Property Ladder s09e05

way back in 2002 i met talak mukhtir a merchant banker who was after a bit more spice in his life so without any developing experience he set about creating a stylish loft apartment in london defend with his own bare hands it's only a two bedroom flat yeah famous last word oh yes that's optimistic when i said drawers i meant drawings you're having a laugh do you know how long they took i work in a bank i've never used a pencil in a ruler in my life it was a baptism of fire and since then talat's been on quite a journey now i'm back to catch up with the next installment of this remarkable story with your portfolio do you ever sort of lie in bed and hear looks like am i in too deep i'm not deep enough yet meet 28 year old talat mukhtar he currently works as a merchant banker but wants to give it all up to become a property developer although he has no experience talat's just bought an empty shell in trendy shoreditch east london it's on the third floor of a new development of flats with offices below most of which is still being built he plans to fit out this concrete shell and sell it on making a whopping profit of a hundred thousand pounds i'm really excited about it always have been it's a vision it's a dream really it is talent shell is 900 square feet which is as big as a badminton court he plans to turn this space into an upmarket two-bedroom apartment this is a massive project for someone with no previous experience as it's nothing more than a shell with only basic plumbing and electricity it's also a big investment which talet is financing with savings and loans great space this is fantastic it's amazing isn't it so how much did you actually buy the flat for i paid 220 000 pounds for it and how much are you planning on spending on it right about 30 000 pounds and so then you'd be in at 250 000 pounds how much do you think you'll be able to sell it for 350 000 that's what i'm hoping for so that's 100 000 pounds profit that's it and what are you going to do with all that money get out of banking and move into property development hopefully talap bought the apartment for 220 000 pounds his development budget is 30 000 he wants to sell for 350 000 making a profit of a hundred thousand pounds before tax and legal fees [Music] not only has talent no experience as a property developer he's also planning to be his own architect something i really wouldn't recommend but he already has his floor plan so tell me about how the layout's going to be two bedrooms two bathrooms one ensuite and one yeah to be accessed by the rest of the flat trying not to put any funny corridors or anything which lead to rooms just you access everything from the main space talet is absolutely right to be including two bedrooms and two bathrooms as this arrangement will undoubtedly add most value as you enter the property the first thing you will see is the large floor-to-ceiling windows located at the front of the building these will act as the focal point for the apartment talent intends to have the kitchen the living area and the entrance as one open space at the front of the flat from this space you will access all the other rooms there will be a double bedroom and a main bathroom the master bedroom with an ensuite shower room will be located at the rear of the property but talat's apartment is on the third floor and the only exit is through the open plan kitchen living area from my experience this layout will not comply with building and fire regulations and if talent doesn't address this issue he'll be in big trouble i suspect you're going to have an issue with building regulations with this because from the bedrooms you have to go through a habitable room to get out to the staircase okay and as far as i know that doesn't comply with fire regulations have you spoken to um building regulations they're just around the corner i plan to do that that probably is something you possibly should have done first before you bought it this is serious stuff tanak bought this property with a vision to create a flowing open plan space but his vision might never happen acting as your own architect as an ambitious undertaking for anyone architects train for seven years by taking on this role himself talet set himself a big challenge i think i'm absolutely right to be putting two bedrooms and two bathrooms to maximize the value of this flat it's quite a limited market and there are quite a lot of flats like this so you have to make this flat better than all the rest to achieve what you want to achieve and so you desperately need your wow factor here and i'm not quite sure where you're going to get it yet but you have to make that wow factor somewhere the look that talat needs to achieve with his development doesn't come cheap but he only has thirty thousand pounds he estimates spending eight thousand pounds on all building work including electrics and plumbing four thousand three hundred pounds will be spent on the flooring he's set aside a total of fourteen thousand for the kitchen and the two bathrooms that leaves 3700 for contingencies including professional fees and mortgage costs bringing the total budget to 30 000 pounds for the kind of property and market i think this budget is too tight [Music] it's two weeks after our meeting and work hasn't started yet even after my warning about fire regulation issues talent's still hoping to have the open plan space he's always wanted he submitted his original plans to the building regulations officer and today he's about to find out if his amateur architects layout will get the go-ahead hello sarah how's it going okay so the guy has basically uh told me what i really need to do as we've discussed previously is to put a wall creating a lobby area i've got to scrap all my plans for this whole open plan space but i've got a now redesign on everything to try and accommodate