Subsidence Nightmare!!

Pops_3

I need some advice please!! >:(

We are 12 weeks into a house purchase. We bid £21k above the asking price in a closed bidding war and won. The final price was still fair for the property, or so we thought.

Yesterday after weeks of waiting the vendor's insurer came over to inspect a crack in the wall and pronounced it as having been caused by subsidence. The initial settlement was caused by a leaking drain and this has already been fixed but the crack will need stabalising with metal rods.

The vendor wants to move asap as she has a retirement flat to go to. We can apparently be assigned the benefit of her claim, but the work cannot be carried out until mid Jan 2005.

At present we can't seem to get insurance from regular companies and may not get it transfered from the vendor as her company is Saga and we don't fit the age criteria!

Apart from this we are still interested in the house but only at the right price. We want to go for a discount but are unsure of how much to ask for - 10%? Is this reasonable in the circumstances? I hate this! Anyone had similar experiences?

deemy2004

You need professional advice

It must have shown up in the survey etc. What did the surveyor advice ?

Pops_3

Yes, the vendor finally made a subsidence claim as our survey had spotted a large crack. Their (the insurance company's) engineer diagnosed subsidence and has set the wheels in motion to get the crack strengthened etc - no underpinning required.

Our dilemma is not really to do with the work itself - more the fact that the property now has the stigma of a subsidence history which will alter its value, not only from a future insurance point of view but also future purchasers should we wish to sell.

We are not sure how much to reduce the price by and how much house prices are typically affected by this sort of structural problem.

deemy2004

It depends on the buyer, some people will run a mile and not bother to listen to explanations, others will be comfortable, but definetly it will be a net negative on future sale prospects, even more so in a buyers market.

sshnuke

was the original survey an RICS Homebuyer Survey? assuming it was and without knowing what the survey said it can be difficult to advise on this. in the first instance you need to refer the matter back to the surveryor and ask them to reinspect the property and\or read the engineers report. the surveyor may value the property at a lower price which you can use as leverage to get a discount.

the problem that you're having getting insurance are indicative of the extent to which i would say most people would "run a mile" from properties with a history of subsidence. it might be a good idea to negotiate the price but in the long run it might be a false economy.

btw has the mortgage lender agreed to give you the mortgage amount you requested? usually with subsidence they would either decline to offer the mortgage or provide a mortgage with a "retention" i.e they withold all or some of the mortgage until they are satisfied that the work will be\has been done. the valuation report from your mortgage lender should give you some idea. if they are a high street mortgage lender willing to invest in the property with full knowledge of the subsidence issue then that's a good sign.

Pops_3

Thanks sshnuke!! ;D

That may well end up being THE biggest money saving tip ever! I don't know why neither of us thought to go back to the original surveyor!!

We have an appointment today so watch this space!!

shaz1000

Maybe this should be a new thread but, a friend of mine rushed into buying a property about a year ago that she knew had been underpinned. Now she is worried because the wall that is underpinning has a slight bulge. Is this cause for concern ? ???

John_M_Business

hi there

re: underpinning - we had some done to our basement (in fact, the whole basement) and were concerned about the distinction between 'settlement' and 'subsidence' - the surveyor we used said that his general rule of thumb is that if you can fit a key into the crack (in a vertical, rather than flat direction - i.e. about 1cm wide and more than 2 cm deep) then start getting concerned.

Re: subsidence. I think it's time to seriously consider your committment to the sale... even if it can be fixed, there will be a history AND there is no guarantee that the fix expected will have the desired effect. The two options are: pull out completely, or renegotiate. Go through at the agreed price at your peril.

deemy2004

Maybe this should be a new thread but, a friend of mine rushed into buying a property about a year ago that she knew had been underpinned. Now she is worried because the wall that is underpinning  has a slight bulge. Is this cause for concern ? ???

What did her surveyor say ?

Usually theres some guarantee to the survey results being accurate, maybe she should call them up and say you adviced x and now y is hapenning etc.

shaz1000

The survey was quite clear that it had been underpinned, but it was not a full structrual survey, which I think they should have had under the circumstances. Surely this bulge that is there must mean that the underpinning is failing ???

deemy2004

Well not being a surveyor and only applying common sense.

If the properties been underpinned, then it should NOT subsquently start bulging, thus something is definetly wrong - call a surveyor in ASAP ! Do the full structural now ! worth the few hundred pounds, if for nothing more than piece of mind.

She is insured, is it not ? i.e. against subsidence.