Now I find out the property is underpinned. Insurance problems? you bet ya.

g_fella

Is nothing in this world simple anymore ? After the artex issues I had with my buyer were resolved with a small price drop of £1.5k, I stupidly thought that everything else would go to plan in our chain.

Alas, while our mortgage was arranged, homebuyers report (survey) was pending our solicitor called last week to ask if we were aware that the property we are trying to buy was underpinned. We weren't, this was the first I'd heard about it. Shouldn't this have been declared a little earlier in the process.

Details of the underpinning were received which show soil samples back from 1985 (property built in 1975) that showed there was a soft layer of organic material, which had ultimately meant that an area in the lounge had begun to sink causing the floor to bow. This was resolved at the time and guarenteed for 20 years (ie. ran out in 2005). The current owners of the house bought in 2004.

To make matters more interesting the environmental search carried out as part of the solicitors work shows a path of previously filled land (possibly water) that runs almost directly under the house. They found this out by looking at old maps. Having looked myself I believe it was probably a ditch at the side of a field, or something like that rather than a river or flowing water, which I guess would explain the organic material a few layers down.

My solicitor suggested that we continue with the Homebuyers report and then potentially get a Structured Engineer to come out and have a look at the house to confirm that there were no issues since the underpinning (though what exactly he will be able to do apart from look for cracks is beyond me). Assuming we wanted to continue after seeing the Homebuyers report of course (I'm not expecting that to throw anything major up).

Anyway the Estate Agent passed the buck and suggested we talk straight to the owners regarding their buildings insurance and their understanding of the work that was carried out, and check whether they had any issues when they bought it.

The couple who live there seem totally genuine, the house they are buying is less than half a mile away, so at least that fills me with some confidence that the area is good to live in. They explained that their solicitors hold an A1 size plan of the original work that was carried out, and it shows that 72 mini piles were put in before a fresh layer of concrete and wire mesh were laid to underpin the house and that they have seen no evidence of any movement in the house since they have been there. Sounds pretty secure to me as well, although obviously we want to see the details, and we'll get our solicitor on the case to get hold of it. They and the neighbours either side were quite suprised about the path of infilled land described on the environmental report, and had never seen mention of it before. They also kindly informed us that our Homebuyers Report was carried out at the end of last week, something that obviously the Mortgage Company, Estate Agents and Surveyors themselves decided we really didnt need to know.

With regard to insurance, they said they insured the property when they moved in with Abbey, and despite informing them of the previous underpinning work, they didnt bat an eyelid and insured them with no problems and as far as I know this was not at increased premiums.

However, our problem is thus... while I can believe the house is sound and not going anywhere, and therefore still suitable to purchase, we have a potential future problem and a more immediate problem.

While we plan to live in the house for quite some time, we are also aware that should we decide to move we may have problems selling it in the future due to the underpinning.
However the more pressing issue is the insurance... I phoned around a couple of the more regular insurers today as was told that they dont insure underpinned properties, no matter how long ago it was done or how well it was done and even tho it has shown no signs of movement since. Using GoCompare.com returned precisely 0 results - with most reasons being that the house has had subsidence (remember the walls weren't moving, it was just the floor).

I know there are companies that will insure underpinned properties, but the premiums are higher and there is a lot less choice. So if whatever company we choose decides to up their premium year on year then we cant shop around (and nor could any future owners).

Any advice on what we should do ?

Any more common insurance companies that are likely to at least discuss the underpinning before saying No ?

Any advice on companies that we should be looking at, and anyone any experience of how much these companies raise their premiums year on year ?

Is there a point when an underpinned property (which in theory is more structurally sound than a non-pinned property) becomes more easily insurable ?

Is there any specific information that the insurance companies (specialist or otherwise) require before they agree to insure the property ?

Any one think that we should look to get a price reduction at this stage and what would be a reasonable reduction considering we didnt know about the underpinning when we originally offered (Property was POA, accepted offer of £277500, then details show property was marketed before for £285k) ?

Should we run a mile and find somewhere else ?

What will the structural engineer do exactly, as he certainly wont be ripping up the floor to look at the underpinning ?

Sorry for the long message, but wanted to get as much detail in as possible.
Any help, advice or jokes regarding our situation would be much appreciated.

pawpurrs

A House which has been underpinned is actually a better bet than one that hasnt been, however that does not get rid of the stigma attached.
Most insurance companies will want evidence of the work that has been done, and a structural enginners report, then they *may* take it on
Regarding insurance, your right a lot of normal insurance companies wont touch it, they wont touch Period properties, thatch, Listed, timber frame etc either, they just want to insure bog standard houses. Your best bet would be to go the vendors Insurance the Abbey as a first port of call and see if you can take over when they leave.
Heres a link to some specalist insurers
http://www.bureauinsure.co.uk/subsidence_insurance.htm
http://www.adrianflux.co.uk/subsidence-detail.php
The excess may well be 1k or more for future subsidence claims.
If since the work has been done there has been no further movement, I cant see it as too much of an issue, there are millions of houses that have suffered from subsidence, huge parts of London for a start. As long as you can get insurance and the premium isnt too high, and the surveyor is happy with what he sees.