for this big wall it's going to be spanking spanking you usually have to go for soho for that now i actually think it's going to look nicer with the wall in a little bit more more complete but i've got this whole kind of loft kind of vision in it and it's going to turn it into a proper flat now but that's fine we can adapt around it we can i've got to go back to the drawing board now in order to meet building regulations as i suggested talat will have to build a wall separating the kitchen and the entrance hall to create a hallway with fire doors to all the other rooms [Music] both bedrooms the bathroom and the living area will now all lead off this hallway creating a safe escape route from the flat in the event of a fire to avoid telap's mistake always consult your building regulations officer at the local council planning office before embarking on any building work [Music] building regulations are needed to ensure any works are safe and legal building regulations officers will visit your site to make sure it is running in accordance with the guidelines you can start work without them but at your own risk as any work that does not comply must be changed back and officers do have the power to shut down any site they consider to be unsafe so how long do you hope this project is going to take you i'm hoping for about three months three months that's that's not very long for a project considering that you're working maybe i'm underestimating what's what's going to happen but i am walking into a little bit blind are you planning on doing a lot of the weight yourself some of the work i'll be doing myself with my brothers i think we're quite handy with with the old hammer [Music] it's three weeks into the project the new layout has been approved and the work has finally begun not content with being his own architect talat's also taking on the role of builder despite having no experience he's taken two weeks annual leave to get the project up and running he's single-handedly putting up the metal stud work for the internal walls but it's not as easy as it looks the problem is that my drill bit is shined talat's in for another surprise when he presents his amateur architect's drawings to the local builders merchant master board living have you got a set of drawings when i said drawings i meant drawings um they've got to be my architects really because it's there's nowhere near enough detail on it it doesn't tell me on there what scale it is either yeah do you know how long they took for someone who's not an architect i don't believe you worked hard on it but i work in a bank i've never used a pencil in a ruler in my life do you know how long it took me to draw that and that's a lot of scales as long as a bengal would take to do an architecture i should imagine as a novice talat's convinced he can do it all as well as any professional but by taking on the roles of project manager builder and architect he's on a very steep learning curve i'm worried he's bitten off more than he can chew first time developer talak mukhtar recently bought this shell apartment in london's trendy shoreditch he wants to spend three months fitting it out and sell it for a massive profit of a hundred thousand pounds despite having a full-time job and no building experience talat thinks he can do most of the labor himself for the last two weeks he's been off work and with a little help from his brother to hear he's been erecting the metal stud work tahir works in computers and he too has little experience you don't need a nogging in everyone do you it doesn't necessarily have to go inside the ridges does it [Music] i don't know it's been a month since my first visit talat's now a third of the way through the development and i'm keen to find out what progress he's made and to check out the new hallway hi hello how are you so this is the hallway made a nice big hallway because i think it's quite important this place where we're trying to emphasize the space and the whole kind of the height issues often when you have a large hallway or weight what would appear to be wasted space it's actually not wasted because it gives a sense that's right of the fact that you can afford to waste that space yeah so that's an other bedroom that's the other bedroom and this is the main sitting room exactly so what have you found the hardest thing so far the plans they're definitely the hardest thing making sure that everything measures up exactly the the right proportions the right dimensions things go in the right you know order and do you think it was time effective to spend two weeks putting the stud work up do you think it might have been better to pay a no i've always i've always believed that i've been totally against that uh from right from the beginning i wasn't going to get some just hire somebody give him all my money and say yeah mate make me make me a flat you know i'd have learned nothing we'd have achieved not very much the guy would have made loads of money are you satisfied with the progress so far it's been a bit slow but yeah we're definitely making progress you've still got eight weeks left and then it can be done in eight weeks it's just the my the bit i feel concerned about and worried for you is that you've both got you don't have part-time jobs you have very stressful very full-time jobs yeah you say eight weeks but yeah it's only a flat it's only a two-bedroom flat yeah famous last word oh yes that's optimistic i do admire talent's desire to learn on the job but one of the key things with developing is to know your limitations all right now time is money so recognizing when it's more cost effective to pay someone to do the work more quickly and efficiently is crucial that's very difficult with our scale rules it's also essential to be realistic about your budget and i'm worried talats will just not be enough have you got a breakdown