0:00:02 > 0:00:04Hello, and welcome to the show. Now, for many first time
0:00:04 > 0:00:07property investors, it can be a nerve-racking, intimidating process.
0:00:07 > 0:00:10Yes, but by doing your research and getting up-to-date
0:00:10 > 0:00:14with the housing market can make it a little less daunting.
0:00:14 > 0:00:17Yes, and one place you can find out exactly what's going on is at your
0:00:17 > 0:00:18local property auction.
0:00:45 > 0:00:49The variety of properties at auction is huge.
0:00:49 > 0:00:53Yes, but it's really important to do your research,
0:00:53 > 0:00:55and then stick to your budget and your plans.
0:00:55 > 0:00:57Even when the bidding commences.
0:00:57 > 0:01:00So, let's find out what choices today's buyers made.
0:01:02 > 0:01:04I visit this two-bed bungalow in Cornwall,
0:01:04 > 0:01:07and there's a mystery to be solved.
0:01:09 > 0:01:12You're thinking, what is this house made of?
0:01:12 > 0:01:15But it doesn't take Sherlock Holmes to work out what's amiss with this
0:01:15 > 0:01:17three-bed semi in the West Midlands.
0:01:17 > 0:01:18Clear as day.
0:01:20 > 0:01:22Everything's out.
0:01:22 > 0:01:24And in this two-bedroom house in Watford,
0:01:24 > 0:01:27it's a puzzling layout that has me scratching my head.
0:01:27 > 0:01:31You have to walk through a bedroom to access your bathroom.
0:01:34 > 0:01:37All these properties have been sold at auction, and we'll find out who
0:01:37 > 0:01:40bought them and what they paid when they went under the hammer.
0:01:47 > 0:01:51It's always a delight to travel to the south-west of England.
0:01:51 > 0:01:54And this is the pretty village of Callington in Cornwall,
0:01:54 > 0:01:56where, in August 2014,
0:01:56 > 0:02:00I visited this two-bed bungalow, for sale at auction
0:02:00 > 0:02:02with a guide price of £100,000 plus.
0:02:04 > 0:02:07Well, you're left in no doubt before you even step inside the house
0:02:07 > 0:02:09that it's kind of quirky.
0:02:09 > 0:02:12But let's see exactly what we've got.
0:02:12 > 0:02:15The entrance area there, and through into this really nice
0:02:15 > 0:02:17double-fronted lounge. Beams.
0:02:17 > 0:02:20Wouldn't have expected that, but there you go!
0:02:20 > 0:02:25Off there, first of the bedrooms and a half decent sized bathroom.
0:02:25 > 0:02:27Slightly unusual feature there,
0:02:27 > 0:02:31with this kind of glassy, conservatory, greenhouse
0:02:31 > 0:02:33kind of thing going on.
0:02:33 > 0:02:35I don't know how else to describe it!
0:02:35 > 0:02:38But your second bedroom there,
0:02:38 > 0:02:41and then through into your kitchen.
0:02:41 > 0:02:44It's all pretty together.
0:02:44 > 0:02:47It's clean. It's relatively tidy. It might not be to everyone's taste,
0:02:47 > 0:02:51but you could pretty much live in it straightaway as it is.
0:02:51 > 0:02:54And it's quirky. I mean, I like that.
0:02:54 > 0:02:57I like the quirkiness. It doesn't get any more quirky than out here,
0:02:57 > 0:03:00where you step into what was presumably a little courtyard area.
0:03:00 > 0:03:04It's been covered over, encompassing your shed.
0:03:04 > 0:03:06Wow!
0:03:06 > 0:03:09A shed and a lean-to, that was a new one for me.
0:03:09 > 0:03:12However, it was outside that had my attention.
0:03:12 > 0:03:14Just look at the exterior of the building,
0:03:14 > 0:03:18and immediately you're thinking, "What is this house made of?"
0:03:18 > 0:03:21It is, in fact, a wooden frame construction.
0:03:21 > 0:03:24And this is just cladding on the outside.
0:03:24 > 0:03:27So, probably a concrete base and then this has been built on the top.
0:03:27 > 0:03:291920s, 1930s.
0:03:31 > 0:03:33What's wrong with that? Well, you might like it.
0:03:33 > 0:03:37I might like it, but generally mortgage companies don't.
0:03:44 > 0:03:46Now, while there are companies that specialise
0:03:46 > 0:03:49in mortgaging non-standard constructions,
0:03:49 > 0:03:52I reckon this one might be a quirk too far for most.
0:03:52 > 0:03:54However, the really interesting thing about this lot
0:03:54 > 0:03:57was the plot of land the bungalow stood on.
0:03:58 > 0:04:02Step out here to the front of the property, and another potential
0:04:02 > 0:04:04opportunity presents itself,
0:04:04 > 0:04:06because you've got a very, very large garden.
0:04:06 > 0:04:090.2 acres in total.
0:04:09 > 0:04:11So, what am I thinking?
0:04:11 > 0:04:13Building plot, perhaps?
0:04:13 > 0:04:17Knock that whole thing down, divide this up, maybe one large house,
0:04:17 > 0:04:20with an amazing garden, maybe two properties.
0:04:20 > 0:04:22It would all come down to planning, of course,
0:04:22 > 0:04:25and all come down to how much you get for those properties
0:04:25 > 0:04:29when they were built, but as a potential...
0:04:30 > 0:04:33..I think it's definitely an option. Sad though it is, to say it.
0:04:35 > 0:04:38On auction day the guide price for this lot was raised from 100
0:04:38 > 0:04:40to £125,000 plus.
0:04:40 > 0:04:42125 anywhere in the room?
0:04:42 > 0:04:43125?
0:04:45 > 0:04:47- 115?- 110.- 110.
0:04:47 > 0:04:50Thank you, sir. Great bid. 110, go with that.
0:04:50 > 0:04:52115 somewhere.
0:04:52 > 0:04:54Looking for 112.
0:04:54 > 0:04:56113. 112, then.
0:04:56 > 0:04:59You've got a riposte at 112. 114.
0:04:59 > 0:05:00Yeah?
0:05:00 > 0:05:02114. 116.
0:05:02 > 0:05:03116.
0:05:03 > 0:05:05118.
0:05:05 > 0:05:08We're moving. It's a slow train, but we're moving.
0:05:08 > 0:05:09118.
0:05:10 > 0:05:11A slow train that was gathering pace,
0:05:11 > 0:05:14because despite that guide price change,
0:05:14 > 0:05:17neither of the two bidders seemed to be running out of steam.
0:05:18 > 0:05:22We're back on track at 131,000.
0:05:22 > 0:05:25131 here. 132. It's against both of you.
0:05:25 > 0:05:27131 and a half.
0:05:27 > 0:05:28132.
0:05:30 > 0:05:33132 on the wall here. 132 and a half.
0:05:33 > 0:05:36Or has he worn you down? I think he might have worn you down.
0:05:36 > 0:05:39It's £132,000 here on the wall against both of you.
0:05:39 > 0:05:40At £132,000.
0:05:40 > 0:05:43Started at 110. We're at 132.
0:05:43 > 0:05:46First time with you, sir, on the wall, at 132.
0:05:46 > 0:05:47Second time.
0:05:47 > 0:05:49Third and last time.
0:05:49 > 0:05:52At 132 for a bungalow chalet.
0:05:54 > 0:05:55132.
0:05:59 > 0:06:04Paying £132,000 for the lot was Andrew and his son, Mark.
0:06:04 > 0:06:06Both electrical contractors.
0:06:06 > 0:06:09They weren't much taken by the chalet bungalow's quirky charms.
0:06:09 > 0:06:11It's somewhere to live for the time being.
0:06:11 > 0:06:14The overall idea of it is to knock it down,
0:06:14 > 0:06:17- and hopefully to build two houses. - You're going to live here, then?
0:06:17 > 0:06:19- I'm going to live here, yeah. - Oh, great, OK.
0:06:19 > 0:06:22- Girlfriend's not very happy about it.- Oh, right, why not?
0:06:22 > 0:06:25Well, as I say, from what I'm living in now to living in this is a little
0:06:25 > 0:06:29- bit different, really. - I think this place is charming.
0:06:29 > 0:06:32- Has she not bought into that yet? - It's first impressions, let's say.
0:06:32 > 0:06:35- Is it?- I think when she moves in, eventually she'll like it.
0:06:35 > 0:06:38It's a short-term place to live in. Cheap living, so...
0:06:43 > 0:06:46Mark was clearly well prepared for some cheap and cheerful lodgings,
0:06:46 > 0:06:50but girlfriend Tamsin obviously might have needed
0:06:50 > 0:06:52some persuading, and reluctant girlfriend might
0:06:52 > 0:06:54have been the least of their problems.
0:06:56 > 0:06:59Have you had any preliminary discussions with the planners at all
0:06:59 > 0:07:02- about what about you might do? - Not yet, no.- No.
0:07:02 > 0:07:04What will you approach them with, do you think?
0:07:04 > 0:07:07We want to look at two individual properties.
0:07:07 > 0:07:10- Three bedroom.- Wow!
0:07:10 > 0:07:13That's it. We're looking at possibly taking the main entrance
0:07:13 > 0:07:16out the side, rather than the front. Because of the traffic lights.
0:07:16 > 0:07:19- Yeah.- But again it's down to what we can get on the site,
0:07:19 > 0:07:21how it works, basically.
0:07:21 > 0:07:24Well, theoretically two detached properties?
0:07:24 > 0:07:26That's what we're after, yeah.
0:07:26 > 0:07:29Andrew and Mark figured that two dormer bungalows
0:07:29 > 0:07:32would fit nicely into the local area,
0:07:32 > 0:07:34and the plan was to build one house first,
0:07:34 > 0:07:38demolish the existing bungalow and build the second one.
