Episode 19 Homes Under the Hammer

We're all tempted by those glamorous properties advertised in newspapers and magazines.

But don't you find they're always over budget?

Yes, but one way to get interesting properties at good value is to visit the auction rooms.

Everything looks good with this flat in Folkestone, Kent, until, that is, you go round the back.

It's a concrete jungle, you don't want to look at that!

This two-bedroomed house in Surrey looks normal from the outside.

But just walk through those doors... and it gets really, really weird.

These properties have been sold at auction.

We'll find out who bought them and what they paid when they went under the hammer.

House sold!

Folkestone in Kent is on the up, a local council have great plans

for the area. High-speed rail links, new shopping centres and houses are all scheduled in the next few years.

I love these old, grand Victorian houses.

Years ago, rich merchants would have lived in them

with their families and their servants.

Today, as you can see, they've become a little more run down and they've been converted into flats.

I've come to see a ground-floor flat, it's got a garden and it's right there.

That gorgeous Victorian frontage is looking a little bit tired,

the garden's a mess and you'd want to get the roof checked out,

but the guide price of just 65,000 to 70,000 takes all that into account.

Got to say, first impressions aren't great.

Lots of tiles all broken down here, the doors are a bit wobbly,

there's bikes and prams all piled up in the corner.

The next-door flat hasn't even got a front door.

Now, I've done my research and I do know the maintenance charges here are £800 a year.

I'd want to know where my money's going, I think.

It gets better through here, looks as though the hallway's decorated,

there's some nice spotlights, a good-sized lounge,

but the floorboards are up - warning signs - maybe there's some dry-rot,

some damp, it's definitely worth having that looked at.

But you've got a spectacular Victorian bay window. Another good-sized room here.

You've got views out to the terrace, painted a funny lilac colour, but apart from that, it's looking good.

Moving through, the colour scheme changes in the second bedroom.

This is pretty small, but you could fit a single bed in here.

At the end of the corridor is the kitchen.

Looks as though there's quite a bit of work going on, some rewiring, etc.

You've got a new window, that's going to let in lots of light, but a nice square kitchen.

You're going to have to think about replacing all the units in here,

but through the kitchen, you get to the bathroom.

By the sound of it, there's a dodgy boiler in the corner.

That's going to definitely need to be looked at, but it's a good space.

You've got lovely white and blue tiles, fairly new,

a nice, new white bathroom suite, but sadly,

to get to the garden, you have to walk through the bathroom.

So that's one hurdle to cross... Oh, no, there's another one.

If you'd just go right the way down the end of the garden...

Keep going back, keep going...stop!

Now take a look at that.

It's a concrete jungle, you don't want to look at that!

There's a couple of flats with roof terraces up there and a really dodgy-looking fire escape.

It looks like it's about to fall down at any moment.

Now this is the really interesting thing.

In the legal pack, there's a quote for a new fire escape. The cost?

£36,000!

Now that's going to have to be divided up between the three flats.

Let's just hope the buyer has read the legal pack and factored that into the costs.

It's things like this that make reading the legal pack so important.

Always read it before thinking about bidding at auction.

I would usually say a two-bedroom garden flat

with a guide price of £65,000 to £70,000 was a no-brainer.

However, with the high service charge and, of course, this little beauty here,

I would want to find out a whole load more about this flat before I bid for her at auction.

Guide price of 65 to 70, pop this one straight in. £65,000 to start me?

65,000 anywhere?

65,000, I'm bid by the door. At £65,000 I'm bid, and 67 do I see?

67 I have, and 70, 70 in a fresh place, and 72,

at 70,000, 72 by the door, 75 is bid, 77,

75 I have bid is sitting, you're out by the door at 75, 77 in a fresh place,

78 is bid, and 80, 80 I have, and 82,

being sold then for the first time at 80,000, 82 in another fresh place,

at 84, 85 is bid,

that was a very reluctant bid this side, 86, 86 I have, and 87.

At 86,000 then, for the first time at 86,000,

for the second time at 86,000.

Your last chance at 86,000, bid's on my left hand side, are you all done for the third and final time?

Sold at £86,000 and your bidder's number is 3278.

The winning pair are friends and business partners Nick and Neil.

They've known each other since university, where they graduated as physiotherapists.

They now run their own practice together, which is what led them into property development.

So what I want to know, what really led you into this project?

Well, I think that everybody knows that property is a good investment if you get it at the right price

and with the physiotherapy, we treat a lot of builders and developers,

and you have conversations while you treat them, and they sowed the seed,

"Maybe, shall we chance our arm?" We went to a few auctions, got an idea of the market,

what the process was and we decided if you're going to do it, you might as well take the risk.

