0:00:02 > 0:00:04Hello and welcome to the show. Investing in property
0:00:04 > 0:00:07can be a good way of looking after your money
0:00:07 > 0:00:10AND grow your pension, but it's not always a sure thing.
0:00:10 > 0:00:12There are some risks.
0:00:12 > 0:00:15Definitely. If it sounds too good to be true,
0:00:15 > 0:00:18then more often than not it is.
0:00:18 > 0:00:20However, there are some bargains to be had.
0:00:20 > 0:00:23Maybe down at your local property auction.
0:00:49 > 0:00:53Now, a lot of people don't consider buying under the hammer a viable
0:00:53 > 0:00:55option, and yet it really isn't that difficult.
0:00:55 > 0:00:58Yes, but you do have to do your research.
0:00:58 > 0:01:01Let's hope today's buyers have done just that.
0:01:02 > 0:01:06I'm having some layout issues at this two-room flat in Sutton.
0:01:06 > 0:01:08It's not even vaguely working.
0:01:08 > 0:01:10It's not even vaguely in the ball park of working.
0:01:12 > 0:01:15Lucy got the wrong impression at this flat in Kent.
0:01:15 > 0:01:17Well, that is so misleading.
0:01:17 > 0:01:21Lovely new front door, nice communal areas to this!
0:01:22 > 0:01:26Could someone clean up this low guide price, mid-terrace in Middlesbrough?
0:01:26 > 0:01:27There's lots of rubbish and rubble
0:01:27 > 0:01:29that needs to be cleared out of here,
0:01:29 > 0:01:32as like the first reception room as well.
0:01:33 > 0:01:36All these properties have been sold at auction and we'll find out who
0:01:36 > 0:01:40bought them and what they paid when they went under the hammer.
0:01:40 > 0:01:41Sold to 13.
0:01:49 > 0:01:51We head now to the popular London Borough of Sutton.
0:01:53 > 0:01:56Full of appeal and charm, this area is highly sought-after,
0:01:56 > 0:01:59thanks to its travel links to the city and a plethora of shops
0:01:59 > 0:02:01and amenities on the high street.
0:02:04 > 0:02:08Well, two minutes' walk from Sutton high street is the property I'm here
0:02:08 > 0:02:13to see. It is a ground floor flat with a guide price of £180,000 plus.
0:02:13 > 0:02:16Now, there are a few alarm bells going off already,
0:02:16 > 0:02:20because it's described as having two rooms, not bedrooms.
0:02:20 > 0:02:22Obviously a layout issue.
0:02:22 > 0:02:25And there's one way to find out what's going on and that's to have a look.
0:02:25 > 0:02:30# Give me a chance to show how much I love you
0:02:30 > 0:02:36# Give me a chance to show how much I care
0:02:36 > 0:02:39# How I care... #
0:02:39 > 0:02:42This place might be worth giving a chance to because the outside has a
0:02:42 > 0:02:45bonus - off-street parking.
0:02:45 > 0:02:48And the communal stairwell looks well maintained.
0:02:51 > 0:02:53OK, let's explore.
0:02:53 > 0:02:57Bit of a narrow corridor when you come through the front door there.
0:02:57 > 0:03:00I'm straight away noticing this little area here,
0:03:00 > 0:03:05which has got a very large sort of water heating system going on.
0:03:05 > 0:03:09I wonder if there's a combination boiler can go somewhere and create a bit of space there, which is good,
0:03:09 > 0:03:12because we haven't got much. Straight away you can tell.
0:03:12 > 0:03:14There's a bedroom, I imagine,
0:03:14 > 0:03:16or at least that's what that room is, that way.
0:03:16 > 0:03:19And then this way, you've got the bathroom.
0:03:19 > 0:03:22Lovely avocado suite.
0:03:22 > 0:03:23We've also got damp.
0:03:23 > 0:03:27It's not massive. Actually, proportionally it's not a bad size,
0:03:27 > 0:03:31compared to everything else, because really that avocado suite is the least
0:03:31 > 0:03:35of your worries, because coming to this room here...
0:03:35 > 0:03:37And what is going on?
0:03:37 > 0:03:40We've got this tiny little...
0:03:40 > 0:03:44sort of bit of kitchen fitments going on in this corner.
0:03:45 > 0:03:48This then was what, the lounge?
0:03:48 > 0:03:50I don't know. Lounge/kitchen because this...
0:03:52 > 0:03:53..is the only other room.
0:03:55 > 0:03:58It's tiny. It's got two doors.
0:03:58 > 0:04:01I can see why they said it's only got two rooms.
0:04:01 > 0:04:05Two main rooms and a tiny thing there. Eurgh!
0:04:05 > 0:04:06It's not working, is it?
0:04:06 > 0:04:08It's not even vaguely working.
0:04:08 > 0:04:11It's not even vaguely in the ball park of working!
0:04:11 > 0:04:14Yeah. Hm. Not good!
0:04:14 > 0:04:18# Let's think it over
0:04:18 > 0:04:21# Let's start again... #
0:04:23 > 0:04:28The guide price of £180,000 plus suggested this is a popular area.
0:04:28 > 0:04:31But what to do to get the best out of it?
0:04:31 > 0:04:33Is it a one bed or is it a two?
0:04:33 > 0:04:37Well, I think the main bedroom is THE bedroom.
0:04:37 > 0:04:41That small room is a bit tight for your bedroom.
0:04:41 > 0:04:45If you extend it into that cupboard space it might just work.
0:04:45 > 0:04:49Could you fit the kitchen in there and have a really decent-size lounge,
0:04:49 > 0:04:52with no noisy and smelly kitchen appliances?
0:04:53 > 0:04:55Moving plumbing and drains could be expensive.
0:04:55 > 0:04:59I think my preference would be to knock through into the cupboard,
0:04:59 > 0:05:03use it as a study and get the bathroom updated.
0:05:04 > 0:05:06And then you've got a flat that works.
0:05:06 > 0:05:10You've got a one bedroomed, one study, one living area,
0:05:10 > 0:05:13nice bathroomed flat, as opposed to what it is right now,
0:05:13 > 0:05:16which is...rubbish.
0:05:16 > 0:05:19As ever, it depends on what the buyer wants the property for.
0:05:19 > 0:05:23But there are definitely options here.
0:05:23 > 0:05:26Well, the flat is described as having a communal garden.
0:05:31 > 0:05:32That's it?
0:05:33 > 0:05:36It's not going to win any awards at Chelsea, is it? Let's be honest.
0:05:38 > 0:05:41Yes, it just goes to prove how important it is that you physically
0:05:41 > 0:05:45visit a property before you head to the auction house.
0:05:45 > 0:05:49We asked a local estate agent along for his opinion on this flat guided
0:05:49 > 0:05:51at £180,000.
0:05:53 > 0:05:56This flat would need total renovation, total gutting,
0:05:56 > 0:05:57starting again from the beginning.
0:05:57 > 0:05:59New kitchen would be great.
0:05:59 > 0:06:04New bathroom and new heating system and painting and decorating with new
0:06:04 > 0:06:09flooring as well. I would keep it as a one bed and refurbish it to
0:06:09 > 0:06:15a high standard and you could possibly achieve a high price as it's in a great location.
0:06:15 > 0:06:19Possibly you could market a two-bedroom property,
0:06:19 > 0:06:22depending on the builder and what they do.
0:06:22 > 0:06:27They would need to open up the space there in the second room to make that larger,
0:06:27 > 0:06:30maybe cut into this room to create more space for the second room.
0:06:30 > 0:06:32If that's done and it's done in the right way,
0:06:32 > 0:06:35then I'm sure I can market it as a two-bedroom apartment.
0:06:35 > 0:06:38OK. So if a full refurbishment was done here,
0:06:38 > 0:06:42what numbers could we be looking at as a one-bedroom property?
0:06:42 > 0:06:44As a one-bedroom, ground-floor flat,
0:06:44 > 0:06:49this property could achieve in and around £250,000 for sale and for
0:06:49 > 0:06:52rental, it could achieve £900 per calendar month.
0:06:52 > 0:06:56And what if it was converted into a two-bed?
0:06:56 > 0:06:59This property, as a two-bedroom flat, could sell in the region of
0:06:59 > 0:07:01£300,000.
0:07:01 > 0:07:05For rental amount, could achieve £1,250 per calendar month.
0:07:05 > 0:07:08Well, it's definitely in a good location,
0:07:08 > 0:07:13but whoever bought this place definitely needs to decide
0:07:13 > 0:07:17if it's a one or two-bedroomed flat and work towards that goal.
0:07:17 > 0:07:21Let's find out who it was when it went under the hammer.
0:07:21 > 0:07:23Our next one is lot 25.
0:07:23 > 0:07:24Ground-floor flat.
0:07:24 > 0:07:27I don't know, start at £180,000 here.
0:07:27 > 0:07:31180. Quite a bit of discount at that for Sutton.
0:07:33 > 0:07:35Oh, sorry. 180.
0:07:35 > 0:07:37180. 185.
0:07:37 > 0:07:39Elsewhere.
0:07:39 > 0:07:40185 with you.
0:07:40 > 0:07:43185. 190, sir.
0:07:44 > 0:07:48195. 200. 205.
0:07:48 > 0:07:50There's plenty of interest in this one.
0:07:50 > 0:07:53We rejoin at £226,000.
