0:00:02 > 0:00:04Hello and welcome to the show. Now, for many people, investing in
0:00:04 > 0:00:07property is a good way to look after your money, but there's
0:00:07 > 0:00:10- always risks along the way. - Yes, it pays to be cautious,
0:00:10 > 0:00:13especially if something seems too good to be true.
0:00:13 > 0:00:15But one place where you might find
0:00:15 > 0:00:18a real bargain is at your local property auction.
0:00:43 > 0:00:47Well, buying property at auction is surprisingly simple and
0:00:47 > 0:00:49pretty straightforward and yet,
0:00:49 > 0:00:52lots of people are intimidated by the whole process.
0:00:52 > 0:00:55Yes, it does help when you learn from your successes and your
0:00:55 > 0:00:58failures as well. That's where we come in.
0:00:58 > 0:01:02Let's find out how the people on today's show got on at the auction house.
0:01:02 > 0:01:07First up, in Beeston, and you could call this one a fixer upper.
0:01:07 > 0:01:12What an absolute mess! What on earth has gone on in here?
0:01:12 > 0:01:16Whilst in Dulwich, London, Lucy is being pushed from pillar to post.
0:01:16 > 0:01:22A little bit tight. You can literally bounce off the walls.
0:01:22 > 0:01:25The size issues continue in Godalming, Surrey,
0:01:25 > 0:01:29where a property described as a two bed is stretching it somewhat.
0:01:29 > 0:01:32You can't get a bed in there, so it's not a bedroom.
0:01:34 > 0:01:37All these properties have been sold at auction and we'll find out
0:01:37 > 0:01:40who bought them and what they paid when they went under the hammer.
0:01:40 > 0:01:42Sold at 60, thank you.
0:01:47 > 0:01:51We now head to Beeston, a popular and busy town that lies just
0:01:51 > 0:01:54three miles south of Nottingham city centre.
0:01:54 > 0:01:57Already a favourite with property investors,
0:01:57 > 0:02:01it's really on the up, thanks to the addition of a tram system.
0:02:01 > 0:02:06Well, those are tram lines and that is a new development for this area.
0:02:06 > 0:02:10Basically a tram which leads all the way into Nottingham city centre and
0:02:10 > 0:02:14that's really bringing up all the properties around here,
0:02:14 > 0:02:17so somewhere to look for a bit of a bargain with potential and
0:02:17 > 0:02:19that's certainly what this is.
0:02:19 > 0:02:22Former commercial unit with residential above.
0:02:22 > 0:02:25I certainly like the half timber look.
0:02:25 > 0:02:28Let's hope it's as good on the inside as it is on the outside.
0:02:29 > 0:02:31Ah.
0:02:32 > 0:02:34Right.
0:02:36 > 0:02:38Floor's an optional extra then.
0:02:38 > 0:02:42What an absolute mess! What on earth has gone on in here?
0:02:43 > 0:02:48My guess is nothing, for a very long period of time.
0:02:48 > 0:02:52Um, it's falling to pieces, isn't it?
0:02:53 > 0:02:54Now, just imagine...
0:02:54 > 0:02:58Just imagine that you'd seen the picture from the outside in
0:02:58 > 0:03:01the auction catalogue and thought, "I'll have a go at that.
0:03:01 > 0:03:04"How bad could it be inside?" Ha!
0:03:04 > 0:03:07What horrors are in store around here then?
0:03:07 > 0:03:09How much?, I hear you ask.
0:03:09 > 0:03:14Guide price £75,000, but you might be asking yourself...
0:03:14 > 0:03:16# What in the world can I do?
0:03:16 > 0:03:18# What in the world can I do? #
0:03:18 > 0:03:21But someone will take this on.
0:03:21 > 0:03:25At the back here, there's some toilets and what looks like,
0:03:25 > 0:03:28under all that mess, a bar.
0:03:28 > 0:03:30But no time for any light refreshments.
0:03:32 > 0:03:35So, where do I start with the
0:03:35 > 0:03:40clearly big problems of this property? Well, you know,
0:03:40 > 0:03:43you don't need to be a rocket scientist to figure it out, do you?
0:03:43 > 0:03:46We've got structural issues. There's no floor in this bit.
0:03:46 > 0:03:48There's a bit of timber holding up
0:03:48 > 0:03:50one of the major structural beams there.
0:03:50 > 0:03:55We've got damp. I guess it's a catalogue of all sorts of rot.
0:03:55 > 0:03:59So, does that mean it's a non-starter for ten?
0:03:59 > 0:04:02You'd just like to forget about it? Well, possibly not because this
0:04:02 > 0:04:06would have put a lot of people off. I mean, you stepped in the front
0:04:06 > 0:04:09door and straightaway you think uh-ah. However, you know,
0:04:09 > 0:04:13a good builder and a reasonable budget could sort this place out.
0:04:13 > 0:04:16But for now, a lot of imagination is required.
0:04:16 > 0:04:22I can just imagine that I'm sitting on the dock of a bay right now.
0:04:22 > 0:04:24Cue Otis Redding.
0:04:24 > 0:04:26# Yeah
0:04:26 > 0:04:29# I'm sitting on the dock of the bay
0:04:29 > 0:04:33# Watching the tide roll away... #
0:04:33 > 0:04:36It's going to take far more than sitting on the dock of
0:04:36 > 0:04:38a bay to get this place ship shape.
0:04:38 > 0:04:41Anyone taking this project on needs to be realistic with their
0:04:41 > 0:04:45ambition and there is of course another hurdle to navigate.
0:04:48 > 0:04:53Well, one problem we haven't talked about with this place,
0:04:53 > 0:04:56in our long list, is the potential for finance.
0:04:56 > 0:04:59Now, not only is the state of the place going to give you
0:04:59 > 0:05:02a bit of an issue, when it comes to talking to a lender about giving you
0:05:02 > 0:05:05money to do this place up, but the fact it's mixed use,
0:05:05 > 0:05:09as in residential upstairs and a business premises downstairs,
0:05:09 > 0:05:13will limit severely the kind of lender who will actually lend
0:05:13 > 0:05:16you money on this. However, as with all these things,
0:05:16 > 0:05:19if you present them with a spectacular enough business
0:05:19 > 0:05:22case, you might find somebody who just goes, "Oh, yeah.
0:05:22 > 0:05:26"I can see what that could become," and give you some money.
0:05:26 > 0:05:30But I wouldn't, ahem, necessarily hold your breath.
0:05:30 > 0:05:32# I just can't rely on you
0:05:32 > 0:05:34# Just can't rely on you... #
0:05:34 > 0:05:37Yeah, you'd better make sure your finances are in order before
0:05:37 > 0:05:39you visit the auction,
0:05:39 > 0:05:42otherwise you could land yourself in hot water, which is ironic,
0:05:42 > 0:05:46because I don't think the flat upstairs has any of that.
0:05:47 > 0:05:51So, round the back of the property, there's a little courtyard,
0:05:51 > 0:05:55up some steps on to this flat roof and you can gain access to
0:05:55 > 0:05:58the flat that's above the retail unit.
0:05:58 > 0:06:03However, warning, enter at your own risk. I don't think so!
0:06:03 > 0:06:06However, Russell, cameraman, good lad!
0:06:08 > 0:06:12# Don't say a word, don't say anything
0:06:12 > 0:06:16# Don't say a word, I'm not even listening
0:06:16 > 0:06:19# You better watch your step... #
0:06:19 > 0:06:23Now, of course, no camera person was harmed in the making of this film.
0:06:23 > 0:06:27We took sensible precautions, so don't worry.
0:06:27 > 0:06:32Anyway, up here, and despite the obvious problems, it is a good size.
0:06:32 > 0:06:36There's a kitchen and a bathroom, plus attic space.
0:06:36 > 0:06:40Now, this could be one large two bed, or maybe two one beds.
0:06:40 > 0:06:43Either way, it's going to take
0:06:43 > 0:06:46someone with vision and determination.
0:06:46 > 0:06:49We asked along a local estate agent for his opinion on this
0:06:49 > 0:06:52property, guided at £75,000.
0:06:53 > 0:06:55If this was my property,
0:06:55 > 0:06:58and based on if I can get the appropriate planning consents,
0:06:58 > 0:07:02I would downstairs convert it into two separate shops and
0:07:02 > 0:07:06upstairs look at the avenue of trying to have two separate
0:07:06 > 0:07:09apartments of have one apartment of a very high standard.
0:07:09 > 0:07:11OK, that sounds like an option,
0:07:11 > 0:07:14but how much would something like that cost?
0:07:14 > 0:07:17I'd probably be looking and it's very approximate within the
0:07:17 > 0:07:21region of around £100-125,000.
0:07:21 > 0:07:25What about valuations if you did convert the upstairs?
0:07:25 > 0:07:29A two bedroom apartment in Beeston city centre,
0:07:29 > 0:07:32you're looking within the region of around £150,000.
0:07:32 > 0:07:35If you're selling a one bedroom flat in Beeston town centre,
0:07:35 > 0:07:38you're looking within the region of around £100-125,000.
0:07:38 > 0:07:40OK, that's that.
0:07:40 > 0:07:44But how much would you be able to rent a commercial unit out for?