0:07:38 > 0:07:41Let's assume we're going to build a dormer bungalow, two dormer bungalows,
0:07:41 > 0:07:45- what, three bedrooms each? - Yeah.- Roughly what would they cost?
0:07:45 > 0:07:48Well, I'm sort of saying they'd sell for 100,000 each.
0:07:48 > 0:07:51- That's...?- Well, I've built one down the road and it cost me about
0:07:51 > 0:07:53- £80,000, so...- OK. - That's only for a two-bed.
0:07:53 > 0:07:56So, bearing in mind what you paid for this place, there's still quite
0:07:56 > 0:07:58- a profit margin there.- Hopefully.
0:07:58 > 0:08:02- We've got to help the taxman somewhere.- Yes, of course!
0:08:02 > 0:08:05So, what about the idea of working together as father and son?
0:08:05 > 0:08:07Well, I've got two sons in the business,
0:08:07 > 0:08:09so I do it seven days a week, really.
0:08:09 > 0:08:13So hopefully we will get on. We have our moments, as everybody.
0:08:13 > 0:08:17But I think, you know, the strengths sort of outweigh the disadvantages,
0:08:17 > 0:08:20- really.- And the timescale for the whole project?
0:08:20 > 0:08:22- Two years.- Yeah, something like that.
0:08:22 > 0:08:25- Two years to completely finish the whole project?- Yeah.
0:08:25 > 0:08:27So, when we returned almost two years later,
0:08:27 > 0:08:30the guys hadn't managed to finish as they'd hoped,
0:08:30 > 0:08:32but things were definitely progressing.
0:08:42 > 0:08:46But there had been several changes to their original plan.
0:08:46 > 0:08:48We originally thought we were going to build the one at the front first,
0:08:48 > 0:08:50Mark would live in that one.
0:08:50 > 0:08:53And then we would demolish that and build this one.
0:08:53 > 0:08:56That didn't work out quite as we planned, really.
0:08:56 > 0:08:59The first time it rained it was apparent that we're never,
0:08:59 > 0:09:02ever going to move into the place. It was leaking everywhere, really.
0:09:02 > 0:09:05So it was bye-bye, quirky bungalow.
0:09:05 > 0:09:09When we actually started demolishing the place, we found out we had
0:09:09 > 0:09:10asbestos and bits and bobs.
0:09:10 > 0:09:14We had professionals in to sort that out for us, which was great.
0:09:14 > 0:09:16Once that was all gone,
0:09:16 > 0:09:19a lot of the actual building left was a timber frame.
0:09:19 > 0:09:21So most of that, I took down with a chainsaw.
0:09:23 > 0:09:26And there was also a change to the plans Andrew and Mark submitted
0:09:26 > 0:09:28for planning approval.
0:09:28 > 0:09:31Instead of the two- to three-bed dormer bungalows,
0:09:31 > 0:09:34they went for a three-bed and four-bed house,
0:09:34 > 0:09:37and to their delight, the plans were approved.
0:09:37 > 0:09:40We didn't think we were going to get planning on these two houses,
0:09:40 > 0:09:42but six weeks it had come through.
0:09:42 > 0:09:44And we actually put the digger bucket in,
0:09:44 > 0:09:4712 months to the day we actually bought the place.
0:09:50 > 0:09:53Of the two builds, the four-bed house was more advanced,
0:09:53 > 0:09:56with the upstairs rooms clearly laid out.
0:09:56 > 0:09:59But Andrew was on hand to tell us more about the downstairs layout.
0:10:01 > 0:10:05We're in the kitchen at the moment. We plan to put an L-shape kitchen.
0:10:05 > 0:10:08Under the window, sink there. Units are back there.
0:10:09 > 0:10:12Here is the downstairs toilet,
0:10:12 > 0:10:16leading to the hall and the lounge over there.
0:10:16 > 0:10:18Really like the layout down here.
0:10:18 > 0:10:20Really looking forward to seeing it finished.
0:10:20 > 0:10:21I think it should be fantastic.
0:10:23 > 0:10:27Andrew was excited about the layout, but what was all this going to cost?
0:10:27 > 0:10:33Well, back in 2014, the original budget had been £200,000.
0:10:33 > 0:10:36But that was for building bungalows, not houses.
0:10:36 > 0:10:40We've obviously got a long way to go yet, but the original budget,
0:10:40 > 0:10:44because of planning, we never knew where we were going to be to begin
0:10:44 > 0:10:46with anyway, so it's a big difference.
0:10:46 > 0:10:49I would say we're probably going to be spending
0:10:49 > 0:10:52about another £100,000 to finish the project.
0:10:52 > 0:10:56Hopefully, we will finish one now within the next three months
0:10:56 > 0:10:59and maybe even the other one.
0:10:59 > 0:11:01We haven't really decided yet.
0:11:01 > 0:11:04Having taken care of the bungalow demolition,
0:11:04 > 0:11:07Mark and Andrew were now overseeing the final stage of the build,
0:11:07 > 0:11:12and the completion of the electrical fittings would depend on how much work they'll have on.
0:11:12 > 0:11:14Mark and I, we come in weekends.
0:11:14 > 0:11:17We have a measure up and talk about things, tidy up.
0:11:17 > 0:11:21We'll probably get more involved now as we're at the second-fix stage.
0:11:21 > 0:11:24- There's more things that we can do. - We're starting to really push now.
0:11:24 > 0:11:26What we're trying to do is,
0:11:26 > 0:11:29we're trying to get this one here finished so we can actually get it
0:11:29 > 0:11:32on the market for the summer - well, the end of the summer, really.
0:11:32 > 0:11:34Because that's when they're telling us is the best time to sell.
0:11:34 > 0:11:36I think they will sell.
0:11:36 > 0:11:38I'm pretty sure they will.
0:11:38 > 0:11:40I'm not... No concerns there, really.
0:11:41 > 0:11:45And you know, I'm very pleased with the layouts,
0:11:45 > 0:11:48and hopefully we can give it a good finish,
0:11:48 > 0:11:50and we should be proud of what we've produced.
0:11:50 > 0:11:53Well, I can't wait to see what the finished build looks like.
0:11:53 > 0:11:57Join us later in the show, where all will be revealed.
0:12:01 > 0:12:06Willenhall is located halfway between Wolverhampton and Walsall.
0:12:06 > 0:12:09It's well serviced by both road networks and public transport.
0:12:10 > 0:12:14One of the most famous landmarks in the town is the clock,
0:12:14 > 0:12:17which is dedicated to Dr Joseph Banks.
0:12:17 > 0:12:21He was known as the poor man's doctor for his generosity
0:12:21 > 0:12:24and devotion, trying to help the poorer members of society.
0:12:26 > 0:12:29I'm in this lovely cul-de-sac in Willenhall.
0:12:29 > 0:12:33The M6 is just a few miles away, so the location is good.
0:12:33 > 0:12:38Now, I'm here to see a three-bed semidetached house
0:12:38 > 0:12:43which has a guide price of £19,000-£24,000.
0:12:43 > 0:12:47You heard me right. Now, as I've been walking around this cul-de-sac,
0:12:47 > 0:12:49I've been seeing some really nice houses.
0:12:49 > 0:12:54Now, I think this is my property for today,
0:12:54 > 0:12:58but...is this the one?
0:13:00 > 0:13:01Is this...?
0:13:02 > 0:13:04£19,000-£24,000!
0:13:06 > 0:13:07Let's find out why.
0:13:08 > 0:13:11There has to be a reason, right?
0:13:12 > 0:13:13OK.
0:13:15 > 0:13:20That's me just come through the door, and you can feel it!
0:13:20 > 0:13:23You can feel there's a fall towards the door here.
0:13:23 > 0:13:24Straight away I'm thinking,
0:13:24 > 0:13:28"Ah, that's why it has a guide price of £19,000-£24,000",
0:13:28 > 0:13:32because it's got subsidence. Right, right,
0:13:32 > 0:13:35I might need a bit of help getting to that end of the house!
0:13:35 > 0:13:37Lads, would you mind?
0:13:37 > 0:13:40Thank you very much. Right, hold it...
0:13:40 > 0:13:41Right, you've got the stairs...
0:13:43 > 0:13:44..going up to the bedrooms.
0:13:47 > 0:13:48HE PANTS
0:13:50 > 0:13:51Radiator.
0:13:52 > 0:13:55There's fresh plaster on the ceiling.
0:14:05 > 0:14:07Only kidding! I might have gone over the top,
0:14:07 > 0:14:12but there's definitely subsidence in this house.
0:14:12 > 0:14:14Taking that out the equation, what have we got down here?
0:14:14 > 0:14:18Right, we've got a good sized first reception room.
0:14:18 > 0:14:21Nice, big bay window. Lots of space in here.
0:14:21 > 0:14:24The second reception room is pretty much the same.
0:14:24 > 0:14:27You have got double doors going out on to the back garden,
0:14:27 > 0:14:29and the kitchen itself's a good size.
0:14:29 > 0:14:33It looks like it's had some kind of small extension.
0:14:33 > 0:14:34It's now in an L-shape.
0:14:34 > 0:14:37So, lots of room to play with.
0:14:37 > 0:14:41Very dated, and I say this a lot on Homes Under The Hammer -
0:14:41 > 0:14:44strip it back to bare brick and start again.
0:14:44 > 0:14:47There's space to play with outside, too.
0:14:47 > 0:14:50This semi is blessed with a large plot and a garage.
0:14:50 > 0:14:52The subsidence is also evident here,
0:14:52 > 0:14:55from the cracks and repairs that have been done
0:14:55 > 0:14:57to the exterior walls.
