The nation’s TV viewers just can’t get enough of property shows and I confess that we at SDL Property Auctions are no different to anyone else. In fact, we probably love them even more than most people; there’s something very satisfying about watching a show when you have some inside knowledge of the subject.
Of course, our favourite has to be BBC TV’s Homes Under the Hammer, which SDL Property Auctions has been involved in for many years. Before the pandemic, we frequently welcomed the TV crews into our auction rooms and, over the past 18 months of live-streamed auctions, we have been delighted that the Homes Under The Hammer researchers have continued to track our progress and follow up with our buyers.
It’s always a thrill to see our customers, properties and colleagues featured on the show. What we particularly enjoy though, is seeing how our buyers transform their purchases into lovely homes to be resold, let to tenants or even to live in themselves. We don’t always get to follow up with our buyers so it’s fascinating to see their progress on the small screen.
We’ve also been excited to be involved in a more recent addition to the property TV show genre; the Great House Giveaway on Channel 4, where two strangers who are keen to get on the housing ladder are given a challenging budget to spend on a rundown auction property. They buy this unseen and are then given six months to work together to renovate it for resale, often carrying out the work themselves or calling in favours from friends and relatives. If there is a profit – and somewhat inevitably there isn’t always – they get to split this between them to use as a deposit on their own home.
As much as we love these shows and are grateful to them for raising awareness of auctions as a fast and efficient method of buying and selling property, they don’t provide the full auction picture. Instead, these shows can tend to reinforce one of the most popular myths about auctions; that they are just for rundown, vacant properties.
It’s true that many investors and developers do experience great success in buying properties that provide the opportunity to add value – and many of them begin their renovation journey by purchasing in one of our auctions. However, these refurbishment projects are only a part of our vast range of auction properties, which span everything from luxury city apartments to smart family homes, commercial properties, parcels of land and everything in between.
Not all investors have the time, resources or stamina to commit to a major property renovation. Some may even have been deterred by property TV shows themselves. After all, television has shown us often enough how projects can go wrong, how unexpected expenses can arise and how easily budgets can be exceeded; a prime example of this is the perennially popular Grand Designs on Channel 4.
Some programme-makers seem to love it when property owners make costly errors, such as failing to secure planning permission or get building regulations sign-off – after all, this is what gets people talking at work the next day or on social media afterwards.
For investors who do their research and due diligence, who tackle the project in the correct order and use reputable tradespeople or have the relevant skills themselves, the reality is usually much less dramatic, although admittedly it wouldn’t make quite such entertaining viewing.
There are also plenty of investors who prefer to keep their hands clean and leave the renovations to others. What TV property programmes don’t show are the many well-presented properties available at auction, which are ready to move into or let straight away, or which are already happily tenanted. These properties are far too run-of-the-mill to justify an appearance on TV but do represent a growing proportion of our auction offering – and offer fantastic opportunities for investors.
As an investor, buying a property that is ready to let means you save lots of time, money and effort in preparing the property and means you can start looking for tenants right away. You will only need to budget for ongoing maintenance costs, instead of paying for major repairs, floor coverings, decoration – and unexpected expenses.
If you can secure a tenanted property, this saves even more time and effort. All the details of the tenancy, including right to rent evidence, rental payments, deposits, tenancy agreements and safety certificates, will be included in the legal pack for you to view before bidding. As the successful bidder, the tenancy transfers to you as soon as the transaction completes, which can be as little as 20 working days from the end of the auction, so you really get to hasten things along.
This means that as soon as you take ownership of the property, you hit the ground running with a guaranteed income from day one. You don’t need to spend any time or money advertising for a new tenant and can start seeing a return on your investment right away.
*Andrew Parker is the Managing Director and Auctioneer at SDL Property Auctions