0:07:44 > 0:07:48With regards to downstairs, two retail units, you're looking at
0:07:48 > 0:07:52a projected rental income within the region of around £17,000 per annum.
0:07:52 > 0:07:55And what about selling the unit as a whole?
0:07:55 > 0:07:58If you're looking to sell the downstairs units,
0:07:58 > 0:08:02and take into account it's one large unit or two separate units,
0:08:02 > 0:08:05and you've got a large two bedroom flat upstairs,
0:08:05 > 0:08:10you're looking within the region of around £250-275,000.
0:08:10 > 0:08:11Well, look, let's be honest.
0:08:11 > 0:08:14It's not a project for the uninitiated, is it?
0:08:14 > 0:08:17However, I do think this place has potential.
0:08:17 > 0:08:21- DOG BARKS - Thank you, dog. And it all comes down to the price
0:08:21 > 0:08:24that's paid at auction. Let's see what happened when it went under the hammer.
0:08:27 > 0:08:30It requires some upgrading, repair, and improvement,
0:08:30 > 0:08:33but has got lots of potential. Start me where you like with this
0:08:33 > 0:08:37one, ladies and gentlemen. 70,000 for it, may I say? 70,000.
0:08:37 > 0:08:4170. 65. 65,000.
0:08:41 > 0:08:4460,000 to start me. Renovation project with potential.
0:08:44 > 0:08:4660, I've got. Thank you.
0:08:46 > 0:08:49Bidding was slow to start, going up in £1,000 bids.
0:08:49 > 0:08:53It looked as though it would struggle to reach the guide price,
0:08:53 > 0:08:55but then things got interesting.
0:08:55 > 0:08:59We rejoin at an amazing £155,000.
0:08:59 > 0:09:02155,000.
0:09:02 > 0:09:05Your bid. 56.
0:09:05 > 0:09:08156. 57.
0:09:08 > 0:09:10157.
0:09:10 > 0:09:12Throwing the towel in?
0:09:12 > 0:09:15157,000.
0:09:15 > 0:09:17All done? Definitely? Going down.
0:09:19 > 0:09:218. 58.
0:09:21 > 0:09:23159.
0:09:24 > 0:09:27159, now. Nice round figure, 160.
0:09:27 > 0:09:30£159,000. Is that a definite?
0:09:30 > 0:09:32Or a maybe?
0:09:32 > 0:09:33A definite.
0:09:33 > 0:09:35- All done? - BANGS GAVEL
0:09:35 > 0:09:38Sold at 159. Thank you.
0:09:39 > 0:09:43Bought for over twice the guide price for £159,000,
0:09:43 > 0:09:48the successful bidders were brothers Jamil, here on the left, and Manir.
0:09:48 > 0:09:52I met the pair back at the property to find out their plans.
0:09:52 > 0:09:55- Jamil, Manir, lovely to meet you both.- Hiya. You all right?
0:09:55 > 0:09:57- Congratulations.- Thank you. - You've taken on quite
0:09:57 > 0:10:00- a challenge here then. - It is a big challenge.
0:10:00 > 0:10:03Tell me why you wanted to buy it.
0:10:03 > 0:10:05We did some research on the area and there's
0:10:05 > 0:10:10no retail properties available on this stretch of road and it's
0:10:10 > 0:10:13also up and coming as well because the tram works are finished now.
0:10:13 > 0:10:16In fact, there's a tram going past, as we speak.
0:10:16 > 0:10:19That then was a major part of one of the reasons you wanted to buy it,
0:10:19 > 0:10:21the tram that's literally outside the door.
0:10:21 > 0:10:25It wasn't just the tram. I think we just found this are was just starting to be a bit more
0:10:25 > 0:10:30upmarket, starting to come up with a few bars opening up, small
0:10:30 > 0:10:34delis and restaurants, so we thought this would be a good location.
0:10:34 > 0:10:36So, then, the idea is to keep it as a retail unit, is it?
0:10:36 > 0:10:40We're thinking about separating two separate units and have two
0:10:40 > 0:10:42- flats upstairs as well.- OK.
0:10:42 > 0:10:46- But keeping it commercial.- Yes. - Yes, keeping it commercial.- Right.
0:10:46 > 0:10:49With a view to using it yourself or renting it out or what?
0:10:49 > 0:10:52- No, we're just going to rent them out.- Right.
0:10:52 > 0:10:55While Jamil and Manir's full-time jobs are as postmasters,
0:10:55 > 0:10:58they have done a couple of property renovations before,
0:10:58 > 0:11:00so they're not novices.
0:11:00 > 0:11:02To create two flats upstairs,
0:11:02 > 0:11:06they're hoping to get planning permission to extend out onto
0:11:06 > 0:11:10that flat roof and twice the flats means twice the rental potential.
0:11:10 > 0:11:15What kind of rent have you been thinking you might be able to get?
0:11:15 > 0:11:18Well, we spoke to a local estate agent.
0:11:18 > 0:11:22- Roughly, for this size, 6-7,000 for one shop.- For a year.
0:11:22 > 0:11:24For a year, per annum.
0:11:24 > 0:11:30- OK.- And upstairs flats, two bedroom, anything between 5-550 per month.
0:11:30 > 0:11:33OK. Just to tot it up then, approximately, 12,000,
0:11:33 > 0:11:366,000 for each of the flats, that's 12,
0:11:36 > 0:11:39- and then 6,000 for each of the retail units.- That's right.
0:11:39 > 0:11:42Approximately. So 24 grand on your 160,000-odd,
0:11:42 > 0:11:45by the time you've factored in cost purchase.
0:11:45 > 0:11:47- So a good return.- It is, yeah.
0:11:47 > 0:11:50That's why we were looking for this area and this location.
0:11:50 > 0:11:53- Definitely upcoming and definitely potential here.- Right.
0:11:53 > 0:11:56Now, of course, I worked that out without working out how much it's going to
0:11:56 > 0:11:59cost to actually do these places up, so that is a really important point.
0:11:59 > 0:12:05- So, we're estimating roughly between 30-40,000.- To do the whole building.
0:12:05 > 0:12:07- To do the whole building.- Oh, wow! That's pretty good.
0:12:07 > 0:12:10- We will be doing a lot of stuff ourselves as well.- Right.
0:12:10 > 0:12:14So I'll be doing a lot of the DIY work myself, sort of thing.
0:12:14 > 0:12:18Right, OK. You'll be into it for about 200,000 by the time....
0:12:18 > 0:12:20- That's right. - Yeah, round about that figure, yeah.
0:12:20 > 0:12:24So if your income is 24 grand, that's still pretty impressive, isn't it?
0:12:24 > 0:12:27- Yeah.- Wow. So, what's the timescale?
0:12:27 > 0:12:30The timescale, looking about 4-6 months,
0:12:30 > 0:12:33so depending on the council for the permission.
0:12:33 > 0:12:35- It will take eight weeks to get a reply.- Great.
0:12:35 > 0:12:39- So we'll take it from there. - Well, listen, congratulations.
0:12:39 > 0:12:44- Good luck with it.- Thank you very much.- We look forward to seeing how you get on.- Thank you, Martin.
0:12:44 > 0:12:48Well, Jamil and Manir have certainly got a few challenges ahead of them with this place.
0:12:48 > 0:12:50However, they don't seem too daunted.
0:12:50 > 0:12:54And when you listen to the potential in terms of that amount of
0:12:54 > 0:12:56money coming back in rental, well,
0:12:56 > 0:12:59you can see why they're very excited about it.
0:12:59 > 0:13:03How will they get on? You can find out later in the show.
0:13:09 > 0:13:11Now, we wind the clock back to 2014,
0:13:11 > 0:13:16when Lucy visited the very popular London suburb of East Dulwich.
0:13:16 > 0:13:20Along a pretty tree-lined street, close to local amenities,
0:13:20 > 0:13:24Lucy looked around this semidetached four floor
0:13:24 > 0:13:27property that had been split into three flats.
0:13:27 > 0:13:30One on the ground floor, one on the lower ground,
0:13:30 > 0:13:33and the third comprising the top two floors,
0:13:33 > 0:13:39all for a hefty guide price at £620-650,000.
0:13:39 > 0:13:42It's not as huge as I would have expected.
0:13:42 > 0:13:45The hallway is just, well, look - a little bit tight.
0:13:45 > 0:13:48You can literally bounce off the walls.
0:13:48 > 0:13:51You've got some stairs leading to the upper flat.
0:13:51 > 0:13:54And through here, again, you know, tight spaces.
0:13:54 > 0:13:57# Don't stand, don't stand so
0:13:57 > 0:14:00# Don't stand so close to me... #
0:14:00 > 0:14:03The ground floor flat had a kitchen and a small bathroom,
0:14:03 > 0:14:07plus a bedroom with the dreaded textured wallpaper.
0:14:07 > 0:14:10But that was the least of the problems here with this
0:14:10 > 0:14:12bizarre layout.
0:14:12 > 0:14:17It's tight, you've got a big slope here, it's all a little bit,
0:14:17 > 0:14:19you know, get round.
0:14:19 > 0:14:22Not an ideal place for the fridge, so I would relocate that.
0:14:22 > 0:14:26But you have got a really nice spacious lounge through there.