0:14:57 > 0:15:01# As these four wall collide
0:15:01 > 0:15:04# As your whole world subsides... #
0:15:05 > 0:15:09Well, let me show you just how much this house has moved.
0:15:09 > 0:15:13If you look at this, those floors are definitely out.
0:15:13 > 0:15:18Now, if your floors are out, your walls are going to be out as well.
0:15:18 > 0:15:21Clear as day.
0:15:21 > 0:15:25And...your door frame's going to be out, too.
0:15:25 > 0:15:27Basically, everything's out.
0:15:29 > 0:15:32OK, upstairs we've got the bedrooms.
0:15:32 > 0:15:37And we've also got a few cracks on the landing as well.
0:15:37 > 0:15:40Apart from all that, you've got three bedrooms.
0:15:40 > 0:15:44Two really good sized bedrooms just either side of that wall.
0:15:44 > 0:15:47One facing out the front of the house, one facing the back.
0:15:47 > 0:15:49But good double size rooms.
0:15:49 > 0:15:53More of a box bedroom just there, and the bathroom is there,
0:15:53 > 0:15:56which is a good sized bathroom as well.
0:15:56 > 0:15:59There's loads of space to play with downstairs as well.
0:15:59 > 0:16:03You would have to get these floors levelled out, most definitely.
0:16:03 > 0:16:06If you don't mind getting your hands dirty and getting stuck in,
0:16:06 > 0:16:08this could be a project for you.
0:16:09 > 0:16:12We called in an agent from the auction house that sold the property
0:16:12 > 0:16:15to see if he could cast some light on the issue of subsidence
0:16:15 > 0:16:16in the area.
0:16:16 > 0:16:20Apparently, the mining legacy and issues of the subsoil have caused
0:16:20 > 0:16:22problems in the past.
0:16:22 > 0:16:25One of the problems is not necessarily the subsoils,
0:16:25 > 0:16:28because people will build probably better foundations
0:16:28 > 0:16:30that were done here,
0:16:30 > 0:16:32but mine shafts do tend to sort of
0:16:32 > 0:16:36crop up with monotonous regulatory.
0:16:36 > 0:16:38To the rear of the development here,
0:16:38 > 0:16:40there is some land that they were
0:16:40 > 0:16:43originally looking on to build.
0:16:43 > 0:16:47And the chap in the JCB was digging merrily away
0:16:47 > 0:16:48to see what the subsoil
0:16:48 > 0:16:51was like, and found one of the mine shafts.
0:16:51 > 0:16:54Thankfully, although the digger disappeared,
0:16:54 > 0:16:56the driver escaped unscathed.
0:16:56 > 0:16:59According to the agent, this was over 25 years ago,
0:16:59 > 0:17:02and even if you suspect the tale has been exaggerated slightly over
0:17:02 > 0:17:05the years, I'd definitely get a mining report.
0:17:05 > 0:17:08Subsidence can have many causes.
0:17:08 > 0:17:12Soil shrinkage accounts for 75% of insurance claims.
0:17:12 > 0:17:15While drains and trees can also be the source of the problem.
0:17:15 > 0:17:17Regardless of the cause here,
0:17:17 > 0:17:20the agent thinks this is definitely one for a cash buyer,
0:17:20 > 0:17:21and best as a rental opportunity.
0:17:23 > 0:17:27I think anybody that contemplates buying it and doing it up to sell on
0:17:27 > 0:17:30again will hit problems with the settlement.
0:17:30 > 0:17:32A lot of banks and building societies
0:17:32 > 0:17:35still won't contemplate giving a mortgage on it,
0:17:35 > 0:17:40mainly because a lot of the insurance companies won't cover it.
0:17:40 > 0:17:44So, once refurbished, what sort of rental income could this achieve?
0:17:44 > 0:17:47They would be able to let the property in the region
0:17:47 > 0:17:49of £600 per calendar month.
0:17:49 > 0:17:51Guided at £19,000-£24,000,
0:17:51 > 0:17:54what could it achieve on the sales market?
0:17:55 > 0:17:58If it was all done, then the top end on a sale price
0:17:58 > 0:18:02would more than likely be in the region of about £75,000.
0:18:04 > 0:18:06There is a lot of work that needs to be done here,
0:18:06 > 0:18:12and it's not all cosmetic. This is a big corner plot, in a nice area.
0:18:12 > 0:18:15What I would say, it's not a project for the faint-hearted, though.
0:18:15 > 0:18:17Let's see who went for it when it went under the hammer.
0:18:17 > 0:18:20This next lot is a three-bedroomed...
0:18:20 > 0:18:22The auctioneer started well above the guide price,
0:18:22 > 0:18:24and it certainly had some interest.
0:18:24 > 0:18:2650,000, anywhere?
0:18:27 > 0:18:30Thank you, madam, at 50,000. And what a buy this will be.
0:18:30 > 0:18:32At 50,000 I'm bid, and thank you. Is it 60 now?
0:18:33 > 0:18:36At 60. Thank you, sir. I have you first at 60.
0:18:36 > 0:18:38At 60 I'm bid. Is it 70 now?
0:18:38 > 0:18:40At 70 I'm bid.
0:18:40 > 0:18:42Is there 80,000 anywhere?
0:18:42 > 0:18:43At 80,000 I'm bid, and thank you.
0:18:43 > 0:18:45Is it 90 now? No?
0:18:45 > 0:18:47Do you want five, madam?
0:18:47 > 0:18:49Or anywhere? 85.
0:18:49 > 0:18:53Thank you, at 85. 90, sir?
0:18:53 > 0:18:57No? At £85,000, then,
0:18:57 > 0:18:59are we all done?
0:18:59 > 0:19:02Madam, could I see your number?
0:19:02 > 0:19:03Is that 90, sir?
0:19:03 > 0:19:05Thank you. A new bid at 90.
0:19:05 > 0:19:07At 90 I'm bid. Madam, is it 95?
0:19:09 > 0:19:11Do I have 95 anywhere?
0:19:11 > 0:19:13£90,000, one...
0:19:15 > 0:19:16..two...
0:19:17 > 0:19:18..three.
0:19:18 > 0:19:21Congratulations, just the one bid was enough for you, sir.
0:19:21 > 0:19:23Escaping our cameras at the auction,
0:19:23 > 0:19:26but with a massive top bid of £90,000,
0:19:26 > 0:19:28was Prince, on the right,
0:19:28 > 0:19:32and his nephew and property development partner, Jay.
0:19:32 > 0:19:35We met up to find out their plans for this subsiding house,
0:19:35 > 0:19:38which they paid nearly four times over the guide price for.
0:19:38 > 0:19:41- Prince, nice to meet you.- Hello, how are you?- Congratulations.
0:19:41 > 0:19:44- Jay, same to you.- Nice to meet you.
0:19:44 > 0:19:47- Right, let's start at the beginning.- All right.
0:19:47 > 0:19:49Subsidence. Did you view the property?
0:19:49 > 0:19:51Did you know it had subsidence? Talk to me, tell me.
0:19:51 > 0:19:54Well, we didn't actually view the property.
0:19:54 > 0:19:55I wasn't at the auction on the day.
0:19:58 > 0:20:01Prince was at the auction, and what we've got,
0:20:01 > 0:20:03we've got somebody local who's part of our team,
0:20:03 > 0:20:06who normally does the works. He had a look.
0:20:06 > 0:20:09He had a look from outside, as far as we know.
0:20:09 > 0:20:11We know he didn't look inside.
0:20:11 > 0:20:14So, subsidence, we didn't quite know.
0:20:14 > 0:20:16We've come to know,
0:20:16 > 0:20:19and, yeah, we're going to have to deal with it.
0:20:19 > 0:20:22Oh, dear! Sending someone you trust to view
0:20:22 > 0:20:24is better than not viewing at all.
0:20:24 > 0:20:29But not seeing inside was a crucial mistake, and has meant that they
0:20:29 > 0:20:30have bid way more than was wise.
0:20:30 > 0:20:32People, you know what I'm going to say,
0:20:32 > 0:20:34I've said it before and I'll say it again.
0:20:34 > 0:20:37If it looks too good to be true, it probably is.
0:20:38 > 0:20:40Originally, what had happened is,
0:20:40 > 0:20:43the potential which they noticed on paper
0:20:43 > 0:20:47was the land, and the potential to either build a separate plot
0:20:47 > 0:20:48or to extend the property,
0:20:48 > 0:20:51and the idea is if we can get the planning permission,
0:20:51 > 0:20:54separate the plot off, do the legals and sell that separately
0:20:54 > 0:20:57to the house once refurbished, so we've got the two parts
0:20:57 > 0:21:01and that's the maximum sort of return we can make on this.
0:21:01 > 0:21:05Prince and Jay reckon a plot for a two-bed house at the side is
0:21:05 > 0:21:10the way to go. It sounds good in theory but, again, do some homework.
0:21:10 > 0:21:14The subsoil the agent mentioned could be an issue.
0:21:14 > 0:21:18Even if modern foundations would fare better than this original house,
0:21:18 > 0:21:20it would still put buyers off.
0:21:20 > 0:21:22So, what are their plans for the semi?
0:21:22 > 0:21:26We're going to sell it. Basically, we are just doing a development,
0:21:26 > 0:21:29just basically trying to make some money out of it,
0:21:29 > 0:21:31- so we can reinvest again in another property.- OK.
0:21:31 > 0:21:33That's how we look, actually.
0:21:33 > 0:21:35- You spent a lot of money on this property.- Mm.
0:21:35 > 0:21:38- A lot over the guide price.- Yes. - We've had a look at the market.
0:21:38 > 0:21:41We've had a look at what's on the market around here,
0:21:41 > 0:21:43and there's one a few doors away,
0:21:43 > 0:21:46without the extra sort of space and land.
