Episode 62 Homes Under the Hammer

Hello and welcome to the show.

Now, it's no secret that we both love property development stories.

Yes, and it never gets old,

because with every new experience comes lessons learned.

Yes, and when it comes to property, your education should never end.

So, if you fancy learning some good stuff,

head down to your local property auction.

Those who buy often at the auctions know a few tricks of the trade.

But they're no secret, do your research, view the property,

and please read the legal pack.

Yeah, sounds simple, doesn't it?

But you'd be amazed at how many people

don't stick to those simple rules.

Let's find out the properties that we're featuring on today's show.

I visit Prestatyn in North Wales,

on top of my list for this three bed mid-terrace.

It's a good view, but does this property have one of those?

Let's find out.

Lucy is in Folkestone,

but it's the smell, not the sights, that bother her

in this shop below a one-bedroom flat.

Damp, you can just smell it the minute you walk in.

And I'm in Darley Dale, Derbyshire.

And a three bed terraced cottage

where the decor takes me back to...

Upton Park, scored there many times,

I've got to say, thank you very much.

All these properties have been sold at auction.

And we will find out who bought them and what they paid

-when they went under the hammer.

-Sold, well bought, sir.

Situated in North Wales, Prestatyn has many holiday attractions.

This statue depicts the town's location

at the most northerly point of Offa's Dyke,

one of our most popular national trails.

It runs 177 miles south to Chepstow.

# I'm walking... #

I'm just a short walk from the railway station,

but it is a steep climb.

Well, I'm in a very desirable part of Prestatyn

to see a three-bedroom mid-terrace with a guide price of 95,000 quid.

Now what you'd really like

if you were to buy a property in this part of town,

is a good view.

Does this property have one of those?

Let's find out.

Wow! Yep, it certainly does.

# I can see for miles and miles

# And miles and miles and miles... #

Ah.

Sadly, the views inside aren't quite as spectacular.

Never mind, what have we got? Stairs up to the bedrooms there,

we've got a living room over to the right-hand side.

Nice fireplace, actually.

Another living room over to this side, dual aspect.

So, a door out to the rear courtyard there.

Nice window, making the most of those views there.

Which is good.

It's definitely looking in the dilapidated category of properties,

but I'm not seeing anything structurally that worries me.

I quite like this,

that is an entrance into that first right-hand sitting room there.

So you can walk around the property which is always nice.

And then through to the rear where you've got this kitchen.

It almost feels like this is a bit of an extension and certainly,

judging by the - ha-ha - original beams, ha-ha,

it probably is.

Strange enough, worst part of the house,

probably last-in, first-out sort of thing.

This definitely needs a lot of work, but then, so does the whole house.

Normally I'd be looking at the state of the property

and sucking in air a lot and tutting.

But the location is fantastic.

So is that alone enough to make it a good investment?

# Do you wonder

# Is it really worth your while...? #

So, upstairs, bathroom there.

Definitely need a refurbishment.

But three good-sized bedrooms.

One on that side. One towards the back,

but it's really the ones at the front

you're interested in, aren't you?

because those are the ones which have that outstanding view.

And you know what, it's one of those properties that

you forgive it pretty much everything

because of that.

# It's glorious

# Don't give it up... #

Well, at the back of the property,

and you've got this little courtyard area.

That's actually the side of the kitchen with the bedrooms above.

I think your land goes that way,

and also a little bit that way

to give you a little bit of outside storage.

But in a list of names to describe the state of the garden,

overgrown would be in the top three.

So, another to add to the comprehensive list of to-dos,

and the cost is certainly starting to grow.

And though my heart says, "Yes, of course, it's worth it,"

my head is now not so sure.

-# Is it really, really worth it?

-I don't know

-# Is it really, really worth it?

-I don't know... #

So, what does the local estate agent think?

It's a project. There is evidence of penetrating dampness

and rising dampness here,

so you've got to sort out the damp problem.

Parking is very limited.

The answer here would be to do as they've done nearby,

where they excavate the front of the property

and put a parking area in there,

maybe a carport, which would make all the difference.

So, add that driveway to the to-do list.

And can a property guided at £95,000

still see a decent return to go with that excellent review?

My opinion of value here, when renovated,

would be that the property would be something circa £175,000.

Situated where it is, and near a holiday town,

I can see this property potentially appealing as a holiday let.

But how would the figures stack up?

First, as a conventional long-term let.

On the rental market, renovated and refurbished,

this would achieve £700 per calendar month.

And as a holiday let?

I would look at the rate per week.

It's something circa £700 a week.

That's interesting.

One week's holiday let could match one full month's rent.

And though with a holiday let,

you're unlikely to get full occupancy,

if you could get, say, 15 to 20 weeks a year,

you could be quids in.

Well, it's a good price for a property in this kind of location.

So who was inspired to buy a house on a hill overlooking Prestatyn?

Let's go to the auction and find out.

And with the Prestatyn house being right near the end of the auction,

it was up for grabs in an almost empty room.

So a three-bedroom mid-terrace,

in need of a full upgrade and refurbishment scheme.

The guide on this is £95,000, can I say 90?

What's that, sir? 80,000, we are up and running at £80,000.

Can I say 85 anywhere else?

Anybody else, 85. 90?

Five? 100?

Five?

Fair enough. 100, I have then, I'm looking for 102?

I'll move on, for the first time at 100,000,

second time for £100,000?

Last chance, all going at £100,000...

Sold. Well done, sir, you got it at 100.

And that successful bid of £100,000

was made by local Prestatyn man Tony.

And he joined me back at the house with his brother, Ian.

Tony, Ian, good to meet you both.

-And you, Mike.