0:14:26 > 0:14:28It could be quite a nice little flat.
0:14:28 > 0:14:31Let's check out the upstairs one.
0:14:31 > 0:14:35Split over two levels, the top floor flat was more spacious,
0:14:35 > 0:14:36with a decent sized kitchen,
0:14:36 > 0:14:40along with a reception room and good sized bedroom.
0:14:40 > 0:14:44But it was the upper level of this flat where things got interesting.
0:14:44 > 0:14:46I'm just wondering...
0:14:47 > 0:14:50Yes, you could potentially knock through here, apply for
0:14:50 > 0:14:54planning permission, you could put a nice dormer window there.
0:14:54 > 0:14:57Really open the space up, so you've got a great master bedroom.
0:14:57 > 0:15:00You could put an en suite shower room in the corner.
0:15:00 > 0:15:04I really think that would work well and then this would be a fantastic master bedroom.
0:15:07 > 0:15:11On the lower ground floor was the one bedroom flat with its own
0:15:11 > 0:15:15separate entrance and access to the good-sized garden.
0:15:15 > 0:15:19Inside, it was pretty spacious, but dated, and along with the
0:15:19 > 0:15:22rest of the property, not really achieving its potential.
0:15:24 > 0:15:27A lot of work was needed to all three flats, but then,
0:15:27 > 0:15:32once complete, it could be a very sound investment for the bidders on auction day.
0:15:36 > 0:15:4096, we're moving in to East Dulwich. Semidetached building. Three flats.
0:15:40 > 0:15:44Subject to addendum. I've got phone bidding. Start me at 600,000.
0:15:45 > 0:15:48Opening bid of 6, please. 600,000. Straightaway, gentleman there.
0:15:48 > 0:15:51610 anywhere? 600, I'm bid.
0:15:51 > 0:15:54So, the bids built slowly and steadily.
0:15:54 > 0:15:56We rejoin just at the point where it's about to meet
0:15:56 > 0:16:00- the £1 million mark. That guide a distant memory.- 995.
0:16:00 > 0:16:03Your pleasure, a million in the bank, sir.
0:16:03 > 0:16:05£ 1 million I'm bid and 5.
0:16:05 > 0:16:11Passing the £1 million mark, we rejoin again at £1,030,000
0:16:11 > 0:16:14£1 million and 30, is that right? I think that's right.
0:16:14 > 0:16:19So £1 million and 40. That's 35, is it, sir? 35.
0:16:19 > 0:16:21And 40, sir?
0:16:21 > 0:16:23And 40. And 5?
0:16:23 > 0:16:2645. And 50.
0:16:26 > 0:16:28And 50. And 55?
0:16:28 > 0:16:30No, so I've got £1 million and 50.
0:16:30 > 0:16:3255.
0:16:32 > 0:16:3460, sir. I'm bid. 65.
0:16:34 > 0:16:37No. £1 million and 60, first time.
0:16:37 > 0:16:40Second time. Third and last time at £1 million and 60. All done?
0:16:42 > 0:16:44BANGS GAVEL
0:16:44 > 0:16:47Yours, in front of me. £1 million and 60. Thank you.
0:16:47 > 0:16:51It was bought on the day for £1,060,000 by professional
0:16:51 > 0:16:54pianist and violinist Edgar.
0:16:54 > 0:16:57He bought it on behalf of a property
0:16:57 > 0:17:00and music company owned by him,
0:17:00 > 0:17:02business partner Paval,
0:17:02 > 0:17:04and Edgar's father, Slava.
0:17:04 > 0:17:08This was the company's fifth property purchase in just its
0:17:08 > 0:17:09first year of trading.
0:17:09 > 0:17:13Lucy met Edgar and Paval at the property to find out the plans.
0:17:15 > 0:17:17Why did you want to buy this property?
0:17:17 > 0:17:20My dad is involved in the property development business for the
0:17:20 > 0:17:22last 15 years.
0:17:22 > 0:17:25We've done some research, spoke to Paval, show him this property.
0:17:25 > 0:17:28I went to the auction and won this lot.
0:17:28 > 0:17:31Had you set a limit for this building?
0:17:31 > 0:17:36- It was actually £1 million, so we paid 60,000 more.- We overpaid a bit.
0:17:36 > 0:17:39However, it was a strategic decision because this house
0:17:39 > 0:17:40has a lot of potential.
0:17:40 > 0:17:44Edgar and Paval were in two minds as to whether to convert the property
0:17:44 > 0:17:49into one large family home or renovate the existing three flats.
0:17:49 > 0:17:52But they were keen to extend out the back and make the most out of
0:17:52 > 0:17:54the property's potential.
0:17:54 > 0:17:58We're going to do some loft conversion as well in the rear garden side.
0:17:58 > 0:18:02- That'll be fantastic. There's a lot of spare space in the roof if you extend.- An extra bedroom.
0:18:02 > 0:18:06- So, if I ask you, what is your budget, can you answer that question?- Yes, we can.
0:18:06 > 0:18:10We are looking around £40,000 for each flat.
0:18:10 > 0:18:14- And if you convert it into a house, into a family home?- £140,000.
0:18:14 > 0:18:18If you renovate the ground floor flat and you get an extension, how
0:18:18 > 0:18:21much do you think a flat downstairs like that would be worth on
0:18:21 > 0:18:22the open market?
0:18:22 > 0:18:25I think it'd be worth about 500,000.
0:18:25 > 0:18:28You're hoping £500,000 for the flat downstairs.
0:18:28 > 0:18:33I think this flat, we are looking for £450,000.
0:18:33 > 0:18:38OK. £450,000. And what about the upstairs flat with lots of stairs?
0:18:38 > 0:18:42We are thinking about 550,000.
0:18:42 > 0:18:45So, really, you do hope to have a decent profit at the end of it.
0:18:45 > 0:18:49Yes, we are looking ideally for £300,000.
0:18:49 > 0:18:53Fast forward 11 months later and the exterior of the house was
0:18:53 > 0:18:55much improved.
0:18:58 > 0:19:00Inside was a work in progress,
0:19:00 > 0:19:03with the decision made to renovate the existing three flats.
0:19:07 > 0:19:11Whilst there was plenty of work to be done on the ground floor,
0:19:11 > 0:19:15and lower ground floor flats, they were starting to take shape.
0:19:19 > 0:19:23When Lucy met Edgar and Paval, they were keen to maximise profit
0:19:23 > 0:19:27here and that desire had now taken on a new angle.
0:19:27 > 0:19:29You can see we have quite a large garden.
0:19:29 > 0:19:31So we have several options.
0:19:31 > 0:19:34The initial option was to split the garden in three parts,
0:19:34 > 0:19:37so each flat would have a separate garden.
0:19:37 > 0:19:43But obviously that would get much more value if we would be
0:19:43 > 0:19:46able to develop a house at the back.
0:19:46 > 0:19:49Yes, adding a property at the back could be a real money-maker,
0:19:49 > 0:19:53but they also needed to complete their existing property.
0:19:53 > 0:19:57They'd secured planning permission for an extension to the
0:19:57 > 0:20:00ground floor flat and also for the rear loft conversion,
0:20:00 > 0:20:04turning the split level top flat into a three bedroom property.
0:20:12 > 0:20:16As well as an extra bedroom, they'd created a handy laundry room.
0:20:28 > 0:20:30By combining bedroom one with the kitchen,
0:20:30 > 0:20:33they'd made a modern and slick kitchen diner.
0:20:41 > 0:20:44The front reception room became the master bedroom,
0:20:44 > 0:20:45complete with en suite.
0:20:51 > 0:20:53With such a high-end finish to this flat,
0:20:53 > 0:20:56the estate agents felt it could generate a sale price
0:20:56 > 0:21:02of £600,000, but as ever, Paval was setting his sights higher still.
0:21:03 > 0:21:08We are looking to get 700,000 and irrespective of some other
0:21:08 > 0:21:11lower forecasts, we are quite ambitious about this flat.
0:21:11 > 0:21:14You can't say much about the properties downstairs,
0:21:14 > 0:21:19as they are still being done, and once they are done,
0:21:19 > 0:21:22we can predict more specifically.
0:21:22 > 0:21:25# But he's got high hopes
0:21:25 > 0:21:28# He's got high hopes
0:21:28 > 0:21:34# He's got high apple pie in the sky hopes... #
0:21:35 > 0:21:39Well, the estate agents did feel happy to predict the value of the
0:21:39 > 0:21:43remaining flats and the average for both flats combined was £950,000.
0:21:43 > 0:21:47Plus they estimated that should they get the planning permission for
0:21:47 > 0:21:48the large family home,
0:21:48 > 0:21:52that could generate a sales
0:21:52 > 0:21:55valuation of around £875,000.
0:21:55 > 0:21:58So, did they get the planning permission for the extra
0:21:58 > 0:22:02property and did the remaining two flats get finished?
0:22:02 > 0:22:04Join us later in the show to find out.
0:22:06 > 0:22:09# But he's got high hopes
0:22:09 > 0:22:12# He's got high hopes
0:22:12 > 0:22:16# He's got high apple pie in the sky... #
0:22:18 > 0:22:20Still to come in Godalming, Surrey,
0:22:20 > 0:22:23you learn all sorts about yourself when renovating a property.