Doozergirl

The comparison websites will be no good with something like underpinning - you're not providing enough information and they therefore won't want to quote you at that point. I'd go and see an insurance broker.

Perhaps ask the vendors to ask them to call you for a quote so they can see the house to be insured, iyswim.


It's worth asking for a reduction to at least cover any increased premiums for a while.

ad9898_3

Why buy a house that is underpinned, there are literally hundreds to choose from, and the money you have have lost so far will be more than made up for by the continuation of falling prices within a couple of weeks to a month, avoid like the plague.

suki1964

As said previously, comparrison websites are as much use as chocolate teapots when it comes to underpinning

My husband is a builder and every house he works on in SW London needs underpinning, either because of subsidence or because the house is having extensions. We are talking houses that have already cost over the million mark and then perhaps are having a million or more spent on them. These houses are bought and sold all the time - underpinning in place - with no problems

And I do remember that during the drought of 76, more then a few roads in Battersea(london) being underpinned because of the clay later drying so much the houses started to sink. They still sell without problem. I think that most of the houses in SW London built on clay will have to be underpinned at some time because the dryer summers is causing the clay to dry out

silvercar

the websites like gocompare will not show companies if there has been underpinning. Phoning the same insurers should yield quotes. 20 years is a long time, if there was a problem with the underpinning it should have shown itself by now.

jenny74

Ignore ad9898, they have no idea what they are talking about.

As Purrpaws right says, it is most likely a better bet than one that as not been underpinned.

Regarding insurance, find out who currently insurers the property and ring them, explain the situation and ask for a quote. They are unlikely to 'load' the premium (as some insurers do on what is considered a 'new' risk).

My house was underpinned following mining subsidence, and my insurer did not bat an eye lid when I took out the policy, as they had previously insured it.

I have also working in the insurance industry for (Her-humm) years and can re-assure you that you will be able to get insurance for it, most probably at no extra cost.

Good luck and if you still want to buy the house, go ahead; don't let this stop you. :-)

g_fella

pawpurrs - Thanks for the links, will check them and their terms and conditions out.
As I said before, we are trying to get our hands on full details of the work that was carried out, and will almost certainly have some kind of structural check done to put both the insurance companies and our minds at rest.

Doozergirl - Good point about the insurance broker. I used to use an independant financial advisor for searching for decent mortgages. I think she used to also look at things like insurance. If she is still in business then I could see what she reckons.

ad9898 - I guess I didnt explain that the area we are looking in (near Yateley in Surrey) was apparently built on old marsh land. As such a lot of the properties are underpinned. A bit like SW London as suki1964 mentioned.

I guess I'm left with phoning round as many different insurance companies as I can (as suggested by silvercar and jenny74), though I may well contact check up on the current insurers.

Thanks all for your input, feel free to chip in anymore suggestions.

Ladybird20

Thanks for posting the question...my house has just had 12 pile foundations put into place and i had to move out for 3months while they did so..It needed the pile foundations as rogue builders forgot to put foundations under a load bearing wall .My house began to dip about 15mm,,,,altho i like my house the plot is an amazing plot in fact i did wonder were i stood if i chose to re sell..I do understand my house is probably stronger than any other house on the development but maybe insurers dont see it this way......

suki1964

Ladybird20 wrote: »

Thanks for posting the question...my house has just had 12 pile foundations put into place and i had to move out for 3months while they did so..It needed the pile foundations as rogue builders forgot to put foundations under a load bearing wall .My house began to dip about 15mm,,,,altho i like my house the plot is an amazing plot in fact i did wonder were i stood if i chose to re sell..I do understand my house is probably stronger than any other house on the development but maybe insurers dont see it this way......

Insurers do see it that way - as long as the underpinning has been signed off by the DS as meeting the regulations laid down at the time

Many a time hubby has had to go down past the usual 3 metres to get solid enough ground for underpinning, but once a house has been underpinned PROPERLY then its not going to move anywhere


House at the end of my road, stunning it is,but built on a bog. The house it self was set up on pylons and isn't moving anywhere but they forgot about the front doorstep - that's constantly sinking and needing replaced

g_fella

suki1964 wrote: »

Insurers do see it that way - as long as the underpinning has been signed off by the DS as meeting the regulations laid down at the time

Which insurers see it as stronger tho ? Apart from the specialist ones. I have a 100% failure rate at the moment with the normal insurance companies. They don’t even let me get as far as explaining the I have (or will have) full details of the work, a copy of the original guarantee, etc. I say it's underpinned and they say sorry, no can do.

Our mortgage is with first direct, I think their insurance is underwritten by Norwich Union. I haven’t called them yet, but I will and I expect they will say the same thing.

I've got Thursday off and intend to phone around even more insurance companies then, so if you have any suggestions they will be gratefully accepted. I will obviously be calling people like adrianflux, towergate, assetsure, bureau insure, and a few other specialist insurers to get an idea of their premiums.

Maybe if I have a structural engineers report that says the problem has been completely corrected then the other companies may listen to me.

Someone told me the other day that if a structural engineer says that the property isn’t going to move, but it does, then it is possible to sue them for misinformation or something... anyone know that if that is true ? If that’s the case then is there any point having the structural survey as I am sure they will leave a small percentage doubt in any report just to cover themselves.