0:21:46 > 0:21:48It's on the market at £140,000.
0:21:48 > 0:21:50- OK.- So, that's all pristine condition.
0:21:50 > 0:21:53So, we've still got a margin to play with here.
0:21:53 > 0:21:56You know, there's one down the road, smaller, £120,000.
0:21:56 > 0:21:58So, we've still got a margin to play with here.
0:21:58 > 0:22:01- OK.- We didn't realise it's going to be major work needing to be done.
0:22:01 > 0:22:04But sometimes you have to take a gamble in business.
0:22:04 > 0:22:06You make some profit from one property,
0:22:06 > 0:22:07and then you lost something.
0:22:07 > 0:22:10But overall, we think we should be OK.
0:22:10 > 0:22:13That's why I feel confident because business is something you have to
0:22:13 > 0:22:15be prepared, loss and profit.
0:22:16 > 0:22:21Prince and Jay's company paid £66,000 more than the guide price.
0:22:21 > 0:22:24Beside the extra work caused by the subsidence,
0:22:24 > 0:22:27they wanted to do a basic standard refurb
0:22:27 > 0:22:29using their regular workforce.
0:22:29 > 0:22:32It begs the question - what's the budget?
0:22:32 > 0:22:34Originally the budget was £10,000.
0:22:34 > 0:22:36- OK.- We won't get it done with £10,000.
0:22:36 > 0:22:39We're quite aware of that with all the structural works, et cetera.
0:22:39 > 0:22:44We are probably looking sort of in the region of £20,000
0:22:44 > 0:22:48- on the works now.- OK.- If we keep everything very tight.
0:22:48 > 0:22:50How long's it going to take?
0:22:50 > 0:22:52We'd like to have this part ready and done
0:22:52 > 0:22:53- within three months.- OK.
0:22:53 > 0:22:56And the planning has got an eight-week process.
0:22:57 > 0:22:59Our architect's talking for pre-application advice.
0:22:59 > 0:23:02We'll find out what can be done or can't be done.
0:23:02 > 0:23:04If it can't be done, we'll just move on and carry on,
0:23:04 > 0:23:06a bit like what Prince said.
0:23:06 > 0:23:11We bite the bullet and carry on and sell it with it, perhaps
0:23:11 > 0:23:14sort the garage out, so there's a proper garage there
0:23:14 > 0:23:15and then sell it on.
0:23:15 > 0:23:18- Prince, good luck. - Pleasure meeting you.
0:23:18 > 0:23:21- Hope it all works out for you. - Thank you.- Jay, same to you, pal.
0:23:21 > 0:23:24- Good luck to you.- It was lovely meeting you.- Pleasure.- Thank you.
0:23:25 > 0:23:29This is why I always bang on about reading the legal pack
0:23:29 > 0:23:31and viewing the property.
0:23:31 > 0:23:36Jay and Prince had no idea that this place had subsidence.
0:23:36 > 0:23:39So their budget has gone out the window.
0:23:39 > 0:23:43They also are trying to get planning right there
0:23:43 > 0:23:45to build another two-bed house.
0:23:45 > 0:23:48All I can say is, good luck, lads.
0:23:48 > 0:23:50I wish you all the best.
0:23:50 > 0:23:52You can find out how they get on later in the programme.
0:23:55 > 0:23:58Still to come - there are big plans
0:23:58 > 0:24:00for this two up, two down in Watford.
0:24:00 > 0:24:06From floor to ceiling, it's going to be completely brand-new in here.
0:24:06 > 0:24:08And back in Willenhall -
0:24:08 > 0:24:10after buying that cracking property,
0:24:10 > 0:24:13we find out if Jay and Prince managed to smooth things over.
0:24:18 > 0:24:20But before all of that, let's head back to Cornwall,
0:24:20 > 0:24:24where we first met Andrew and Mark in 2014.
0:24:25 > 0:24:30They had purchased this two-bed bungalow at auction for £132,000,
0:24:30 > 0:24:33and there was only one thing on their minds.
0:24:34 > 0:24:36The overall idea of it is to knock it down,
0:24:36 > 0:24:40and hopefully to build two houses.
0:24:40 > 0:24:43But before this quirky construction was reduced to rubble,
0:24:43 > 0:24:45it would serve one final purpose,
0:24:45 > 0:24:49a temporary home for Mark and his girlfriend, Tamsin.
0:24:49 > 0:24:52- Girlfriend's not very happy about it.- Oh, right! Why not?
0:24:52 > 0:24:55Well, from what I'm living in now to living in this
0:24:55 > 0:24:57is a little bit different, really.
0:24:57 > 0:24:59As it turned out, it leaked like a sieve,
0:24:59 > 0:25:02so Tamsin was spared that ordeal.
0:25:02 > 0:25:04Fast forward now to 2016,
0:25:04 > 0:25:07and the porous bungalow was long gone,
0:25:07 > 0:25:12and in its place stood two new but, as yet, unfinished houses.
0:25:12 > 0:25:14# How long
0:25:14 > 0:25:16# Has this been going on? #
0:25:18 > 0:25:20Good question! By that point it was two years,
0:25:20 > 0:25:22and most of the delay was down to a change of plan
0:25:22 > 0:25:26about what they were going to build here.
0:25:26 > 0:25:29We didn't think we were going to get planning on these two houses,
0:25:29 > 0:25:30but six weeks it had come through.
0:25:30 > 0:25:33And we actually put the digger bucket in
0:25:33 > 0:25:3512 months to the day we actually bought the place.
0:25:35 > 0:25:39The four-bed house was nearer completion than its three-bedroomed
0:25:39 > 0:25:43neighbour. But Andrew was relaxed about timescales.
0:25:43 > 0:25:48Hopefully, we will finish one now within the next three months,
0:25:48 > 0:25:52and maybe even the other one. We haven't really decided yet.
0:25:52 > 0:25:56Would Andrew and Mark manage to drag this project over the finishing line?
0:25:56 > 0:25:58Or would the money run out?
0:25:58 > 0:26:01Would they manage to make a profit?
0:26:01 > 0:26:02So many questions.
0:26:02 > 0:26:05The only way to find out the answers, nine months later,
0:26:05 > 0:26:08after our last visit to the building site, we're going back.
0:26:19 > 0:26:21A beautiful Cornwall day shows off
0:26:21 > 0:26:24this sparkling project to perfection.
0:26:24 > 0:26:27The four-bedroomed house has been finished,
0:26:27 > 0:26:29and it's just awaiting carpets.
0:26:29 > 0:26:31The stunning kitchen and dining area
0:26:31 > 0:26:35illustrates just how much space this building has.
0:26:35 > 0:26:39The living room is equally spacious, and both feature sliding
0:26:39 > 0:26:43patio doors that lead out into the landscaped back garden.
0:26:43 > 0:26:47There's also a downstairs toilet and a large integrated garage.
0:26:48 > 0:26:53Upstairs, the pick of the four rooms has to be the master bedroom,
0:26:53 > 0:26:55complete with dressing room,
0:26:55 > 0:27:00en suite bathroom and stunning views across Bodmin Moor.
0:27:00 > 0:27:01The other three bedrooms
0:27:01 > 0:27:04are a really good size, and the accommodation is
0:27:04 > 0:27:07completed by a large family bathroom.
0:27:09 > 0:27:11We chose not the cheapest products.
0:27:11 > 0:27:13We tried to use good things throughout,
0:27:13 > 0:27:15hoping it would enhance the value of the property.
0:27:15 > 0:27:17As you drive up to the actual building now,
0:27:17 > 0:27:20and seeing the actual end product, the four bedroom,
0:27:20 > 0:27:24it really stands out, it's a fantastic building
0:27:24 > 0:27:28and it's something to be proud of.
0:27:28 > 0:27:31Next door, the three-bedroomed house is lagging behind,
0:27:31 > 0:27:33but Andrew isn't that worried.
0:27:33 > 0:27:36Timescale was never really a problem to us.
0:27:36 > 0:27:39It was going to be what it was going to be.
0:27:39 > 0:27:43It was obviously our aim to get one to market to sell it,
0:27:43 > 0:27:46to enable us to finish the second property.
0:27:46 > 0:27:49And that's exactly what they've done.
0:27:49 > 0:27:53The four-bed house has recently been sold, and Andrew is looking forward
0:27:53 > 0:27:55to receiving the funds to finish the three-bed.
0:27:57 > 0:28:01I would say from today, to finish the three-bed,
0:28:01 > 0:28:04we're probably looking another three months
0:28:04 > 0:28:06to get the quality that we want.
0:28:06 > 0:28:10The timescale has been flexible and so has the budget.
0:28:10 > 0:28:13Back in 2014, Andrew costed
0:28:13 > 0:28:16two bungalows at £200,000.
0:28:16 > 0:28:21Revising their budget to £300,000 for two houses.
0:28:21 > 0:28:25Now it looks like £350,000 will finish the job.
0:28:25 > 0:28:27But hopefully, their profit will climb, too.
0:28:30 > 0:28:32With one down and one to go,
0:28:32 > 0:28:36what will two property experts think of this new development?
0:28:36 > 0:28:39The layout with the kitchen fitments in,
0:28:39 > 0:28:42you can see it's a good sized family kitchen-living room.
0:28:42 > 0:28:43Garage is excellent.
0:28:43 > 0:28:46Finished off with the utility area.
0:28:46 > 0:28:50The main bedroom, with the dressing room and en suite really sets it apart.
0:28:50 > 0:28:52It's a really good finish, of a high standard.
0:28:52 > 0:28:54I think they're in really good position,
0:28:54 > 0:28:56the vendors have really thought about what buyers want.
0:28:56 > 0:28:59What families will be living like when they live here,
0:28:59 > 0:29:01so they've positioned them very, very well.
