhaps new cupboards.

New cupboard doors. Right.

But I shall leave the hob and the oven and...

I mean, it's a deceased estate,

so everything's just been left here. Yeah.

There's fridge, freezer, dishwasher.

Ideal for you, then. Yeah.

Now, we are on a cliff-top property.

Have you done any investigations into how solid the cliff is

and all that kind of stuff?

Not personally, but... Right.

There is a website about all of this,

an East Devon website, that has logged all of that

and, yeah, it is an issue.

The coast road between Seaton and Beer subsided about a year ago,

which isn't too far from the front of this property.

Ah. Probably about 20 feet of it is gone.

Right. But, I mean, that happens a lot on the south Devon coast.

It's a worry, but I think it will...

I'll probably see it out. Right.

I'll go before that goes.

So no other major plans for investment in terms of property?

This is really just for you and it fits the bill perfectly.

I have another house in Cornwall, that I bought at auction last year,

which has been done up and is up for sale.

Oh, right. When that goes, I shall probably look for something else.

OK. But I mean, no, it's not serious, it's a hobby.

So what kind of costs have you allocated for doing it?

Maximum 3,000, I'm hoping 2,500. Right.

So how long is it going to take you to do what you'd like?

I'd like to think two months, probably three.

Well, congratulations. Thank you. Good luck with it.

Thank you very much. Hopefully you and Harry are very happy.

We will be. Definitely.

Well, it seems like it's the perfect spot

for gardener Barry and dog Harry.

Yes. He's aware of the issues

and they don't seem to be too much of a concern to him,

which is really important.

Forewarned is forearmed.

If he is happy, then jolly good luck to him,

a good price to pay for, as he says, a bolthole by the sea.

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

# Why? Cos they lovin' the crew

# They lovin' the crew

# They lovin' the crew... #

It seems like everyone loves Crewe in Cheshire.

The town grew up around the railway station built in 1837.

It's this strategic position on the West Coast Main Line

that has meant Crewe has always been a great location for manufacturers,

from munitions in the Second World War

to luxury cars of today.

Talking of great locations, this is a good one.

Just ten minutes away from the M6

and two minutes away from the railway station

is the property I'm here to see.

It's a three-bed semidetached property

with a guide price of ?100,000.

Let's have a look inside.

# Long drive, long night... #

I know this is a 1930s semi,

but were cars really 100 foot long then?

Joking aside, off-street parking is great,

even though it is a bit of a trek to the door.

# Long drive, long night... #

OK, so straight in, you've got the stairs

going up to the bedrooms,

into the living room, front room area, which...

It hasn't been touched for some time.

Very old-fashioned decor, bay window here,

which, surprisingly, has double-glazed windows.

Good sign is they have a gas fire, so there is gas in the property.

Into the dining room, maybe, very small.

Polystyrene tiles, they will definitely have to come down.

You've got a bathroom off to the left, and...

Maybe a pantry or some kind of cupboard.

OK, into the kitchen.

Which...you would have to start all over again.

It's a decent size, or could be a decent size,

if you were to configure it in the right way,

and I can see that, in the corners, there's a little bit of damp,

maybe some leakage coming from the roof of the extension,

so there's a bit of space in here, it's just how you use it.

It really does need a rethink.

For a three-bed family house, this is not a family-sized bathroom,

and its location downstairs isn't ideal, either.

I'd also be tempted to see if I could get rid of

some of these dividing walls here,

and create a nice modern kitchen-diner.

You'd also need to modernise the decor.

So a long list of works already.

So as you come upstairs to the three bedrooms,

the master bedroom is there to the front of the property,

the smaller of the three is there, and this is bedroom two,

with some of the original features, the skirting boards, there,

in a lovely shade of pink, as you can see,

and these original windows.

I'm pretty sure nowadays they are called industrial chic,

I'll have you know.

But what is nice about this property

is it's lovely to take a step back in time.

That's about the only good thing you can say.

There's not much room for an upstairs loo,

unless you lose the smallest bedroom.

No central heating, either,

so enjoy the trip down memory lane while you can,

as this house needs a lot of modernisation.

# Now let me take a trip down memory lane

# Comin' outta Queensbridge

# Now let me take a trip down memory lane... #

Out into the back garden, which I think is a decent space.

You've got off-street parking down the side of the property,

you've got a garage, and you've also got a shed

at the end of the garden.

As I look back at the property,

I can see that the extension has a flat roof,

so that may explain the damp stains in the extension,

but I don't think it would take much to turn this around

into a nice back garden at all.

The garden is pretty much the only part

that makes you think, "Gnome sweet gnome."

I think you really have to focus your efforts on the inside, here.