That's what we've done and, so far, other than seeing the damp patches, we have no regrets.

No, I think there's not a great deal to be scared of, you know,

I think if you're happy to rip things up and roll your sleeves up,

I think the basic structure has been here for however long it's been here, 100 years or so,

I think you can't go far wrong.

One of the things which did worry me was the proposed price for a stairwell

out the back of the property, cos it's a concrete stairwell, it needs to be replaced.

I think the price quoted was in excess of £30,000.

Now, we've talked to a company that makes metal stairwells

and they told us you can get one for that height for £4,500.

Now, clearly, the maintenance company, there is a mark-up,

but it has to be a reasonable mark-up and we will have some issues if they try to push that through.

We'll have to establish a relationship with the management company, it's fair to say.

-I like the way you put that, very diplomatic.

-Yes!

-Well put.

In fact, that's the crux of this whole deal, the sooner the boys make friends with the management company,

the better, as there's the issue of that high maintenance charge.

I can see you two are definitely prepared for a fight.

Oh, I think we'd quite enjoy it, actually.

It's fighting spirit and I like it. Unfortunately, I think they'll need it,

because all of that will need sorting out before they can start

the real job in hand, renovating the flat.

What we're going to do is move the kitchen into that small room, galley kitchen,

and then, next to that, we'll open it up, big living area

next to that galley kitchen, with a door out from the living room.

And then we've got these two big rooms at the front as bedrooms.

-So how will you get into your garden?

-From the living room.

-You'll put a door out there?

Patio doors into the garden.

The big question I need to ask is, "What's your budget, guys?"

Realistically, we would be looking to come in under 5,000 on this.

-So about £4,000 you'd like...

-Yeah.

-Roughly yeah, give or take.

-THEY LAUGH

-Obviously, new boilers are quite expensive.

-Yeah.

-Yeah.

-You see, I don't think you can do it for £4,000 to £5,000.

-I'm a betting man.

-I'll bet you a tenner!

-Do you really think you can do it for four grand?

-Yes, definitely.

-Do you think you can turn it around in a month?

-No.

-Eight weeks.

-So, eight weeks, £4,000 budget...

-Yeah.

-Yeah.

-I'm going to be spying on you two.

-OK.

-Listen, good luck.

-Thanks very much.

-Can't wait to see it.

Neil and Nick are great guys and good on them for doing all the work themselves,

but I would advise them to take a good, hard look at their budget.

For all their plans, £4,000 is extremely tight.

This is New Malden,

just a 25-minute train ride into central London.

It's in the suburban commuter belt

but still manages to retain a friendly village atmosphere.

And with property about 20% cheaper than in nearby Kingston and Wimbledon,

it's a prime investment spot.

Well, this is Oregon Close, about a mile from the High Street.

What I'm here to see is this.

It's a two-bedroomed end terrace property,

built around the 1980s.

It doesn't look that inspiring from the outside.

Let's take a look inside and see if it gets any better.

You don't expect too many surprises with a property of this age.

And, yes, fair enough, a reasonable first impression.

A boarded-up window there.

It's a reasonable sized space. It's a modern house.

Even more so here in the kitchen.

Interesting coloration on the walls!

But not a bad-sized space.

And things like these units, yeah, they could probably do with ripping out,

or you could stick some drawer fronts on those.

Pretty serviceable. If you were gonna rent this place out,

a bit of paintwork, a bit of work in the kitchen,

and you'd get this place up to scratch.

Just off the kitchen is a tiny courtyard garden

complete with a home-made wishing well in the corner.

It's a bit dark, but removing that verandah

would lighten it up beautifully.

Well, it's all pretty standard stuff downstairs,

and then you come up here.

And it gets really, really weird.

It starts here in the bathroom.

How about this for a doorway?

I mean, the size of the door you'd have to have on there, it'd be huge!

Or maybe go for an open-plan bathroom.

Somebody's gone to all the trouble of putting real stone around the window.

Hmm. Nice aluminium loo seat!

Lovely(!)

And the bath itself...

Looks like it's been attacked by a shark! But the best bit for me -

look at this tap!

Fantastic(!) Straight out of the garden, that is!

A lion's head with a pipe out of its mouth!

Wow!

But it gets worse!

Because this is the bedroom. Apart from this strange thing here...

..what is going on there?!

CHORAL SINGING

Somebody must have spent a lot of money

doing this to a very particular taste.

Well, it just goes to show

the strange things that go on in the suburban houses of Britain.

