'subsidence' - as dirty as a word can be

mmoalem

hi there all - facing dilema in regard to purchasing a house.

1st survey suggested subsidence affecting the house and detached garage at the end of garden.

me - big panic

2nd hired structural engineer for professional verdict - according to him cracks at the house were due to expansion of wood frames. house is fine and has signs of subsidence. Garage was effected by subsidence and need demolishing (which we knew about and happy to do).
reassured by engineer that there should be no problem insuring the house under normal policy and that once garage demolished the house is definitely subsidence free in the eyes of the law

me - calmed down

3rd stage - exchange looming in few days time need to sort insurance - tried few all refuse to insure even if we were to demolish the garage before exchange. all main line insurers will not insure ne the word 'subsidence' was uttered - as far as they are concerned a structural engineer reporting is not enough. once any part of the land the house is on has suffered of subsidence movement the risk is there for life on the rest of the plot.

couple of specialist brokers have suggested insurance can be arranged at a fee

me - panicking again

the dilema - under normal circumstances i would have walked away but this is not normal...we are selling our place, we are a family with 2 children (one is a week old) so living of suitcases in temporary rented flat while we look for another place is rather more complicated. buyer of our place has mortgage offer that runs out in January - messing with the dates might bring the house of cards down. also to consider that i have already spent some 2k around the purchase on fees, surveys, etc

i guess the big question is - beside the expensive premiums - how can i put a value on the 'subsidence' stigma. is there a percentage value of the reduced value to the house?

clutton_2

you will need to consider how difficult this house will be for you to sell on when you are ready...... insurance will only get more and more difficult...

RAther lose £2k now - than tens of thousands in 10 years time

nell53

Ask the vendors who they are insured with. The same company will often take the new buyers on.

diable

Why are you even bothering with this as this could be a loose around your necks? Its broken and you still want to buy, unless you can force the price down and get the work done and make a saving then it may be worth the hassle.

mmoalem

hi there all and thanks for the replies.

in regard to the vendors insurance (natwest) they were my first port of call but 1 they would not insure a house with subsidence issue at all 2. because the vendors policy does not mention the issue they said that the policy is invalid and need investigating for why it has not been mentioned - maybe they just trying to wiggle out of it

and why am i bothering with this? good question - its down to the fact that we are now 4 month down the road of the sale and purchase with many hurdles overcome in the way. mortgage offer is great but might not be extended for me to find another place. the other houses in the area are a bit dearer so not much option for us to choose from. good school was deciding factor in purchase - no other options in our price range in the catchment area and most importantly the house has been declared sound and safe by the structural engineer - the issue is the stigma rather than real health of the house - without the stigma is a good buy as far as i can tell so how much the stigma worth in real terms?

BTW house is in good area in zone 4 north west london near the tube, shopping and parks with grade 1 schools so at least in theory should be an easy sell in most economic climates

DVardysShadow

mmoalem wrote: »

... the dilema - under normal circumstances i would have walked away but this is not normal...we are selling our place, we are a family with 2 children (one is a week old) so living of suitcases in temporary rented flat while we look for another place is rather more complicated. buyer of our place has mortgage offer that runs out in January - messing with the dates might bring the house of cards down. also to consider that i have already spent some 2k around the purchase on fees, surveys, etc

mmoalem wrote: »

.... and why am i bothering with this? good question - its down to the fact that we are now 4 month down the road of the sale and purchase with many hurdles overcome in the way. mortgage offer is great but might not be extended for me to find another place. the other houses in the area are ....

- the issue is the stigma rather than real health of the house - without the stigma is a good buy as far as i can tell so how much the stigma worth in real terms?

A house with these issues may turn out OK, but it needs a lot of thought. As you are finding, there is a definite stigma as far as insurance is concerned, which will reflect in terms of purchase, so effectively the value of you investment is in the hands of the underwriting policy makers. At the moment, we are in ultra cautious times - perhaps one day the underwriters may realise that they are authors of a portion of their own losses simply by writing off generally sound properties on pure suspicion. But unless this realisation dawns, this property will always be more difficult to sell on.

Now, make your decision on the ability to sell on. Do not be swayed by the amount of money you have spent so far or the accommodation problem you might have or the mortgage offers. These problems are all far easier to solve than solving the problem of a house you bought with problems which you had not thought through.

nell53

in regard to the vendors insurance (natwest) they were my first port of call but 1 they would not insure a house with subsidence issue at all 2. because the vendors policy does not mention the issue they said that the policy is invalid and need investigating for why it has not been mentioned - maybe they just trying to wiggle out of it

In that case, I would definitely walk away. It's opened up a whole bag of worms.There will be other properties.

CloudCuckooLand

A one-week old knows nothing of whether you are renting or in the home of your dreams.

Would the "stress" of a rental be any greater than the stress of living in something that might fall down around your ears ?

The insurers are correct, about the issue with the garage potentially spreading to the remainder of the property - what was the cause ?

The current vendor should put a claim into their insurance company to have any subsidence issue dealt with. Then there will be a paper trail and they will have to cover future owners.