But Crewe is a town where property is in demand,

so we called in an agent

from the auction house who sold it

to tell us what he thinks of the property,

guided at ?100,000.

I think you need to consider this as...a fair old project.

It's a bit of a shell,

and it's certainly going to need a re-wire,

central heating system, certainly kitchen, bathroom,

possibly a damp course, new windows,

a lot of skimming, a lot of replastering.

The new owners have certainly got their work cut out on this one.

Maybe it's better we make a list of what doesn't need doing.

What about the loo and the layout issues?

I would definitely consider maybe putting the bathroom upstairs,

or there is potential to convert the loft in these properties.

Other people in the area have done that.

That could mean a lot of time and money,

but could it be worth spending on this property guided at 100 grand?

What could it achieve on the sale and lettings market?

I think, once the property's renovated,

I definitely think it would achieve around about ?145,000 mark.

From a rental point of view, once it's been modernised,

as a three-bedroom property,

I think you'd be looking in the region

of ?575-?600 per calendar month.

And what about the resale price with a loft conversion?

There is a limit, there is a ceiling price

on these semidetached houses,

and I think that would be around about ?165,000.

This is a solid 1930s semidetached property.

Now, you would have to get yourself a skip,

clear it out and start again.

New bathroom, new kitchen, and new windows.

Basically, new everything.

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

Good spot, good-looking house, lot 16.

85, going to say, to start.

Got a bid at... 85 bid, thank you.

?85,000. 90, can I see now?

95?

There wasn't much interest to start, but the bids slowly climbed.

We rejoin the bidding at ?98,000.

At ?98,000.

Standing left, then. 99 anywhere else?

99.

Make it 100. At 90...

Half, he's saying, 99 and a half.

100. 100.

And a half?

At 100,000, gentleman in the white shirt, at ?100,000.

Another 500 anywhere else?

At ?100,000 for the first time.

?100,000 for the second time.

Third and final time...

?100,000.

GAVEL BANGS Sold to you, sir, well done.

Bang-on the guide of 100 grand,

Adam in the white polo shirt secured a first property,

along with his brother Thomas on the left.

The brothers have bought jointly,

as they look to build a business in property.

So I wanted to find out about their first steps on the ladder.

Adam, nice to meet you. Congratulations.

Thank you very much. Your very first one. It is, yes.

Tell us why you decided to venture into the property world.

It was just something we decided we wanted to do, start of last year,

so we saved up and this was the one we came to,

we wanted a three-bed family house that we could renovate.

We went to the bank, started saving, putting money away,

we set ourselves a goal to buy one by the end of the year.

We live around here, we saw this come up, so yeah, we went for it.

So you know the area, then? Yeah, yeah, we do, yeah.

And whose decision was that, to go into a family business?

Well...a joint one, I think.

Well, I'd have liked to have done it on my own, but he earns more wages than me, so...

LAUGHING: That's clever. Yeah, yeah, very clever.

Get him involved for his money. Yeah, yeah.

If there ever was an expression of brotherly love,

it's raiding your sibling's wage packet

to finance a property empire.

But the boys are playing nice together...at the moment.

They want to fit the house and sell on, splitting the profit.

# Brotherly love... #

So you're on the board, you've got your first property.

Are you happy with what you've got? Yeah, yeah, yeah. We are.

Yeah, obviously, first thing, clear out everything that's in here.

And then start from scratch, basically.

We're going to...replaster, rewire,

there's no central heating, so we're going to put a combi boiler in,

and just give it a nice, clean finish,

new kitchen, new bathroom, and go from there.

The agent from earlier suggested a post-renovation sales price

of 140 grand,

and with the brothers forking out 100 grand for the property,

they are opting not to go into the loft or move the loo,

to hopefully maximise the profit on their first venture,

which brings me to a key question.

And in regards to spending money on this,

obviously Tom's going to be spending a lot more...

Tell us about the budget or what you've saved up

that you can spend on this.

We're going to go for between 15,000 and 20,000,

try and keep it in there and hopefully we'll fall within that

and get a nice finish within that, as well.

And what do you expect most of that, sort of, 15, 20 grand

is going to be spent on, the majority of it?

Obviously, like, your kitchen, your bathroom,

boiler, central heating...

We're going to try and do a lot of the work ourselves.

Brother's a gas engineer, so he's going to do all that.

I'm quite handy, so I'll be doing kitchens, bathrooms,

painting, decorating, we've got a couple of friends to rein in

for plastering and electrics, so, yeah,

try to keep the costs down.

That's brilliant. You're going to do the kitchens and bathrooms yourself?

Yeah. Have you done it before? Yeah, yeah, yeah. Oh.

I work as a site manager, so...