0:29:01 > 0:29:04Both like what Andrew and Mark have produced here,
0:29:04 > 0:29:07but in the almost three years since this plot was purchased,
0:29:07 > 0:29:09how has the housing market developed?
0:29:09 > 0:29:14Since I last saw it, the property market's improved,
0:29:14 > 0:29:17particularly in the higher-priced properties in this region,
0:29:17 > 0:29:19which is above £250,000.
0:29:19 > 0:29:21There is a high demand for properties in this area.
0:29:21 > 0:29:24Obviously, we've got people waiting that would love to buy.
0:29:24 > 0:29:28Obviously, there is a short supply of three-, four-bedroomed properties.
0:29:28 > 0:29:30On to the sales values.
0:29:30 > 0:29:33There's already been a price agreed for the four-bed house,
0:29:33 > 0:29:37but how close will the agents' valuations be?
0:29:37 > 0:29:39I think for a property in this area, I would put a value on it
0:29:39 > 0:29:41of about £350,000.
0:29:41 > 0:29:44Hoping to get offers of £340,000 and above.
0:29:44 > 0:29:47I would expect it to be on the market around £350,000.
0:29:47 > 0:29:51And because of the standard it's got and just the way it appeals,
0:29:51 > 0:29:54the selling price ought to be £330,000 to £340,000.
0:29:54 > 0:29:56I don't see it going below that.
0:29:56 > 0:29:59We have actually sold this property for £330,000.
0:29:59 > 0:30:03It just proves to me that the prospective buyer's got a bargain.
0:30:05 > 0:30:08But will Andrew and Mark be laughing all the way to the bank?
0:30:08 > 0:30:13With total costs estimated to reach £482,000,
0:30:13 > 0:30:16the sale of the four-bed house will go some way towards paying the bills.
0:30:16 > 0:30:20But they need another £152,000 to break even.
0:30:20 > 0:30:23So what can they expect to get for the three-bed?
0:30:23 > 0:30:25Although it's a three-bedroom,
0:30:25 > 0:30:27size-wise, you could put four bedrooms into it.
0:30:27 > 0:30:31And I think somebody appreciating size, quality and space,
0:30:31 > 0:30:34and again the views from there to Bodmin Moor,
0:30:34 > 0:30:37I can see that one achieving £300,000.
0:30:37 > 0:30:40A three-bedroomed property would be valued at £320,000,
0:30:40 > 0:30:43looking to get any offers above £300,000 and £310,000.
0:30:43 > 0:30:46I would say, spot on.
0:30:46 > 0:30:49So, if they did manage to get £300,000 for the second house,
0:30:49 > 0:30:53that would leave them with a potential profit, before tax,
0:30:53 > 0:30:55of around £148,000.
0:30:55 > 0:30:57As his property adventure comes to a close,
0:30:57 > 0:31:02a different sort of adventure is just about to begin for Mark.
0:31:02 > 0:31:05I've just had a little boy.
0:31:05 > 0:31:07He's two weeks old now.
0:31:07 > 0:31:10So, it would be nice to finish off and actually spend some time with him.
0:31:10 > 0:31:14With the patter of tiny feet making demands on Mark's spare time,
0:31:14 > 0:31:17I wish him good luck in finishing in three months!
0:31:17 > 0:31:20So, is Granddad Andrew keen to buy at auction again?
0:31:22 > 0:31:27For me, at the beginning of this year, I had one grandchild,
0:31:27 > 0:31:30by the end of the year I will have four.
0:31:30 > 0:31:31It means we've got to do it again,
0:31:31 > 0:31:34because I've got to earn some money to take them to Disneyland!
0:31:40 > 0:31:44Watford is a town in Hertfordshire which is well located.
0:31:44 > 0:31:48Close to the M25 and M1 motorways, with their links to London,
0:31:48 > 0:31:49Midlands and the North.
0:31:49 > 0:31:51It's also home to the Colosseum,
0:31:51 > 0:31:53which was built in 1938,
0:31:53 > 0:31:58and earned a worldwide reputation for its fine acoustics.
0:31:58 > 0:32:01It's been used to record well-known film soundtracks,
0:32:01 > 0:32:04including The Lord Of The Rings and The Sound of Music.
0:32:04 > 0:32:07It's also been the venue for acts such as The Who,
0:32:07 > 0:32:09Oasis and Robbie Williams.
0:32:09 > 0:32:14# Let me entertain you. #
0:32:16 > 0:32:19On that note, it's time for me to entertain you,
0:32:19 > 0:32:21and show you around an auction property.
0:32:22 > 0:32:26A ten-minute walk from Watford's high street, and I'm on this popular
0:32:26 > 0:32:30residential road, which is home to the two-bed terrace I'm here to see.
0:32:30 > 0:32:34It had a guide price of £310,000.
0:32:34 > 0:32:38This is it. Is it just me, or does it look really narrow from outside?
0:32:38 > 0:32:41Best go inside to see if it's such a squeeze inside.
0:32:44 > 0:32:46Yes, it is small.
0:32:46 > 0:32:48But, you know, pretty well proportioned.
0:32:48 > 0:32:50It's a square room.
0:32:50 > 0:32:54What is more concerning, however, is this - very obvious signs of damp.
0:32:54 > 0:32:57You really want to get that checked out.
0:32:57 > 0:32:59Is it rising damp?
0:32:59 > 0:33:01Is it coming up, or is it penetrating damp?
0:33:01 > 0:33:04It is being caused by a leak or a burst drain?
0:33:04 > 0:33:08Such a shame in a Victorian property not to see an original fireplace.
0:33:08 > 0:33:12That's obviously been put in. You'd probably want to take it out again,
0:33:12 > 0:33:14because it's pretty dated now.
0:33:14 > 0:33:18Current building regulations would never allow you stairs that steep.
0:33:18 > 0:33:19They're really steep.
0:33:19 > 0:33:24And through to another pretty well-proportioned room.
0:33:24 > 0:33:25Woodchip on the walls.
0:33:25 > 0:33:29You've got sliding doors over here, which...
0:33:30 > 0:33:33..not only dated, probably not the safest.
0:33:33 > 0:33:35Definitely want to take them out.
0:33:35 > 0:33:39I'd say anyone buying or renting this would expect the property
0:33:39 > 0:33:42to have central heating. A bit of an expense, but well worth it.
0:33:43 > 0:33:45A poky kitchen.
0:33:45 > 0:33:48Really poky and again very dated.
0:33:48 > 0:33:50You'd want to rip that out.
0:33:50 > 0:33:53And here we have a dilapidated-looking lean-to.
0:33:53 > 0:33:56This is your only source of natural light,
0:33:56 > 0:33:59so the place has a feel of just being gloomy,
0:33:59 > 0:34:02and it definitely needs a lot of work.
0:34:05 > 0:34:08One thing I haven't found yet is the bathroom,
0:34:08 > 0:34:09and that could be good news,
0:34:09 > 0:34:12as it means it has already been moved up to the first floor.
0:34:12 > 0:34:16I'll check that out shortly, but first, I'm heading outside.
0:34:18 > 0:34:21Upon closer inspection, this lean-to
0:34:21 > 0:34:24is actually even more flimsy than I first expected.
0:34:24 > 0:34:27So, away with it, I say. Probably the same for this.
0:34:27 > 0:34:29These outbuildings aren't really doing much.
0:34:29 > 0:34:30They're not adding much at all.
0:34:30 > 0:34:33If you did get rid of them, you would create a bigger garden,
0:34:33 > 0:34:37because here we are in a garden that is not huge and you could make it
0:34:37 > 0:34:40bigger, or you could extend.
0:34:40 > 0:34:44Taking away these outbuildings, and if you were to extend within the
0:34:44 > 0:34:46three metres permitted,
0:34:46 > 0:34:49then you would have no need to seek planning permission.
0:34:49 > 0:34:54And an idea would be to make the kitchen-dining area big, open,
0:34:54 > 0:34:56create some natural light coming in.
0:34:56 > 0:35:00You're adding value and all of a sudden things are looking up.
0:35:00 > 0:35:03- # Suddenly I see - Suddenly I see
0:35:03 > 0:35:05# This is what I want to be. #
0:35:05 > 0:35:08Suddenly the prospect for this house isn't so gloomy.
0:35:08 > 0:35:13Now, permitted development rights do allow alterations without planning
0:35:13 > 0:35:15permission, but I always recommend
0:35:15 > 0:35:17you contact your local planning department first.
0:35:17 > 0:35:21Certain types of work might need a planning application in some areas,
0:35:21 > 0:35:23but not in others.
0:35:23 > 0:35:26And of course you still need to comply with building regs,
0:35:26 > 0:35:30and when you see those stairs, you can see how having those regulations
0:35:30 > 0:35:32has improved things over the years.
0:35:33 > 0:35:36Yep, those stairs are as steep as they look.
0:35:36 > 0:35:38Made it to the top to a first bedroom,
0:35:38 > 0:35:40which is a really good size.
0:35:40 > 0:35:44Huge window, but I'd like to see a bit more character.
0:35:44 > 0:35:47It seems that a lot of the features have been ripped out.
0:35:47 > 0:35:49There's no original fireplaces.
0:35:49 > 0:35:53You have polystyrene roof tiles, which definitely need to come off.
0:35:53 > 0:35:55They're a real fire hazard.
0:35:55 > 0:35:58Woodchip on the walls, which can be a nightmare to come off.
0:35:58 > 0:36:03Now, I said it was a good thing that the bathroom must be upstairs.
0:36:03 > 0:36:04I hadn't found it downstairs.
0:36:04 > 0:36:08Still true. But I still haven't got to it.
0:36:08 > 0:36:09I'm still walking.
0:36:09 > 0:36:14Yes, you have to walk through a bedroom to access your bathroom.