0:07:54 > 0:07:56226.
0:07:56 > 0:07:59Straight ahead. 228.
0:07:59 > 0:08:00230, sir.
0:08:00 > 0:08:03230? 232.
0:08:05 > 0:08:07230, with you.
0:08:07 > 0:08:11First time. Second time.
0:08:11 > 0:08:12Third and last time, if you're all done.
0:08:14 > 0:08:16Sold. 230, straight ahead.
0:08:16 > 0:08:19The successful bidder there was Fifi,
0:08:19 > 0:08:25who, after a bit of a battle, bought the property for £230,000.
0:08:25 > 0:08:27£50,000 over the guide price.
0:08:27 > 0:08:30I met up with him back at the property to find out about his plans.
0:08:30 > 0:08:32Fifi, great to meet you.
0:08:32 > 0:08:34- A pleasure to meet you, too. - Congratulations.
0:08:34 > 0:08:37- Thank you.- First of all, I've got to ask about your name.
0:08:37 > 0:08:38That's a fantastic name.
0:08:38 > 0:08:40I've never met a Fifi.
0:08:40 > 0:08:42Yes, it's a Ghanaian name.
0:08:42 > 0:08:45Same as Kofi. Means Friday born.
0:08:45 > 0:08:47Oh, fantastic! Wonderful!
0:08:47 > 0:08:50So, why did you want to buy this flat?
0:08:50 > 0:08:52What attracted me is the location,
0:08:52 > 0:08:55because I don't live far from here, I live in Morden,
0:08:55 > 0:08:58just less than ten minutes' drive,
0:08:58 > 0:09:02- and Sutton is a well sought-after area.- Mm-hm.
0:09:02 > 0:09:04So it's the location that attracted me.
0:09:04 > 0:09:07OK. And is this what you do? Are you a property investor, or what?
0:09:07 > 0:09:09No. This is the first time.
0:09:09 > 0:09:13It's something that I've always wanted to do,
0:09:13 > 0:09:15so this is the first project.
0:09:15 > 0:09:18What have you been doing up to now? What's your job?
0:09:18 > 0:09:20I had my own company.
0:09:20 > 0:09:25- OK.- Which I run it for...nearly about seven years.
0:09:25 > 0:09:26Sold it not long ago.
0:09:26 > 0:09:32- OK.- And after the sale, I'm just looking at different things to do
0:09:32 > 0:09:34and I thought this is about it.
0:09:34 > 0:09:38So, what was it that you liked about this place?
0:09:38 > 0:09:42It's not a lot of work.
0:09:42 > 0:09:43Walls are pretty good.
0:09:43 > 0:09:45Great location, as I said.
0:09:45 > 0:09:48And it needs a total makeover.
0:09:48 > 0:09:53And then I think I'll be able to bring that into it and make it great.
0:09:53 > 0:09:57OK. And is the idea then to sell it on or rent it out?
0:09:57 > 0:10:00Depends on figures at the end of the work.
0:10:00 > 0:10:03So if you can make a lot by selling it on,
0:10:03 > 0:10:05- you'll take that?- Then I will.
0:10:05 > 0:10:06Yeah. Good.
0:10:06 > 0:10:09So, obviously it's got a very interesting layout, hasn't it?
0:10:09 > 0:10:11You've got the tiny room behind us here and the other rooms.
0:10:11 > 0:10:14What are you going to do to the layout?
0:10:14 > 0:10:16Almost everything will stay the same,
0:10:16 > 0:10:19with the exception of the door behind you,
0:10:19 > 0:10:22which is the tiny room there.
0:10:22 > 0:10:28We might relocate that door into the old tanked, hot water area.
0:10:28 > 0:10:31- Yes.- Before we're going to put central heating in.
0:10:31 > 0:10:33So, all that will be removed.
0:10:33 > 0:10:37- Right.- That door is already created, so it's just taking,
0:10:37 > 0:10:39changing the position of the entrance.
0:10:39 > 0:10:42- Sure.- Extend the kitchen.
0:10:42 > 0:10:47- Straight across from where it is, close to the entrance.- Yep.
0:10:47 > 0:10:50And that will actually...
0:10:51 > 0:10:53That is about it, really.
0:10:53 > 0:10:55OK. What will that room then become?
0:10:57 > 0:11:03I've looked at the divisions in there after the hot water tank,
0:11:03 > 0:11:05so that will be extended.
0:11:05 > 0:11:06- Yeah.- And when that is taken out,
0:11:06 > 0:11:11you'll have a decent room to be able to put a bedsit in there.
0:11:11 > 0:11:15OK. You think you'll be able to squeeze a bed into that, just about.
0:11:15 > 0:11:18Possibly a child's room or something like that.
0:11:18 > 0:11:20- Absolutely.- OK. What kind of budget have you got?
0:11:20 > 0:11:22We're looking between...
0:11:22 > 0:11:26- £12,000 to £15,000.- Mm-hm.
0:11:26 > 0:11:27Well, it's not a big budget,
0:11:27 > 0:11:31especially since Fifi isn't doing any of the work himself.
0:11:31 > 0:11:35He hopes that his builder will get the work done in six weeks,
0:11:35 > 0:11:37with Fifi acting as a project manager.
0:11:40 > 0:11:44So, what kind of finish are you going to go for? Are you going to for high-end or what?
0:11:44 > 0:11:47We're looking at high-end.
0:11:47 > 0:11:49We've got plans for the bathroom.
0:11:49 > 0:11:52The bathroom is going to be very high-end and modern as well.
0:11:52 > 0:11:56At the same time, the kitchen as well.
0:11:56 > 0:12:00We're looking to have open-plan, very, very small,
0:12:00 > 0:12:05but will have all the necessary white goods fitted in here.
0:12:05 > 0:12:07- Great.- Integrated.
0:12:07 > 0:12:12And then, do you have any idea what it might be worth when you've done the work?
0:12:12 > 0:12:14I've got figures in mind.
0:12:14 > 0:12:16Go on, then?
0:12:16 > 0:12:22I've got figures in mind, because I know the property value around Sutton.
0:12:22 > 0:12:26There's one up above us, just a two-bed,
0:12:26 > 0:12:29but it's quite a decent size and that is on the market
0:12:29 > 0:12:32- at the moment for £315,000.- Whoa!
0:12:32 > 0:12:36This hasn't got the same size,
0:12:36 > 0:12:40- so we'd be looking at roughly about £280,000, £290,000.- Wow.
0:12:40 > 0:12:43So what kind of profit's in it for you, then, if it all goes well?
0:12:43 > 0:12:48If all goes well, then we'll be looking at roughly between £40,000 to £50,000.
0:12:48 > 0:12:51Wow, that would be great for your first project, wouldn't it?
0:12:51 > 0:12:53It would be absolutely fantastic!
0:12:53 > 0:12:55Listen, congratulations.
0:12:55 > 0:12:58- Thank you.- Good luck and I look forward to seeing how you get on. - Thank you.
0:12:58 > 0:13:03Well, an interesting one for Fifi's first development project.
0:13:03 > 0:13:08Tight budget to get a high-end finish and a relatively short timescale.
0:13:08 > 0:13:10How will he get on?
0:13:10 > 0:13:12You can find out later in the show.
0:13:16 > 0:13:19Lucy is in the town of Chatham, in Kent,
0:13:19 > 0:13:22famous for its dockyard situated on the River Medway.
0:13:22 > 0:13:26It served the Royal Navy for 414 years
0:13:26 > 0:13:30and during that time produced over 500 ships.
0:13:30 > 0:13:33# Did I build a ship to wreck? #
0:13:34 > 0:13:35Now, however, the ports,
0:13:35 > 0:13:40dockyards and ship building sites are being redeveloped into more
0:13:40 > 0:13:44contemporary tourist-attracting wharfs for fine dining,
0:13:44 > 0:13:46nightclubbing and shopping.
0:13:46 > 0:13:50Chatham has changed massively in recent years, owing to all the
0:13:50 > 0:13:53regeneration that's taken place here
0:13:53 > 0:13:56and those changes are most definitely for the better.
0:13:56 > 0:13:59# ..To wreck
0:13:59 > 0:14:02# To wreck...#
0:14:02 > 0:14:05Well, if you want to be right in the heart of Chatham,
0:14:05 > 0:14:09you can't get much more central than this, because all the shops and all
0:14:09 > 0:14:11the action is just around the corner there.
0:14:11 > 0:14:14Well, I'm here to see a studio flat and it went to auction with
0:14:14 > 0:14:17a guide price of £50,000 to £55,000
0:14:17 > 0:14:20and the entrance, well, it's just around here.
0:14:22 > 0:14:25The entrance is located on a private road,
0:14:25 > 0:14:29so best to check out what permits, if any, are required for parking.
0:14:32 > 0:14:33Heading inside,
0:14:33 > 0:14:36there's a rather nice foyer and a charming stairwell.
0:14:36 > 0:14:37Looking good.
0:14:38 > 0:14:40Well, that is so misleading.
0:14:40 > 0:14:45Lovely new front door, nice communal areas to this!
0:14:45 > 0:14:49Oh, it's a little bit grotty on the inside, I am not going to lie.
0:14:49 > 0:14:50I have seen better.
0:14:50 > 0:14:53So, a nice area of damp.
0:14:53 > 0:14:55It is really wet to the touch.
