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Homes Under the Hammer’s Martin Roberts reacts to ‘unmortgageable’ house | TV & Radio | Showbiz & TV

Martin Roberts couldn’t believe his eyes in the latest episode of Homes Under the Hammer after he checked out a big townhouse in Newport. The huge place was on sale for £199,000 and came with four floors including a basement and loft space.

The rooms were big with high ceilings, and someone had already started fixing up the ground floor. Martin liked what he saw at first as he said: “It’s a grand building with some grand opportunities presenting themselves.”

But then he saw the state of the electrics when he went upstairs. He explained: “The higher up the house you get, the less renovated it appears, it’s charming in its own way but very, very dated, and you don’t have to be a rocket scientist or even an electrician to work out that this (the electrics) with its Bakelite switches and its old fashioned fuses is a very old electrical system.”

“You’d probably want to replace the electrics anyway but it gives an indication that probably the rest of this building hasn’t been touched for a very long time.”

The expert added: “But that has its bonuses – the doors you’ll be able to strip back because they are all original and the floorboards seem to be in a really nice condition and then lovely little features like this fireplace so if you can retain some of that magic and that character, all well and good, but obviously the higher up the house you go, the higher the costs are going to be.”

The house had the potential to be a big family home, or it could be changed into flats or even used as an HMO (house of multiple occupations). It looked like an exciting chance, but there was an extra surprise waiting in the basement – a paying tenant.

This meant there would be money coming in from the first day you buy the house, but it could also be tricky because getting a mortgage with a tenant already is deemed more risky.

Martin said: “Whenever you take on a property that isn’t vacant possession, as in it has somebody as a sitting tenant, you’ve just got to make sure that all the right legal things are in place so that there is an assured shorthold tenancy agreement covering that person and also that you’re happy with the amount of rent that you’re paying.”

A large four-storey period house, with a tenant in the basement flat and two upper floors in a poor state, is not eligible for a mortgage, which might deter some at a property auction. However, it didn’t stop a mother and son team from Bristol.

Decody, who ran a takeaway in Bristol, and Cherylyn, a foster carer, spotted the Newport period townhouse up for virtual auction with a guide price of £199,000. They secured it for £200,000 as a family investment, planning to turn it into a six-bedroom HMO, some with ensuite facilities, a kitchen, bathroom, lounge, and leaving the basement as a rented flat.

However, when they explained to Martin what they had planned to do, the BBC expert was left in a state of shock and said: “Oh wow.”

He repeated: “Wow, so you’re really maximizing the potential of the building.”

The duo had a strict six-month timeline because they bought the house with a bridging loan, which was their only option as the old house was considered unmortgageable due to the condition of the electricity and plumbing.

They had a budget of £30,000, with the family doing most of the work and hiring specialist tradespeople for the rewiring, plumbing, and plastering. They also received free advice from Cherylyn’s brother, an experienced property developer.

Thirteen months later, the house was looking fresh and new after a £35,000 makeover.

It just needed some safety features like fire doors and alarms before the family could apply for an HMO licence from Newport County Council.

The duo managed to secure a buy-to-let mortgage within six months of starting the renovations, easing their financial worries. However, they were in for a surprise – after spending a total of £235,000 on the house, it was only worth £250,000 if sold as a single-family home, according to the estate agent.

Homes Under the Hammer is available to watch on BBC iPlayer.