0:36:14 > 0:36:19This is never ideal, whether you want to rent this out or sell it on.
0:36:19 > 0:36:22Who wants to walk through someone else's bedroom
0:36:22 > 0:36:25to get to the bathroom in the middle of the night?
0:36:25 > 0:36:27No, you have to change the layout.
0:36:27 > 0:36:30Now, the way to do this is pretty costly,
0:36:30 > 0:36:32but you would flip the stairs around.
0:36:32 > 0:36:36You would change the layout so that there's a corridor along here,
0:36:36 > 0:36:38so you can access your bathroom.
0:36:38 > 0:36:41A lot to do. Quite a lot of money.
0:36:41 > 0:36:42But it could just work.
0:36:42 > 0:36:46And I'd also extend the bathroom into this tiny boxroom.
0:36:46 > 0:36:50Can't see what use it is, and it would be much nicer to have a
0:36:50 > 0:36:52window in the bathroom.
0:36:54 > 0:36:57So, that's the house tour, but what about the neighbourhood?
0:36:57 > 0:37:00It's time to hear from a local estate agent.
0:37:02 > 0:37:04This road is a very popular road.
0:37:04 > 0:37:07A lot of people are buying in the area to get their children into the
0:37:07 > 0:37:10girls' school, so there's a lot of families buying in this area,
0:37:10 > 0:37:13and also there's a lot of people buying for investment
0:37:13 > 0:37:16to rent to families that also want to get into the girls' school.
0:37:18 > 0:37:22A popular school in the area will always push up property prices.
0:37:22 > 0:37:26And so, can she take an educated guess as to how much this place
0:37:26 > 0:37:28could fetch when fully refurnished?
0:37:28 > 0:37:33If the property was renovated, I'd expect the property to reach
0:37:33 > 0:37:36£350,000-£360,000 on the sale side.
0:37:36 > 0:37:41On the rental side, £1,250 to £1,295 per calendar month.
0:37:42 > 0:37:46The agent also reckons that although building a rear extension will make
0:37:46 > 0:37:48the property more sellable,
0:37:48 > 0:37:51it might only add £10,000 to the resale value.
0:37:53 > 0:37:55This property is not without its issues.
0:37:55 > 0:37:59Not least that damp and the first-floor layout.
0:37:59 > 0:38:02But if you have the budget to throw some money at it,
0:38:02 > 0:38:04it's got loads of potential,
0:38:04 > 0:38:06especially if you take that option to extend.
0:38:06 > 0:38:09Let's find out who agreed when it went under the hammer.
0:38:11 > 0:38:12Watford, Hertfordshire.
0:38:12 > 0:38:15Unfortunately we're unable to show you the bidding for this lot.
0:38:15 > 0:38:20But it sold for bang on the guide price for £310,000.
0:38:21 > 0:38:23Sold, 310.
0:38:27 > 0:38:30Lee came along to tell us his plans for the property,
0:38:30 > 0:38:34however, he wasn't the person who parted with the readies for this
0:38:34 > 0:38:35two up, two down.
0:38:37 > 0:38:41- Lee, congratulations.- Thank you.- So, you weren't at the auction yourself.
0:38:41 > 0:38:43What's your involvement with this property?
0:38:43 > 0:38:45So, we've got a client of ours,
0:38:45 > 0:38:48who's obviously bought this property with a view of redeveloping it,
0:38:48 > 0:38:51and I'm going to help him with the redevelopment through our architects
0:38:51 > 0:38:53- and structural engineers.- OK.
0:38:53 > 0:38:56When you say a client of yours, what is it you do?
0:38:56 > 0:39:00I'm an estate agent. He's bought properties through me previously.
0:39:00 > 0:39:03I've got a brand-new agency and with the brand-new agency,
0:39:03 > 0:39:06what I'm looking to do to take things to new levels is to
0:39:06 > 0:39:10attend auctions where needed, if clients can't make it,
0:39:10 > 0:39:13purchase properties on their behalf and help with the redevelopment,
0:39:13 > 0:39:16- with the team we've got in place. - Do you know this area?
0:39:16 > 0:39:20Yes. Yeah, yeah, we know the area well. It's a growing area.
0:39:20 > 0:39:22We're very, very close to the hospital,
0:39:22 > 0:39:24which thousands of employees and stuff at the hospital,
0:39:24 > 0:39:27close to the football club as well.
0:39:27 > 0:39:28And over the next couple of years,
0:39:28 > 0:39:31there's going to be some train stations real close by as well,
0:39:31 > 0:39:35linking into Watford Junction. So it's absolutely a growing area.
0:39:35 > 0:39:39You think you can get some profit from here if you do it up?
0:39:39 > 0:39:42Yeah. The long-term plan is to let the property out,
0:39:42 > 0:39:45so we're not looking to make a quick buck on it
0:39:45 > 0:39:48in terms of a resale point of view.
0:39:48 > 0:39:51Watford is an area just north of London.
0:39:51 > 0:39:53We get a lot of the London market coming out this way.
0:39:53 > 0:39:56It's still a very, very easy commute back into central London
0:39:56 > 0:39:59for a completely different lifestyle.
0:39:59 > 0:40:01How long would the commute be into central London?
0:40:01 > 0:40:03Once the new station, things are put in place here,
0:40:03 > 0:40:06you're probably looking at 20 minutes max.
0:40:06 > 0:40:09Great! Let's talk through what there is to be done, because it's quite
0:40:09 > 0:40:11- dated.- Do you think so?
0:40:11 > 0:40:16Well, you know the sliding doors and there's a lot that needs replaced.
0:40:16 > 0:40:19What are your plans? What's most of your budget going to go on?
0:40:19 > 0:40:21The whole house needs doing. It completely needs gutting,
0:40:21 > 0:40:23so from floor to ceiling,
0:40:23 > 0:40:26it's going to be completely brand-new in here.
0:40:26 > 0:40:28We're looking to extend out the back as well.
0:40:28 > 0:40:30Single-storey extension out the back,
0:40:30 > 0:40:34with a loft conversion to give it a real good sized double bedroom up there,
0:40:34 > 0:40:36with an en-suite bathroom as well.
0:40:36 > 0:40:38In terms of the interior space right now,
0:40:38 > 0:40:41it's just going to be a case of re-modernising the whole thing.
0:40:41 > 0:40:43Ripping it all down, starting from scratch.
0:40:43 > 0:40:45It's going to take more than a feather duster, this place, anyway.
0:40:45 > 0:40:48And the bathroom which is upstairs -
0:40:48 > 0:40:52good it's upstairs - not great you can only access it through a bedroom.
0:40:52 > 0:40:55Do you have plans to change the layout of that first floor?
0:40:55 > 0:40:58We do. Yeah. I mean I put a lot in the hands of our architects and
0:40:58 > 0:41:02structural engineers, obviously professionals in their field.
0:41:02 > 0:41:05So we will play around with the structure slightly to make sure that
0:41:05 > 0:41:09we've got a proper landing space upstairs to try and get the bathroom
0:41:09 > 0:41:12off the landing, as well as incorporating going up into the loft as well.
0:41:12 > 0:41:14So, we're going to be turning it into a three-bed,
0:41:14 > 0:41:18two-bath instead of the two that it is now.
0:41:18 > 0:41:22This place is going to change massively over the next kind of 10-12 weeks.
0:41:22 > 0:41:24So, yeah, I'm looking forward to seeing the end kind of product.
0:41:24 > 0:41:27- 12 weeks?- Mm.
0:41:27 > 0:41:2912 weeks!
0:41:29 > 0:41:32There's an awful lot to do - structurally, there's a lot to do.
0:41:32 > 0:41:34Yeah. I know we're going to meet the timescales we set out with the
0:41:34 > 0:41:38architect team we that we've got in place with the structural guys we've
0:41:38 > 0:41:41got in place as well. 12 weeks will be achievable.
0:41:41 > 0:41:43We're probably a week away from start.
0:41:43 > 0:41:44What about budget?
0:41:44 > 0:41:48So we're looking at up to £100,000.
0:41:48 > 0:41:50- Substantial?- Yeah.
0:41:50 > 0:41:52It's a serious client.
0:41:52 > 0:41:55He's not in the game of kind of making a quick buck,
0:41:55 > 0:41:57but having extremely unhappy tenants and things like that.
0:41:57 > 0:41:59For us, it's the bigger picture,
0:41:59 > 0:42:03making sure we've got a happy family living here, moving forward.
0:42:03 > 0:42:06With that, we want to present them with a beautiful home.
0:42:10 > 0:42:14Short term, Lee has his hands full with this project for a couple of
0:42:14 > 0:42:16months, but he's got a few properties of his own
0:42:16 > 0:42:19and aims to build up that side of the business,
0:42:19 > 0:42:21and all for a very special reason.
0:42:24 > 0:42:28# Doing it all for my baby. #
0:42:28 > 0:42:31My long-term plan is just to create a better life for my son.
0:42:31 > 0:42:33Whether that be through the agency that I've got,
0:42:33 > 0:42:36leaving him something which is a huge agency -
0:42:36 > 0:42:39We're looking to expand over the next couple of years -
0:42:39 > 0:42:41or through the properties that I've got.
0:42:41 > 0:42:44Either or, just as long as I know I'm doing something for him moving
0:42:44 > 0:42:46forward. So if it's to be more properties,
0:42:46 > 0:42:50- then it's to be more properties. - How old's he?- Two and a half.
0:42:50 > 0:42:52- And he's an absolute diamond. - Of course he is.
0:42:52 > 0:42:55By the time he's 18 you could have a huge portfolio.
0:42:55 > 0:42:56Yeah, yeah, absolutely.
0:42:56 > 0:43:00- I can't wait to see what you do with the place. Good luck!- Thank you.