-Congratulations.

-Thank you.

-Fantastic view.

-Yeah, great view.

-And pretty nice house.

Tell me why you wanted to buy it?

Well...

We only saw it advertised at auction, didn't we,

about 16 hours before the actual auction day.

16 hours?

-Yeah.

-Right.

So, but we live on the hillside anyway.

-Oh, do you?

-Yeah. I live just about 1,000 metres down the road.

So we know houses like this don't come up for sale very often here.

-Right.

-And we know these views are a premium.

-Right.

-We had a quick look through the window,

and went to auction the next day.

Tell me about you two first.

We're brothers. We've been in partnership in business for

26, 27 years.

-Wow...

-And we used to have an indoor go-kart track.

-Oh, what fun.

-Ten, 15 minutes away from here.

Wasn't a great work-life balance,

needed to do something different

so we decided to get into the holiday-let market,

-so...

-Oh, OK.

So we got a few,

this is the sixth or seventh one actually that we've...

Seventh one we've bought together, yeah.

Bought together, yeah. We've got two that are going live next week,

and then, hopefully, the rest will be ready

within the next three or four months hopefully, won't they?

Fingers crossed.

-Fingers crossed, yeah.

-So how is the holiday market in this area?

It's changed a lot.

It used to be a lot of people coming for two weeks holidays,

but now its people coming for weekend breaks.

What we're looking at as well is that we are right at the end

or the beginning, of the Offa's Dyke path here.

So there is a lot of walkers coming to this area to holiday.

So, hopefully, we might get some of them renting the place.

# She told me to walk this way

# Talk this way... #

Depending on whether you're walking south from here, or north to here,

the path is just a stone's throw away.

So there really is potential for a holiday-let market

right on their doorstep.

And though some people might be grateful for a roof over their heads

and a soft bed after a long walk,

I think most people might want a little more

than is currently on offer.

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

THEY LAUGH

Strip it right back.

Strip it right back. Needs everything, windows, doors, rewire,

central heating system, obviously new kitchens, bathrooms.

So we're basically going to take it right back.

But one of the main areas is, it's got no parking,

so we're going to create a parking space at the front.

By digging out?

By digging out and putting a balcony over the top of it.

-Oh, nice.

-With a glazed frontage

and then that will be like an outside area as well.

Oh, wow.

And we've done that at another property before, so...

Will that need planning permission?

We don't think so, so fingers crossed it won't.

I think it'll just be building recs, so...

OK, and will that have like an outdoor seating area

with a view and everything as well?

Yeah, that's right. It'll go out from here.

That would be amazing. Really capitalise on where it is.

So what's the time scale and the budget for doing the work?

We're looking at about four months, budget-wise,

anywhere between sort of 30 and 40,000.

And so is the plan to get more?

I mean, if it's working, why don't you just continue, I guess?

Yeah, we just, we've got another one at the moment

that's going to take up of a lot of our time as well.

So, once that one's boxed off as well as this one,

then, yes, we'll certainly be looking at more in the future.

Yeah, get these two finished first.

And how does it work between you two guys?

We basically do all the non-skilled labour together.

Yeah, we do all of the ripping out.

Tony usually finds the properties,

and then we'll do all the ripping out, don't we?

-Yeah.

-And then we'll get the professionals in

to do all the proper work.

And has it turned out to be less stressful and time-consuming

-in the work-life balance?

-At the moment, no.

No, far from it.

But, hopefully the long-term picture it will, it'll turn out that way.

We did say we've never worked so hard in our lives

didn't we, this year?

-Exactly.

-Bring back the go-karts!

-Yeah, exactly, yeah.

Oh, fantastic. Well, congratulations.

-Thank you.

-Good luck with it,

and looking forward to see how you get on.

Yeah. Thank you.

-Nice to meet you.

-Cheers, cheers.

So, Ian and Tony buying the house for the view,

as you might have expected,

to add to their portfolio of holiday properties.

I'm sure it will go very well.

Just a bit of sorting out to do first,

before it is ready to take those first holiday-makers.

You can find out how it all turns out later in the show.

Lucy is in Folkestone in Kent,

a place ever popular with those hunting for property.

And soon to get more popular

when the new high-speed rail link starts -

from the coast to London in under an hour.

Well, just on Folkestone's pedestrianized shopping road here,

is a mixed-use commercial and residential property.

There's a shop on the ground floor

and a flat spread over the two floors above.

Now its guide price at auction was £80,000 to £82,000.

Now the auction catalogue happened to mention

that it's been in the same ownership since the 1960s,

so can I expect some psychedelic wallpaper

or even some '60s-filled decor?

You never know.

Well, I absolutely love the exterior.

And no '60s interiors at all.

But it absolutely wholeheartedly 100%...

SHE SNIFFS

..smells hideous in here.

Damp, you can just smell it the minute you walk in.

It hits you in the face.

I mean, you can imagine, if you can smell beyond that,

see beyond everything in here,

you've got quite a little unusual shop frontage.

I actually like that.

And I do know that this is in an area

where you can't change things like that,

so it's going to probably have to stay as it is.

Probably going to cost a fair bit,

because that damp is really worrying.

So you've got your shop downstairs, the commercial premises.

Residential upstairs, the one-bedroom flat.

But what I'm really glad to see is this door.

Now the other side of this door is a little alley way,

so whoever wants to buy this, rent it, live here,

has their own independent access,

so they don't need to traipse through the shop to get upstairs.

I'm going to get upstairs and have a good look around.

# Looks like we're getting out to explore... #

So upstairs is the first level of the flat.

It's not huge, you've got a very narrow staircase.

Little staircase leading up there to the bedroom.