of your budget of 30 000 and let's have a look at how we're going to pull it out costed about 3 000 pounds per bathroom right and that's for the for supplying and fitting the bus yeah that's right for the ensuite bathroom i'd rather have a glass partition without a door let's say just a frosted or acid etched glass um where's the cost for that here i'm not costed for those yet it's very very expensive isn't it because you'd have to have toughened glass yeah i mean you're talking about thousands of pounds it's a certainly all flat for the sort of price you want to sell it you really need to have at to set it apart from all the others and i'm a little bit concerned that to achieve that you need to be spending more than thirty thousand pounds so how much could you go up to with money 45 000 really maybe 50 tops upping his budget by 20 000 means talat will make 20 000 pounds less profit this practice is something i'd usually advise against but in this instance it's exactly the right thing to do if he doesn't do it talat won't have enough money to create the wow factor he needs to get his top selling price it will cost to get this right but in the shoreditch market buyers spending 350 000 on a two-bedroom flat will expect a top-notch property [Music] the shoreditch market is a unique mix of high-earning city slickers and young creative types they've swapped the conventional for loft-style living preferring big open spaces with lots of natural daylight as many work from home and enjoy entertaining one of the absolute key rooms to get right for these buyers is the kitchen i saw a beautiful kitchen in the magazine went to their london showroom to find that the kitchen which i had fallen in love with cost uh costs 50 000 pounds you know which is your whole budget my whole budget so so how much are you planning on spending about 10 000 pounds i'd say so a fifth of your budget is going to be on the kitchen yeah yeah about that yeah i think that's probably right considering what you're trying to achieve with the flat and the kitchen is going to be the wow factor isn't it creating a kitchen of this high standard for 10 000 pounds will take focus lots of research and relentless shopping around a full-time job in itself and with mortgage payments of 700 pounds a month talent can't afford to let this become an endless drawn-out project i think our main problem is that you're not organised enough not ordering everything in time and these kitchens here i know take three or four weeks to come and some kitchens can take seven or eight weeks which is when it's meant to be going on the market have you actually made a decision about buying a kitchen yet no i haven't actually quite made the decision about which kitchen i'm going to buy i know where the kitchen's going i know what style of kitchen i want but it's literally just a case of now choosing and putting my order down how long exactly do you mean i mean next week or three weeks two weeks time i've made that decision for sure and ordered it and ordered it so within two weeks from today you'll have ordered the kitchen i'll hold you to it for a first time developer who's given himself just three months to finish a complex build talents not showing much sign of stress i'm too cool for school nothing can uh shake me that's a problem i'll always be calm in the face of adversity that's when i shine this development's certainly not shining two weeks come and go but talat still hasn't ordered his kitchen and no more progress is made on site as he works all week at the merchant bank talent's doing this project in his spare time it's already halfway through and he's only just got round to getting a professional builder colin who's helping him at weekends [Music] because they're only working at weekends and there's just the two of them it's another whole month before the walls are actually finished [Music] i've achieved a lot i've done a lot of what i wanted to do and i really enjoyed the structural side to more than anything styling of it the design creating the space i've been thinking about it so long it's my baby it's all i think about it's now more than two-thirds of the way through the project with such a long way to go and no end in sight talent's finally realized he can't do everything himself my workload's quite heavy-duty maybe it's better for me to kind of hand it over to some professionals who can take it off my hands yeah i'm satisfied i want to get my hands dirty and i have done it's taken talent six whole weeks to find the right man that man is dennis and today is his first day on the job talet originally wanted to finish this project in three months his three-month deadline has just gone but now dennis is on board things should really get moving it's the big day tell us at work but his brother tahir is on site um we need manpower we could use at least four laborers it could take 10 days to clear the whole flat i don't think it would take 10 days well if i actually make 10 days i'm being safe with twice as many labourers all we need to do is half the amount of [Music] is a new guy time hired to do some of the building work um he's supposed to have organized a plasterer plaster hasn't turned up by the time dennis's right-hand man starts to tidy up it's lunchtime and talent pays a flying visit expecting to find the plastering well underway where's the pastor i don't know i've tried his phone i don't know where he is now on schedule and the plaster is not here um well i don't see that at this point in time it's being serious dennis talks a lot and i want talk i really want to see some action at this point in time classroom is not an issue is it what i'm saying is it's unfortunate it's unfortunate that the plaster was not here this morning it's been quite stressful at work it's always quite busy there anyway um it didn't help too much i was sitting there worrying about