0:22:23 > 0:22:25I'm a little bossy!
0:22:25 > 0:22:28- Yes.- But he likes it.
0:22:28 > 0:22:33And in Dulwich, London, have Edgar and Paval been able to turn what was
0:22:33 > 0:22:37a building site into desirable flats for the demanding London market?
0:22:43 > 0:22:47Back to Nottinghamshire now and the town of Beeston.
0:22:47 > 0:22:48It was on a busy high street,
0:22:48 > 0:22:51complete with recently added tram lines,
0:22:51 > 0:22:54I looked around this former commercial unit with residential
0:22:54 > 0:22:59accommodation above that had an attractive guide price of £75,000.
0:22:59 > 0:23:02Well, I certainly like the half timber look.
0:23:02 > 0:23:06Let's hope it's as good on the inside as it is on the outside.
0:23:08 > 0:23:09Ah.
0:23:12 > 0:23:14Right.
0:23:15 > 0:23:17Floor's an optional extra then.
0:23:17 > 0:23:21What an absolute mess! What on earth has gone on in here?
0:23:23 > 0:23:27# You're in a bad way and I can't help you through... #
0:23:27 > 0:23:31Yes, the term "room for improvement" fell a little short here.
0:23:31 > 0:23:36This unit was in a horrific state and needed a huge amount of work.
0:23:36 > 0:23:41# Just dial my number, I've got some plans for you... #
0:23:43 > 0:23:46Out the back and up the stairs to the residential half and the
0:23:46 > 0:23:50signs weren't good. Literally.
0:23:50 > 0:23:53Looking beyond the mess up here though and it was
0:23:53 > 0:23:57a good size with potential for one or maybe even two flats.
0:24:01 > 0:24:04# Oh, yes, wait a minute, Mr Postman
0:24:04 > 0:24:08# Wait, Mr Postman... #
0:24:08 > 0:24:11Two people who weren't put off by the mess were brothers and
0:24:11 > 0:24:15postmasters Jamil, on the left here, and Manir.
0:24:15 > 0:24:19They paid over twice the guide price, at £159,000.
0:24:19 > 0:24:23So I was hoping their plans would be first class rather than
0:24:23 > 0:24:24return to sender.
0:24:24 > 0:24:28We're thinking about separating two separate units and have two
0:24:28 > 0:24:30- flats upstairs as well.- OK.- Yeah.
0:24:30 > 0:24:33With a view to using it yourself or renting it out, or what?
0:24:33 > 0:24:36- No, we're just going to rent them out.- Right.
0:24:36 > 0:24:39The brothers hoped to extend on to the flat roof,
0:24:39 > 0:24:43in order to create two two bedroom flats, as well as two retail
0:24:43 > 0:24:45units downstairs,
0:24:45 > 0:24:50all for a budget of £30-40,000 and in a timescale of 4-6 months.
0:24:53 > 0:24:58So, do we have two retail units and two flats by two brothers?
0:24:58 > 0:25:00Let's see.
0:25:00 > 0:25:03# It takes two, baby
0:25:03 > 0:25:06# It takes two, baby
0:25:06 > 0:25:09# Me and you
0:25:09 > 0:25:12# It just takes two... #
0:25:12 > 0:25:16I know I do say this a lot, but this is truly unrecognisable.
0:25:16 > 0:25:19The brothers have done a sterling job,
0:25:19 > 0:25:24turning this building site into two smart, spacious units.
0:25:24 > 0:25:27They will make a great blank canvas for any retailers.
0:25:29 > 0:25:34Out the back and it's looking so much better.
0:25:34 > 0:25:37And if you cast your eyes upwards,
0:25:37 > 0:25:41it looks like they got planning permission for the extension too.
0:25:41 > 0:25:44# It takes two, baby
0:25:44 > 0:25:47# It takes two, baby
0:25:47 > 0:25:49# To make a dream come true... #
0:25:49 > 0:25:52Thanks to the extension on to the flat roof,
0:25:52 > 0:25:54there's now two two bedroom flats.
0:25:54 > 0:25:58Both have living spaces with open plan kitchen-diners,
0:25:58 > 0:26:01with modern, clean lines.
0:26:01 > 0:26:03What's more, they've extended into the attic,
0:26:03 > 0:26:07to create bright and spacious bedrooms in each property.
0:26:14 > 0:26:19There's a separate second spacious bedroom downstairs in each flat.
0:26:19 > 0:26:22There's also brand-new bathroom suites and a general sense of
0:26:22 > 0:26:27space and freshness that just didn't seem possible 12 months ago.
0:26:27 > 0:26:31I think the biggest work that we've had done is the extension part at the back.
0:26:31 > 0:26:35It's definitely made the property much better, much more open,
0:26:35 > 0:26:39and much more let-able, I guess, and resell-able.
0:26:39 > 0:26:41Commercial units, we changed the frontage on them.
0:26:41 > 0:26:44Also, we raised the ceiling height.
0:26:44 > 0:26:47As you probably see, we've now got a floor at the front as well,
0:26:47 > 0:26:49which wasn't there before.
0:26:49 > 0:26:52So we've got a floor, we've had to put new joists in and put new floor
0:26:52 > 0:26:56in and then raise it up to make it level with the rest of the floor.
0:26:56 > 0:26:59We actually found a structural beam that wasn't actually resting
0:26:59 > 0:27:02on the wall, but was actually resting on a piece of timber.
0:27:02 > 0:27:07So that was another major work which we didn't expect.
0:27:07 > 0:27:09And now that we've cleared all of that out,
0:27:09 > 0:27:12and we've just made it a level high ceiling...
0:27:12 > 0:27:15It's worked out really good and we're really happy with the
0:27:15 > 0:27:17retail units.
0:27:17 > 0:27:20Yikes! Extensions, loft conversions, structural beams,
0:27:20 > 0:27:23joists - all big expenses.
0:27:23 > 0:27:27Plus they added a shared access entrance out the front for
0:27:27 > 0:27:31future flat tenants, so I'm afraid to ask, how's the budget looking?
0:27:33 > 0:27:36So, our original budget was between 30-40,000.
0:27:36 > 0:27:39- We've gone slightly over that. - Slightly.
0:27:39 > 0:27:44We've gone to 56,000, in total, including everything.
0:27:44 > 0:27:47Our original timescale was 4-6 months.
0:27:47 > 0:27:50But we got delayed with the council planning permission and also
0:27:50 > 0:27:53with the tram line, so the scaffolding was an issue.
0:27:53 > 0:27:56The time we had to find out who would be able to put it up, when
0:27:56 > 0:28:00they'd be able to put it up, what the cost would be, delayed things.
0:28:00 > 0:28:02So it's taken us about a year now.
0:28:02 > 0:28:06Well, you know, £56,000 and in 12 months is still pretty good,
0:28:06 > 0:28:09considering the amount of work they've done here.
0:28:09 > 0:28:12But with Jamil and Manir set on renting,
0:28:12 > 0:28:16will their investment of £215,000 make financial sense?
0:28:20 > 0:28:24We've asked along two local estate agents for their opinions,
0:28:24 > 0:28:27starting with the agent who saw it originally.
0:28:27 > 0:28:33You've got two excellent retail units and also two spacious
0:28:33 > 0:28:38and contemporary-style flats, so it's an incredible transformation.
0:28:38 > 0:28:42The flat upstairs has been finished to a very high standard,
0:28:42 > 0:28:43in particular the kitchen
0:28:43 > 0:28:45and bathrooms. They're nicely tiled.
0:28:45 > 0:28:47Good standard of carpet through.
0:28:47 > 0:28:51All lightly decorated and that will make it very popular.
0:28:51 > 0:28:53The agents are impressed,
0:28:53 > 0:28:58so let's hear what they think the whole unit combined could be worth.
0:28:58 > 0:29:02With regards to selling this property overall,
0:29:02 > 0:29:07the whole entity, you're looking within the region of £250-275,000.
0:29:07 > 0:29:10So, as a whole, I would expect to achieve somewhere around
0:29:10 > 0:29:16the £300,000 mark, if we were to market the property as a whole.
0:29:16 > 0:29:20That top estimate would mean a pre-tax profit of £85,000.
0:29:20 > 0:29:22Very nice.
0:29:22 > 0:29:26Rental wise, you're looking to achieve overall
0:29:26 > 0:29:31a rental income somewhere in the region of £28,000 per annum.
0:29:31 > 0:29:34I would expect to achieve somewhere in the region of £700 per
0:29:34 > 0:29:36calendar month for each of the flats.
0:29:36 > 0:29:39I would expect to achieve somewhere in the region of £600 per
0:29:39 > 0:29:42calendar month for the retail space. Per unit.
0:29:42 > 0:29:47So, if they have a combined rental of £28,000 per annum, that
0:29:47 > 0:29:52would equate to a yield of nearly 13%, which is a fantastic result.
0:29:52 > 0:29:55And whilst they're planning a well-deserved holiday,
0:29:55 > 0:29:57they also have an eye on future projects.
0:29:59 > 0:30:03I'm always checking my e-mail to see what's coming up for auction, so yeah, definitely.