0:14:55 > 0:14:57Flaky, flaky, flaky.
0:14:57 > 0:15:00Wedding cake sort of effect here.
0:15:00 > 0:15:04In fact, when you look at this wall, look, it's just...
0:15:04 > 0:15:06just got to be sorted out.
0:15:06 > 0:15:11So, on first glance, this room is not very welcoming.
0:15:11 > 0:15:13I mean, I'm not even looking at the cobwebs everywhere.
0:15:13 > 0:15:16You've got a big old water tank through here.
0:15:16 > 0:15:18But, look, there's just holes everywhere.
0:15:18 > 0:15:20I mean, look at the state of that door!
0:15:20 > 0:15:23Yeah, I think it's been empty for quite some time.
0:15:23 > 0:15:25Leading through into the kitchen,
0:15:25 > 0:15:28so I'm taking it that was probably the sleeping/living area.
0:15:28 > 0:15:30Through here is the kitchen.
0:15:30 > 0:15:31Oh, my goodness me!
0:15:31 > 0:15:33Look at it!
0:15:33 > 0:15:37Yup, so we need a skip and we need to get all this stuff out and it needs to be dumped in there.
0:15:37 > 0:15:40You've got a little shower room through here with what
0:15:40 > 0:15:42looks like half the wall is missing.
0:15:42 > 0:15:44Quite a bit of work needs to be done in here.
0:15:44 > 0:15:45You've got strip lighting.
0:15:45 > 0:15:47It's just not very nice.
0:15:47 > 0:15:50So, really once you spend a little bit of money,
0:15:50 > 0:15:54I mean, it's not too big, so it's not going to take such a huge
0:15:54 > 0:15:57injection of cash, it will look amazing.
0:15:57 > 0:16:01But as it stands at the moment, it looks pretty terrible.
0:16:02 > 0:16:04# B-B-B-Bad
0:16:04 > 0:16:06# Bad to the bone... #
0:16:07 > 0:16:08Yes, it's not pretty.
0:16:08 > 0:16:11But there's nothing that stands out as a major issue.
0:16:11 > 0:16:15But are there any hidden nasties lurking in the legal pack?
0:16:16 > 0:16:19Now, if you're a regular viewer of Homes Under The Hammer you'll know
0:16:19 > 0:16:23that flats often come with a sting in their tail when it comes to the
0:16:23 > 0:16:25finer details laid out in the legal pack.
0:16:25 > 0:16:29So, I've carried my own investigations out with this studio,
0:16:29 > 0:16:31so what I can tell you?
0:16:31 > 0:16:34Well, now, the ground rent is £150 a year,
0:16:34 > 0:16:38which is a fairly standard amount, and then the service charge,
0:16:38 > 0:16:40well, that's £350 a year.
0:16:40 > 0:16:45Which, well, it sounds OK for a flat with communal areas to maintain,
0:16:45 > 0:16:48and the biggest bonus, for me, well,
0:16:48 > 0:16:53it's got to be the new 125-year lease that's on offer.
0:16:53 > 0:16:55So, all in all,
0:16:55 > 0:16:58there doesn't seem to be any hidden nasties here and that is why you
0:16:58 > 0:17:01should always read the legal pack, just in case.
0:17:02 > 0:17:08Could this studio flat, guided at between £50,000 and £55,000,
0:17:08 > 0:17:10be a small, but perfectly formed investment?
0:17:10 > 0:17:14We invited a local estate agent along to give us his opinion
0:17:14 > 0:17:15on what could be done here.
0:17:16 > 0:17:19The flat is quite a small property.
0:17:19 > 0:17:22It does need just some love and care.
0:17:22 > 0:17:24I would leave the layout as it is.
0:17:24 > 0:17:28I would suggest central heating into the property,
0:17:28 > 0:17:30a new kitchen and a new bathroom.
0:17:30 > 0:17:34With such a small flat and no obvious structural changes to be made,
0:17:34 > 0:17:38this flat could be renovated for a relatively small sum.
0:17:38 > 0:17:44But could there be a profit margin on a guide price of £50,000 to £55,000?
0:17:44 > 0:17:48This property could sell for approximately £65,000 to £70,000
0:17:48 > 0:17:52and rent for approximately £450 to £475 per calendar month.
0:17:54 > 0:17:58Yep, it does need quite a bit of work, but being such a small space,
0:17:58 > 0:18:02well, it shouldn't take too much time or money to turn this studio flat around.
0:18:02 > 0:18:06Once that's done, well, it could be a decent little investment for someone.
0:18:06 > 0:18:09Who agreed? Let's head to auction and find out.
0:18:11 > 0:18:14Lot 57. Again, studio flat.
0:18:14 > 0:18:16Main line railway station, et cetera.
0:18:16 > 0:18:18Guided at £50,000 to £55,000.
0:18:18 > 0:18:19You've got to start me at 50.
0:18:19 > 0:18:2250, can I say? 50, can I say?
0:18:22 > 0:18:23Give me 45, then.
0:18:23 > 0:18:2445 from anybody?
0:18:24 > 0:18:2645 at the back, with you.
0:18:26 > 0:18:28Thank you. 45. 47 now.
0:18:28 > 0:18:3047, fresh place.
0:18:30 > 0:18:31And 50, can I say?
0:18:31 > 0:18:3450 I have. 52 for either of you?
0:18:34 > 0:18:3752 now. Well, at £50,000, I shall sell, then.
0:18:37 > 0:18:39For the first time at 50.
0:18:39 > 0:18:4152. Thank you.
0:18:41 > 0:18:4354. 54.
0:18:43 > 0:18:4656. 56.
0:18:46 > 0:18:5054,000 is back with you, sir. £54,000.
0:18:50 > 0:18:5556, can I say? I shall sell then for the first time at 54.
0:18:55 > 0:18:5656.
0:18:56 > 0:19:0056. 58. Yes? No?
0:19:00 > 0:19:0358. And 60 now. 60, can I say?
0:19:05 > 0:19:08£58,000 for the first time.
0:19:08 > 0:19:0960. £60,000.
0:19:09 > 0:19:11Lady's bid. 62 now.
0:19:11 > 0:19:1562. If not, lady's bid at £60,000.
0:19:15 > 0:19:17First time. Second time.
0:19:17 > 0:19:19You're going to miss it, sir. Third and final time.
0:19:19 > 0:19:22Back of the room at £60,000.
0:19:22 > 0:19:25Sold, madam. £60,000, you've got yourself a flat.
0:19:25 > 0:19:27And your bidder's card number?
0:19:27 > 0:19:31The successful bid of £60,000 came from Mary, who is retired,
0:19:31 > 0:19:32but develops property.
0:19:34 > 0:19:38Regular viewers of the show may remember this fashionista,
0:19:38 > 0:19:42when Lucy met her three years ago at a property in Deal.
0:19:42 > 0:19:46Lucy caught up with Mary again to hear her plans for her newest acquisition.
0:19:46 > 0:19:49# And then along comes Mary... #
0:19:49 > 0:19:51Mary, congratulations.
0:19:51 > 0:19:53Gosh, it must have been three years since I've seen you last.
0:19:53 > 0:19:57- Yes, it was.- Tell me, why are you here in Chatham?
0:19:57 > 0:20:01I was looking for something not too expensive
0:20:01 > 0:20:03and I decided on this place.
0:20:03 > 0:20:08What did it, the difference, it's got a new 125-year lease.
0:20:08 > 0:20:13Some of these properties, there's only about 69 years left on them,
0:20:13 > 0:20:16so you have to pay extra for an extension.
0:20:16 > 0:20:21So, tell me, did you get a chance to get in this property and have a good look around before you bid?
0:20:21 > 0:20:24No, I didn't, but the trouble is, I looked at so many properties,
0:20:24 > 0:20:27I just didn't have the time to look at them all.
0:20:27 > 0:20:30- It's great news for you that it has got a new 125-year lease.- Yes.
0:20:30 > 0:20:33But you didn't look inside!
0:20:33 > 0:20:35No. When I looked, I thought, "Oh, my God!"
0:20:35 > 0:20:37SHE LAUGHS
0:20:37 > 0:20:41But once you start, you say, "Well, this is going to get done."
0:20:41 > 0:20:46Essentially, it's just one large room, a bit of a kitchen.
0:20:46 > 0:20:48A bit of a loo. I mean, you can do it all up.
0:20:48 > 0:20:53- It's not going to cost you the earth to do this place, is it?- No.- Then what are you going to do with it?
0:20:53 > 0:20:56I'm going to let it out to start with.
0:20:56 > 0:20:59And later on I'll probably sell it off.
0:20:59 > 0:21:01Are you happy with what you paid now?
0:21:01 > 0:21:05It's all right. Once it gets done up, I know I'll be able to sell it again.
0:21:05 > 0:21:08I don't think I'll lose any money on it, that's the main thing.
0:21:08 > 0:21:12Having completed 20 property renovations in her time,
0:21:12 > 0:21:15Mary should know better than to buy blind,
0:21:15 > 0:21:17but hopefully this time it will pay off.
0:21:17 > 0:21:20What is it about property that keeps her on her toes?
0:21:23 > 0:21:26It's exciting, you never know what you're going to get hold of next and
0:21:26 > 0:21:30what you're going to do with it. To be honest, it's something you can get into from scratch.
0:21:30 > 0:21:33You don't have to study for five years to do it.