We do a lot of the work.

All coming out now, see, you've got the skills within yourself.

Yeah. Your brother, as well. Yeah. And you're roping in your mates.

What are your mates going to do? I've got a good mate of mine,

he's a plasterer, so he's going to be doing

the finishing touches to the walls.

Buy him as much pizza as I can and beer, as well. Exactly!

Will you get mates rates, or...?

Not with him, no. DION LAUGHS

Tell us about your timescales, as well, Adam.

Yeah, I'd like to think we'd be nearly there in about six months.

Obviously, we both work full time,

so it's going to be evenings and weekends,

and we'll try and do it in that sort of timescale.

You play a little football, as well. Yeah, yeah, I try to, I try to.

For your local... Give your local team a mention.

Haslington. Haslington, yeah?

And how are they doing? Not very well.

Only just joined last week, so... Have you? Yeah.

All change, now, cos you've joined. Yeah, maybe, yeah.

Promotion on the cards already.

Listen, pal, I wish you all the best. Yeah.

Hope it goes well. Yeah. I'm sure it will, between you.

Yeah. Thank you, cheers. Take care. Thank you.

Adam and his brother Thomas

have wisely decided to invest into the property world.

They've saved up their own money, they're planning ahead,

but how will they get on as a partnership?

You can find out later on in the programme.

Still to come, Lucy is uncovering some nasties

in South Norwood, London.

Well, I think there's obvious signs of a leak,

or something terrible happening up there.

And we find out if Crewe is the city of brotherly love.

It is hard, finishing work, coming after work, your weekends...

Back to Seaton in East Devon now,

where I saw a ground-floor flat

in a lovely building very near a cliff,

which is on the Jurassic Coast with erosion issues.

That's a worry. However, for me, its position had a big bonus.

Thankfully, out of that window, we get the sea, we get the horizon,

and we get a fairly dramatic cliff view.

Ooh...that's what we're after.

The inside of the one-bedroom flat was pretty good,

and, with a little bit of modernisation,

it would make a great pied-a-terre.

It was sold at auction for under the guide band

of ?65,000-75,000 to Barry,

who paid ?59,000 for a seaside bolthole.

Gardner Barry had previously lived in Devon for 15 years

and was planning that he, and rescue dog Harry,

would have somewhere to stay when they came to visit friends

from their home in Milton Keynes.

What were you looking for, then?

Somewhere by the sea? Or didn't it matter?

Yeah, I've always lived by the sea,

and of course, being in middle England, now,

it's not conducive to the way I've lived for all of these years,

so, yeah, I've been looking for a year

for somewhere on the coast that I could afford.

Barry was content to take the risk of being so close to the cliff

in exchange for the affordability factor.

And with his maximum budget of ?3,000

and a three-month timescale,

he was hoping he'd soon be able to relax.

Well, we've returned eight months later to see how he got on.

The kitchen has been brought bang up-to-date

with some rearranging and some white units.

The old false ceiling has been stripped back,

creating a much brighter and lighter space.

The beige bedroom now looks like a proper seaside home.

New windows have been fitted throughout,

and the frames have been brightened up

with a lick of fresh white paint.

He's kept the bathroom suite, as planned,

but it's all looking much fresher with white paint.

And he's replaced that old shower curtain with a modern screen.

The pokey living room feels much more spacious,

with grey and white decor and modern accessories.

So let's hear more about the changes from Harry.

Sorry, I mean Barry.

The colour scheme was very '80s, brown and miserable.

So it was a case of really fixing these windows up,

installing new double-glazed windows

and then changing this from brown to white and just lightening the room.

It's just been redecoration in here.

I think the result's quite good, it's light and bright.

And I think the white surround now really enhances that view.

The white frame makes all the difference,

but one thing I'm not quite so pleased to still see

is the '80s-tastic woodchip wallpaper.

Barry didn't want to risk damaging the plasterwork, so he's left it.

I went around and sort of repaired where it was...damaged.

And two good coats of paint, and I think it looks OK.

OK, we'll let you off with the woodchip, Barry.

The flat is looking great.

But what does he like the best?

The view. I mean, that's the reason...

When I viewed this property, I walked in and...

Those windows, and the view, probably,

are my favourite part for me.

He could have saved himself a pretty penny decorating,

if he's only going to look out the window,

but did he keep an eye on his maximum ?3,000 budget?

I've ended up spending about 2,800, which I think's pretty reasonable

for all the stuff that I've had to do,

but it wasn't difficult - when I looked at the property,

I knew it wasn't a complete rebuild,

so, yeah, I've come in on budget.

But it took him twice as long as his original timescale

of two to three months.

So why did it take so long?