And the kitchen through here, we've got a very quirky room.

It's such an unusual shape.

Look at it, it's sort of goes like a square shape but a bit off.

And again, it absolutely stinks.

My goodness. Look at that.

The damp is everywhere on the first floor.

Let's see if the second is as bad.

So upstairs, well, this room

completely mirrors the downstairs space.

And again, the damp, you can see it you can smell it.

So I definitely think there's something wrong with that roof.

Now in the auction catalogue, it's interesting,

it calls, well, this is a bedroom and next door through here a study.

And that's because there's no window, therefore no natural light.

And this couldn't be classed as a bedroom,

because of the window issue.

But honestly, it might be pushing it as a study.

It's tiny.

So, as a one-bedroom flat over two floors,

with all the cosmetic work needed,

those windows will have to be replaced like for like,

as this is a conservation area.

Plus, extensive replastering

and potentially very expensive roof repairs.

Could this flat and shop guided at 80 to 82 grand

add up to a reasonable investment?

We asked along a local estate agent to give us his thoughts.

So this property is located in a very good location.

We are at the foot of the main high street,

and on the sort of cut through to the old high street area,

which is the creative quarter.

The small unit shop area downstairs,

I think would suit a sort of boutique-type shop.

Probably a sole trader,

somebody who wants to run their own business from there.

Sounds an ideal spot, but what about the flat?

The flat area of the property is actually quite interesting.

It's over two floors,

it's got sash windows to the front and the rooms are unusual shapes.

And you have, although it's only one-bedroom,

we have a separate room as a sort of study area.

But it doesn't have a window or ventilation,

so it can't be a bedroom.

But it could be quite appealing to somebody,

and the location is very good.

So, what could the shop and flat sell for on the open market?

Once the property is fully renovated,

I feel that the commercial unit downstairs,

we'd be looking at around £30,000.

And the residential one-bedroom property up here, at £75,000.

As one building altogether, I feel that might be a better route,

and I think somebody would pay around £110,000 for it

as one unit that they could use together.

Well, this shop and flat are not without their problems.

It's in a good location,

and it's great that you can sort out independent access for the flat,

but there is so much damp to deal with.

So, who was tempted to buy this quirky Folkestone property?

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

Put your hand up if you haven't bought a property yet.

Oh, one person.

All right, how much can we start the next bidding at then?

We've got a guide of 80 to 82,000.

Start me where you will,

but £80,000 should see hands flicking up everywhere.

£80,000 anywhere?

£80,000 to start me.

There's going to be a bun fight

if this doesn't sell in the room afterwards.

£70,000?

Thank you very much, £70,000 I am bid.

£70,000 I have, 72.

And four? 76, and eight.

And 80? At £80,000?

Lady's bid on the right-hand side at £80,000, I have.

82, I have.

What about 85?

After a low start,

bids then exceed the top of the guide-price band.

We rejoined the bidding at 92,000.

At £92,000, 95,

at 98, sir?

98. 100?

£98,000 I am bid,

100, do I see?

For the first time, at 98,000.

For the second time, at 98,000.

For the third and final time, 98,000, are you all done?

Sold at 98,000.

At £98,000, the buyer was John, who's already a local resident.

Guess what he does for a living?

# Hey, Mr Taxi Driver! #

And the good news is, this is the cabbie's first property purchase,

and he's bought it for himself.

John, congratulations.

I think it's brilliant what you've bought here at auction.

You've got a lot of work to do.

How do you feel now? The hammer went down, and it's yours.

-Scared.

-Are you scared?

No, this is quite a lot of work to do.

Yes.

So tell me about your journey

and how you've got to end up being here in this position.

Well, I'm renting a place at the moment and getting a bit older now,

so I thought if I don't get myself a place, I never will, so...

So how did you manage to finance this?

Had to take out a bridging loan at the moment

because they won't give me any,

a mortgage on it, because it's part-commercial, part-residential.

So were are you hoping to buy this

and then be able to get a mortgage on it straightaway?

I hoped to yes, but

they don't seem to want to know, no.

So you've had to get a bridging loan,

which is really costly.

-Yes.

-And is that worrying you at all?

Not hugely, but as long as it's not too long,

as long as I get something sorted fairly quickly. Yeah.

# I want a roof over my head

# And bread on the table... #

So, John has decided it's time to own a home.

However, a bridging loan might not be the best choice,

they're really designed for short-term,

and they can be very expensive,

with a much higher interest rate than a conventional loan.

It's always wise to arrange a loan and the interest rate

before you put your hand up at auction.

But the first thing John should do now,

is get a specialist to source a good mortgage deal and quickly.

We're still in a rush to put a roof over his head,

John has a property with serious roof problems.

So tell me about the roof, it looks as though there's leaks everywhere,

it could be quite an expensive job to rectify.

Have you been up to check it out?

No, no, no.

I'm a bit of a wimp, me, I'm scared of heights.

So, I'll just get somebody else to go up there.

John, you need to sort it out.

I mean, there's obviously problems up on the roof.

Yes, yes, yeah, I have to get someone in

who knows what they're doing.

So are you worried that what you've bought

might end up costing so much more than what you initially thought?

I hope it doesn't, but...

The roof is the biggest, biggest expense, really.

Unfortunately, while John did view the property before the auction,

he didn't consult any experts about the damp.

# Oh, no... #

Have you got any idea of the budget,

and how much money you're going to need to spend here

to turn things around?

No, no...

John, you're really frightening me.

How much do you think you might need to do the work here?

If I wanted to change any of the windows,

it's a conservation area, so...

You're looking at about a grand a piece on those sash windows.