I shall never look at a property like this in the same light again!

Let's see what happens when it goes under the hammer.

So this is lot 60, 10 Oregon Close, New Malden.

Where do you wish to start?

Yes. 150 on my right.

Gotta take it here. 150. Are you bidding? 155.

160.

160. 165.

170. 175. 180.

185.

186.

187.

188.

190. 191.

192.

195. 196.

197. 198.

199.

200. 201.

Have a think. Don't lose it for 1,000.

200,000 in the aisle. It's against you.

£200,000.

First time, second time, third and last...

201. Nearly lost you.

202. 203.

204.

205. 206.

207.

206.

207?

Back in? If not, 206.

First time, second time, third and last time. Are you all done?

Sold 206.

The new owner of our design disaster is Robert.

He's a former teacher who now runs his own IT training company

as well as some buy-to-lets on the side.

Now he plans to branch out into property developing.

I met him with his son James

to discuss their plans for this house of horror.

Congratulations.

-Thank you.

-It's one of the weirdest houses I've ever been in!

Well, yes. We didn't see it beforehand, so...

-It's our saving grace.

-I'm relieved you said that.

Had you bought it because of what it was like, I'd think, "Interesting".

-They are selling points, though.

-Are they?!

-You hadn't seen it before you bought it.

-No, I wasn't even at the auction.

I didn't expect him to buy a house that day.

I just got a text message, "I've bought a house. Thought it was a good idea at the time."

-And that was it?

-Well, he's taken two years to buy a property

and bought a property without looking at it!

At an auction!

It was a shock, to say the least, to be honest!

So tell me about you two, then.

Father, son. Eldest son of five.

He's been looking at doing this sort of thing for some time.

Did a year as an estate agent and really got into it.

He's been pestering me and I suppose that's where it's come about.

Pestering you like, "Dad, buy me a house"?

Yes.

I couldn't afford a house myself, so I had to rope somebody in and it happened to be him!

-Is the idea to do it together?

-Basically.

Actually, James does have a very good eye for things

and I think that's quite useful.

So he's helping with shapes and colours and that'll help.

Joking aside, it really isn't that bad.

Buying it for 206 grand

should give them a healthy profit margin.

What's the overall plan?

We thought we'd buy it, do it up, make it look nice,

and take the profit and move on.

Great. Do you have any idea how much this is all gonna cost?

Uh...

I think around 15, I reckon, at tops.

That's good, isn't it?

It looks like James has the whole thing planned out.

But it'll be Dad paying the bills this time.

James is obviously determined to get it right

and Robert is more than happy to help.

He's at university at the moment, but he has this as an interest

and if he gets into it, then yes, it's worth carrying on.

Because he's had this interest for some time.

It is a focus and if he can carry on, that's great.

If not, he'll move on to something else.

It's a starting block.

Yeah.

Great.

Are we going to see any of the interesting architectural and other features remaining

when we return in three months - he says, hoping for the answer, no.

Again, ask my style manager here!

-What do you think?

-No way! No way!

-It's all gonna go?

-It's all gonna be nice.

So, how will our father and son team get on with this interesting little property?

Find out later in the show!

Time waits for nobody, that's for sure.

So, have our buyers lived up to their promises?

-Shall we find out?

-Let's do that.

Three months ago I made a little wager with physiotherapists Neil and Nick.

They bought this ground-floor flat in Folkestone, Kent, for £86,000,

with plans to renovate and sell it for a profit.

I thought they were being a little too optimistic.

I was ready to eat my words,

but it looks like I needn't have worried.

They haven't won this time, but I'm not one to gloat.

I'm keen to find out what changes they've made.

We had a bit of an odd-shaped layout to the flat.

It's two-bedroom, one of the bedrooms was very small,

it was here with a door, we had a wall coming across here

and basically we'd be hard pressed to get a bed in there.

So we thought, well, let's shift the kitchen,

which was there, over here and then make this

a large sort of kitchen, diner, lounge, living space with a little breakfast bar across here.

We thought that made more sense.

One of the main problems when we bought the flat, there was quite a lot of dampness.

So the floors had to come up and the beams replaced.

There was a damp-course injected into the walls where you see the holes

and that had to take two to three weeks to dry out.

Subsequently we had all the walls and ceilings re-plastered.

# Bend me, shape me, any way you want me

# As long as you love me, it's all right... #

Just as they planned, they blocked off the back door in the bathroom

and added a new door, which will lead off the new living room.

Physios Nick and Neil have actually done quite a lot,

especially considering they're doing this while managing full-time jobs and families.