You arrive tired, not prepared,

having not brought the right stuff and then having to go out again

and get materials, so it has taken me longer than I expected,

but it's been a lovely summer, haven't minded that too much.

Barry was set to relax here

and enjoy the view for some time to come,

but there's been a change of plan.

I've found another property in Plymouth,

which is closer to my friends, which I'm now working on, as well.

So the plan has changed slightly with this,

although I definitely don't want to sell it.

In an ideal world, I would let it for holiday-makers,

which would then free it up for me to use some of the time,

which would be lovely.

But failing that, I shall do a permanent let.

Let's see what kind of holiday rental Barry could achieve

on his ?61,800 investment.

We invited two local estate agents along

to give us their opinions on the flat.

It's got a nice feeling of space, nice high ceilings,

and you've got some nice views from the property.

The selling features of this flat are probably the allocated parking,

the sea views, and its location to town.

There's active coastal erosion not far from the property,

and that has been ongoing in recent years.

That would have an impact on the price,

wouldn't be mortgageable,

so you're looking at someone that's a cash purchase, basically.

We know Barry isn't going to sell but, out of interest,

has he added value to the property?

This flat would probably resell for in the region

of ?100,000 in today's market.

This property would sell

for ?120,000 or something in the region of that.

I'm shocked. Yes, I...

I had no idea it would be anywhere near that figure.

Wow! I'm gobsmacked, too.

That would mean a potential profit of just over ?58,000.

Could the rental values grab as much attention?

For the rental side of things,

we would be looking to market the property

at 495 per calendar month.

If you were to use it as a holiday let,

we would be looking for ?450 a week, and then off-season,

we'd be looking to go for 250.

It could residentially let for ?575 a month,

and it could holiday let for ?450 per week

during the peak summer months,

and about half of that out of the season.

The top value for a long-term let could give Barry a yield of 11%!

So what does he make of the maths?

Yeah, I would definitely be swayed towards a permanent let.

Certainly, for a year, I would see how it would go

and as long as I'm not missing the beach too much for that,

and I've got a good tenant,

I would probably stay with that, yes.

SONG: The Teddy Bears' Picnic

This is South Norwood in Greater London.

South Norwood was originally covered in woodland,

which formed part of the Great North Wood,

hence the name.

And while Lucy won't be seeing any teddy bears here,

you might just see an eagle, which, if you're not in the know,

is the name of the local club supporters.

The property I'm here to see is very close to Selhurst Park.

It's home to Crystal Palace Football Club.

It could get pretty busy around here on match days.

Well, here it is, it's a two-bed first-floor flat

in this mid-terrace building,

and it went to auction with a guide price of ?170,000 plus.

Nice street and nice-looking building.

It's impressive so far, but BEAR with Lucy as she climbs the stairs.

Well, as you can hear, from the echo...

This flat has been stripped back.

It's rather bare, not much in here,

but it's got a few little redeeming features that I like.

The staircase could be quite nice, and the banisters,

and the little spindles, once painted up.

You've got a nice big bedroom at the back with a sash window.

Some sort of little cupboard here, which is a bit weird,

there is no glass in it, and, well, the bathroom here,

again, it's all in a really bad state,

and it's as though all the bathroom furniture

has just been rammed in a room that's too small for it.

Not much you can do about that, sadly,

because it is quite a small bathroom.

Along this corridor,

and into the first room on the left, which is the kitchen.

Now, I'm quite surprised at that,

because quite a lot of the properties I've seen before

that are similar to this,

you would normally have this as a bedroom,

and the kitchen would have been at the back,

so I'm thinking a little bit of rearranging in here

wouldn't go amiss.

Woodchip wallpaper everywhere!

And, well, I think there's obvious signs of a leak

or something terrible happening up there with the roof,

because the ceiling is sort of coming down,

so that definitely needs to be looked at, but, yeah,

some TLC needs to be injected into this building, that is for sure.

But it's not all doom and gloom,

as there is something that could spark your interest.

So this is the lounge.

Now, nothing wrong with this room, other than it's a little bit small,

but on the positive side, you've got lovely light

coming through the windows here, nice and big,

and this glorious fireplace.

I mean, how lovely is that?

So, definitely make a feature with that.

Bit of a downside for me, this...

HOLLOW KNOCKING

..rather papery partition wall has been plonked up

and I'm not sure it's doing anybody any good.

Now, I talked earlier about a potential layout change,

so this is the other little room.

I'm thinking this is, like, a study or a baby's room,

it's very small to call a bedroom.

What about taking this wall out,

putting this kitchen into this space,

having a potentially nice, open-plan kitchen area

with all three windows, then?

Imagine that lovely light coming through.