So I take it you're probably not going to be changing the windows?

No, no. Not in the short-term, no.

It's just the roof really, it's the main cost.

Have you got any idea how much that might cost you?

I did phone somebody up and I managed to get a...

they gave a rough sort of idea of about three and a half grand,

plus scaffolding.

And that was just on the phone.

They hadn't seen it, so that's a really loose estimate.

-Rough, rough.

-OK, right, that's worrying me as well.

What about your funds?

So, did you put all your money into this property?

-Yes, yeah.

-So you don't have any side funds to pay for the works?

Not a lot, no, no.

How long do you think it's going to take you?

It's probably going to take a year to sort the place out.

I work on weekends, and in the evenings,

so I'll just have to try and do a bit during the day.

Are you worried about renting out the shop?

Once you've got it tip-top and all looking good,

you've got to find somebody that wants to rent it from you.

What sort of business could you see running from here?

Yeah, there's a lot of art shops and I think down,

down sort of around the old high street area there.

Are you going to be all right?

-Hopefully.

-THEY LAUGH

Listen, we shouldn't laugh, because this is quite serious.

I don't want you spending any more money on that bridging loan.

No, no, no, I've got to get that sorted as soon as possible.

-Good luck with this.

-Thank you.

I really can't wait to see how you turn it around.

-Lovely meeting you.

-Thank you, thanks very much.

Thank you.

John wanted to leave the world of renting behind,

to buy his first property.

But he's bought a bit of a tricky one here.

My biggest worry is his finances!

That bridging loan!

We'll find out which problems John solves later in the show.

Still to come, in Derbyshire this three-bed Darley Dale cottage

gets me channelling my inner Sherlock Holmes.

I'm taking a guess, that was the colour of the wallpaper.

And at John's Folkestone property,

avian residents mean his roof repair plans have had their chips.

Seagulls were on there.

We're heading back to North Wales now,

and the picturesque seaside town of Prestatyn

where, earlier, I saw this three-bedroom mid-terraced property

guided at 95 grand.

My first thought was, does it have a good view?

Yep, it certainly does.

# Ain't no mountain high enough

# Ain't no valley low enough

# Ain't no river wide enough

# To keep me from you... #

Sadly, the internal view of the property was far less inspiring.

Particularly in the kitchen and bathroom.

The three bedrooms, though, were a good size,

and the front ones enjoyed this spectacular vantage point.

Paying 100 grand for the property

were brothers Ian and Tony, on the right.

Years ago, they had decided to sell their demanding go-kart business

and go into property development

in the hope of a better work-life balance.

They already have six other holiday lets in their portfolio.

And were aiming this for the same market,

because of its proximity to the Offa's Dyke path.

When we met them, I hit them with my favourite question,

you know the one.

So tell me what you're going to do to sort it out then?

Strip it right back, needs everything, windows, doors, rewired,

central heating system.

One of the main areas is, it's got no parking,

so we're going to create a parking space at the front.

-By digging out?

-By digging out,

and putting a balcony over the top of it.

-Oh, nice.

-With a glazed frontage.

All that digging and clearing would certainly worsen

my work-life balance.

We're back, just over eight months later, to see the changes.

# I can't wait to go home

# I'm on my way... #

And what a change.

They've really solved the parking issue.

And opened the view up to the outside space.

# Over the castle on the hill... #

I can't wait to look inside.

Remember the old bathroom?

It now has a much more hygienic flooring

and waterproof cladding for a groutless mould-free finish.

Worthy of a 5-star hotel.

And ideal for the demands of frequent changeovers

with holiday lets.

Do you remember how the master bedroom looked?

Nope? No worries, I'll take you back to when it was like this.

# Take me back to when... #

Well, actually, Ed, it was February 2017,

we did mention it earlier.

Anyway, this bedroom being at the front of the house

is one of the two that really enjoy those fantastic views.

And there's lots of touches of luxury here in the dressing room.

# I can't wait to go home... #

Well, just keep singing for a minute, we're nearly done now.

And here's bedroom two.

And finally, upstairs, the back bedroom.

# Over the castle on the hill

# Hey, hoo, oh... #

Well, we'd better hurry things along now,

because I think Ed needs to get off home.

Pretty much anything you would've done to the kitchen

would've been an improvement.

And this certainly is.

And the front room, let's face it, it was pretty user-hostile.

Now, it's got a homely log burner making it, ooh, homely.

And the dining room has a rejuvenated feature,

over to Tony and Ian.

You can get off now, Mr Sheeran.

We decided to put the French doors,

just to bring the garden into the house, almost.

Because nowadays, a good garden is almost like an extra room.

It's like an extra living room.

And the brothers didn't do it all on their own.

They called in a relatively seasoned tradesman,

Ian's father-in-law, Bob, and his best friend, Brian.

We cleared all the rubbish out of the way, didn't we?

-And they had all the tools to hand.

-Well, they were great, weren't they?

-Oh, yeah, couldn't have done it without them.

-No.

But working with family and friends can be tricky.

Was there any sibling rivalry?

We wouldn't be brothers if we didn't fall out, would we?

No.

The chaps are fairly cool about doubling the timescale

to eight months. They put new drains in at the back,

plus planning for the carport took its time, as did digging it out.

There must have been about 20 odd tonne that we'd actually handballed

at some stage up to a skip 200 metres up the road, and between the

two of us, we shifted most probably 18.5 of those tonnes, didn't we?

-Yeah, definitely.

-So, yeah.

I'm told "handballed" is a technical term

used in the wheelbarrow fraternity.

So, how's the new work-life balance compared with the old days?

Well, we had a little say in when we worked at the go-kart tracks,

saying, "It's not exactly digging coal, is it?"