One of the biggest issues with this flat was the fire escape at the back, which they had to replace.

But with quotes of £30,000 coming in, the boys were keen to look around.

So have they got any further?

No agreement's been reached about the fire escape yet,

because that was obviously an outrageous quote to start with,

so we've sort of gone back to the drawing board with that.

And have they managed to solve those problems

with the high maintenance charges for what seemed like no maintenance?

We have now talked to the maintenance company and renegotiated maintenance fees,

pointed out that some things haven't been undertaken,

even though previous occupants paid for maintenance.

We've come down quite hard on them and they know that we won't be rolled over as such.

So things are getting sorted.

They said they could do the renovations for £4,000 in just eight weeks.

So, twelve weeks later, has the budget increased too?

It has gone up a bit, but we've still kept it under 6,000, which we're quite happy with.

Not bad at all, and largely due to them mucking in themselves. But how did they get on with that?

All in all, we're keen to do it again and, if anything, it's made us stronger friends, really.

Bet or no bet, they've done well considering the time they've had

and the flat will be lovely when it's finished in a week or two.

So, with a total spend of £92,000 to date,

will their first development project be a success?

If I put this property on the market today,

you'd get somewhere in the region of £120,000.

I would consider putting this property on the market for £130,000.

If they sell, that's a profit of between 20,000 and 30,000,

minus mortgage repayments for the last three months.

That's pretty good considering they're not doing this full-time.

It was quite nice to not have the one-to-one like we do with patients,

day in, day out. And that's why we're probably keen to continue on and do a bit more.

-You don't have to be clean to be a builder, do you?

-Right.

I'm sure many builders might disagree, but one thing's for sure,

these physios have certainly cleaned up with this flat.

Now, I've seen many properties over the years

but none quite like this two-bedroomed house in New Malden, Surrey.

From the outside, nothing peculiar.

But inside, things were a little unusual.

It was to be Robert and son James's first attempt at property developing

and they picked an interesting one to start with.

Two months later, I couldn't wait to find out how they'd got on.

I think it's gone well.

I think the good part is having some people, some builders,

that were reliable and did the job as they said.

That's a big thing.

And broadly,

it's been a straightforward job.

As you can see for yourself, this strange property has been remodelled

into something a lot more appealing.

Turning this Gothic masterpiece into a family home

has taken just two months.

With only a couple of weeks until it's completely finished,

there have been some major changes.

Well, this is the main aspect that's changed dramatically.

We've lost the wall. This used to be two rooms.

We've made it one large reception room.

We feel the open plan gives us a lot more space and more of a wow factor when you walk in.

You don't walk into a hallway, you walk into the main living room.

However, upstairs was going to take a little more consideration,

especially that bathroom.

A dramatic change.

It was all smashed up before.

We've changed the tiles. We've got some beige tiles now.

With a nice dark black floor

which we think looks really nice.

We've got the new shower, which my dad here bought.

I'm pleased to see that the lion's head tap

has been moved to a more appropriate location.

But what I really wanted to know

was how they got rid of the stained glass.

We replastered that

and made it conventional.

But she's still up there in the loft, if you care to go up there!

I'd love to see the look on the face of the person who discovers

the hidden Madonna in the ceiling.

Just how much has it cost to put it all right?

The original budget, I think we looked at a very minimum of ten.

And a top end, hopefully, of twenty.

In going through the figures I think at the moment

we're between ten and fourteen.

I'd say closer to fourteen, with bits and pieces.

-So that's been good.

-It's not been too bad.

It was James who had the idea of going into property development.

He saw the potential in the area after working as an estate agent round here.

Remember, they bought it for 206,000 and spent 14,000,

turning it into a good-sized two-bed home.

But should they rent or sell?

We asked two agents to give us their opinion

on its potential for rental and sale.

So what could they rent it out for?

Two bedrooms in this area are going for about 1,050 at the moment.

I'd put it on the market at that figure.

Original thought was maybe 950.

But to get 1,050 would be good.

No surprises there, then.

But could they sell this house for more than they've spent?

In its current condition,

we could put this on the market for about 250.

If it were to be completed, I think we could market it at 265

and certainly see what we could get between the 250 and 265.

-That would be a great result.

-That would be a great result.

-I expected that.

-Bearing in mind what we paid for it

and what we've spent on it, it would be a good result.

This is a very good start for this father and son team.

They've taken a rather strange house,

turned it into a great family home,

and made themselves a pretty tidy profit into the bargain.

We'll have lots more auction experiences for you next time.

So we'll see you then for more Homes Under The Hammer.

-Goodbye.

-Goodbye.

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