0:30:08 > 0:30:12This is the historic town of Godalming in Surrey.
0:30:12 > 0:30:16The weekly market has been here since 1300,
0:30:16 > 0:30:21making this attractive town very popular, especially with commuters.
0:30:21 > 0:30:25These days, you can travel by train into Waterloo in under 50 minutes.
0:30:25 > 0:30:28The property I'm here to see is about half
0:30:28 > 0:30:30a mile from the train station.
0:30:30 > 0:30:33So, we're just down the road from Charterhouse School,
0:30:33 > 0:30:36which has lots of famous former pupils.
0:30:36 > 0:30:41Lots of politicians, members of Genesis, including Mr Peter Gabriel.
0:30:41 > 0:30:43That's enough of the pop history.
0:30:43 > 0:30:47We're here to see this ground floor two bedroom flat,
0:30:47 > 0:30:49with a guide price of £150,000.
0:30:49 > 0:30:51Let's take a look.
0:30:51 > 0:30:57# I wanna be a sledgehammer... #
0:30:57 > 0:31:01The first bit of good news, there's already off-road parking at the
0:31:01 > 0:31:05front of the flat, but also, there's a garage in the block at the back.
0:31:05 > 0:31:07Right.
0:31:07 > 0:31:10I like the fact that there's a bit of a porch here.
0:31:10 > 0:31:12Yes, it's not the prettiest looking,
0:31:12 > 0:31:15but it's somewhere to put your coat, your wellies,
0:31:15 > 0:31:17and your dirty shoes,
0:31:17 > 0:31:21so you're not dragging the mud into the main part of the property.
0:31:21 > 0:31:25OK, you've got a small room just there to the right of me.
0:31:25 > 0:31:27I'll get back to that in a minute.
0:31:27 > 0:31:31But then you come into this really good-sized lounge,
0:31:31 > 0:31:36living area, big window, lovely high ceilings, central heating as well.
0:31:36 > 0:31:40There's lots of space in here to put your TV and your sofas and
0:31:40 > 0:31:43everything. Come up a step, into this part of the flat,
0:31:43 > 0:31:47you've got a big good-sized bedroom behind me.
0:31:47 > 0:31:51And you've got as well a kitchen and a bathroom just to the left.
0:31:51 > 0:31:54The kitchen's a really good size, in good condition as well,
0:31:54 > 0:31:56which I think you'd be able to keep.
0:31:56 > 0:31:58Possibly think about changing the bathroom in there.
0:31:58 > 0:32:01It's a bit tight, but I'm sure you could rejig it.
0:32:01 > 0:32:02But I'm a bit baffled.
0:32:02 > 0:32:06There's your bedroom, which is a good size, but that's only one.
0:32:06 > 0:32:12So that, over here, has got to be the second bedroom.
0:32:12 > 0:32:15Now, there's no hard and fast rules
0:32:15 > 0:32:19on what size a bedroom has to be.
0:32:19 > 0:32:22There's guidelines, but there's no rules.
0:32:22 > 0:32:25But there is in my head. You can't get a bed in there.
0:32:25 > 0:32:27So it's not a bedroom.
0:32:27 > 0:32:31# I have no space, no room to move around
0:32:31 > 0:32:38# And this box is getting smaller, I'm trying to get out... #
0:32:38 > 0:32:41It's more of a boxroom than a bedroom.
0:32:41 > 0:32:45You might squeeze a baby's cot in here or it could be a study,
0:32:45 > 0:32:47but really, it's not working.
0:32:48 > 0:32:53So, how could you rejig it so it works just a little bit better?
0:32:53 > 0:32:56The bedroom, for me, the small bedroom isn't really a bedroom.
0:32:56 > 0:32:58I would get rid of that.
0:32:58 > 0:33:01And I'd knock it through into one big lounge.
0:33:01 > 0:33:04I would look to move this kitchen into the lounge area,
0:33:04 > 0:33:08so you'd have like a kitchen lounge area.
0:33:08 > 0:33:11That would leave this room completely free.
0:33:11 > 0:33:13This could be your second bedroom.
0:33:13 > 0:33:16Don't forget, the family bathroom's just next door there and the
0:33:16 > 0:33:18other bedroom's on the other side of that wall.
0:33:18 > 0:33:21So you've got your sleeping accommodation on this side of
0:33:21 > 0:33:24the property, living accommodation on that side of the property,
0:33:24 > 0:33:27and for me, that works so much better.
0:33:28 > 0:33:33Of course, there is a cost in moving all the plumbing and electrics.
0:33:33 > 0:33:35On top of that, you would need to get the freeholder's
0:33:35 > 0:33:38permission to make such a major change.
0:33:38 > 0:33:40So is it worth it?
0:33:40 > 0:33:44We asked a local estate agent to get her opinion on the property
0:33:44 > 0:33:47that's guided at £150,000.
0:33:47 > 0:33:52This property would really benefit from being revalued as
0:33:52 > 0:33:54a one bedroom property.
0:33:54 > 0:33:58It's not a bedroom. It's a child's cot room.
0:33:58 > 0:34:03Or it would be good for a study. A very, very small study.
0:34:03 > 0:34:06I would get rid of it completely.
0:34:06 > 0:34:12Take away that small area and turn it into an even brighter
0:34:12 > 0:34:13style living room.
0:34:13 > 0:34:16The rest I would say would be cosmetic.
0:34:18 > 0:34:20We are all agreed the small bedroom has to go,
0:34:20 > 0:34:23but the jury is still out whether it should remain
0:34:23 > 0:34:26a two bed with some re-jigging, or a spacious one bed.
0:34:26 > 0:34:30Perhaps the valuations could give us an idea of the best way
0:34:30 > 0:34:35forward for this flat, which is guided at £150,000.
0:34:35 > 0:34:39If you kept it as a two bedroom and perhaps moved things around,
0:34:39 > 0:34:44made the living room open plan, into an open plan kitchen area,
0:34:44 > 0:34:49it would be worth between £250-255,000,
0:34:49 > 0:34:51on a resalable value.
0:34:51 > 0:34:55If you were to keep this property as a one bed,
0:34:55 > 0:34:59I think you would only be taking it under to say £245,000.
0:35:00 > 0:35:04OK, for just a £10,000 uplift for the second bedroom,
0:35:04 > 0:35:06it might not be worth the hassle.
0:35:06 > 0:35:10Given it might cost you a lot in rewiring, re-plumbing,
0:35:10 > 0:35:13gas and water and perhaps drainage to move the kitchen.
0:35:13 > 0:35:17It could well suck up any difference between these valuations.
0:35:19 > 0:35:21This flat is in a good location,
0:35:21 > 0:35:24property prices in the area are healthy.
0:35:24 > 0:35:27It just needs a bit of a tidy up and that second bedroom,
0:35:27 > 0:35:29would you keep it or would you get rid of it?
0:35:29 > 0:35:32Let's go to the auction house and see who fancied it.
0:35:36 > 0:35:39Unfortunately, we weren't able to catch this particular lot
0:35:39 > 0:35:40on this occasion.
0:35:41 > 0:35:45But the successful bidders getting a house for 186 grand
0:35:45 > 0:35:47were Erica and her husband Hamid.
0:35:49 > 0:35:52They already have one rental property and whilst Hamid
0:35:52 > 0:35:55entertains their daughter Ellie, I found out from Erica
0:35:55 > 0:35:57what the plan was going to be.
0:35:57 > 0:36:00- Erica, nice to meet you. - Nice to meet you.- Congratulations.
0:36:00 > 0:36:02- Thank you very much. - Are you happy?- Yes, yes.
0:36:02 > 0:36:04What was it about this place that you liked, then?
0:36:04 > 0:36:08I think it was the window and the open space. It was the location.
0:36:08 > 0:36:11The road is beautiful. And it's just a lovely area.
0:36:11 > 0:36:14Do you know the location well? Is it your area?
0:36:14 > 0:36:17No, actually we just came here on the day of the viewing
0:36:17 > 0:36:20- and we just loved it. We just fell in love.- Really?
0:36:20 > 0:36:21Yes, we just love the area.
0:36:21 > 0:36:24So were you looking for something like this, this kind of size, a flat?
0:36:24 > 0:36:27Yes, we were looking for maybe one or two bedroom flats
0:36:27 > 0:36:30to renovate so it was kind of what we wanted.
0:36:30 > 0:36:33And your day job, what do you do? What is your day job?
0:36:33 > 0:36:35- I'm a full-time mum now but... - Nice.- Yeah, thank you.
0:36:35 > 0:36:39We've run a chauffeuring company for ten years...
0:36:39 > 0:36:43beforehand, so I've been on maternity leave for almost a year now.
0:36:43 > 0:36:45And we decided to get into this.
0:36:45 > 0:36:47Check your records for me cos I might have been in the back
0:36:47 > 0:36:49- of one of your cars at some stage. - Possibly.
0:36:49 > 0:36:51If you'd allowed me in, that is!
0:36:51 > 0:36:54So you wanted to get into property now, away from that?
0:36:54 > 0:36:56- Yes, that's correct.- Why is that?
0:36:56 > 0:36:58We just wanted something a little less stressful
0:36:58 > 0:37:01than what we were doing and also give us a bit of flexibility
0:37:01 > 0:37:04with our daughter so that we can be at home
0:37:04 > 0:37:06and switch between working and stuff.