0:21:33 > 0:21:36You have to get a bit of money one way or the other, but you...
0:21:36 > 0:21:38Anyone, you can get into it quick.
0:21:38 > 0:21:40Is this what you've always done?
0:21:40 > 0:21:43No, no. I was a housekeeper.
0:21:43 > 0:21:45This interests me more.
0:21:45 > 0:21:48Because when you're in a job, you're sort of tied down by the people.
0:21:48 > 0:21:50Doing this you're your own boss.
0:21:50 > 0:21:51Mary, I love your energy.
0:21:51 > 0:21:54You are not kicking back and relaxing and retiring.
0:21:54 > 0:21:57- You're still out and about, aren't you?- No. I want to get out.
0:21:57 > 0:21:58I don't want to be stuck in the house.
0:21:58 > 0:22:04So, Mary, tell me, what's been happening since we last saw you on Homes Under The Hammer?
0:22:04 > 0:22:07Loads of people have recognised me about...
0:22:07 > 0:22:10Over 20 people in the street have recognised me.
0:22:10 > 0:22:11All over the place.
0:22:11 > 0:22:14- I can't believe it!- So complete strangers have been coming up to you and saying,
0:22:14 > 0:22:18- "We recognise you from Homes Under the Hammer." - Today, a car stopped.
0:22:18 > 0:22:20He said, "Oh, have you been on Homes Under The Hammer?"
0:22:20 > 0:22:22I said, "Yes."
0:22:22 > 0:22:24You see, we can take you there, Mary,
0:22:24 > 0:22:26because I know you quite like acting, don't you?
0:22:26 > 0:22:30- You'd quite like to be an actress, wouldn't you?- I would.
0:22:30 > 0:22:31SHE LAUGHS
0:22:31 > 0:22:34If I was about five foot ten, I think I'd be...
0:22:34 > 0:22:36I'd love to be a top model.
0:22:36 > 0:22:40You must be one of the most glamourous landladies I think I've ever met.
0:22:40 > 0:22:42I like dressing up.
0:22:42 > 0:22:46# She's in fashion... #
0:22:46 > 0:22:49It would be a shame to ruin that fantastic outfit,
0:22:49 > 0:22:53so Mary is going to get local builders in to do the work.
0:22:53 > 0:22:56So, Mary, talk me through the changes you're going to be doing here.
0:22:56 > 0:22:59Let's start in this room.
0:22:59 > 0:23:03Obviously the plastering's most important, but as it's...
0:23:03 > 0:23:06As it's damp as well, it's going to be quite a job.
0:23:06 > 0:23:11It's not as easy as you think. To get this really just dead-on,
0:23:11 > 0:23:12it's quite a job.
0:23:12 > 0:23:14And then we've got the roof.
0:23:14 > 0:23:16Got to get a new kitchen.
0:23:16 > 0:23:17Once you get the new kitchen,
0:23:17 > 0:23:19you wouldn't believe it's the same place.
0:23:19 > 0:23:22Maybe a new bathroom and maybe a new shower.
0:23:22 > 0:23:25But it will be a big difference when it's done.
0:23:25 > 0:23:27So, Mary, what about the central heating?
0:23:27 > 0:23:28Are you going to be installing it?
0:23:28 > 0:23:30I will definitely get central heating put in.
0:23:30 > 0:23:33Everyone wants central heating nowadays.
0:23:33 > 0:23:35And what about that old tank - is that going to go?
0:23:35 > 0:23:37I'd like to get rid of it.
0:23:37 > 0:23:40But I better check it out if it's allowed.
0:23:40 > 0:23:43Maybe the whole place is just electricity.
0:23:43 > 0:23:46We'll have to look into it first.
0:23:46 > 0:23:48And how much are you going to spend on the work here?
0:23:48 > 0:23:51I don't know, maybe £4,000, £5,000.
0:23:51 > 0:23:52So, that's...
0:23:52 > 0:23:56It's actually quite a... You look at it, it's quite a lot to be done here.
0:23:56 > 0:23:58It's quite a mess.
0:23:58 > 0:24:00So, what is your timescale?
0:24:00 > 0:24:03I could probably get it sorted out in three months without actually
0:24:03 > 0:24:06rushing it. Oh, my God, it's just too much.
0:24:06 > 0:24:09You know, just within that timescale somewhere.
0:24:09 > 0:24:13Well, Mary, we look forward to coming back and seeing the big
0:24:13 > 0:24:17transformation of this very small studio flat, and it's been a real
0:24:17 > 0:24:19pleasure to see you again.
0:24:19 > 0:24:20- Thank you.- Lots of love.
0:24:20 > 0:24:22Thanks.
0:24:24 > 0:24:29Oh, it's great to see that Mary's still got as much energy and enthusiasm as when I last saw her.
0:24:29 > 0:24:33She seems to be taking her latest project in her stride and I just
0:24:33 > 0:24:35hope it all works out for her.
0:24:35 > 0:24:38You can find out how Mary gets on later in the show.
0:24:41 > 0:24:44Still to come - there's problems afoot at this mid-terrace
0:24:44 > 0:24:45in Middlesbrough.
0:24:45 > 0:24:48As you can see, there's a lot of floorboards missing in here,
0:24:48 > 0:24:50which is very dangerous.
0:24:52 > 0:24:56And will Mary be seeing red after budget issues in Kent?
0:24:56 > 0:25:00I thought maybe it'd be £4,000, £5,000, but it went over.
0:25:03 > 0:25:08But first, let's head back to the sought-after London Borough of Sutton.
0:25:08 > 0:25:14It was here I saw this ground-floor flat guided at £180,000 plus.
0:25:14 > 0:25:17Inside was a tight squeeze,
0:25:17 > 0:25:23not helped by the large water heating system occupying space in the narrow hallway.
0:25:23 > 0:25:28The avocado bathroom suite was stuck firmly in the '70s, and the bedroom,
0:25:28 > 0:25:31although dusty, was a decent size.
0:25:32 > 0:25:38But it was the flat's description as a two-room property that had me concerned.
0:25:39 > 0:25:42What is going on? We've got this tiny little...
0:25:44 > 0:25:49..sort of bit of kitchen fitments going on in this corner. Erm...
0:25:49 > 0:25:51This then was what, the lounge?
0:25:51 > 0:25:52I don't know. Lounge/kitchen.
0:25:52 > 0:25:54Because this...
0:25:54 > 0:25:56is the only other room.
0:25:58 > 0:26:01It's tiny. It's not working, is it?
0:26:01 > 0:26:03It's not even vaguely working.
0:26:03 > 0:26:06It's not even vaguely in the ball park of working!
0:26:06 > 0:26:09£230 with you, first time.
0:26:09 > 0:26:11Second time.
0:26:11 > 0:26:14Third and last time, if you're all done?
0:26:14 > 0:26:18The man to make it work was first time property developer Fifi,
0:26:18 > 0:26:24who paid £230,000 on auction day and he had a simple plan to get the
0:26:24 > 0:26:27dysfunctional layout working.
0:26:27 > 0:26:29Almost everything will stay the same,
0:26:29 > 0:26:31with the exception of the door behind you,
0:26:31 > 0:26:33which is the tiny room there.
0:26:33 > 0:26:39We might relocate that door into the old tanked,
0:26:39 > 0:26:43hot water area, before we're going to put central heating in.
0:26:43 > 0:26:46- So all that will be removed.- Right.
0:26:46 > 0:26:49That door is already created, so it's just taking...
0:26:49 > 0:26:51changing the position of the entrance.
0:26:51 > 0:26:56Fifi hoped the new layout would make enough space to turn this flat
0:26:56 > 0:26:59from a two-room, to a two-bedroom.
0:26:59 > 0:27:02He had a budget of £12,000 to £15,000
0:27:02 > 0:27:05and a tight schedule of six weeks.
0:27:05 > 0:27:09We're back just eight weeks later to see how he got on.
0:27:14 > 0:27:18A bright new kitchen stretches along the wall,
0:27:18 > 0:27:20where there was once a doorway.
0:27:20 > 0:27:23It's open-plan, with a compact living-dining space.
0:27:28 > 0:27:31The water tank has been removed and that space has been incorporated into
0:27:31 > 0:27:34the small room, creating a second bedroom.
0:27:38 > 0:27:41The master bedroom has had a refresh too.
0:27:41 > 0:27:46The whole flat now benefits from new PVC double glazing and central
0:27:46 > 0:27:50heating. That avocado suite, well, that's gone too,
0:27:50 > 0:27:54replaced by an ultra modern, super stylish, tiled bathroom.
0:27:59 > 0:28:03We decided to go for a modern fitting bathroom.
0:28:03 > 0:28:07It's been amazing, the designer was fantastic.
0:28:07 > 0:28:10She came out with great designs that I love.
0:28:10 > 0:28:15And we were able to fit the things that we wanted in there.
0:28:15 > 0:28:17So the bathroom looks modern.
0:28:17 > 0:28:19The shower is amazing.
0:28:19 > 0:28:23I wish it's even the shower at my home, but unfortunately, it's not.
0:28:24 > 0:28:27Well, if the flat doesn't sell, you could always keep it for yourself.
0:28:27 > 0:28:32But based on the exceptional finish here, I think that's unlikely.
0:28:32 > 0:28:36Project manager Fifi and his builder Pajo have made it look easy.