But this has been worse.

The original budget was £30,000-40,000,

and Tony and Ian reckon they've spent £42,000 before fees.

But have they learned anything for the future?

Find somewhere with better access.

Yeah, without a doubt.

The chaps also learned that a previous occupier was

privileged to be one of the few saxophonists

who is rumoured to have played with Dusty Springfield.

On occasion, we do hear the slight sort of tones of a saxophone

late at night, don't we?

# Spooky... #

The chaps have started taming the overgrown back garden,

and they're going to invest more in its landscaping in due course.

They've found it's got three distinct levels,

and want to capitalise on it.

# Ooh, spooky... #

The spectre of estate agents' valuations may put a shiver down

some developers' backs, but I suspect not here. So first, the

agent who's visited this particular haunt before work started.

It's a nice traditional property.

Dates back, I think, to about the 1890s.

So they haven't ruined it in any way.

I think it's a really, really nice property.

I think the property has been done to a very high standard,

a really nice finish, even down to the doors.

So, having bought it for 100,000 and spending 42,000 on it,

the top agent sales evaluation came out at 220 grand,

a potential 78 grand profit.

But as we know, the chaps aren't in it for the short-term game.

It's more about maximising their assets in the long-term.

So if it was a holiday let, it could achieve around £800 a week.

In the high season, this would achieve £850 per week.

And in low season, I would suggest that it would be

something in the order of £600-£650 per week.

For simplicity, let's take the average of £725 per calendar month,

which equates to an annual yield of nearly 7%.

We've had some forecasts done already.

They were projecting about £20,000 a year based on 30 weeks occupancy.

So, if we have, you know, anything over 40 weeks, it's a bonus.

Has anything in this project made them wary of

returning to the auction?

-Nothing to be afraid of.

-Definitely not.

We've bought most probably half our portfolio now, at auction, so...

You know, I'd recommend it to anyone as long as they do their homework.

We're in Derbyshire, in the village of Darley Dale,

a popular spot on the edge of the Peak District, with some

very attractive period properties built using stone from the region.

This area is not just a lovely place to live,

but it's popular with holiday-makers,

so I'm hoping to find something interesting.

Now, the property I'm here to see is this. It's a three-bed cottage,

over three floors with a guide price of £78,000 plus.

It's raining, so I'm going inside.

# And a little rain never hurt no-one... #

All right, so we're in, and straight into the front room.

Good size, actually. Wasn't expecting it to be this big at all.

Fireplace here, gas fire, nice high ceiling.

Central heating as well.

It does...

OK, I'm taking a guess, that WAS the colour of the wallpaper.

So, yes, it hasn't been touched in some time.

Through across a small hallway,

there are the stairs going up to the bedrooms.

I'll get up there later. Into the second reception room,

and you've got some... you could call it vintage.

Some people might call it retro.

Whatever it is, get rid of it.

This is '80s. We don't want '80s now, we want modern.

Get rid of this, more space in here, good size room again.

I recognise that stadium - West Ham's old ground, called Upton Park.

Scored there many times, I've got to say, thank you very much.

And then you stroll into the kitchen.

Galley kitchen, good size again.

And there is a lean-to just out here as well.

But, like everything else I've seen so far,

this place needs a bit of TLC.

Needs a bit of effort and a bit of love given to it.

Modernise it - that's all it needs so far.

Upstairs, there are more rooms in need of TLC,

two bedrooms and a bathroom, to be precise.

And wow, an avocado suite.

Now I've heard that these are sought-after again.

Just shows you, hang onto something long enough, and...

No, take it out.

And there's a lot of wood panelling on show, and I would definitely

get rid of it and take this house up a level.

Speaking of upper-level...

So this is your third bedroom in the loft space. Now, it's

quite unusual you've got this much headroom in a loft space bedroom.

But it's good, it's a double size.

You'd get a double bed in here, no problem at all.

You've got some wardrobes here...

Which aren't too bad, bit of cupboard space.

You could also use this as an office if you were to work from home.

Have this as your office space, get rid of the wardrobes,

you won't need those. Make it just that little bit bigger.

I'm happy with the size of this room. And, if you are...

..6' 2" plus, on your tip-toes, you can enjoy the view.

# Peekaboo! Peekaboo! #

You might only get a peek at the Peak District from here,

but it's better than nothing.

And although we're at the top of the house,

we haven't peaked yet at this property.

So let's have a look out the back, see what we've got.

That's Dublin!

And he's scored again!

Anyway, the back garden is long and thin. It's a decent size.

But it's the back of the house I wanted to look at,

and I know what you're thinking. You're thinking the same as me.

DOG BARKS What about...?

And the dog is thinking the same thing as well.

A bit of an extension, not that simple.

This is a conservation area. This is the Derbyshire Dales -

you can't just stick up a conservatory wherever you want.

# Change is hard, I should know... #

A chat with your local planning officer is a good way to find out

what you can and can't do in a conservation area.

There are normally restrictions on anything to do with the exterior,

such as types of materials used in cladding,

external walls, chimneys, and windows.

This ensures that all buildings in a conservation area remain in keeping

with the area's special architectural quality.

The building isn't listed, though, so work can be done internally

to this house to get it fully modernised.

We've asked along an agent from the auction house that sold it

to see what he thinks of this place.

Having seen the property myself,

internally, it needs a good scheme of improvements, really,

ranging from a new kitchen and bathroom to re-plastering,

perhaps a new central heating system,

some windows will need replacing.

So overall, a comprehensive scheme of improvements that is needed,

and will surely bring it up to a nice, modern day standard.