0:37:06 > 0:37:08Whose idea was it to go into property?
0:37:08 > 0:37:10It was actually my husband's.
0:37:10 > 0:37:13We've got a friend who is an electrician and he always had
0:37:13 > 0:37:16a plan to maybe go into business with him.
0:37:16 > 0:37:19He should hopefully help us with this, so he had this plan
0:37:19 > 0:37:23- about two years ago and it took a while for us to get going.- It does.
0:37:23 > 0:37:25You've got to do your bits of planning,
0:37:25 > 0:37:28your bits of research and find out what you want to do.
0:37:28 > 0:37:31We have family in this business as well so we thought it was
0:37:31 > 0:37:34- a good way to start.- Bit of a head start then?- Yes, little bit.
0:37:34 > 0:37:37So, now you've got it, what are your plans for it?
0:37:37 > 0:37:41Well, we were thinking that because the small bedroom is very small...
0:37:41 > 0:37:43- Very small.- Yes.
0:37:43 > 0:37:46..we were thinking of knocking that wall down and possibly bringing
0:37:46 > 0:37:52a kitchen into this area, so making it open-style kitchen-living area.
0:37:52 > 0:37:55And converting that kitchen into a second bedroom.
0:37:55 > 0:37:59Ah, so Erica and Hamid were thinking what I was thinking.
0:37:59 > 0:38:03I know on the face of it, the maths don't look great but I can't
0:38:03 > 0:38:07help think it will make this flat more appealing to the market.
0:38:07 > 0:38:09When it's all done, are you looking to sell or rent?
0:38:09 > 0:38:12I think we want to sell it.
0:38:12 > 0:38:16If the market is good, we want to sell it but let's see what happens.
0:38:16 > 0:38:20- Exactly. Have you done your research on what properties cost...- Yes.
0:38:20 > 0:38:23- ..around here to buy, to sell, to rent?- Yes, we have.
0:38:23 > 0:38:26We've spoken to a couple of agents as well about what the potential is
0:38:26 > 0:38:29in this area so hopefully we can make a good profit
0:38:29 > 0:38:31and then maybe move onto the next one.
0:38:31 > 0:38:34You've got a little bit to do, not an awful lot. I know you want to
0:38:34 > 0:38:37- move the kitchen this way which is probably the biggest job.- Yes.
0:38:37 > 0:38:39How much is that going to cost you? What is your budget?
0:38:39 > 0:38:44We said maximum 20 but we're looking about 15.
0:38:44 > 0:38:47- OK.- So something like that.
0:38:47 > 0:38:49We've just been advised that it's a bit of a big job -
0:38:49 > 0:38:52things we want to do - so maybe 15 maximum.
0:38:52 > 0:38:55- A bit of pipework and all that kind of thing....- Yes, exactly.
0:38:55 > 0:38:56- ..got to be moved. - The boiler as well
0:38:56 > 0:39:00cos we've got a water tank in there and it's a separate boiler
0:39:00 > 0:39:02so we want to get a combination boiler
0:39:02 > 0:39:03- which I think is a bit of an expensive job.- OK.
0:39:03 > 0:39:06Does your husband know people that can do that for you,
0:39:06 > 0:39:08professionals?
0:39:08 > 0:39:12Yes, we have got some friends so hopefully they will give us a hand.
0:39:12 > 0:39:15- Are you looking for mates' rates? - Yes! Of course!
0:39:15 > 0:39:18- So you are hoping a £15,000 budget hopefully?- Yes.
0:39:18 > 0:39:20- You've got 20 if you need to go to 20.- Of course.
0:39:20 > 0:39:23And how long is it going to take to finish?
0:39:23 > 0:39:24We're hoping within three months,
0:39:24 > 0:39:30- if we get all the approved plans through from the freeholder.- OK.
0:39:30 > 0:39:33- Are you worried about anything? - Just... I think just the boiler.
0:39:33 > 0:39:36Just about moving that cos we just wanted to move it either
0:39:36 > 0:39:40into the porch area or just into the other side of the wall
0:39:40 > 0:39:42- so just with the permission to move that.- OK.
0:39:42 > 0:39:46And what kind of finish can we expect? Is it going to be your eye
0:39:46 > 0:39:49- that's going to be doing all the interiors?- Oh, yes, definitely.
0:39:49 > 0:39:52- Oh, you say that. Not for Hamid! - No, not at all, just me!
0:39:52 > 0:39:56We're just thinking wooden floors and high-spec finish.
0:39:56 > 0:39:59Hopefully we will get a good job done.
0:39:59 > 0:40:03Will you get involved yourself in regards the painting or stripping?
0:40:03 > 0:40:05Possibly, yes, I've done some painting before so...
0:40:05 > 0:40:09- When I was younger so maybe I'll do that.- So you are project manager?
0:40:09 > 0:40:10Yes, of course.
0:40:10 > 0:40:13- Wow, and he'll just be your assistant.- Of course, as always.
0:40:13 > 0:40:17- Hamid's taking a back-seat!- Yes.- He might like that.- I think so, yeah.
0:40:17 > 0:40:20After a few years of stressful work, I think he'll like it.
0:40:20 > 0:40:21- I wish you good luck. - Thank you very much.
0:40:21 > 0:40:24- I hope it works out for your first project...- Thank you.
0:40:24 > 0:40:26- ..and you make a few quid.- Thank you.- That's what it's all about.
0:40:26 > 0:40:30- Good luck.- Thank you.- Wish you all the best.- Thank you very much.
0:40:30 > 0:40:34So, Hamid and Erica have sold their chauffeuring company and taken
0:40:34 > 0:40:37their first steps into the property developing world.
0:40:37 > 0:40:40And I think they've got themselves a good little flat
0:40:40 > 0:40:44but will they get the freeholder's permission to rejig the layout?
0:40:44 > 0:40:46You can find out how she gets on later in the show.
0:40:50 > 0:40:54Time has passed since we visited our two remaining properties.
0:40:54 > 0:40:57I hope they've been busy completing their renovations.
0:40:57 > 0:40:59Yes, all sorts of problems could have occurred, though,
0:40:59 > 0:41:01so let's find out what's been going on.
0:41:03 > 0:41:07'It was back in 2014 that Lucy looked around this handsome
0:41:07 > 0:41:11'semidetached property that had been split into three flats.'
0:41:12 > 0:41:15'Sitting in the popular London area of East Dulwich,
0:41:15 > 0:41:21'the property had a guide price of £620,000 to £650,000
0:41:21 > 0:41:24'and on first entry, it didn't really impress.'
0:41:24 > 0:41:27It's not as huge as I would have expected.
0:41:27 > 0:41:30The hallway is just, well, look, a little bit tight,
0:41:30 > 0:41:33you can literally bounce off the walls.
0:41:33 > 0:41:36'All three flats needed serious rethinking but there was
0:41:36 > 0:41:40'scope for an extension to the ground floor flat and extra room
0:41:40 > 0:41:42'in the top floor flat.'
0:41:44 > 0:41:48'Two people who could see the potential here were friends
0:41:48 > 0:41:51'and business partners Edgar - here on the left - and Paval,
0:41:51 > 0:41:55'who along with Edgar's father, Slava, had bought this property
0:41:55 > 0:42:00'at auction for an eye-watering £1,060,000.
0:42:00 > 0:42:03'They planned to extend to the back of the property
0:42:03 > 0:42:05'and convert the loft into an extra bedroom,
0:42:05 > 0:42:08'all with an eye on some ambitious valuations.'
0:42:10 > 0:42:13If you renovate the ground floor flat and you get an extension,
0:42:13 > 0:42:16how much do you think a flat downstairs like that will be
0:42:16 > 0:42:18worth on the open market?
0:42:18 > 0:42:22- I think it will be worth around 500,000.- Really?
0:42:22 > 0:42:26I think this flat, we are looking for £400,050.
0:42:26 > 0:42:30And what about the upstairs flat with lots of stairs?
0:42:30 > 0:42:33We are thinking about 550,000.
0:42:33 > 0:42:37So, really, you do hope to have a decent profit at the end of it?
0:42:37 > 0:42:40Yes, we're looking ideally for £300,000.
0:42:42 > 0:42:45'We returned 11 months later and the good news was,
0:42:45 > 0:42:49'the exterior of the house was much improved, plus they had been able to
0:42:49 > 0:42:53'convert the top flat into a highly desirable three bedroom property.'
0:42:56 > 0:42:59'Unfortunately, though, the bad news was,
0:42:59 > 0:43:02'that the other two flats were very much a work in progress.
0:43:02 > 0:43:08'Although that hadn't deterred Edgar and Paval from making fresh plans.'
0:43:08 > 0:43:11As you can see, we have quite a large garden
0:43:11 > 0:43:12so we have several options.
0:43:12 > 0:43:15The initial option was to split the garden in three parts
0:43:15 > 0:43:18so each flat would have a separate garden.
0:43:18 > 0:43:24But obviously, that would get much more value if we would be able
0:43:24 > 0:43:26to develop a house at the back.