0:28:36 > 0:28:38But were there any struggles along the way?
0:28:41 > 0:28:46The most difficult part was the kitchen, because we had a very
0:28:46 > 0:28:51limited space and you need to try and squeeze almost everything you
0:28:51 > 0:28:54can think of in that space.
0:28:54 > 0:28:55And it was challenging.
0:28:55 > 0:28:59We draw and then we look at the drawings and then we scrap it
0:28:59 > 0:29:02and said, "No. This is not good enough."
0:29:02 > 0:29:06Even last minute, we had to order a few different things, because we realised that
0:29:06 > 0:29:09some of the cupboards, when you walk in,
0:29:09 > 0:29:11the cupboards shouldn't be right on your face,
0:29:11 > 0:29:14it has to be nicely tucked away.
0:29:14 > 0:29:17So we went for slight different changes,
0:29:17 > 0:29:22with a curved edge at the entrance, which cost us a lot more money.
0:29:22 > 0:29:26It's little touches like those curved cupboards that make all the
0:29:26 > 0:29:28difference to the end user.
0:29:28 > 0:29:31And while you can't put a price on good design,
0:29:31 > 0:29:35how much of that £12,000 to £15,000 budget did Fifi spend?
0:29:36 > 0:29:37We've gone over budget.
0:29:37 > 0:29:39There's no question about that.
0:29:39 > 0:29:40We've gone over budget.
0:29:40 > 0:29:46I thought we'd be able to deliver what we wanted within £12K to £15K,
0:29:46 > 0:29:48but unfortunately we couldn't.
0:29:48 > 0:29:52We went extra mad. We went over budget £5K.
0:29:52 > 0:29:56So we ended up spending £20K on the flat.
0:29:56 > 0:30:00The £20,000 bill costs takes Fifi's total spend
0:30:00 > 0:30:05to £250,000. As he is unsure whether to rent or sell,
0:30:05 > 0:30:11let's see what two local estate agents make of the changes to this ground-floor flat.
0:30:11 > 0:30:13It's in excellent condition.
0:30:13 > 0:30:16And it's really made some really good use of the space.
0:30:16 > 0:30:18It's quite a spacious main bedroom as well.
0:30:18 > 0:30:22But also, I think it's got really good usable space in the
0:30:22 > 0:30:25kitchen/diner as well and in really good condition.
0:30:25 > 0:30:27The flat's been completed to a high specification,
0:30:27 > 0:30:30although it is a little bit compact.
0:30:30 > 0:30:32However, being close to the high street, it is expected,
0:30:32 > 0:30:35and the amenities and transportation links make up for that.
0:30:35 > 0:30:41So, what kind of prices would someone pay to rent a high-end flat in this city location?
0:30:41 > 0:30:43In the rental market, very popular,
0:30:43 > 0:30:49I'd say you'd be looking in the region of sort of £1,250 to £1,350
0:30:49 > 0:30:51per calendar month.
0:30:51 > 0:30:54I believe this property will fetch in the region of £1,300
0:30:54 > 0:30:56per calendar month.
0:30:56 > 0:30:57That is a great figure.
0:30:57 > 0:31:02That is the sort of figure that I was thinking about
0:31:02 > 0:31:03within the region of £1,200.
0:31:03 > 0:31:05So that's fantastic.
0:31:05 > 0:31:11The top value of £1,300 a month could mean a potential yield of over 6%,
0:31:11 > 0:31:16which isn't bad. But could there be good profit on the £250,000
0:31:16 > 0:31:18investment on the resale market?
0:31:19 > 0:31:20Sales market, I mean,
0:31:20 > 0:31:25you're looking probably around about £300,000 to £315,000.
0:31:25 > 0:31:29I believe this property will achieve in the region of £320,000.
0:31:29 > 0:31:30That is amazing!
0:31:30 > 0:31:35That is way beyond my projections.
0:31:35 > 0:31:42I think I might probably go, put it on the market for a resale.
0:31:42 > 0:31:47With a potential profit of £70,000, minus taxes and fees, it's no wonder.
0:31:47 > 0:31:52So, has this experience been all he had hoped for?
0:31:52 > 0:31:59Hearing the values, and also taking into account that this is the first main project,
0:31:59 > 0:32:05I think I'm very excited and I can't wait to set a foot in that auction room again.
0:32:07 > 0:32:12Teesside in the north-east of England is made up of a series of towns,
0:32:12 > 0:32:15including Middlesbrough and Stockton-on-Tees.
0:32:15 > 0:32:19They are separated by the River Tees and connected by the Newport Bridge.
0:32:19 > 0:32:23The bridge was the first vertical lift bridge to be built in the UK
0:32:23 > 0:32:27and was lifted over 1,000 times a week in its peak.
0:32:27 > 0:32:29These days, it remains permanently lowered,
0:32:29 > 0:32:34providing an important road connection between Stockton and Middlesbrough.
0:32:34 > 0:32:37# Here I am Stuck in the middle with you... #
0:32:38 > 0:32:39So, I'm in Middlesbrough,
0:32:39 > 0:32:43just a ten-minute walk away from the town centre and an even shorter walk
0:32:43 > 0:32:46to Teesside University, which is just down the road.
0:32:46 > 0:32:49I'm here to see a two-bedroom, mid-terrace property
0:32:49 > 0:32:53with surprisingly low guide price of £14,000.
0:32:53 > 0:32:58Now, is that going to prove to be a good deal or a good deal of work?
0:32:58 > 0:33:00Let's find out!
0:33:03 > 0:33:05Right.
0:33:05 > 0:33:06OK, that's not a great front door,
0:33:06 > 0:33:09but what I do like is if you put a brand-new door on there,
0:33:09 > 0:33:12you've got a second door here as well, which is good for security,
0:33:12 > 0:33:15keeps the heat in, keeps the cold out and then you come straight into
0:33:15 > 0:33:17a hallway here.
0:33:17 > 0:33:20First reception room just here, it's a good-sized room.
0:33:20 > 0:33:22Nice high ceiling.
0:33:22 > 0:33:25Big bay window, but I have seen a little bit of damp just above that
0:33:25 > 0:33:30bay window there. Doesn't look too bad and it's not alarming me at the moment.
0:33:30 > 0:33:34Down the hallway and you've got your stairs up to your bedrooms into
0:33:34 > 0:33:36the second reception room.
0:33:36 > 0:33:38It's a decent size again.
0:33:38 > 0:33:40There's lots of rubbish and rubble
0:33:40 > 0:33:42that needs to be cleared out of here,
0:33:42 > 0:33:44as like the first reception room as well.
0:33:44 > 0:33:46Central heating here, which is good.
0:33:46 > 0:33:47This doesn't look in great condition.
0:33:49 > 0:33:51As you can see, that's falling off the wall altogether.
0:33:51 > 0:33:53So, if you're looking to rent this out,
0:33:53 > 0:33:57put some brand-new radiators up and get a nice new boiler.
0:33:57 > 0:33:58Just keep it nice and safe.
0:33:58 > 0:34:00Kitchen's just here.
0:34:00 > 0:34:02It's a galley kitchen, nice and long.
0:34:02 > 0:34:05Not in great condition though, so that would have to come out.
0:34:05 > 0:34:09Same goes for the bathroom, which is right at the end of the property.
0:34:09 > 0:34:14Saying that, apart from the radiators, all the rubble and the rubbish...
0:34:14 > 0:34:16there's potential here, definitely.
0:34:16 > 0:34:21# Pick up the pieces and we'll throw them away
0:34:21 > 0:34:26# Throw them away and replace them... #
0:34:26 > 0:34:29Step one - clear everything out.
0:34:29 > 0:34:32Bear in mind, this job can sometimes be a health hazard,
0:34:32 > 0:34:35so you could get a specialist company in to do it.
0:34:37 > 0:34:40I'd certainly recommend some safety measures, though,
0:34:40 > 0:34:41like protective gloves.
0:34:42 > 0:34:46But so far, I'm not seeing any reason for that low guide price.
0:34:46 > 0:34:48Maybe upstairs might shed some light on it.
0:34:53 > 0:34:56Right, there's two good-sized bedrooms up here.
0:34:56 > 0:34:59The one at the front more or less mirrors this one.
0:34:59 > 0:35:01So there's lots of space.
0:35:01 > 0:35:04As you can see, there's a lot of floorboards missing in here,
0:35:04 > 0:35:06which is very dangerous.
0:35:06 > 0:35:09I would suggest get the basics done, get it nice and safe.
0:35:09 > 0:35:13Get those floorboards back in and you'd have two good-sized bedrooms,
0:35:13 > 0:35:17either to rent out or to flip it and sell it, and see what kind of profit
0:35:17 > 0:35:20you could make. On the other hand, I'm thinking,
0:35:20 > 0:35:22you've got the university, which isn't too far away.
0:35:22 > 0:35:27Is there an argument that this could fit the student market?
0:35:27 > 0:35:30That's three markets, three choices I've given to you.
0:35:30 > 0:35:32I love options, I really do!
0:35:32 > 0:35:33# I can't choose
0:35:33 > 0:35:36# It's too hard when your mind's a big
0:35:36 > 0:35:39# Bruise Dida dida, should be this guy... #
0:35:39 > 0:35:42Two things are not an option. First,
0:35:42 > 0:35:46resolving the damp both upstairs and downstairs, and secondly,
0:35:46 > 0:35:48clearing all this stuff out.