And once fully modernised,

what could this house guided at 78 grand plus be worth?

On the open market, it's likely to achieve in the region of

£165,000-£170,000.

So this cottage needs a bit of money spending on it,

and it's in a conservation area, so you are restricted somewhat

on what you can do to the outside of this place.

But you're in the Peak District, it's beautiful here.

This should appeal to a lot of people.

So, why don't we find out who peaked at the right time

when it went under the hammer?

Highly desirable location.

I know lots of you have been to see this property.

So, guide price here is 78,000.

Who will start me off on the guide at 78?

75?

We'll go further away than this.

72? We've got 72,000 to put this into the bidding.

She has, thank you, at £72,000 we're away.

72, I have, 73 now?

72,000, 73?

There was plenty of interest in this lot,

but eventually, it boiled down to two bidders at the back of the room.

They soon took the bids up to £102,000.

102? It's back at 102 and a half.

And a half again. 103. And a half?

104. And a half?

105?

Fair warning, the hammer is up at £104,500.

It goes to the gentleman right in front of me seated.

Sold. Well bought, sir, at 104 and a half.

Thank you.

And, after a tensely-fought lot,

the purchaser who paid £104,500 for this was Daniel, who was seated.

Stood behind him was property broker Abdul. Abdul has been on the show

before when he renovated a house in Swadlincote.

In his role as a property broker, Abdul searches for

suitable properties to purchase and renovate for his investors.

In this case, he's working for Daniel.

I met him back at the house to find out more.

-Abdul.

-Nice meeting you again.

-You've been on the show before,

-and you're still at it.

-I source the properties for the investors,

so this is for another investor.

Is this what they were looking for?

Yeah, they're looking for flip projects.

So buy something run down like this,

you know, spend a bit of money, and sell it on.

OK, so have your clients seen this?

Yes. I always advise my clients to come and view the property...

-Clever.

-..prior to auction.

-Good work, good work, yes.

-I'll take a handshake on that one, good work.

-Thank you.

-Good work. Good work, don't let your clients down.

-No. Never.

Now when they seen it, were they happy? Did they say, "Well done"?

Yeah, there's bags of potential on this property.

We've had a value of about £185,000.

-OK.

-Similar properties have sold for about £190,000.

So if we achieve 185, then the investor is going to be very happy.

So you've done your research in the area, you know what

-properties are going for?

-Yeah, that's what we expertise in.

So we don't just source it,

we do all the evaluation reports etc for the investor.

So, it saves them a lot of the legwork and the tension

and the headache.

There are plenty of people who want to invest their savings in property,

but don't have the time or expertise to do so.

So they go through brokers like Abdul or other companies

offering a similar service.

As always, it's important to make sure the companies are reputable.

And also remember that there is always a risk that you could

lose out on any project. The one thing that can minimise that risk is

making sure that for every project, you do something I'm always

banging on about - research, research, and more research.

So, in the Peak District here, very pretty place.

You get a lot of holiday-makers here as well.

Was that in the thinking with the client?

That's one thing that impressed the investor,

because there's lots of tourism, and we've studied the market quite well,

and the properties are selling very fast.

So that's what appealed to the investor most.

Well, this is in a conservation area first and foremost,

so you're kind of restricted. Did they know that? Do they mind?

That's right, yeah, no, that's what they used me for.

And, of course, it's a restricted area.

-We can't change the outside.

-Uh-huh.

-We can't do an extension.

But interiorly, we've been given advice we can change it,

-bring it to a modern standard.

-It's just all old-fashioned, isn't it?

That's right, strip it all bare. You know, bring it back to freshness.

-That's the plan.

-What's your budget for this project?

Maximum budget, £20,000.

-OK.

-But there's always unforeseen things popping up.

-Of course.

-But we're going to tend to stick to the budget, £20,000.

OK, 20 grand, and what's it going to be spent on?

I know you want to refurb it, and just change it all.

Yes, so rewiring the place. You know, decorating the whole place.

-Probably going to put a coal burner there.

-OK.

Changing the doors, etc.

So everything's just going to come back to the bare brick.

-Bare brick?

-Yeah, bare brick, and style all over again.

Are you getting involved in this one?

Are you getting your hands dirty on this one?

No, I might take the tie off, though.

-Is that the lot?

-Yeah, that's the lot!

No, I project manage the repairs for the investor.

So 20 grand budget - how long is it going to take you to do?

We're looking at about three months. Three months timescale.

-Start to finish?

-Yeah, start to finish.

OK, and you're happy with this project moving forward?

Very, very happy, yeah. Very happy.

-Can't wait to start.

-I can't wait to see it.

I really can't. I wish you all the best.

-Thank you, sir.

-Good luck, Abdul.

-Thank you very much.

Well, it's good to see Abdul again, and as per usual,

he's as confident as ever.

He's talking the talk, but can he walk the walk?

He's happy with this project,

but will his clients be happy with the end product?

You can find out how he gets on later in the programme.

Well, earlier on we saw how one property turned out,

but what about the other two?

Yes, will they look any different and will all that time and money

have been well spent? Let's find out.

Back to Folkestone in Kent now,

where Lucy looked around a mixed use lot.

A shop on the ground floor, and a two-storey flat above,

all guided at between £80,000 and £82,000.

The main problem with the property got up Lucy's nose straightaway.

Damp - you can just smell it the minute you walk in.

It hits you in the face.

The property was bought for £98,000 by local Folkestone cabbie, John.

This was his first property purchase to save him from

paying rent, and to get on the property ladder.

But the premises weren't mortgageable,

and John had taken out a bridging loan to finance the purchase.

And is that worrying you at all?

Not hugely.