what's going on over here if you want to say well i'm sorry dennis get a few conflicting reports but this is happening this isn't happening i wanted to hand it over to someone but you know at the end of the day i'm the governor really i am the governor here after a disastrous day talent decides not to hand the project over after all and is back to square one in a desperate attempt to keep the site moving however slowly talak continues labouring in his spare time tiling one of the walls in the apartment with slate last time i saw you you were going to get a main contractor to finish the job yeah and you haven't got to main contraction no um i tried to take that route but uh i never found any contractors who were really kind of in tune with my kind of thoughts what i wanted to achieve the other point was their prices were astronomical one of the contractors was saying the classroom would cost um 5 000 pounds and it would take them a week to do it it cost me 400 pounds and took me a day to get it done any main contractor is quite reluctant to do the second half of a job because it's i think partially because they slightly worry about why halfway through you're not going down the same route and they would expect to have the job right at the beginning and do the whole thing so they do tend to charge a premium of that so half a suicide you'll find it much easier to employ subcontractors directly rather than take on a project manager or a main contractor to be honest when i came to handing it over i was like really kind of a bit nervous i didn't really truly want to hand it over to someone i realized because i personally felt i was a bit of a failure i'm a bit of control for you now the success of this development hangs entirely on talat's inexperienced shoulders [Music] merchant banker talat mukhtar has a dream to transform this concrete shell into a designer apartment making a massive hundred thousand pound profit [Music] after four months the development is running a month over schedule despite having a full-time job from now on talent will project manage the site himself bringing in subcontractors to do the work quite lucky in some respects that i'm actually situated right on a massive building site yeah meet plasterers and you meet various other trades chippies and what have you who can come in and do the work every day after a hard slog at the merchant bank tala visits the site to oversee subcontractors and plan the development the rest of his spare time is spent sourcing fixtures and fittings that is something unique what's it called feng shui yeah i can see why but talents had a change of heart about the long-term future of his development which could seriously affect his choices about a third of the way into the project i decided i wanted to keep the place and rent it out as opposed to sell it why did you decide to do that i realized this is going to be something pretty special and quite spectacular and i didn't want to just do it and you know sell it and then try and move on and do something else it's just that the danger with a beautifully finished flat that's very modern if you rent it out there's a certain amount of wear and tear that happens is that when you do come to sell it in the future then it's not going to be a newly finished flat unless you do it all over again the kind of market which i'll be renting out to is going to be like the young professional city types you like quality apartments and prepared to pay for it in a perfect world people who rent want a new kitchen and new bathrooms and so you're actually better off with renting putting in slightly cheaper units that you can replace every few years now talent's renting out his flat i've come to see if he's taking my advice about the kitchen i'm now only going to spend about 5 000 pounds on a kitchen however the effect and the look of it will still have that wow factor luckily creating the wow factor with memorable design ideas needn't cost a fortune using a sliding door instead of a wall installing two wash basins as opposed to one or a sexy double shower can be done on a budget but the cheapest option is to use eye-catching ideas like inexpensive coloured lights and quirky stone cladding which will appeal to the young trendy rental market [Music] talent's gone for a feature wall of indian slate that gives you the wow factor and the radiators as well which are fantastic how much does this lake slate cost me in total about 500 pounds 500 pounds is actually very cheap for creating an amazing focal feature in the room talent's doing well with his design ideas which will give his property the edge it needs but he has taken on a lot project managing this site finding subcontractors sourcing the materials and chasing the suppliers is all down to him and he's still juggling this with his full-time job at the merchant bank is it any wonder then that the scheduling is now holding things up the boiler hasn't arrived flooring kitchen and bathrooms can't be fitted and something is going to have to give talat makes the life-changing decision to give up his job in banking i'm now focusing on property development as my career with no regular income talent is under still more pressure to make this project a success depends on what i can achieve now not just going turning up for work every day and getting paid it's up to me now to try and accomplish my own aspirations the project has reached a standstill talent's first challenge is to get it moving again and fast the whole site was being held up by the boiler but not anymore with a boil approved and the plumbing system tested everything else can now happen at long last the walnut flooring which was delivered and paid for months ago is finally laid after weeks on site talent's designer bathroom fittings can now be plumbed and with no job to distract him talent can address every detail it's taken talent