0:35:48 > 0:35:52Let's see what a local estate agent would chose to do with this two up,
0:35:52 > 0:35:55two down guided at £14,000.
0:35:55 > 0:35:57This is a great property.
0:35:57 > 0:36:00Yes, it does need scheme modernisation,
0:36:00 > 0:36:02the windows need addressing,
0:36:02 > 0:36:06the kitchen needs an overhaul, as does the bathroom and then after that,
0:36:06 > 0:36:07really just a general tidy through.
0:36:07 > 0:36:11I think you could probably spend sort of £6,000 to £8,000 on this property.
0:36:11 > 0:36:14That's more good news for potential investors.
0:36:14 > 0:36:18So what's the best option in terms of the area?
0:36:18 > 0:36:20It's very much a student let area.
0:36:20 > 0:36:23You know, these houses will be converted into three,
0:36:23 > 0:36:27possibly four bedrooms, depending on the size of the property.
0:36:27 > 0:36:31But, yeah, there's definitely a very strong student rental market in this area.
0:36:31 > 0:36:35We would turn the front room into a bedroom and then, the room which
0:36:35 > 0:36:40we're stood in now into, obviously, a bedroom and across the corridor
0:36:40 > 0:36:41another bedroom.
0:36:42 > 0:36:46That's one option and the agent thinks as a student let it could bring in
0:36:46 > 0:36:50at least £55 per room, per week.
0:36:50 > 0:36:55With three rooms, that's £660 per month in total.
0:36:55 > 0:36:59He also thinks it could be a lot more depending on the finish.
0:36:59 > 0:37:02But what could it rent for if it was kept as a two-bed house?
0:37:05 > 0:37:07If we were looking to rent this as a two-bedroomed house
0:37:07 > 0:37:09it would achieve £350 per calendar month.
0:37:09 > 0:37:12As a final option, what would it sell for if you got it for anywhere
0:37:12 > 0:37:16near the guide price of £14,000 and spent £8,000 on it,
0:37:16 > 0:37:18as the agent suggested,
0:37:18 > 0:37:22investing a total, somewhere around £22,000?
0:37:23 > 0:37:27The property could be placed on the open market at £45,000.
0:37:28 > 0:37:30This is one not for the faint-hearted.
0:37:30 > 0:37:32There's a bit of work that needs to be done in there -
0:37:32 > 0:37:36new bathroom, new kitchen, not to mention all the windows as well.
0:37:36 > 0:37:37On the positive side,
0:37:37 > 0:37:42it's in a good location and don't forget that low guide price of £14,000.
0:37:42 > 0:37:44I'm sure that's got to create some interest.
0:37:44 > 0:37:48Let's go to the auction house and find out who the last person was standing.
0:37:49 > 0:37:53This is a two-bedroomed, mid-terraced property.
0:37:53 > 0:37:55Start me if you will. Five again.
0:37:55 > 0:37:56Five again. Do I have ten?
0:37:56 > 0:37:58Ten. Thank you, sir. Ten.
0:37:58 > 0:38:0015? Say it again.
0:38:00 > 0:38:0111. If we must.
0:38:01 > 0:38:0312, sir.
0:38:03 > 0:38:06The £1,000 increases had the bidders interested,
0:38:06 > 0:38:10so we rejoin the auction looking for £27,000.
0:38:10 > 0:38:1227 in the room?
0:38:12 > 0:38:1327 with Ian.
0:38:13 > 0:38:1527 and a half in the room.
0:38:15 > 0:38:1827 and a half in the room. Is it 28 anywhere?
0:38:18 > 0:38:2228. 28. 28 and a half, sir.
0:38:22 > 0:38:2528 on the phone and being sold...
0:38:25 > 0:38:27With Ron, then. Sir, do you want 28 and a half?
0:38:27 > 0:38:29You do? 28 and a half.
0:38:29 > 0:38:3029.
0:38:31 > 0:38:35Being sold, then. Gone, gone. Gone is gone, I think so.
0:38:35 > 0:38:37It's with you. 28 and a half.
0:38:37 > 0:38:40Are we all done? One, two, three.
0:38:40 > 0:38:41That's yours. Well done, sir.
0:38:41 > 0:38:42Good contest.
0:38:42 > 0:38:44# You might find it cheap
0:38:44 > 0:38:47# But you're never gonna find it free... #
0:38:47 > 0:38:53The successful bid of £28,500 came from property developer Mohammed.
0:38:53 > 0:38:56He lives and works in London, and is a builder by trade.
0:38:56 > 0:39:01I caught up with him to find out what his plans were for his new acquisition.
0:39:01 > 0:39:04- Mohammed, nice to meet you, sir. - Nice meeting you.- Congratulations.
0:39:04 > 0:39:07- Thank you.- What made you buy this property?
0:39:07 > 0:39:10The price was low, so...
0:39:10 > 0:39:12that's the reason I just came and
0:39:12 > 0:39:17plus, it's closest to town centre and the big uni around here.
0:39:17 > 0:39:19So that is the only reason I just went for it.
0:39:19 > 0:39:25So were you looking for a property this size in an area, like, near a university?
0:39:25 > 0:39:27Yes, I was looking for quite a few months.
0:39:27 > 0:39:30- Were you happy with what you paid? - Yes, definitely.
0:39:30 > 0:39:32- I'm happy.- Because you're a London lad, aren't you?
0:39:32 > 0:39:34Yes, I live in London.
0:39:34 > 0:39:39And, yeah, I saw it through the internet and I found this place really cheap.
0:39:39 > 0:39:42Good-sized bedrooms and a good-sized property.
0:39:42 > 0:39:44So what are the differences then, Mohammed?
0:39:44 > 0:39:47You've got a house of this size up here, up north -
0:39:47 > 0:39:48what would it cost you down south?
0:39:48 > 0:39:51Yeah, I mean, the price which I paid up here,
0:39:51 > 0:39:55you can't even pay the deposit out there.
0:39:55 > 0:40:00So it's about ten, 15 times more higher than this.
0:40:00 > 0:40:03- Are you moving up north? - No, I'm not. I'm not, I'm sticking in London!
0:40:03 > 0:40:05- Sticking in London. - I'm sticking in London.
0:40:05 > 0:40:07But I'm buying properties up north.
0:40:07 > 0:40:11OK. So now you've got this property, it's now yours.
0:40:11 > 0:40:12What are your plans for it?
0:40:12 > 0:40:15Probably I'm going to do HMO for students
0:40:15 > 0:40:17and I'm going to rent it out.
0:40:17 > 0:40:20I'm trying to capture the student market basically.
0:40:20 > 0:40:24OK. So how many bedrooms can we expect when it's all finished?
0:40:24 > 0:40:26It's going to be a four-bedroom,
0:40:26 > 0:40:28- because it's two bedroom upstairs already.- Yeah.
0:40:28 > 0:40:33So it's two reception rooms on the ground floor. One there, one here.
0:40:33 > 0:40:35So I'm converting that one as bedrooms as well.
0:40:35 > 0:40:39So it's going to be good, three king-size bedrooms,
0:40:39 > 0:40:41and one is going to be a double bedroom.
0:40:41 > 0:40:44So in order to change this into an HMO, do you know what is required?
0:40:44 > 0:40:49Yes. You need to have heat alarms, smoke alarms, all over the rooms.
0:40:49 > 0:40:52Plus, you need to have fire doors.
0:40:52 > 0:40:54It is all about fire and health and safety checks.
0:40:54 > 0:40:59You have to put in some signs and this kind of stuff.
0:40:59 > 0:41:01And what about financially for you?
0:41:01 > 0:41:04What are you looking to get back from this property financially?
0:41:04 > 0:41:08I had a word with a couple of estate agents as well.
0:41:08 > 0:41:14And the advice which I have is £125 or £110
0:41:14 > 0:41:17to £125 margin per week.
0:41:17 > 0:41:20- OK.- So, for example, if there's four rooms up here,
0:41:20 > 0:41:24I'm getting about £450 per week.
0:41:24 > 0:41:27- So times four...- Yes.
0:41:27 > 0:41:28It's decent, isn't it?
0:41:28 > 0:41:30It is a really decent return.
0:41:30 > 0:41:33The yield is about 18% yield,
0:41:33 > 0:41:35which is not bad either.
0:41:36 > 0:41:38That is an amazing return.
0:41:38 > 0:41:40But to get to those mental figures,
0:41:40 > 0:41:43Mohammed is pushing the boat out in terms of quality.
0:41:43 > 0:41:46He'll need to watch his budget and have a very tight team.
0:41:49 > 0:41:51I have six, seven people.
0:41:51 > 0:41:55- Wow!- They work underneath me, so I'm going to bring them down here.
0:41:55 > 0:41:58So they're going to have their holidays while they're working here
0:41:58 > 0:42:01as well! It is going to be away from London where it's a hectic life
0:42:01 > 0:42:04down there, so it's going to be away from London.
0:42:04 > 0:42:08Plus, after the work, it's going to be all party going on here.
0:42:08 > 0:42:11- That's the plan. - So tell me how that works, then?
0:42:11 > 0:42:13You've got a team of six to seven builders.
0:42:13 > 0:42:15Will they be up at the weekends or for the week?
0:42:15 > 0:42:17Where are they going to stay?
0:42:17 > 0:42:19We're going to rent a house down here.