0:43:26 > 0:43:29'Here we are, then, 18 months down the line,
0:43:29 > 0:43:32'since we last visited and the exterior of the property
0:43:32 > 0:43:36'has had further improvements and is looking very classy.
0:43:36 > 0:43:40'Hopefully inside will be more chandeliers and champagne
0:43:40 > 0:43:42'and less dust sheets and debris.'
0:43:43 > 0:43:45'Ground floor flat first, I think.'
0:43:48 > 0:43:50'The wall between what was the bedroom and kitchen
0:43:50 > 0:43:51'has been knocked through.
0:43:51 > 0:43:55'The compact kitchen area is partially closed off from the
0:43:55 > 0:43:59'living area, which is great to contain noise and cooking smells.'
0:44:02 > 0:44:06'First of all, the bedroom has excellent traditional proportions.'
0:44:09 > 0:44:11'The once cramped hall is now open and fresh
0:44:11 > 0:44:14'with a little laundry space created under the stairs.
0:44:14 > 0:44:15'Good thinking.'
0:44:18 > 0:44:21'And the bathroom, complete with stone tiles and high-end fittings
0:44:21 > 0:44:25'completes this one bedroom flat.
0:44:25 > 0:44:29'So, along with the top floor flat, that's two out of three - not bad.
0:44:29 > 0:44:31'But what about the basement flat?
0:44:31 > 0:44:34'Last time we were here, it was more of a building site.'
0:44:41 > 0:44:43'Well, the extension to the back of the lower ground floor
0:44:43 > 0:44:48'has transformed what could be a rather dark space.
0:44:48 > 0:44:52'Bifold doors bring in a lot of light and allow direct access
0:44:52 > 0:44:54'to the garden.
0:44:54 > 0:44:56'The master bedroom to the front of the property
0:44:56 > 0:44:59'is a great size and even boasts a walk-in wardrobe.'
0:45:04 > 0:45:06'The hall is bright and spacious and again,
0:45:06 > 0:45:12'the travertine tiles give the place that luxurious spa feel.
0:45:12 > 0:45:15'Bedroom two - well, it's definitely a skinny single
0:45:15 > 0:45:18'as a guest room or study would be fine.
0:45:18 > 0:45:21'After almost two and a half years, Edgar, Paval and Edgar's
0:45:21 > 0:45:26'father Slava's original investment plan has reached fruition.'
0:45:28 > 0:45:31'These three flats are in a popular area so the top flat
0:45:31 > 0:45:35'has already sold while the other two are currently rented.'
0:45:37 > 0:45:41'It all looks so simple, but when it came to that other plan
0:45:41 > 0:45:44'for a house in the back garden - well, not so simple.
0:45:44 > 0:45:47'After two attempts at getting the house off the ground,
0:45:47 > 0:45:49'they've changed their minds.'
0:45:49 > 0:45:54That would require involvement of more solicitors and more
0:45:54 > 0:45:57paperwork and more waiting time, unfortunately.
0:45:57 > 0:46:00We have quite a lot of new orders that we have to work on
0:46:00 > 0:46:03and we've been quite busy with that.
0:46:03 > 0:46:05So, unfortunately, we didn't...
0:46:05 > 0:46:09We couldn't take advantage of that opportunity that we probably had.
0:46:09 > 0:46:12'Of course, not building the house means the flats have
0:46:12 > 0:46:14'a valuable and prized asset.'
0:46:14 > 0:46:16This building has three flats and each flat
0:46:16 > 0:46:19has its own piece of garden which is a bit unusual for London,
0:46:19 > 0:46:21which is good and the three bedroom flat
0:46:21 > 0:46:25has a garden at the rear side, the one bedroom flat has the
0:46:25 > 0:46:28middle garden and the two bedroom flat has the garden behind me.
0:46:29 > 0:46:31# One, two, three. #
0:46:33 > 0:46:36'Doing this means each flat can be marketed as a garden flat,
0:46:36 > 0:46:38'making them more desirable.
0:46:38 > 0:46:40'Another good idea.
0:46:40 > 0:46:43'But how much have all the renovations in total cost?
0:46:43 > 0:46:47'Paval initially believed it would be £40,000 per flat.'
0:46:47 > 0:46:48So, altogether,
0:46:48 > 0:46:55we spent about 240,000 for refurbishment of all the flats.
0:46:55 > 0:46:59And that includes natural wood flooring,
0:46:59 > 0:47:04quite high standard appliances and furniture as well as
0:47:04 > 0:47:08a better quality finish on all the walls and ceilings.
0:47:08 > 0:47:10We're really happy,
0:47:10 > 0:47:13seeing new tenants move in here and we are trying to keep them
0:47:13 > 0:47:16happy as well which is what gives us as much pleasure.
0:47:21 > 0:47:25'All in all, they've invested £1,301,000 here,
0:47:25 > 0:47:29'and whilst all the flats are spoken for, it'll be interesting to hear
0:47:29 > 0:47:32'the thoughts and opinions of two local estate agents.'
0:47:34 > 0:47:37The ground floor flat is done to a very high specification.
0:47:37 > 0:47:40It's very modern, sleek, simplistic but works.
0:47:40 > 0:47:44There's an open plan layout which works very well for
0:47:44 > 0:47:47first-time buyers and it's a good property.
0:47:47 > 0:47:49I think the developer's done well with the basement flat given
0:47:49 > 0:47:52that they're always restrictions in terms of light and clearly,
0:47:52 > 0:47:55the second bedroom suffers from that but what the developer's
0:47:55 > 0:47:58done really well was with the main reception, opening it out, extending
0:47:58 > 0:48:02and putting bifold doors in which really have transformed the area.
0:48:02 > 0:48:03I think the possibility of building a house
0:48:03 > 0:48:06in the rear garden is not that high.
0:48:06 > 0:48:11The plot is only big enough to house three flats at a maximum and provide
0:48:11 > 0:48:14decent garden spaces so at the moment, all flats work really well.
0:48:14 > 0:48:16Had they built in the rear garden,
0:48:16 > 0:48:18the plot would have been overcrowded and overdeveloped
0:48:18 > 0:48:20and would have lost its curb appeal.
0:48:20 > 0:48:24'The top flat was sold for £640,000.
0:48:24 > 0:48:27'So the remaining investment of around £638,000
0:48:27 > 0:48:29'is in the rental market.
0:48:29 > 0:48:32'So what do the agents think they could achieve there?'
0:48:32 > 0:48:37I think the ground floor flat would achieve £1,650 per calendar month
0:48:37 > 0:48:39and the first floor, one bedroom,
0:48:39 > 0:48:41would a achieve 1,300 per calendar month.
0:48:41 > 0:48:45For the rental market, the one bed flat will achieve somewhere
0:48:45 > 0:48:49between £1,250 per calendar month to £1,300 per calendar month.
0:48:49 > 0:48:52The two bedroom flat will achieve somewhere between £1,500
0:48:52 > 0:48:55per calendar month and £1,600 per calendar month.
0:48:55 > 0:49:00We already are getting 1,400 a month for this flat, one bed,
0:49:00 > 0:49:05and we're already getting 1,700 for the one downstairs.
0:49:05 > 0:49:08So, we're quite confident and it's already a fact
0:49:08 > 0:49:12that we are renting at that rate and therefore,
0:49:12 > 0:49:16we are thinking about an even higher price next year.
0:49:16 > 0:49:19'Those current rentals, they are achieving mean a yield
0:49:19 > 0:49:24'of 5.8% so will they be better to sell the two remaining flats on?'
0:49:24 > 0:49:25On the sales market,
0:49:25 > 0:49:29the ground floor flat would achieve in the region of £675,000.
0:49:29 > 0:49:33The first floor flat would achieve in the region of £450,000.
0:49:33 > 0:49:36On the sales market, the one bedroom flat should achieve somewhere
0:49:36 > 0:49:40between £450,000 and £475,000.
0:49:40 > 0:49:43For the two bedroom ground floor flat,
0:49:43 > 0:49:47I believe it will achieve somewhere between £600,000 to £625,000.
0:49:47 > 0:49:52We believe that this flat costs in the region of £465,000
0:49:52 > 0:49:57and the two bedroom flat costs in the region of £690,000.
0:49:57 > 0:49:59Reasonable prices, we believe.
0:49:59 > 0:50:01If they were to achieve these prices,
0:50:01 > 0:50:06that would mean the two flats could be worth £1,115,000.
0:50:06 > 0:50:10Add that to the flat they have already sold at 640,000,
0:50:10 > 0:50:14that's a grand total of £1,795,000.
0:50:14 > 0:50:18I'm running out of fingers to do the counting here but that would
0:50:18 > 0:50:19mean a lot of profit.
0:50:19 > 0:50:24£495,000 minus taxes and expenses.
0:50:24 > 0:50:28They are content to take in the £37,000 in rental for the moment.
0:50:28 > 0:50:30Either way, this is a property
0:50:30 > 0:50:33that has proved to be very profitable indeed.
0:50:39 > 0:50:44Time now to return to the market town of Goldalming in Surrey.
0:50:44 > 0:50:46It was here I first found this ground floor flat
0:50:46 > 0:50:49guided at £150,000 plus.
0:50:51 > 0:50:53Although inside was relatively spacious,
0:50:53 > 0:50:56its description of a two bed was a little optimistic.