Change the kitchen into a much bigger bedroom, and voila!

You've got a much nicer living space.

# Voila... #

Merci, Lucy. Those plans sound tres bien.

But before you take any liberty with this flat,

you'll have to check your lease

because, usually, structural changes like moving walls and kitchens,

will need the freeholder's permission.

But the major issue with this flat is this property is leasehold,

and the lease has approximately 69 years left to run.

Now, that's not ideal because, once a lease is under 80 years,

the value of the property begins to fall,

the shorter the lease, the bigger the price drop,

and that's because a lot of mortgage companies

are not keen to lend on short leases.

You can legally apply to extend your lease,

but you have to own a property for at least two years

before we can do that,

and of course, a lease extension could cost a pretty penny,

so be warned.

In fact, lenders aren't keen on lending

if there is less than 70 years left.

So financing this could be an issue.

With lease extensions and layout changes,

even if you got it for anything like the guide price

of ?175,000 plus, it's going to cost a lot.

So time to ask a local estate agent what profits, if any,

could be made here.

It's a good layout, good size,

and also, there is a lot of potential -

with regards to the smaller bedroom, turn that into a kitchen,

and where the kitchen is existingly, at the moment,

turn that into a bedroom,

giving the extra space that people would need.

We are all in agreement

that a layout change would benefit this flat immensely,

but will the close proximity of the football ground

potentially put people off?

Being very close to a football ground,

depending on the individuals,

some would probably find it very annoying on the event days,

parking may be an issue, noise,

in and out of getting into the property

could be a potential problem.

The real downside to this flat is the short lease.

So how will that affect the value?

Depending upon the lease,

if the lease is extended at the same time

and done to a very high standard,

I would suggest the marketing will be somewhere in the region

of around ?300,000.

If you didn't extend the lease,

I would suggest somewhere in the region

of around ?250,000.

Well, it's a flat that footy fans might love,

because of how close it is to the stadium,

but it needs a lot of work.

It needs modernising, updating,

there's also that short lease to deal with,

and we all know that can get costly.

So who is ready to take on this property with its problems?

Let's find out who bid for it at auction.

Two-bedroom first-floor flat in need of modernisation.

200. Start me off.

Don't want to go to much lower.

180. Try and help.

180, thank you.

After a slow start, the bidding heats up,

and we rejoin at 204,000.

204, new place.

206. 208.

210. 212.

212, yes or no? Hope it's the bank manager.

If not, it's 210 on my right, for the first,

210 for the second,

210 for the third and final time...

GAVEL BANGS Sold, 210.

While the successful bidder Alistair looks a little apprehensive,

there's no mistaking girlfriend Becky's delight

at them getting the property for ?210,000.

Alistair and Becky both work for charities.

They came along to the flat to tell Lucy more,

and brought along baby Saul, who is four months old.

Becky, Alistair, and baby Saul, how lovely to meet you all today.

Congratulations, and lovely to see you,

I'm glad you've come along.

So let's find out, you know, what happened,

and the story behind you guys buying this.

OK. Well, I've always lived in places

that need quite a bit of work,

so I've done places that I've lived in before,

and then we decided between us to pool our resources

and go to auction and buy, and we ended up buying this place.

Was it quite an interesting way of buying this?

How did you feel about going to auction

and actually bidding for something?

It was exciting - I mean, he bid on one before this,

but didn't get it, but I wasn't there for that,

but I had a feeling about this one, so I made sure I came through to see this one through,

and, yeah, you got it.

Becky, how are you going to be involved in this?

Surely you've got your hands full, literally?

I don't tend to have much involvement,

I'm enjoying my maternity leave,

so I'm going to carry on having lunches and coffees with friends.

So, Alistair, why have you chosen to do this?

Is this a property for you both to live in?

We haven't quite decided yet.

I mean, we've got a place that we live in the minute,

so, at the moment, it's more of an investment, we're probably...

It obviously needs a lot of work, so we'll do it up,

and then we're not sure whether we'll sell it on or rent it,

or what we'll do, depends how long it takes and how much it costs.

Depends on the lease, as well.

A lot does depend on the short lease being resolved.

The couple looked into it before they bid,

and they reckon there is a possibility of sorting it out

and they think, or at least hope,

that it's going to cost around ?15,000.

It depends on the freeholder a bit,

and if we had to wait two years to extend it officially,

then maybe we'll have to do that.

If it's up to 20, then it's within kind of our budget.

But if it's more than 20...

So it's a bit of a risk that you guys have taken, anyway.

But whether... We couldn't really afford most of the other properties,

so we had to take a risk in some area,

so we figured a lease was maybe the area to take the risk in.

Are you working at the moment?