almost six months to transform a concrete shell into a designer apartment he needed to achieve the wow factor and he's done it in spades [Music] nowhere more so than with the open plan living and dining space talent has managed to create the bright spacious feel of a loft yet this urban apartment also has a real warmth given by the use of materials like walnut for the flooring and the wall of slate cladding [Music] stylish appliances enhance the simple sleek kitchen but the beautiful granite work surface really gives it the wow factor the industrial looking concrete ceilings and the state-of-the-art radiators are softened by the faintly coloured lighting [Music] talat's choice of furniture is contemporary yet welcoming creating a comfortable environment perfect for entertaining and designed to seduce his target market you've really achieved what you're setting out to achieve and you've got the wow factors in just about all the rooms after the slate on the wall there's great this is one of the better moments of it all actually because you know having seen all the ideas come together and seeing them work it's the most satisfying thing the only thing i would say is that anything that's so on vogue at the moment will be out of that's right relatively quickly style statements are of the moment absolutely otherwise it would just look like a standard flat which is nice and cozy and caters for everybody but i didn't want that i wanted to and want a place which makes an impact so just how much did this contemporary style cost talent's original budget was 30 000 pounds he soon realized he'd have to up this and has done well to come in under his new budget of 50 000 he spent 11 000 on the building work including electrics and plumbing to get that wow factor talent upgraded the flooring which cost him six thousand pounds he got a cheaper kitchen than he originally planned so this with the two bathrooms came in at thirteen and a half thousand pounds [Music] because the project took so long to complete and to pay for essential wow factor features like the wall of slate talent's contingency for this and mortgage costs ended up costing nine thousand pounds as talent will be renting the flat out he had to spend a further 5500 on furnishing his property to the high standard his rental market will expect but he still managed to do all this for a total budget of 45 000 pounds talent bought his property for 220 000 pounds he spent 45 000 renovating it making his total investment 265 000 pounds [Music] that's a big investment for someone without a day job so are you at all concerned about the fact that you now don't have a regular income no i'm not because i'm very i feel it's one of the most positive things i've actually done this has been a trial and error uh on this development i'm glad it's worked out okay but yeah i know for future developments it's going to be yeah i know how it works i know the system and yeah i just feel really really positive about it but with no job to support him talents got to get this apartment rented out all his money is tied up in the project and with mortgage payments of 700 a month defined the estate agent's rental valuations are crucial [Music] so this is it wood strip floor hardwood okay you've got real volume i love the radiators yeah that's it i like the fact that you've got sort of big floor to ceiling windows it looks like it's delighting yeah that's right beautiful very nice very funky funky yeah this is very different where's this one wow great telling talent needs at least 450 pounds a week to make this a worthwhile development but will he get it 400 a week i think is a price that will attract the right sort of people to come and see this property and i think you know talent should be able to achieve a elect quite quickly i think if he gets onto the lettings market sooner rather than later he's got a very good chance of getting near 450 460 a week for it i think you're probably looking about 450 pounds a week touch more than you expect yeah i'm really impressed if talent does rent out the apartment for 450 pounds a week it will give him a yield of almost 2 000 pounds a calendar month [Music] take away his mortgage costs of 700 pounds and the property would give him an income of 1300 pounds a month that's before tax wear and tear and periods when it might just lie empty on these figures talat would get a return of just under 10 which in the current rental market is pretty good [Music] so has talent managed to hit his target market time to let the potential renters decide 450 a week is what we've got on for stone flooring's nice in the bathroom be a nice study actually there you go a social kitchen the fittings are quite so high spec because i'm quite stylish there's a bathroom look at the scene [Music] brilliant i really like it we were sort of looking up to about 500 so this actually does come into our category it's actually under which is always a really good thing so the agent said that this place is valued at 450 pounds a week um so it comes down to now you know whether we'd be prepared to sort of go the extra 50 pounds specifications of the flat are much better than other flats i've seen the radiators and the lights and the kitchen and the walnut floor is really nice i mean it looks like it's laid really nicely yeah i'm certainly tempted by it myself it's very nice i can see us in here i can actually [Music] well the renter seems suitably impressed but i'm still curious to know what the apartment is worth and how much profit talent would make if he did sell it you're originally hoping to sell the flat for 350 thousand now i know you've had three people round to value it what because yeah i've got varying kind of kinds of uh quotes i've had 350 000 pounds 360 000 pounds and the highest which was quite way out 415 thousand pounds obviously i was quite pleased to hear that but