0:42:19 > 0:42:23We're going to go after one or two weeks, after two weeks,
0:42:23 > 0:42:27spend the weekend back in London, come back fresh on Monday again.
0:42:27 > 0:42:29- Ready to go again.- Then start again.
0:42:29 > 0:42:31So when your team get in here, when they get into this house,
0:42:31 > 0:42:33what's the first thing they're going to do?
0:42:33 > 0:42:38First thing, need to get rid of this wallpaper, all over.
0:42:38 > 0:42:42Taking these carpets out, kitchen, everything going into the skip.
0:42:42 > 0:42:46So then we start doing all the plastering and new flooring,
0:42:46 > 0:42:49and new tiles in the kitchen and the boxroom.
0:42:49 > 0:42:51So basically renovating everything.
0:42:51 > 0:42:53What's your budget going to be to turn this place around?
0:42:53 > 0:42:56The budget is going to be about 10,000.
0:42:56 > 0:42:58How long is the work going to take?
0:42:58 > 0:43:00About three weeks, max.
0:43:00 > 0:43:02Really? Turn it all around?
0:43:02 > 0:43:04- Like I said...- HMO?- Everything.
0:43:04 > 0:43:06- So you're ready to go?- Yeah.
0:43:06 > 0:43:08- And happy?- Very happy.
0:43:08 > 0:43:10- Good man. Listen, good luck. - Thank you very much.
0:43:10 > 0:43:13- Can't wait to see how you get on. - Definitely. Thank you.- Pleasure.
0:43:13 > 0:43:17So Mohammed has got his heart set on making this an HMO for students,
0:43:17 > 0:43:20which I think is a very good idea.
0:43:20 > 0:43:22The university is just down the road
0:43:22 > 0:43:26and if he touches those impressive yields, it'll be money well spent.
0:43:26 > 0:43:29But will he pass his test with flying colours
0:43:29 > 0:43:31or will he be university challenged?
0:43:31 > 0:43:34You can find out how he gets on later in the programme.
0:43:37 > 0:43:42It's been a while since we visited our remaining two properties.
0:43:42 > 0:43:45Have they got all the work done or did they make a mess of it?
0:43:45 > 0:43:48Has it all been plain sailing or rough waters?
0:43:48 > 0:43:50Let's go back and find out.
0:43:52 > 0:43:54Back now to the town of Chatham in Kent,
0:43:54 > 0:43:59where Lucy saw a small studio flat at the end of a private road guided
0:43:59 > 0:44:01at between 50,000 and 55,000.
0:44:04 > 0:44:06There was a rather nice communal foyer,
0:44:06 > 0:44:09but inside the flat was a different story.
0:44:10 > 0:44:13It appeared to have been empty for some time.
0:44:14 > 0:44:16There were some problematic areas of damp
0:44:16 > 0:44:19and it was covered in textured wall coating.
0:44:21 > 0:44:22Yes, it was small.
0:44:22 > 0:44:26But for a studio flat it was to be expected.
0:44:26 > 0:44:28At least it had a separate kitchen.
0:44:29 > 0:44:32Oh, my goodness me! Look at it!
0:44:32 > 0:44:35Yep, so we need a skip and we need to get all this stuff out
0:44:35 > 0:44:37and it needs to be dumped in there.
0:44:38 > 0:44:40But good things often come in small packages,
0:44:40 > 0:44:45which was the case when part-time property developer and local celebrity
0:44:45 > 0:44:48Mary bought the flat at auction for 60,000.
0:44:50 > 0:44:54So, Mary, tell me, what's been happening since we last saw you on
0:44:54 > 0:44:56Homes Under The Hammer?
0:44:56 > 0:44:58Loads of people have recognised me.
0:44:58 > 0:45:03Over 20 people on the street have recognised me, all over the place.
0:45:03 > 0:45:06- I can't believe it.- So complete strangers have been coming up to you
0:45:06 > 0:45:08and saying, "We recognise you from Homes Under The Hammer"?
0:45:08 > 0:45:12Today, a car stopped and said, "Oh, have you been on Homes Under The Hammer?"
0:45:12 > 0:45:14I said, "Yes."
0:45:14 > 0:45:17With more than 20 renovations under her belt,
0:45:17 > 0:45:22Mary was certain she could get this studio flat into pristine condition
0:45:22 > 0:45:25for £4,000 to £5,000 in a matter of three months.
0:45:26 > 0:45:29So when we returned seven months later,
0:45:29 > 0:45:31was the flat ready for its close-up?
0:45:38 > 0:45:41The flat is looking much fresher and brighter.
0:45:41 > 0:45:44That icing, cakey wall coating has gone
0:45:44 > 0:45:47and has been re-plastered with a lovely smooth finish.
0:45:50 > 0:45:55The unsightly water tank has been tidied away in a smart new cupboard.
0:45:55 > 0:45:59And that large damp patch has been treated and looks good as new.
0:46:10 > 0:46:13The kitchen has been ripped out and replaced with much more functional
0:46:13 > 0:46:18fittings in neutral creams and greys, with a space or two for a tipple.
0:46:24 > 0:46:28That grotty bathroom has also been given a new lease of life with a new
0:46:28 > 0:46:30suite and is now sparkling.
0:46:30 > 0:46:31It's quite a transformation!
0:46:35 > 0:46:38The wall was in a terrible state.
0:46:38 > 0:46:42There was damp all over this bit here.
0:46:44 > 0:46:46The kitchen was a complete wreck.
0:46:46 > 0:46:50The bathroom was a complete wreck.
0:46:50 > 0:46:52Just about everything was a complete wreck!
0:46:52 > 0:46:54SHE LAUGHS
0:46:54 > 0:46:56This is no comparison now.
0:46:56 > 0:46:59I just can't believe it's the same place.
0:46:59 > 0:47:02The builders have done a smashing job, but I must say,
0:47:02 > 0:47:03I'm a little disappointed.
0:47:03 > 0:47:05It's not as colourful as Mary.
0:47:07 > 0:47:10This is always the safest shade to have.
0:47:10 > 0:47:13Nobody in their right mind would have red!
0:47:13 > 0:47:14SHE LAUGHS
0:47:14 > 0:47:15Some people like it,
0:47:15 > 0:47:19but not if you're...other people coming to look at it though.
0:47:21 > 0:47:24The neutral colour palette seems to have done the trick,
0:47:24 > 0:47:27as Mary has already secured a tenant.
0:47:27 > 0:47:29So everything has worked out nicely,
0:47:29 > 0:47:32but it did take longer than her three-month timescale.
0:47:35 > 0:47:38Well, there was hold-ups along the way,
0:47:38 > 0:47:42because unfortunately with builders,
0:47:42 > 0:47:47they start a job and then they go off to something else,
0:47:47 > 0:47:49and then they have to come back again.
0:47:49 > 0:47:53So unfortunately, they don't do it all straight away.
0:47:53 > 0:47:57The job probably could have been done in maybe a couple of weeks,
0:47:57 > 0:47:58really going straight out,
0:47:58 > 0:48:02but with these hold-ups, it took longer than that.
0:48:02 > 0:48:05So the project overran,
0:48:05 > 0:48:10but how did Mary fare with the £4,000 to £5,000 budget?
0:48:10 > 0:48:14Oh, well, originally I thought maybe be about 4,000 and 5,000,
0:48:14 > 0:48:16but it went over.
0:48:16 > 0:48:18But this often happens.
0:48:18 > 0:48:20Unless you can do it yourself.
0:48:21 > 0:48:24Mary ended up spending 12 grand on the build,
0:48:24 > 0:48:28which takes her total investment to 72,000.
0:48:28 > 0:48:30But will that overspend be worth it?
0:48:30 > 0:48:32What will two local estate agents
0:48:32 > 0:48:34make of the changes to the studio flat?
0:48:36 > 0:48:40I think my initial thoughts is they've done a very nice job to it.
0:48:40 > 0:48:43It's very cosy, very nice and warm with the heating.
0:48:43 > 0:48:46I think its disadvantage is the access to it. For some people,
0:48:46 > 0:48:49they're not going to quite like going up the back there.
0:48:49 > 0:48:52Although the size is on the small side,
0:48:52 > 0:48:55I do feel that it does have everything that you would need.
0:48:55 > 0:48:59It has been freshly painted. You can see that it's got new carpets.
0:48:59 > 0:49:01The kitchen is fantastic
0:49:01 > 0:49:03and so is the shower room there.
0:49:03 > 0:49:07So to have a brand-new apartment in this area is quite sought-after.
0:49:07 > 0:49:10I think the selling point of this property is where it's located.
0:49:10 > 0:49:12It is very close to the town
0:49:12 > 0:49:16and if you don't drive, parking is quite difficult around here,
0:49:16 > 0:49:20then it's ideal to be able to walk to work or to a station.
0:49:20 > 0:49:22The agents are right.
0:49:22 > 0:49:23There's a strong demand
0:49:23 > 0:49:28and Mary is already letting the flat out for £500 per calendar month,
0:49:28 > 0:49:31which is within the range the agents recommended.
0:49:31 > 0:49:34This gives her a healthy yield of over 8%.
0:49:34 > 0:49:37Mary does want to sell the flat at some point,
0:49:37 > 0:49:41but what would her £72,000 investment make now?
0:49:46 > 0:49:51I would suggest placing it on the market in a guide price of £75,000 to £80,000.
