selling an underpinned house

realbean

Thanks property man. I do have a certificate that insures the underpinning work until 2017 I guess I was thinking about possibly selling before this runs out! Which could make the property even harder to sell

cycloneuk

realbean wrote: »

I didn't go for a reduced offer but should of! Out of interest cycloneUK does it worry u that u may have problems trying to sell in the future?

It does yes, i would have to price lower than all other 3 bed semi properties in my area by around 10k at least imo, i also wouldn't be sure on if i should be up front about the underpinning to viewers and put them straight off or wait for any buyer to find out during the local searches and then produce the structoral engineers report ect.

Fire_Fox

Next time have a full structural survey on a period property, and renegotiate when you find problems. Most lenders will reduce the value of an underpinned house significantly, some will want a larger than usual deposit which means you have far fewer possible buyers. Have you had regular inspections/ monitoring since the underpinning so you can prove to a buyer and their lender there has been no further movement?

kingstreet

I've never known underpinning to be a lending issue. Although in the Midlands it is a relatively rare issue. If the surveyor says the value is okay and the property is suitable security for the mortgage, the lender will usually lend.

The insurance is another issue. The lender may decide not to lend if the property cannot be insured.

moneyistooshorttomention

dacouch wrote: »

The insurance that was transferred was the previous owners Building Insurance who paid out on the Subsidence claim. This is common practice within the industry.

You do not need a second policy in place, they just transfer their building policy to the purchased as the previous owners did.

If there's one thing that strikes me every time this underpinning and insurance query comes up and the thought that the previous owners insurance company has to continue providing insurance cover is "What if the previous owner had a specialist insurance company?". If someone is in their 50's or older, for instance, then they might well have their insurance cover with a specialist company that caters only for over 50's (like RIAS) for instance. So, what happens if a house like that is sold by an over 50 with that specialist insurance to an under 50 (ie as they would not be "eligible" for an over-50 only insurance company)??

That is just the first thought that occurred to me. It may well be that there are other insurance companies that have a "specialist" niche of some description and they would also cover the vendor, but maybe regard the buyer as someone that wasn't in their "specialist niche". So what happens then?? Does anyone know the answer to that?

dacouch

They normally don't offer cover as they can't

GDB2222

propertyman wrote: »

Though " underpinning" is a scary term, objectively a 1930's house was commonly built on some hardcore and 12 inches of brick into the ground.

I'd rather have a 5 feet of poured concrete underpinning under me any day :rotfl:

That's certainly true if the whole house were underpinned, including sleeper walls, etc, but usually just one part is.

andy.m_2

When it comes to selling, you may need to consider your strategy carefully.
If you are upfront and have a reduced price then you potentially put people off viewing.
If you have a cheaper price but dont tell the viewers then you run the risk of being beaten down further when the survey is in.

People are historically fearful of underpinned property, it is the unknown the scares them, what if the insurance companyc hoose to no longer underwrite the property? What if there is differential settlement between areas pinned and areas not? There is a stigma attached which is unfair really as we know that a correctly pinned house is going nowhere.

realbean

Our underwriters this year have pulled out so I've been forced to look around for home insurance. This is why I had a structural report last week to help find insurance and it has. I've managed to get a quote for 450 for the year with 2500 subsidence xs no voluntary xs. I think this is quite a good quote for a partially underpinned property. We are currently trying to decide whether to extend or move. As the underpinning guarantee is valid until 2017 and the home insurance is reasonable it may be the house is more attractive to potential buyers.

ruggedtoast

Going back to the original question, in my experience and that of a few friends, banks will lend on an underpinned property as long as nothing untoward comes up on their valuation survey.

If they have any question marks about the state of the property after this they will be added as conditions of the mortgage.

Whether buyers want to proceed when they find out about the underpinning is a different matter and depends on a whole host of variables, largely its a balance between how worried they are about it themselves, and how much they want the property. The price has a lot to do with it.

I pulled out of a place once due to underpinning but it sold within weeks afterwards, and then a year later for more than the previous buyers paid.