Yeah, I work full-time, so it'll be a question

of doing it at weekends, and I won't to do it all myself,

I'll have people helping out, so...

I mean, it's going to be quite challenging, isn't it?

You have got a new baby, new things happening in your life,

and a lot of your weekends are going to be taken up by being here.

Yeah. It's probably not the best timing in the world,

but we'll give it a go, yeah.

But hopefully, if we make a success of it,

it will mean, you know, we'll have more chance

to spend more time with him in the future,

so we can cut back on hours at work, perhaps.

Absolutely. So what are your plans? What do you intend doing here?

There's a chance of moving the kitchen,

maybe to the room at the front,

and having the kitchen as it is now as a second bedroom,

so we'll have two decent-sized bedrooms, so that's an option.

And obviously, apart from that, it just needs everything doing,

new bathroom, new kitchen, new walls, new everything, so...

It really does just need new everything, doesn't it?

Except for the doors. We'd probably keep the doors and the banister

and hopefully the fireplace in the lounge,

if we can restore that.

Yeah, it's lovely to see some original features,

and I think, by keeping those things,

it's going to look fantastic.

Quite a lot of people on this road have done loft conversions.

Any thoughts on that?

They have done, I'm not sure we can afford it.

I mean, it would be a nice idea if we could afford it,

and also, it's very low.

It seems to be quite low, the top of the house to the ceiling,

so I'm not sure how much space there is up there.

We'll look into it, but it's probably out of our budget.

I think timescale-wise, as well, it would be nice to turn this around

and sell it within six months, ideally,

so to do a loft extension as well

might...just make things take longer.

What about the fact that there's little patches of damp?

I've looked around, there is water that's been coming in on the roof.

Does that bother you? Are there roof issues?

No. I don't think they're current, I think they're historic.

There was obviously an issue here with the leak coming down

through the roof, but it's been patched up, the roof,

so it just needs internally fixing up.

What sort of budget have you guys got to do the work here?

So I'm hoping about 20 grand would be enough,

but obviously I'm prepared for it to go slightly over that,

hopefully not too much, but that's the kind of budget were hoping for.

That's not including the lease. Yeah, not including the lease.

Is this something you think you'll both quite enjoy for the future?

Hopefully! Hopefully. Time will tell.

We'll see how this one goes first, I think, but, yeah, that's the idea.

Guys, good luck with this project, it's been fantastic meeting you,

and I'm really excited to see how far you get on

and how much the lease ends up costing you.

Congratulations and good luck with this.

Thank you. And lovely to meet baby Saul.

Well, this is the first investment property for Becky and Alistair

and they've got their new little baby Saul,

but they've got that lease to sort out,

so they've got a lot on their plate.

How are they all going to get on?

Well, you can find out later in the programme.

Earlier in the show,

everyone's plans and dreams seemed pretty good on paper,

but property development is more than just a paper trail.

It certainly is.

So have those dreams turned into a reality,

or more of a nightmare?

Let's go back and find out.

Back now to the town of Crewe in Cheshire,

where I looked around this three-bed 1930s semi,

which was a bit of a trip down memory lane.

Some of the original features, the skirting boards there,

in a lovely shade of pink, as you can see.

And these original windows.

I'm pretty sure nowadays they are called industrial chic.

# Oh, freak out

# Le freak, c'est chic

# Freak out... #

It was a little bit more freak than chic,

and it seemingly had an endless to-do list,

but come auction day, industrious brothers Adam and Thomas

were up for the challenge.

They paid 100 grand for this, their first-ever property together,

and they planned to renovate it, sell it on, and split the profit.

Whose decision was that, to go into a family business?

Well...a joint one, I think.

I'd have liked to have done it on my own, but he earns more wages than me, so...

LAUGHING: That's clever!

The brothers had a budget of 15-20 grand

and a timescale of six months.

21 months later, we are back.

They may have taken their time, but they have not taken it easy.

The dividing wall has gone to open up the back rooms

into a fantastic and huge kitchen-diner.

So what's become of that avocado bathroom?

It's been replaced with a small WC and utility room.

But where's the family bathroom?

Upstairs, the rear bedroom is a contemporary bathroom,

with stylish chrome fittings.

It's very nice, and just what a modern family needs.

But why did the brothers sacrifice that third bedroom?

We didn't want a downstairs bathroom,

we wanted one upstairs, and we didn't want a two-bed,

we wanted a three-bed, so the extension was a solution.

That's right, they've gone all out,

adding a second-floor extension above the original kitchen,

meaning they'd still have three good-sized bedrooms.

The guys have done a huge amount of work themselves,

but they've had their mates around to help, too.

My friend Bri, he's done all the electrics, top to bottom,

and my footballing friend Ian did the extension for me.

