Advice Please - House with Subsidence

madmax2

Hi

Just wondered if anyone can offer us any advice (good or bad!) as we are supposed to be buying a house which the mortgage survey picked up has had movement. The vendors insurance company have now investigated it and are going to start work soon - not sure if they are underpinning it now? We have already sold our house so will be moving into rented accommodation until we either find something else or go ahead with this purchase. My partner is worried about the cost of the Building Insurance - I made a few enquiries and have been advised that there are only a handful of companies who will insure properties with subsidence. I was also told that if we wanted to shop around and go with a company with a cheaper quote then we would have to pay for a Structural Engineers Report first (about £400.00) before they would even quote us! I suppose the thing is I dont know whether I could handle it every year not knowing how much we are going to pay for Building Insurance plus it seems really unfair that properties that have had flood damage dont have to pay much more premium (so I have been told). Do we have to declare that the property has had subsidence/movement or could we opt for Building Insurance without the Subsidence cover as I am told the excess would be more like £10,000.00 rather than the standard £1000.00. Also what would happen if we wanted to sell the house in the future? Any advice would be greatly appreciated. Thank you.

cattie

As the vendors insurance company is going to start work soon they should be willing for you to take over the policy on completion of the house purchase. Hence, getting insurance doesn't become a problem.

If you know the name of the vendor's insurers, you could give their claims department a ring & discuss things with them & hopefully get an indication of how much the premium might increase if you bought the house.

I bought a house which had had recent structural problems & did just that, the insurance company were who I'd always had my previous properties insured with in the past anyway & were very helpful & informative. I was told the premium could possibly increase by 20%, but in fact, on completion it was only about £4 per month than I'd been paying on my previous house.

Milliewilly

In my experience underpinning by the insurance company takes the best part of a year - 6 months to do the work (on and off by various contractors some has travelled hundreds of miles as they bid for the work from the insurers) then another 6 months to replaster / re decorate and do all the snagging.

Unless you are getting a serious serious bargain I personally would not proceed. The property will only be insurable with specialist insurers, some mortgage lenders will not lend even if there is a completion certificate guaranteeing no further movement.

Cazza

The mortgage company will not allow you to have a buildings insurance policy which excludes subsidence - they need to ensure that their interest in the property is fully protected and this is a risk they will not be prepared to take with regard to such a significant problem.

What exactly have the mortgage company said they will and won't do? The remedial works will be essential and they will want these to be completed before they allow you to complete, but they could potentially say that they want the works to be monitored for 6 months before they will issue an offer, or that they will allow you to complete but wuth a full retention in place for a set amount of time - which is as good as useless.

Unless this is your absolute dream property at a bargain basement price, I would consider walking away. Subsidence which has been treated, monitored and halted is not neccessarily a problem, but this is a recent problem and you don't know if the work being done by the insurance company will fix the problem until some time has passed. Personally if I was looking at a property like this I would want the work to have been done a few years ago so that I can see it has worked and stopped the problem. It's not a guarantee, but it is something. If the work currently being done it doesn't fix it, you could be left with a worthless, unsellable property and a mortgage.

nickyx

I am having subsidence monitored at the moment, it will take about a year just to monitor it. I also get the impression that it is unlikely they will do any underpinning as it is on a single storey extension, they will just repair the damage. I wish I hadn't declared the problem because with the £1,000 excess I could have sorted it out with a builder. Generally, I understand that insurance companies are cooler about movement problems than they used to be, it happens so frequently and doesn't usually cause widespread structural problems, houses just bounce up and down with water table.

lovethymini

We've found this thread an interesting and timely read - yesterday, we were told that the house that we're buying has had a subsidence claim on it in 2005, and rectified in 2007. We are told that the problem was caused by shrubs which were removed, and the problem has not reoccurred, which is good.

We've spoken to the vendor's insurance company who will insure it with subsidence cover if we continue the existing policy, but not if it's a new policy (?!). Direct Line won't touch it, and I tried comparethemarket which returned no quotes. Adrian Flux was more helpful and were confident they could insure us, but would first need the relevant documents to examine. We haven't spoken to our mortgage provider as yet.

Unfortunately we're in an area with quite a few houses that have experienced subsidence, it is difficult to make a decision having never experienced anything like this before.