0:43:02 > 0:43:05Well, Lee has a big budget for lots of plans,
0:43:05 > 0:43:08and hopefully a huge transformation.
0:43:08 > 0:43:11What isn't so big is that timescale - 12 weeks.
0:43:11 > 0:43:15Will he get it done in time? And will his client be happy?
0:43:15 > 0:43:16You can find out later in the show.
0:43:20 > 0:43:25Now, even very experienced property developers can miss deadlines
0:43:25 > 0:43:28- and go over budget.- Yeah, even the simplest of budgets
0:43:28 > 0:43:30can sometimes throw a major curveball.
0:43:30 > 0:43:33Yes, so have our two remaining buyers stuck to their budgets
0:43:33 > 0:43:35and timescales? Let's find out.
0:43:39 > 0:43:42It's back to the West Midlands now and the town of Willenhall,
0:43:42 > 0:43:45where, earlier, I found getting around this three-bed
0:43:45 > 0:43:47semidetached house a bit of a struggle.
0:43:47 > 0:43:51Straight away, I'm thinking, "Ah, that's why it has a guide price
0:43:51 > 0:43:55"of £19,000-£24,000, because it's got subsidence."
0:43:55 > 0:43:57Right, right,
0:43:57 > 0:43:59I might need a bit of help getting to that end of the house.
0:43:59 > 0:44:02Lads, would you mind?
0:44:02 > 0:44:04Thank you very much. Hold it.
0:44:04 > 0:44:07OK. Go upstairs, radiator.
0:44:10 > 0:44:12Fresh plaster on the ceiling.
0:44:12 > 0:44:16The early signs weren't encouraging, and since I like to think I'm a
0:44:16 > 0:44:19straight talker, I'm going to level with you.
0:44:19 > 0:44:23If you look at this, those floors are definitely out.
0:44:23 > 0:44:25Now, if your floors are out,
0:44:25 > 0:44:29your walls are going to be out as well. Clear as day.
0:44:30 > 0:44:32Basically, everything's out.
0:44:42 > 0:44:46It was business partners Jay and Prince who forked out £90,000
0:44:46 > 0:44:49for this sloping semi, but were they really aware
0:44:49 > 0:44:51of just how big a challenge they faced?
0:44:51 > 0:44:54Well, we didn't actually view the property.
0:44:54 > 0:44:55I wasn't at the auction on the day.
0:44:59 > 0:45:02Prince was at the auction and what we've got, we've got somebody local.
0:45:02 > 0:45:06He had a look, he had a look from outside, as far as we know.
0:45:06 > 0:45:08We know he didn't look inside.
0:45:08 > 0:45:11So subsidence, we didn't quite know.
0:45:11 > 0:45:13We've come to know,
0:45:13 > 0:45:16and, yeah, we're going to have to deal with it.
0:45:17 > 0:45:21And their plan to deal with it involved renovating the existing property,
0:45:21 > 0:45:22dividing the plot into two
0:45:22 > 0:45:26and applying for planning permission to build a two-bed house,
0:45:26 > 0:45:29but they were well aware that this was a risky proposition.
0:45:29 > 0:45:33We didn't realise it's going to be major work needed to be done.
0:45:33 > 0:45:35But sometimes you have to take a gamble.
0:45:47 > 0:45:51Well, Jay and Prince certainly took a gamble with this property.
0:45:51 > 0:45:54We've returned six months later to see if it's paid off.
0:46:04 > 0:46:08I think these pictures indicate that not much has happened here.
0:46:08 > 0:46:10There's been a bit of a tidy up.
0:46:10 > 0:46:13And outside, the garage has been taken down.
0:46:13 > 0:46:16But the house is still standing, which is a positive.
0:46:17 > 0:46:21With Jay otherwise engaged, we caught up with Prince and Mohammed,
0:46:21 > 0:46:23who is the third partner in the business,
0:46:23 > 0:46:26to find out exactly what's been going on.
0:46:26 > 0:46:28When we begin, when we bought it actually,
0:46:28 > 0:46:31we had a quotation from the builders regarding underpinnings,
0:46:31 > 0:46:35and they said it's going to be £30,000, roughly.
0:46:35 > 0:46:38Even then, that's the price they quoted. It might go over that.
0:46:38 > 0:46:40So we had some quotations with a local estate agents,
0:46:40 > 0:46:43what sort of price we can sell the property for.
0:46:43 > 0:46:45They said £130,000-£140,000,
0:46:45 > 0:46:49and there's quite a lot of extra land just off the property,
0:46:49 > 0:46:52and then we decided that's a long process because we
0:46:52 > 0:46:57haven't got much time and we thought it's not advisable to do this.
0:46:57 > 0:47:00Rather we sell that in auction and get the money out and reinvest
0:47:00 > 0:47:03in somewhere is more advisable.
0:47:11 > 0:47:15Facing a scenario where the area ceiling price of £140,000
0:47:15 > 0:47:18would prevent them from making a workable profit,
0:47:18 > 0:47:20the house was put back into auction.
0:47:20 > 0:47:21The next gamble was,
0:47:21 > 0:47:25could they recoup the purchase price of £90,000,
0:47:25 > 0:47:27plus fees of £7,000?
0:47:27 > 0:47:29It was sold for £87,000
0:47:29 > 0:47:33and the buyer actually paid £10,000 as a deposit,
0:47:33 > 0:47:36which is non-refundable.
0:47:36 > 0:47:39So I think the buyer was struggling to get the finance,
0:47:39 > 0:47:40so he backed out,
0:47:40 > 0:47:43so we got £10,000 from that deposit.
0:47:43 > 0:47:46So that cut down from £97,000
0:47:46 > 0:47:47to £87 ,000.
0:47:50 > 0:47:55But if at first you don't succeed, put it back up for sale at auction.
0:47:55 > 0:47:59So, now we've resold the property again at auction for £87,000.
0:47:59 > 0:48:01So, basically, overall,
0:48:01 > 0:48:04and he already put on the 12th of this month,
0:48:04 > 0:48:08already paid another £10,000 deposit to that.
0:48:08 > 0:48:12So we're thinking about finishing that within 28 days.
0:48:12 > 0:48:15So, hopefully, we should get that done, and once we get the money,
0:48:15 > 0:48:17then we can reinvest again.
0:48:19 > 0:48:21Hopefully the second sale will go through smoothly,
0:48:21 > 0:48:26and the guys will move on from this having learnt some valuable lessons.
0:48:26 > 0:48:28But what about the future for this property?
0:48:28 > 0:48:30We asked along two local experts
0:48:30 > 0:48:33to tell us what they think could happen here.
0:48:33 > 0:48:36Starting with the agent who saw the property earlier.
0:48:36 > 0:48:39It may sell to hopefully a cash buyer,
0:48:39 > 0:48:42who perhaps wants to live here and doesn't mind the fact
0:48:42 > 0:48:44that it slopes forward somewhat.
0:48:45 > 0:48:49Alternatively, they could smarten it all up and then rent it out.
0:48:49 > 0:48:53It's not going to be viable for someone to buy this property,
0:48:53 > 0:48:56refurnish it and still leave the subsidence in place.
0:48:56 > 0:48:58They're not going to be able to finance it,
0:48:58 > 0:49:01therefore, they're not going to be able to sell it on the open market.
0:49:01 > 0:49:03If the subsidence can't be resolved,
0:49:03 > 0:49:05then it could even be as severe as, you know,
0:49:05 > 0:49:08the property needs to come down to start again.
0:49:09 > 0:49:11Well, that's a gloomy scenario.
0:49:11 > 0:49:14But assuming the underpinning work was carried out successfully,
0:49:14 > 0:49:16and the property was refurbished,
0:49:16 > 0:49:18would the house be any more attractive?
0:49:20 > 0:49:24I think if they decide to sell it after they've underpinned it,
0:49:24 > 0:49:26they are still going to have problems,
0:49:26 > 0:49:30because the property's still going to be sloping downwards.
0:49:30 > 0:49:34And building societies are probably still going to be reluctant to give
0:49:34 > 0:49:36mortgages on it, because their insurers are probably not
0:49:36 > 0:49:38going to be too happy with it.
0:49:39 > 0:49:44So, even after all that work, this place could still remain a cash buy.
0:49:44 > 0:49:48Although similar houses have sold in the area for £140,000,
0:49:48 > 0:49:53the agents were sceptical that once renovated, this house could achieve
0:49:53 > 0:49:54anything near that.
0:49:54 > 0:49:57So, what about a buy-to-let option?
0:49:58 > 0:50:00The rent for demand in the area is probably,
0:50:00 > 0:50:02I would have said probably extremely high.
0:50:02 > 0:50:05Anything which comes up for rent which is half decent, yes,
0:50:05 > 0:50:06it goes like that.
0:50:06 > 0:50:10It is a good sized plot and we are in a nice cul-de-sac here,
0:50:10 > 0:50:13tucked away from the main roads, with great access.
0:50:13 > 0:50:17I would say this would be on for £625 per calendar month.
0:50:17 > 0:50:21They would achieve in the region of £600 per calendar month.
0:50:21 > 0:50:24It's no point for us putting it in there
0:50:24 > 0:50:26for the long-term as an investment.
0:50:26 > 0:50:29We either do a development and get the cash out,
0:50:29 > 0:50:32and use those resources on another investment.
0:50:33 > 0:50:37They only have a few tense weeks to wait before the completion of the
0:50:37 > 0:50:40auction sale. If the money comes through, Prince,
0:50:40 > 0:50:44Mohammed and Jay will just about break even.
0:50:44 > 0:50:48After that, they may just take a huge sigh of relief.
0:50:48 > 0:50:50So, chaps, what have you learned?
