Selling a house - subsidence has been sorted

trelorer

my parents house has had a subsidence problem that has been professionally sorted by their insurance company.

1) Does this mean that they will have problems selling their house if they ever decide to sell? Would a future mortage company be happy to lend a potential buyer money to buy the house?
2) Also, it appears that they will always have to stay with their existing insurance company. Will this be always the case?

Many thanks.

Cannon_Fodder

1) Yes. Not all Lenders.

2) Yes.

Sammy85_2

1) They may find it more difficult to get a buyer in the future. Alot of people run a mile if subsidence is mentioned. A future buyer may be able to get a mortgage if all the paperwork for the repairs are in order, but the number of lenders available may be reduced.

2) i have no idea about sticking with existing insurers, but you may need to provide a letter from your current insurer to the new buyers lender stating that the building is insurable.

terryw

trelorer wrote: »

2) Also, it appears that they will always have to stay with their existing insurance company. Will this be always the case?

Many thanks.

Everything being equal, it is a good idea to do this anyway. If down the line, there is further subsidence then the policyholder does not become stuck between two companies who could well have different views when the subsidence took place.

surreybased

Hi,

We walked away from a house purchase when we discovered subsidence. House holder did get a structural survey completed before marketing the house so that potentially buyers would know that the problem was resolved. (however we weren't told!) Insurance premiums literally doubled as a result and we just decided we didn't love the house that much.
Pricing will always be the key - had we been told upfront we would have expected to pay a lower price. Some areas its very common and it's expected but I guess it does reduce your market for buyers. A mortgage company is highly likely to ask for a structural survey.

trelorer

it is a bit of worry. It is clear that the subsidence at best has devalued the property.

A stupid question, but should the insurer compensate my parents for the devaluation of the property, or are they only liable for putting right the property?

So it appears that most lenders would be happy to lend if the work has been done properly. But how can a future buyer get building insurance, because most insurers automatically ask if subsidence has happened in the past? Are they forced to go to specialist insurers?

Surely my parents house has a lower risk of a future claim, because theirs has been sorted and most others in the area still have standard foundations that can clearly fail at any time.

What do people do who live in medieval houses that have bowed walls and many movements in the past insure? In cities with lots of old properties must be insurable, when clearly they have had problems in the past!

Cannon_Fodder

trelorer wrote: »

but should the insurer compensate my parents for the devaluation of the property

The insurer has not devalued the property. They (hopefully) have stopped it falling down.

The subsidence has devalued the property. You could sue the people responsible for the cause of the subsidence, potentially.

I am not aware of an insurance product that would cover "loss of value due to subsidence", but if they exist you would have to choose such a product in advance to benefit from it - not after the fact. The very act of asking for a subsidence-protection product would probably scare any insurer, who might assume you know something they don't!

trelorer wrote: »

But how can a future buyer get building insurance...

Future buyers will need to use the same insurer that currently covers the house.

trelorer wrote: »

Surely my parents house has a lower risk of a future claim, because theirs has been sorted and most others in the area still have standard foundations that can clearly fail at any time.

Depends on the nature of the subsidence, and the remedial action taken to fix it, whether you can totally rule out subsidence. It may take a number of years not just after the event but also after the repair, to be sure its truly fixed.