And... Yeah, we were labourers for a week, weren't we?

Yeah, yeah, I had my person who works with me, Billy,

he's done most of the landscaping stuff with me.

If you know people, it does make it a bit easier.

Obviously we have had to get recommendations off people

for certain things.

Didn't always work, that, did it?

No, not really. Yeah, so be careful when you give recommendations,

is my advice on that.

Thomas's advice is spot-on.

You should always get independent recommendations

for any tradespeople.

Make sure you ask other customers and, if possible,

try and get to see a bit of the work they've done.

And in the end, they got a good team together,

and they've had the house rewired, stripped back, re-plastered,

installed central heating and double glazing.

The list goes on.

So what are they most pleased about?

I'd say... Patio, I think.

Yeah!

Just the final finish, just knowing what work we put in

and seeing, like, how it looks after,

great satisfaction, really, isn't it?

Yeah. It just looks, yeah, really sharp. Yeah.

They've done a cracking and fairly ambitious job here,

especially considering this is their first project.

So what was the toughest challenge?

Obviously, when you're working full-time, both of us,

and you're trying to do half the work yourself, it is hard.

You're finishing work, you're coming after work, your weekends...

You don't realise how long it's going to take, what is involved.

It's been an experience. But we've got it done, haven't we?

I think, yeah, I think we changed the initial plan, as well,

put an extension in and what not,

took a while for planning permission to come through, so...

It wasn't just, like, getting it out -

we wanted to make it a real quality job.

So did that change of plan with the extension

end up blowing their budget of 15-20 grand?

I'd say in the region of 25-30.

We've done a rough estimate, haven't we? Yeah.

Worked out what we've done, and again, it's just the planning,

you're trying to work out what you're going to spend on what,

and you're not exactly sure, with it being the first time, what you're going to spend.

Ten grand over budget with an unplanned extension ain't half bad.

So is there more property developing in the future?

You've got, maybe, an opening, don't you?

Yeah, me and the missus are getting a place together,

so that's the next step, really.

Yeah. My girlfriend wants to get a renovation with me,

so hopefully we'll...

A bit of rivalry. We'll give that a go, yeah.

With sibling rivalry on the cards, we'd better get the values quickly.

We invited two local estate agents

to tell us what they thought of Adam and Thomas's 130 grand investment,

starting with the agent who saw it originally.

Good to come back and have a look at what they've done.

I think they've done a really nice job on it.

Lovely property, and they've obviously done

a lot of work to it since I was last here.

They have put an extension on the back,

that's created a bathroom upstairs, which is what it's needed,

and three really good-sized bedrooms.

I'm very impressed with the property,

it's a really nice, three-bedroom, semidetached house.

I am very impressed with the bathroom, kitchen,

especially the Indian stone patio outside,

it's been really well done.

And the front doorstep matches, as well, so brings it together.

Glowing reports all round.

It sounds like the brothers have a bit of a knack for this business.

But will the brothers make a profit on their 130 grand investment?

From a sales point of view, you'd be looking in the region

of ?170,000.

I think I would put it on the market somewhere between 165 and ?170,000,

and I would hope to achieve very near to that.

That's very nice, yeah. Happy with that, yeah.

Happy with that, yeah. Yeah.

I was hoping for 160 when we first bought it.

Before we did the extension,

we were looking around 150, weren't we?

Yeah. But, yeah, that's quite... Yeah.

No, I'm more than happy with that. Yeah.

With a potential profit of 40 grand, minus taxes and fees,

the brothers should be very happy with themselves.

But it sounds as though they have another kind of door

to be grateful for.

The lady next door, obviously, she's had to put up with a lot,

with all the work going on and that...

Brought a lot of cakes around. As you can see.

Back, now, to South Norwood in Greater London,

a stone's throw away from Selhurst Stadium.

It was here that Lucy saw this two-bed mid-terrace flat,

guided at ?170,000.

A handsome building on the outside, inside was not so good-looking.

Well, the bathroom here, again, it's all in a really bad state,

and it's as though all the bathroom furniture's just rammed in a room

that's too small for it.

Not much you can do about that, sadly,

because it is quite a small bathroom.

The whole flat needed rearranging,

and it also had a short 69-year lease

that would require renewal.

Sold, 210.

So, if they didn't have their hands full already,

new parents to baby Saul, Alistair and Becky

paid ?210,000 at auction for their first joint property venture.

And for the time being, at least, they were feeling optimistic.

It's going to be quite challenging, isn't it?

Cos you have got a new baby, new things happening in your life,

and a lot of your weekends are going to be taken up by being here.

Yeah. Probably not the best timing in the world,

but...we'll give it a go, yeah.