But, as long as I can get something sorted fairly quickly, yeah.

Time is of the essence with bridging loans,

as they are one of the most expensive ways to borrow money,

and John had ploughed all his money into the property,

so financing the refurbishment and the cost of the loan concerned Lucy.

There was expensive roof work to be done,

and the windows weren't in good nick.

About a grand apiece on those sash windows.

So I take it you're probably not going to be changing the windows?

No, no, not in the short-term, no.

How long do you think it's going to take you?

It's probably going to take a year to sort the place out.

I work on weekends and in the evenings,

so I just have to try and do a bit during the day.

With lots of damp and the financial and time pressures,

John certainly had a challenge on his hands.

Well, it's nearly 16 months on,

and we've returned to see how he's getting on.

But don't get your hopes up before we arrived,

he warned us it was at the, "worse before it gets better," stage.

Yep, I'd say that looks worse.

John's taken the back to brick approach in spades,

and in the process, revealed a fireplace in the living room

just by the shop window.

Let's take a look at the top floor, where John's currently living.

Unfortunately, the boiler blew up just after John moved in,

so there's no heating or hot water,

apart from the electric shower, now behind this screen.

Up here, I've took all the walls out.

There was a bedroom there, main bedroom,

small box room there, and bathroom at the back.

What I would like to do is put a bathroom in the middle,

and have the back of the building as a small second bedroom.

And before he can tackle reroofing,

there's a problem up here with rotting joists.

Yeah, I'm going to have to replace all the joists there

before anyone can do anything, really.

And just probably get somebody in to actually put the actual roof on.

The joist ends have rotted - they were resting on this wooden

wall plate, which has also rotted in places.

John is hoping to make a lot of the internal changes himself,

but he's wise to be calling in specialist roofers

to fix and secure the roof's structure.

He's repointing the old walls,

because the mortar has turned to dust.

The rotting joists and the sandy mortar story

continues on the first floor.

John's new layout sounds good, but do remember,

while it's OK to knock down non-supporting walls,

supporting walls need to be removed by the book.

Structural engineers' calculations are required by building control

to determine the type of steel support required to keep

the upper floors from falling through.

John's tackling the jobs he feels he can do himself.

Obviously, that involves dust getting on both floors,

and it's a bit awkward when I'm actually living here,

to try and work around myself.

It can be a fine balance between getting in the professionals

for some jobs, and economics,

which often dictate what you can afford to do.

But some building works - electric and gas work, for instance -

should never be carried out by unqualified people.

Whoever does the work, it will all need to be inspected and passed

by building regulations. Some of the windows

have had to be replaced by Perspex sheets, as they weren't secure

in the rotting frames, and fell out, including the bathroom.

Lucy was right to be worried about them.

On the face of it, it looks bad.

It is, but with stripping out, John's cured the damp problem.

There was a pipe running from the next-door neighbour's roof,

which was going into the corner of my guttering as well.

I had to move the pipe, because even with the gutter cleared,

it still wouldn't cope with it all,

and it was just running down that back wall there.

# Here I am, stuck in the middle with you... #

Above this lobby area on the first floor, John is planning on making

a roof terrace, and as for the leaky main roof...

Being up there, I've patched it up a little bit.

Seagulls were in there last year.

But the scaffolding to repair the neighbour's chimney pot

got in John's way. It stayed there until the gulls had gone away,

and come back again.

# Here I am, stuck in the middle with you... #

Since 1981, seagulls, like all UK wild birds,

have been protected under the Wildlife and Countryside Act.

It's illegal to take, damage or destroy the nest of any wild bird

whilst it's in use or being built.

John's certainly tenacious,

stripping the debris and even taking it to the tip in his car.

Despite a catalogue of issues, and with no definite budget,

he's managing to put a positive spin on living in this shell

and paying an expensive loan.

Maybe I'm saving on the rent with what I was paying before,

but it's still sort of a...

Quite a bit.

With the bridging loan,

don't forget you only pay off interest, and they are high rates,

and involve costly entry and exit fees.

Should be worth it in the end, hopefully.

Let's find out, as we invite a commercial property

and a residential property expert in

for their valuations on the shop and on the flat.

It's most likely to be some type of food or drink establishment,

I would say, rather than a retail shop.

Something like a micro-pub or wine bar.

Oh, a micro-pub downstairs, I like the sound of that,

so long as the flat is well soundproofed.

Anyway, the entrance to the flat is also going to be improved,

as John plans to section it off from the rear of the shop.

By doing the work on the shop himself,

John has kept the renovation costs to a bare minimum,

on top of his £98,000 purchase price.

But what's the end value of the property likely to be?

Certainly once it's all complete, I would expect the owner to be

able to receive a figure in the region of £5,000 per annum,

which equates to roughly £415 per calendar month.

Yes, quite a bit more than what I thought it might have been.

Yeah. Didn't think it would be worth that much.

We know that John's intention is to live above the shop

- that's why he bought it - but could that rental value,

added to the shop's potential income, sway him to rent out both?

As a one bed, I would expect it to achieve around £700 a month.

As a two bed, slightly more, around £750.

For the flat rental values alone, would John be tempted to move out?

For that sort of money, yeah. Yeah, that's, a bit high, isn't it?

Well, John seems chuffed with that.

Perhaps he's beginning to see the light at the end of the tunnel.

But this is a bit of a cautionary tale.

It's really, really not good practice to bid for a property

without having your finance and your budget in place.

In this case, with the bridging loan, time literally is money

and there's still a long way to go. Just how long, John?

Hopefully, sort of the middle of next year,

hopefully sort of pretty much be getting towards getting it done,

hopefully. Fingers crossed.