0:49:51 > 0:49:54I think if I was putting this on the market now,
0:49:54 > 0:49:58I would be looking at offering it out at say offers in the region of
0:49:58 > 0:49:59£80,000.
0:49:59 > 0:50:02It's not the best I've had,
0:50:02 > 0:50:07but as I said, as I've gone through quite a number of properties,
0:50:07 > 0:50:11to me it's just another property, you know, you get through.
0:50:11 > 0:50:17It's still a potential profit of £8,000 minus taxes and fees.
0:50:17 > 0:50:20But for Mary it's onwards and upwards.
0:50:20 > 0:50:24Does she have any advice for any budding property developers out there?
0:50:27 > 0:50:29There's quite a number of things.
0:50:29 > 0:50:32You can make a lot of mistakes along the way.
0:50:32 > 0:50:35It's not exactly a doddle.
0:50:35 > 0:50:39But you've got to be prepared to risk it, basically.
0:50:39 > 0:50:42You know, if you're too scared to risk it, you'll never do it.
0:50:46 > 0:50:49It seems like only ten minutes since I was in Middlesbrough
0:50:49 > 0:50:51looking around this two-bed mid-terrace.
0:50:54 > 0:50:56It had plenty of floor space,
0:50:56 > 0:50:59except it didn't have any floorboards in place.
0:51:00 > 0:51:04Where there was floor, it was covered in lots of damaged items.
0:51:04 > 0:51:08This probably contributed to its low guide price of 14 grand plus.
0:51:10 > 0:51:12Central heating here, which is good.
0:51:12 > 0:51:14This doesn't look in great condition.
0:51:15 > 0:51:17As you can see, that's falling off the wall altogether.
0:51:17 > 0:51:19The kitchen is just here.
0:51:19 > 0:51:22It's a galley kitchen, nice and long. Not in great condition though,
0:51:22 > 0:51:24so that would have to come out.
0:51:24 > 0:51:28Same goes for the bathroom, which is right at the end of the property.
0:51:28 > 0:51:32Apart from the radiators, all the rubble and the rubbish...
0:51:32 > 0:51:34there's potential here, definitely.
0:51:34 > 0:51:37The man who saw that potential at auction was London-based
0:51:37 > 0:51:39property developer Mohammed.
0:51:40 > 0:51:44He paid £28,500 for the property, just over double the guide price.
0:51:47 > 0:51:50- Were you happy with what you paid? - Yes, definitely.
0:51:50 > 0:51:52- I'm happy.- What would it cost you down south?
0:51:52 > 0:51:55Yeah. I mean, the price which I paid up here,
0:51:55 > 0:51:57you can't even pay the deposit.
0:51:57 > 0:52:03It's about ten, 15 times more higher than this.
0:52:03 > 0:52:07Being close to the university, his plan was to convert it into a HMO,
0:52:07 > 0:52:09a house of multiple occupancy.
0:52:10 > 0:52:13So, for example, if there's four rooms up here,
0:52:13 > 0:52:15I'm getting about £450 per week.
0:52:15 > 0:52:19The yield is about 18%,
0:52:19 > 0:52:20which is not bad either.
0:52:20 > 0:52:23Not bad if the work can be done economically.
0:52:25 > 0:52:29Mohammed had a plan to use his trusted tradesmen from London who'd
0:52:29 > 0:52:31worked on his portfolio of rental properties before.
0:52:32 > 0:52:37I have six, seven people, so I'm going to bring them down here,
0:52:37 > 0:52:41so they're going to have their holidays while they're working here as well.
0:52:41 > 0:52:44It's going to be away from London where it's a hectic life down there,
0:52:44 > 0:52:47so it's going to be away from London, plus, after the work,
0:52:47 > 0:52:49it's going to be all partying going on.
0:52:52 > 0:52:56So, was it all play and no work when it came to attacking his ambitious
0:52:56 > 0:52:58three-week timescale?
0:52:58 > 0:53:01Well, we're back, 27 weeks and one day later.
0:53:05 > 0:53:09The rubbish has been cleared and in the first reception room,
0:53:09 > 0:53:14in the first bedroom of what is now a two-bed downstairs flat.
0:53:14 > 0:53:16Looks like the long-distance working has worked out.
0:53:30 > 0:53:34What used to be the rear reception room is now the second bedroom of
0:53:34 > 0:53:35the downstairs flat.
0:53:37 > 0:53:40The new radiators I was hoping for are there and a number of safety
0:53:40 > 0:53:44features have been installed, along with fitted wardrobes.
0:53:45 > 0:53:49It couldn't have been much of a holiday for Mohammed's team of builders.
0:53:57 > 0:54:01The rest of the downstairs tour starts with the hall.
0:54:02 > 0:54:03Very nice.
0:54:05 > 0:54:10In the new gallery kitchen, there's a new boiler, toaster and kettle,
0:54:10 > 0:54:12and all the mod cons.
0:54:16 > 0:54:21The wreck of a bathroom has new fittings and tiles.
0:54:21 > 0:54:26Heated towel rail, neutral tones will make bath times a little more appealing.
0:54:30 > 0:54:35So, to the upstairs where the old back bedroom is now a studio flat.
0:54:39 > 0:54:43It's amazing these days what you can fit into a small space.
0:54:45 > 0:54:49But I don't fancy my chances in that small shower tray.
0:54:50 > 0:54:53There's another studio flat where the front bedroom was.
0:54:59 > 0:55:03But was it all worth a 24 week and one day overrun?
0:55:03 > 0:55:07What does Mohammed have to say about that?
0:55:07 > 0:55:12It took me a little while to find the good builders to come into the property and
0:55:12 > 0:55:14just sort out everything for me,
0:55:14 > 0:55:16rather than me coming around and sort it out.
0:55:16 > 0:55:20Hang on a minute, you told me you were going to use your London-based
0:55:20 > 0:55:22- team.- Bringing them here,
0:55:22 > 0:55:26it was costing me a little bit more, so I was thinking, rather than bring them here,
0:55:26 > 0:55:30just give a contractor a job to finish it off for me.
0:55:30 > 0:55:32The local builders took care of...
0:55:32 > 0:55:36well, building. They also did acoustic tests,
0:55:36 > 0:55:38electrics and gas certification.
0:55:38 > 0:55:40They even sorted planning permission,
0:55:40 > 0:55:44which also didn't go to Mohammed's plan for a HMO.
0:55:44 > 0:55:47I told my builders to find out what exactly can we do
0:55:47 > 0:55:53and ending up having three flats into the property, which is all good.
0:55:53 > 0:55:58He believes he'll make a much better return with the property as three
0:55:58 > 0:56:01flats, but how long did it really take?
0:56:01 > 0:56:05Everything from start to finish, they'd done in four weeks,
0:56:05 > 0:56:09as you can see, so I will 100% prefer them.
0:56:09 > 0:56:12His local builders have really pulled it out of the bag,
0:56:12 > 0:56:16allowing Mohammed to concentrate on projects closer to home.
0:56:16 > 0:56:23I just came a couple of times, especially to come here to make the payments basically.
0:56:23 > 0:56:27Let's find out from two local estate agents if Mohammed's payments were
0:56:27 > 0:56:29wisely invested.
0:56:29 > 0:56:32First, the agent who visited before work commenced.
0:56:32 > 0:56:35First impressions, I think the owner's done a fabulous job.
0:56:35 > 0:56:37They've used all the space available.
0:56:37 > 0:56:40Really well done with a great finish.
0:56:40 > 0:56:43So, the market that this property will be primarily aimed at
0:56:43 > 0:56:46would be the student market.
0:56:46 > 0:56:48It would be really popular with students in the area.
0:56:48 > 0:56:53In fact, one of the agents told us the council were converting another
0:56:53 > 0:56:56terraced house for student lets at the end of the street.
0:56:56 > 0:56:59Good news for the local market.
0:56:59 > 0:57:03The university is expanding, so that's good for the area as well,
0:57:03 > 0:57:06so we are seeing more activity in the market at the moment.
0:57:06 > 0:57:14The agents predicted an average total rental income per calendar month of £1,340.
0:57:14 > 0:57:19Mohammed spent £28,500 at auction and budgeted a £10,000 spend for
0:57:19 > 0:57:24refurbishment. He says this increased to £30,000 because of the extra work
0:57:24 > 0:57:28required for the unforeseen conversion to flats.
0:57:28 > 0:57:35His business model is to rent and you can see why, because the potential yield is 28%.
0:57:35 > 0:57:39Of course, he could have empty rooms during the summer period, but
0:57:39 > 0:57:43nonetheless, nearly a 30% yield is very impressive.
0:57:44 > 0:57:4930% yield you cannot get from anywhere in London, definitely, first of all,
0:57:49 > 0:57:53but it's a very good return and I'm happy with that.
0:57:53 > 0:57:55And so he should be.
0:57:55 > 0:57:57And I'm glad to see, for a change,
0:57:57 > 0:58:00a great return on capital from outside the capital.
0:58:05 > 0:58:08Well, that's it for today's show,
0:58:08 > 0:58:10but there's always something new to learn in the world of property,
0:58:10 > 0:58:12so make sure you join us next time.
0:58:12 > 0:58:15Yes, please do, right here on Homes Under The Hammer.
0:58:15 > 0:58:16- See you.- Goodbye.