"Not the best timing" is a bit of an understatement.

But they did have a realistic budget of 20,000,

and wanted the flat done and sold in six months.

We are back five months later to see how they get on.

Well, that's a definite improvement.

The kitchen is now clean, modern, and has a tiled floor to boot.

But that's not the biggest change.

The dividing wall between the kitchen and lounge is gone,

making way for a new, open-plan living space.

The good news is that they have kept that beautiful original fireplace.

It's all looking much smarter,

but it's definitely not what they discussed with Lucy.

So, as Becky and Saul are feeling poorly,

here's Alistair to talk us through the changes.

Originally, the estate agent suggested

that we might move the kitchen into the front bedroom space.

We decided against that, we thought that would be too small

and it'd be nicer to have a big, open-plan kitchen lounge area,

so we knocked through.

We also made the second bedroom longer

by removing the storage space that wasn't really serving any function.

Speaking of functionality,

what's become of that dingy, cramped bathroom?

With a new bathroom suite and cheerful floor tiles,

it is certainly more welcoming for morning ablutions.

And they've managed to make the bathroom a little bigger

by nicking a bit of space from the master bedroom.

The removal of the fitted wardrobes next door

redresses the balance of the space.

Original features that we kept have been the windows, the sash windows,

especially the one in the bathroom, and the fireplace in the front room,

and also, we've kept all the original doors,

sanded them down, waxed them, so they look nice.

We're always going on about retaining original features,

and we love them, but not everyone loves them as much as we do.

The lack of cosy double glazing may put some buyers off,

although the good news is that they have double glazed

the living room and small bedroom.

They have done a grand job, and they've done it in five months,

which isn't bad.

Alistair has stuck to his schedule,

and he's managed to keep within that ?20,000 budget.

I've ended up spending about ?15,000 on it so far,

and it's almost finished, so I'm quite happy with that.

Main costs have been complete rewiring, new plumbing,

new radiators, new windows.

Cos I've done a lot of work myself,

I guess I've kept the labour costs down in that way.

Under budget! Phew, that's not common on Homes Under The Hammer.

So, well done, Alistair.

But he still has that lease extension to negotiate,

so up till now, what has been the hardest part of the project?

I think the hardest thing

has been juggling work and the flat and a young baby,

and trying to keep that all going,

that's been the hardest challenge for me, really,

and just the worst thing was how bad a condition the flat was in,

even worse than it looked to the naked eye when we first saw it.

Note to self, don't renovate with a new baby if you can avoid it.

That's the hard bit. What about the good bits?

So I feel like I've learnt a lot doing this project,

it's been a really good experience, it's been hard work,

but I'm glad that I've done it now that it's finished.

It's always the way, but let's see what the professionals thought

of Alistair's hard work.

We invited along two local estate agents

to get their opinion of the couple's ?225,000 investment.

It's in a great road, right next to Crystal Palace Football Stadium,

it's going to be really sought-after.

It's a London postcode

and it's been nicely, you know, refurbished.

The vendors have done a good job in making...maximising more space

in the property.

They could have double glazed some of the back windows,

a bit better on the finish on the decor

but, overall, it's pretty good.

The biggest issue affecting value with this flat is the short lease,

so what kind of value does this refurbished flat have currently?

The sales valuation with the current lease

would be in the region of ?270,000.

Should the lease not be extended,

then we're looking at a figure of around ?295,000-?300,000.

The top value could see Alistair and Becky

earn a pre-tax profit of ?75,000,

with the lease extension adding approximately ?25,000

to the value of the property.

But considering the couple are going to rent the flat out

for the foreseeable future,

what could they achieve on the rental market?

The rental valuation for this property would be around

?1,250 per calendar month.

So, for rental, you'd be looking at a figure of

?1,250 per calendar month.

That rental figure would give Alistair and Becky

a yield of just over 6.5%.

How does all that sound?

OK, that's nice to hear, that makes all the effort

seem like it's been worthwhile.

I mean, I definitely will be extending the lease, so...

Those higher figures are nice to hear.

So has Alistair got any advice for aspiring property developers?

Don't do it straight after you've had a new baby, firstly!

Be prepared for quite a lot of hard work,

it was harder work than maybe I thought it would be,

and make sure you've got some good tradesmen to help you out.

Well, that's it for today, but fret not,

we'll be back in no time with more stories from the front line

of the property battlefront.

Yeah, so prepare yourself,

and we'll be back here very soon on Homes Under The Hammer.

Goodbye. Goodbye.

# We could change this whole world with a piano

# Grab a bass... #

Stop! Stop! I said a little bit of your guitar. Just...

Stop getting carried away.