i'm not too sure that if that's too realistic well the average of those three figures would be 375 000 which if you did achieve that you'd make 110 000 profit which is a seriously seriously good profit yeah i'm not going to sell it i don't want to take the money and run i'm in this for the for the long term now now you set yourself an original time scale of three months to do this project in and it's actually taking you nearly twice as long to renovate why do you think that's been like you say sarah i think it's very possible to do it in three months with a team of guys i now have a team of people i didn't then i was quite naive i admit to i think my um calculations on how much it would cost me were quite naive and my time allocation was quite naive as well but that's fine that's that's the way it goes when you when you when you've not done anything before you [Music] and you take that experience on to the next project with you talat finished the flat 12 months ago and after eight weeks sitting empty he got the full rental price he'd been hoping for his second development was another apartment right next door a big part of developing is to learn your lessons from each property so it was good to see that talat had taken on a more manageable project this time and by buying a smaller shell in the same block it meant he could use the same winning formula as he did last time around the idea is having that really nice clean lines the styling is quite bold but developing wasn't the only thing keeping talak busy between finishing his first development and starting the next he scoured europe to find exclusive suppliers for his new business a specialist tile shop in august 2003 it was ready to open [Music] so why tiles i mean of all things it's a good solid business just to keep going while i push on with property development in the background talat's hoping that by buying directly from quarries in italy and spain he'll be able to offer something entirely different and he seems to have got it right because in the first month of business tala sold 5 000 square meters of tiles one month later he's finished his second property and it looks ideal for the high-end young professional rental market he's aiming at he bought the property for two hundred thousand and has learnt from his first development because by being better organized he's done the refurb for thirty thousand that's fifteen thousand pounds less than the last time how much have you read this for then about 300 pounds a week so that's a 230 000 pound investment with about 15 odd thousand pound income a year which is about seven or eight percent return which is quite good in this market actually yeah it's not bad so you're still determined that you want to rent and not sell yeah i'm from finance background and we're always taught to leverage and hold on to capital and build on that what would be your advice to anyone who's thinking about giving up their job and developing full-time it would be to go for it totally you i i did it and you know if if i can do it anyone can do it it's it's not it's it's hard work and it's yeah it goes a bit mental sometimes but yeah it's all good fun at the end of the day and the rewards are there since then time has marched on now it's a full five years later and we're about to find out if talat is still bitten by the developing bug one thing's for sure when you're as unpredictable as talent there's bound to be a surprise install i'm not stuck in an office i'm i'm at street level i'm doing deals i'm moving fast and i'm chasing my dreams it's been a whole five years since i last caught up with talat so how do you continue to live the dream as a property developing entrepreneur or has he gone running back to his city career time to find out it turns out talat's been busier than ever [Music] got two properties in this block and we've got two properties in this block got three flats in this block got two being built off plan in this block and i own these carriages tanat is now quite the man about town and he's built up a portfolio of 21 properties which he feels would be worth 4 million pounds and that's not the only business that has grown i'm standing at my third shop here in angel the second one being in belgravia we've supplied material for some of london's most iconic projects you know namely i guess the gherkin the emirates stadium for arsenal year and year the turnover's gone you know up and up i guess i could afford a ferrari if i wanted one but i farm around london in that little scooter and i love it five years on talat is still too cool for school and in fact i've never met a property developer quite like him after sundown he transforms into a dj strutting his funky stuff in a local nightclub my life yeah moves at uh i think yeah 100 miles an hour maybe i am the only property developing tile selling dj but yeah it's cool man it works and yeah i'm doing what i love talat is certainly one very happy chappie but the lion's share of his finances are tied up in property and in this increasingly difficult market the key is to look at how the figures in his portfolio stack up talat bought three off-plan apartments in this shoreditch building last year and they're typical of how he's trying to build up his property empire so the three apartments in total were bought for 1.2 million they all average out about 400 000 pound each and you know that's an off off plan price once once the properties have completed then once they've been built and i i don't see why these properties won't be worth 500 000 pounds apiece it's a neat trick if property prices rise but at the moment the market is as flat as a pancake and with a huge interest only two million pound mortgage and rates jumping all over the place this could be where it all starts to unravel more recently buy to let landlords are finding it harder and harder to get enough rental