0:50:51 > 0:50:55I think everybody needs to make a mistake to become somebody wiser.
0:50:55 > 0:50:57I think we had the opportunity, I'm very grateful,
0:50:57 > 0:51:01we learned our trade and we are much more wiser and smarter now.
0:51:07 > 0:51:08Let's head back to Watford,
0:51:08 > 0:51:11where earlier in the show I visited this two-bedroomed terrace house,
0:51:11 > 0:51:16with a guide price of £310,000.
0:51:16 > 0:51:19This one had definitely seen better days.
0:51:19 > 0:51:23Very obvious signs of damp. You really want to get that checked out.
0:51:23 > 0:51:25Is it rising damp?
0:51:25 > 0:51:27Is it coming up? Or is it penetrating down?
0:51:29 > 0:51:32With two public rooms and a very small kitchen on the ground floor,
0:51:32 > 0:51:37this house was crying out for an extension to create a bit more space.
0:51:37 > 0:51:42And an idea would be to make the kitchen-dining area big, open,
0:51:42 > 0:51:44create some natural light coming in.
0:51:44 > 0:51:48You're adding value, and all of a sudden things are looking up.
0:51:49 > 0:51:52Upstairs, the layout of the rooms left a lot to be desired,
0:51:52 > 0:51:56particularly the awkward position of the bathroom.
0:51:56 > 0:51:57I'm still walking.
0:51:57 > 0:52:01Yes, you have to walk through a bedroom to access your bathroom.
0:52:03 > 0:52:08The house sold for £310,000, and the new owner wanted to push through
0:52:08 > 0:52:12an ambitious list of improvements to turn this into a high-quality rental
0:52:12 > 0:52:16property. Looking after the property was estate agent Lee.
0:52:16 > 0:52:21He often takes on refurbishments for clients and definitely had a handle
0:52:21 > 0:52:22on what needed to be done here.
0:52:22 > 0:52:25The whole house needs doing. It completely needs gutting,
0:52:25 > 0:52:30so from floor to ceiling it's going to be completely brand-new in here.
0:52:30 > 0:52:32We're looking to extend out the back as well.
0:52:32 > 0:52:35Single-storey extension out the back, with a loft conversion.
0:52:35 > 0:52:38It's going to take more than a feather duster, this place, anyway.
0:52:38 > 0:52:41There would be no penny-pinching with this refurbishment,
0:52:41 > 0:52:46as Lee's client had set aside a very healthy budget of £100,000 to do the work.
0:52:46 > 0:52:49For us, it's the bigger picture,
0:52:49 > 0:52:52making sure we've got a happy family living here, moving forward.
0:52:52 > 0:52:55With that, we want to present them with a beautiful home.
0:52:55 > 0:52:59I had my doubts about the tight schedule,
0:52:59 > 0:53:02but Lee was adamant that 12 weeks was sufficient to complete the job.
0:53:02 > 0:53:05So, just over ten weeks later,
0:53:05 > 0:53:09we're back to see if Lee's super confidence was well founded.
0:53:26 > 0:53:29Well, everything in here has completely changed,
0:53:29 > 0:53:33and if you're sitting there thinking it doesn't look much like a family home,
0:53:33 > 0:53:35then you're absolutely correct.
0:53:35 > 0:53:39Two weeks into the project, Lee's client had a change of mind,
0:53:39 > 0:53:42and decided instead of a family home to rent,
0:53:42 > 0:53:46he wanted an HMO, or house of multiple occupancy.
0:53:47 > 0:53:50As planned, the house has been extended to the rear
0:53:50 > 0:53:53and up into the loft.
0:53:53 > 0:53:57The entire internal structure has been altered to accommodate five
0:53:57 > 0:54:00en suite bedrooms, two on the ground floor,
0:54:00 > 0:54:03two on the first floor and one in the loft conversion.
0:54:03 > 0:54:08But how did Lee manage to perform the equivalent of a handbrake turn?
0:54:08 > 0:54:12It's obviously a little bit more in-depth if you're doing something
0:54:12 > 0:54:16on an HMO rather than just being a kind of one family home kind of rental property.
0:54:16 > 0:54:19But the relationship that we've got with our architects now,
0:54:19 > 0:54:22they know what our expectations are and we know what we're going to get
0:54:22 > 0:54:25from them as well. So once we decided on the HMO and the initial
0:54:25 > 0:54:29requirements and stuff that we needed to meet to go in line with
0:54:29 > 0:54:33the regulations, they hit the ground running.
0:54:33 > 0:54:37You might think that with such a drastic change of plans, this would
0:54:37 > 0:54:40have had an impact on the timescale and budget.
0:54:40 > 0:54:44Well, Lee and his team managed to turn this around in nine weeks.
0:54:44 > 0:54:47Three less than their original estimate. And the budget?
0:54:47 > 0:54:52We had a budget from our client of £100,000 and we spent £100,000.
0:54:52 > 0:54:55So we stuck to the budget. We stuck to the timeframe.
0:54:55 > 0:54:57So, yeah, client's very happy.
0:54:58 > 0:55:01But he's not resting on his laurels just yet.
0:55:01 > 0:55:05There are five bedrooms to fill and Lee has been busy drumming up business.
0:55:05 > 0:55:09The main thing is that you get good clientele living in the
0:55:09 > 0:55:13property. So, here, what we've based this on is the five rooms.
0:55:13 > 0:55:16Advertised, marked to the HR department over at the hospital,
0:55:16 > 0:55:19so that we can get nurses and doctors in.
0:55:19 > 0:55:22So, there are some real good clientele who are going to be moving
0:55:22 > 0:55:24into these rooms real soon.
0:55:24 > 0:55:27In keeping with the fast-paced and changeable nature of the project,
0:55:27 > 0:55:31there's one final change Lee has to tell us about.
0:55:31 > 0:55:35I had a client approach me talking about HMOs in the area and what did
0:55:35 > 0:55:37we have, what did we have that was available?
0:55:37 > 0:55:40And we're now at the stage where an offer's been placed.
0:55:40 > 0:55:44Our current client's accepted it, and now we're just in that kind of
0:55:44 > 0:55:46negotiation stage to get it through.
0:55:47 > 0:55:50Lee's reluctant to say how much it has been sold for,
0:55:50 > 0:55:52but we can of course find out its market value.
0:55:54 > 0:55:58We invited two local estate agents along to see if they could put some
0:55:58 > 0:56:00figures on the property.
0:56:00 > 0:56:05The client paid bang on the guide price of £310,000 and they've
0:56:05 > 0:56:07transformed it into an HMO.
0:56:07 > 0:56:09So how could this investment fare?
0:56:09 > 0:56:11I'm really impressed with what they've done with the property.
0:56:11 > 0:56:14I remember it coming up for sale before Christmas,
0:56:14 > 0:56:17and looking at it now, it just looks fantastic.
0:56:17 > 0:56:20I love it. It's a great property. Great part of town.
0:56:20 > 0:56:23The conversion they've done actually works very well.
0:56:24 > 0:56:26Let's get some valuations now.
0:56:26 > 0:56:31Can they estimate how much this HMO would be worth on the resale market?
0:56:31 > 0:56:35On a resale value, we would actually value the property between 450,000
0:56:35 > 0:56:36to 475,000.
0:56:36 > 0:56:39Looking to achieve anything between those two regions.
0:56:39 > 0:56:41If I was looking to put this on the market for a sale,
0:56:41 > 0:56:46I'd be looking at putting it on maybe at 450,000.
0:56:46 > 0:56:50Yeah. I can see where they're coming from in terms of current market conditions.
0:56:52 > 0:56:56Yeah. Yeah, I mean, it's £450,000, £475,000,
0:56:56 > 0:56:59that is obviously some way down on the figure we've agreed
0:56:59 > 0:57:02with a client, with the deal that's going to go through.
0:57:02 > 0:57:04So, yeah.
0:57:05 > 0:57:08Oh, Lee, you're such a tease!
0:57:08 > 0:57:12But finally we managed to get a figure of £500,000 from him,
0:57:12 > 0:57:17which means a potential profit of £90,000, minus tax and fees.
0:57:17 > 0:57:23But for the new owner what kind of rental income could a five-bed HMO generate?
0:57:23 > 0:57:25Right, the smaller rooms in the property,
0:57:25 > 0:57:29we would expect to achieve £110 per week. The larger rooms
0:57:29 > 0:57:32in the property, we'd probably look to achieve £125 per week.
0:57:32 > 0:57:36Per week, I would value the rooms in the range of £110 per week,
0:57:36 > 0:57:38up to £125 per week.
0:57:38 > 0:57:40Yeah, yeah, that's good.
0:57:40 > 0:57:44Again maybe slightly lower than what our expectations are.
0:57:44 > 0:57:47But, yeah, probably in line with current market conditions.
0:57:47 > 0:57:51The agents agreed that an annual income of around £34,000 could be
0:57:51 > 0:57:54expected, which would represent a yield of nearly 7%
0:57:54 > 0:57:57on a purchase price of £500,000.
0:57:59 > 0:58:01And there's good news for Lee, too.
0:58:01 > 0:58:04He's just picked up a new client.
0:58:04 > 0:58:08We're probably a month away, I would say, from that deal going through.
0:58:08 > 0:58:11And excited to work for my new client on this, with it being
0:58:11 > 0:58:12a fully managed HMO by us.
0:58:16 > 0:58:20Hopefully our stories have given you some tips and insight into the world
0:58:20 > 0:58:24- of property developing.- And maybe it's given you a bit of inspiration
0:58:24 > 0:58:25to start bidding on your own project.
0:58:25 > 0:58:28Yes, and join us next time for more property tales here
0:58:28 > 0:58:31- on Homes Under The Hammer. - Bye-bye.- Bye-bye.- Goodbye.