We've all got our fingers and toes crossed.

Time to head back to the Peak District, where I saw a property

that was quite jolly from the outside,

but the inside was a little bit dated and tired.

But I had a prescription for that.

This place needs a bit of TLC,

needs a bit of effort and a bit of love given to it.

# Can you feel a little love? #

What I did love about it is the space on offer.

Not only did it have two bedrooms and a bathroom on the first floor,

there was a lot more space on offer in the third bedroom in the loft.

And, if you are...

..6' 2" plus, on your tip-toes, you can enjoy the view.

# Can you see what I see? #

Someone who DID see what I saw was Abdul,

a property broker who recommended this to one of his investors.

Have your clients seen this?

Yes, I always advise my clients to come and view the properties...

-Clever, good work.

-..prior to auction.

Good work, good work, yes, I'll take a handshake on that one, good work.

-Don't let your clients down.

-No, never.

Now when they seen it, were they happy? Did they say, "Well done"?

Yeah, there's bags of potential on this property.

Well, Abdul hoped to unleash all the potential that this dated cottage

could offer, for a 20 grand budget and in three months.

But now, six months later, we're back.

Wow, I can see why things have taken a little longer.

Opening up this lounge wasn't part of the original plan,

but I'd say it's been worth it.

Abdul's team of builders had discovered a load-bearing joist that

was already in place, so at some stage, this was an open-plan area,

then separated by a stud wall, now it's open-plan again.

Just goes to show, it's all about personal preference.

I'm also glad to see some original features have been uncovered.

Although, I do like an ultra-modern kitchen, so I hope some of these

dated units have been given the heave-ho.

This fresh modern look continues upstairs.

They may not have laid out the red carpet,

but I'm hoping a replacement for the avocado bathroom

is awaiting its premiere.

Nice.

The bedrooms have also had the star treatment,

and been freshly decorated.

And up in the loft, the cupboards have gone,

to create more space.

I'd like to say, "Let's enjoy the view,"

but it's another wet day out there.

But Abdul has given us another surprise,

as there is now off-street parking.

When it comes to turning your garden into a driveway,

always check whether you need planning permission.

Different councils have different rules,

but you will need permission for a dropped kerb.

Abdul's enthusiasm for developing properties hasn't been dampened,

despite the weather.

When it comes to being a project manager,

it's not just about sourcing the property.

It's about sourcing the property and making sure the builders do a

good job, so the amount of times I've travelled to this property,

to make sure things are right, I've lost count. But that's my job.

With the front of the property,

we needed a stamp of approval from the investor,

because we thought this was a conservation area,

and we might not be able to take a brick wall out.

But we managed to find out it's not under the conservation area,

so we managed to take that off and created a driveway which adds value

to the property. I managed to convince the investor,

even though he's spending a little bit more.

But that adds a lot of value, so we're hoping he'll achieve

much more profit due to that having a car parking spot.

So, a bit of give and take with the investor. At the end of the day,

it's in Abdul's interest to maximise the investor's return,

but it can't be at the expense of the budget.

So, did he stick to it on this project?

Million-dollar question. On this one the budget was £20,000.

Well, we've gone lower than that. Including the landscaping

and everything, we're looking at about £19,000.

Well done on that, and also well done on the timescale.

The work has been done in three months,

but they didn't start right away.

That's why we're coming back six months on.

It has taken a bit of a while. That's because the investor,

he had different minds about this property,

to do with the budget, etc, so we've managed to convince him.

We've finished, we've completed the project and we're just waiting for

the end result now. We do understand there's a high demand in the area

for properties, so we're hoping for him to achieve a very big profit

on this one.

Well, it's time to find out if it's all gone to plan

for Abdul and his client. We asked along two local estate agents

to have a look at the property, and give us their thoughts.

First, let's hear from the agent who saw it last time.

Now, seeing it for the second time, I'm pleasantly surprised.

Done very well, nice neutral colours,

and good quality fitments. So, yeah, good job.

It's a traditional cottage,

obviously surrounded by lovely countryside.

But it's been done to a nice specification, modern.

So the big thing, really, for a potential buyer,

they haven't got to spend anything,

which at this level, is important to people.

It's a hit with the agents, but will this £123,500 investment

hit the profit margins Abdul and his client are looking for?

If we were to place it on the open market,

I would say in the region of £170,000 £180,000.

I would anticipate marketing this property in the region of £180,000.

I think that's a good price.

We were aiming to achieve a little bit more because there's a property

that's come on the market a few doors away.

It was marketed for £199,500. It didn't last that long in the market,

it's been sold. And this is a better property,

so we're aiming to achieve a little bit more.

But even with the figures that they've, you know, given you,

I think that's a very good profit.

£50,000-60,000 profit - that's amazing.

Taking the agent's top evaluation means a potential profit of £56,500,

minus taxes and fees, including Abdul's, of course.

But there's more to it for Abdul than making money.

The passion has grown for me,

and the family's involved into the business as well.

So at times when I'm going to view the properties,

I take my little ones with me, and I tell them,

"All right, you're going into a property - look for faults.

"Look for cracks, look for faults, and that's what we're here for".

So particularly, this property, I had my two sons come around

when I sourced the property, and that's what they were doing.

They were looking for cracks and faults.

And now, when they see the end result,

it creates a passion with them as well.

So they feel like, "You know what, Dad? You've done a great job,"

and it brings smiles to the family as well.

We hope you've enjoyed today's projects, and maybe even picked up

-a tip or two.

-Yes, we hope we have inspired you.

And we'll have lots more where that came from next time,

-here on Homes Under The Hammer.

-See you.

-Goodbye.