income to cover their outgoings and i've come to meet talat at his latest finish rental a one bedroom flat inside this victorian school conversion in north london hi hello how are you good to see you good to see you sir it's been five years since we last met you're now djing and you've invested in more properties and you've also got a number of tile shops how do you fit it all in well i'm a busy little boy i guess yeah no the last five years have been phenomenal for me i've er my portfolio in property has increased significantly but that's solely down to the fact that i'm there looking for new properties constantly inside talent has done well in a small space a mezzanine floor adds valuable square footage and clean units and simple furniture keeps it feeling uncluttered and he's done it all for just under 20 grand so you've got your trademark tiles on the floor yeah yeah they made a feature out of the tiles on the floor in this property very beautiful tiles but the rest of it's not quite as on vogue no as your previous possibilities what i learned from you really sarah over the years is uh that you know keep everything timeless classic because it doesn't date and especially for a property which is to be rented out year upon the year that's learnt a thing or two about design but i'm worried about the financial risks he's taking so from quite a really very big property portfolio on an annual basis do you do you see an income out of it um no after you've paid all your costs and you know any kind of services that need to be done at the time i don't think there is any income left i think the most important thing is to have an appreciation in your capital of yeah of your assets i see a growth year or a year on that talent is not repaying any of the capital he has borrowed the success of his property empire is based entirely on a rising market and he's only just covering his outgoings with his rental income i guess the only danger is that that if all that when it's so tight if the figures go too far apart i interest rates go up and rents go down dance when you start having problems but then that's the nature of the business so the reality is that you couldn't have the property investments that you have unless you had another income you need the tile business which gives you an income and the djing which gives you an income to be able to do it yeah i think so i think um the way that i'm running this whole venture is very much so i've got my other businesses which keep me in a lifestyle which i like but at the same time i'm able to to to keep this going and do you at any time with your portfolio do you ever sort of lie in bed and think oh crikey am i in too deep i'm not deep enough yet so much more to do still you're still completely confident i'm going hard yeah big time he certainly is talat's just bought this large victorian building in south london at auction with plans to turn it into a substantial family home the trouble is it's in a highly unlikely location right on top of a large graveyard he's also got another idea to turn it into a school and pull in 60 000 a year in rent but he's got no planning permission and it all feels like one huge gamble how much did you pay for it so we paid 728 000 pounds for this it's an area i know quite well and personally i don't think i'd have paid quite as much as you did for it it would have been i'd have stopped to drown sort of 650 because it is next to a cemetery and it does have a really small garden and it doesn't have a garage next door well we'll see it does seem to me that the key with this deal stacking up is is that you do get planning for it to be at school so i guess all your eggs are in that basket and you need to go for it yeah yeah all being well it'll be fine fingers crossed as a school this investment stacks up a little better but the alternative is renting it as a family home in a cemetery and whether he could find anyone willing to cover the 30 000 pounds interest on his mortgage is by no means certain once again as with his whole property business talat is sailing very close to the wind well i'm just trying to get my head down is your financial philosophy because you're quite a risk taker you've got a lot of property a lot of debt whatever sarah i remember five or six years ago you used to give me the same hard time telling me yeah what you're playing at what you're doing you know you should be worried how can you do that can you sleep at night i'm quite a relaxed guy and uh yeah everything is thought through it's not just on a whim it'll be all right and you can take it on the chin it'll be cool on the face of it talent's done incredibly well building up a portfolio of property worth millions but scratch the surface and the foundations of his empire look decidedly shaky if interest rates go up and values and rents go down just a little his house of cards could easily collapse but so far so good you never know talat might just pull it off next week we catch up with stephen hodgkinson and philip martinson a whole seven years after their first development to find out if they've made a success of the property game would you say that perhaps you're slightly risk-averse a lot of people are losing money on developing at the moment and i think it's you know i don't want to fall into that we don't want to fall into that trap do we if you'd like to be in the next series of property ladder contact us at channel 4 dot com forward slash take part find out more about tonight's projects and get the property ladder team's advice at channel4.com for horms extreme testing and some gorgeous homes everybody's building grand designs is live next on 4. [Music] bye

Channel: The Forgotten Vault

Views: 24,981

Rating: 4.8823528 out of 5

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Id: 5w7N10yCMBc

Length: 48min 52sec (2932 seconds)

Published: Sat Dec 19 2020