0:50:59 > 0:51:01The second bedroom.
0:51:01 > 0:51:07Now, there's no hard and fast rules on what size a bedroom has to be.
0:51:07 > 0:51:12There's guidelines but there's no rules. But there is in my head.
0:51:12 > 0:51:15You can't get a bed in there, so it's not a bedroom.
0:51:15 > 0:51:17But could there be a solution?
0:51:17 > 0:51:20The front living space was large enough to accommodate
0:51:20 > 0:51:23a large kitchen area which would free up the current kitchen
0:51:23 > 0:51:26to convert into a proper second bedroom.
0:51:28 > 0:51:32Erica and Hamid bought the property for £186,000.
0:51:32 > 0:51:37And it was the first step to a possible change in career.
0:51:37 > 0:51:40We ran a chauffeuring company for ten years beforehand.
0:51:40 > 0:51:44So I've been on maternity leave for almost a year now
0:51:44 > 0:51:47- so we decided to get into this.- And why is that?
0:51:47 > 0:51:49We just wanted something a little less stressful
0:51:49 > 0:51:51than what we were doing and also,
0:51:51 > 0:51:53give us a bit of flexibility with our daughter,
0:51:53 > 0:51:58so that we can be at home and switch between working and stuff.
0:51:58 > 0:52:00With a budget of £15,000 to £20,000
0:52:00 > 0:52:02and a timescale of three months,
0:52:02 > 0:52:03they were ready to go.
0:52:05 > 0:52:08But as the flat was a leasehold, they needed to put the brakes on
0:52:08 > 0:52:12any renovation plans until they got the freeholder's permission.
0:52:13 > 0:52:17So we returned four months later and did they get the green light?
0:52:22 > 0:52:24It certainly looks like it.
0:52:27 > 0:52:30Their plans have come to fruition and the front room is now an
0:52:30 > 0:52:32open-plan kitchen-living area.
0:52:34 > 0:52:37The tiny room is gone, opening up the whole space
0:52:37 > 0:52:40and making it much brighter and more modern.
0:52:42 > 0:52:43They've opted for a contemporary,
0:52:43 > 0:52:47neutral colour scheme and grey subway-style tiles.
0:52:48 > 0:52:51And they've made use of the porch area by creating
0:52:51 > 0:52:54a handy utility space with a new combi boiler.
0:52:55 > 0:52:59So by my calculations, moving the kitchen has left a spare room.
0:53:04 > 0:53:08Yes, there is now a fantastic dual-aspect double bedroom
0:53:08 > 0:53:10where the kitchen used to be.
0:53:11 > 0:53:13It really is a clever use of space.
0:53:15 > 0:53:18The tired bathroom is a distant memory and there is now
0:53:18 > 0:53:21a sparkling new suite with floor-to-ceiling tiling.
0:53:24 > 0:53:27Last but not least is the second double bedroom which,
0:53:27 > 0:53:31like the rest of the flat, has benefited from re-plastering
0:53:31 > 0:53:34and new flooring but not solely for cosmetic reasons.
0:53:36 > 0:53:37When we moved in,
0:53:37 > 0:53:41we found out there is some damp and the smell was not good.
0:53:41 > 0:53:44We asked the company to come and check and they came and they
0:53:44 > 0:53:48checked and they reported to us that there is damp,
0:53:48 > 0:53:50especially now with the wall outside
0:53:50 > 0:53:56and something like 70% of the wall needed now to change.
0:53:56 > 0:53:58We just ended up stripping back the walls ourselves, back to the
0:53:58 > 0:54:02brick and they injected some damp-proofing course
0:54:02 > 0:54:03and re-plastered.
0:54:03 > 0:54:05So hopefully it's all going to be sorted.
0:54:05 > 0:54:07And they've put air bricks in the property
0:54:07 > 0:54:09so hopefully it won't come back.
0:54:11 > 0:54:15Unfortunately, evidence of damp is not always easy to spot
0:54:15 > 0:54:18and when it comes to property, what you see is not always
0:54:18 > 0:54:21what you get as Erica and Hamid have found out.
0:54:23 > 0:54:25When we first got the keys for the property, we were given
0:54:25 > 0:54:29a key for the garage at the back and we were told when we went to view it
0:54:29 > 0:54:32at the beginning as well that the garage came with the property.
0:54:32 > 0:54:35However, a couple of months after completion,
0:54:35 > 0:54:38we noticed that the garage was put on for auction
0:54:38 > 0:54:42and there's four garages out the back so we were quite surprised.
0:54:42 > 0:54:47And we delved a bit deeper and we found out that the freeholder
0:54:47 > 0:54:50had decided to sell them so we ended up not having the garage
0:54:50 > 0:54:53in the end, so that was a bit disappointing for us.
0:54:53 > 0:54:58Erica and Hamid attempted to buy the garage but didn't succeed.
0:54:58 > 0:54:59Just a reminder,
0:54:59 > 0:55:02you and your solicitor have to scrutinise everything.
0:55:02 > 0:55:05Not just about the house but the garages, right-of-way,
0:55:05 > 0:55:09shared accesses and all those small but very important details.
0:55:09 > 0:55:12The next issue they had to address was getting permission from
0:55:12 > 0:55:15the freeholder to move the kitchen.
0:55:15 > 0:55:18We eventually ended up getting through to him through one of
0:55:18 > 0:55:21the neighbours and once we got through to him,
0:55:21 > 0:55:25we started work and completed within four and a half weeks.
0:55:25 > 0:55:28Tracking down a freeholder to sort permission
0:55:28 > 0:55:31or lease issues can be a bit of a headache.
0:55:31 > 0:55:33If you can't get hold of the freeholder, as a last resort,
0:55:33 > 0:55:37you can go to your County Court and apply for a vesting order.
0:55:37 > 0:55:39Luckily, in this case, the freeholder was found
0:55:39 > 0:55:42and this allowed the couple to get the work done.
0:55:42 > 0:55:45They've managed to overcome a lot of obstacles and only gone
0:55:45 > 0:55:48£2,500 over their £20,000 budget
0:55:48 > 0:55:51so are they happy with how it's gone?
0:55:51 > 0:55:55We loved it and we're looking forward to getting another one soon.
0:55:56 > 0:55:58Before you hit the next auction,
0:55:58 > 0:56:01let's find out if moving that kitchen and your total investment
0:56:01 > 0:56:06of £208,500 is going to be profitable.
0:56:06 > 0:56:09We asked two local estate agents what they thought of the renovation.
0:56:09 > 0:56:11First, the agent who saw it before.
0:56:11 > 0:56:16Outstanding, I mean the changes are absolutely outstanding.
0:56:16 > 0:56:18They really are beautifully done.
0:56:18 > 0:56:20I think it's a lovely flat.
0:56:20 > 0:56:23It's been redecorated to a really high standard.
0:56:23 > 0:56:24Nice contemporary colours
0:56:24 > 0:56:28have been used and it would suit the local market perfectly.
0:56:28 > 0:56:32To create two double bedrooms from a very small project
0:56:32 > 0:56:35is very good, very well done.
0:56:35 > 0:56:40The agents are impressed so will that translate into profit?
0:56:40 > 0:56:45The property re-sellable value would be £235,000.
0:56:45 > 0:56:50The rentable value on this property would be £1,050 per calendar month.
0:56:50 > 0:56:55I believe that the property could sell for £255,000 and I believe
0:56:55 > 0:56:59that it would rent as an alternative for £1,100 per calendar month.
0:57:01 > 0:57:05A range of figures there but the top value of £255,000 could mean
0:57:05 > 0:57:10a potential profit minus taxes and fees of £46,500.
0:57:10 > 0:57:14The top rental value of £1,100 per calendar month could mean
0:57:14 > 0:57:17a yield of just over 6%.
0:57:17 > 0:57:21So what do Erica, Hamid and Ellie think of those figures?
0:57:21 > 0:57:24To be honest, they are a little bit lower than we were expecting.
0:57:24 > 0:57:27We've been quoted around 275...
0:57:27 > 0:57:30Between 275 to 285.
0:57:30 > 0:57:32So, just a little bit lower.
0:57:32 > 0:57:37It is good, 1,100. If we can get 1,100, I'm happy.
0:57:38 > 0:57:41Based on the values, Erica and Hamid have decided to hold on
0:57:41 > 0:57:45to the flat and rent it out, so is there more property in the future?
0:57:47 > 0:57:51We definitely want to go for the next one and hopefully,
0:57:51 > 0:57:54we will be doing better in the next one.
0:57:55 > 0:57:58I think they have done a pretty good job of it for the first time
0:57:58 > 0:58:02and it sounds like they have gained some very valuable knowledge.
0:58:03 > 0:58:06I'm a little bossy...
0:58:06 > 0:58:07- Yes!- ..but he likes it!
0:58:10 > 0:58:13Well, thousands of properties are sold at auction every year
0:58:13 > 0:58:15and we'll have plenty more for you next time.
0:58:15 > 0:58:16Yes, we are spoilt for choice.
0:58:16 > 0:58:19- Make sure you join us again here on Homes Under The Hammer.- Goodbye.
0:58:19 > 0:58:20Bye-bye.