House purchase: subsidence history

kg1448

We are in the process of buying a 4 bed Victorian semi-detatched house in London. We are a reasonable way through the process and have just been notified by the seller that a buildings insurance claim was made in 2008 for subsidence damage due to escape of water (leaking drain) resulting in internal and external cracking. The drain was replaced and the cracks were repaired and then monitored for 12 months, no underpinning was required. It was all signed off and there is a Cerificate of Structural Adequacy. The claim was for approx £10k and apparently they have switched insurers since the original claim and now the buildings insurance premium is approx £400/year. The seller says the insurance has never been subject to any rises etc on all the legal forms.

When we offered on the property (between £500-600k) we had no idea about these problems, therefore our offer was significantly over the asking price. It is a ‘project’ and needs completely modernising. It is in an area of London 5 mins walk from a tube in Zone 3 where there are always numerous offers well over the asking price. It had taken us 6 months to find this house due to being ‘outbid’ on similar properties. We have looked at several other properties for sale since finding out and there is nothing anywhere near as good for the money (it has a good size garden, big driveway and 4 double bedrooms).

Both the front and the whole of the back of the house are pebbledashed. The front looks like it’s been there for years but the back looks more newly done (the pebbledash looks much ‘whiter’). The vendor says both sides of pebbledash have always been there. We are yet to go back and have another look and have the works explained in situ. We have a survey booked but we are now wondering whether we should go ahead and spend any more money. If we are going to continue, we feel there should be a reduction in the agreed price.

The house next door (the other side of the semi detatched) also came up for sale recently, we are in contact with the buyers and have seen inside the house. It has some cracking to the internal walls, but the outside looks fine - it is not pebbledashed and all the original brickwork looks intact. We wonder if the neighbours just didn’t bother to repair the internal cracks due to the same issue.

Apologies this is so long winded! Any useful advice would be gratefully received. Should we go ahead?

Doozergirl

London is built on clay, which makes houses susceptible to subsidence. It isn't unusual. The drains of Victorian houses are of an age that failure becomes likely.

Having new drains and the fix already done is a positive in many ways. You'll have the strongest house in the street from now on.

You know the market better than us. Is it likely that the market has already moved on from your winning bid? Insurance premiums could be higher, but value shouldn't really be affected, especially in a strong market. Are the vendors open to a bit of renegotiation? It is a sellers market but they might be a bit nervous of what their buyer will say.

Doozergirl

PS. I'd rather have your house than next door

maninthestreet

If no under-pinning was required, it doesn't sound like it was that serious.

dominoman

I wouldnt worry excessively. Get the full structural survey done and judge it after that.

Subsidence in London, especially S and SE London, is very very common in older houses. Their foundations are shallower than modern houses.

If you like it and are going to do work anyway then you can address any remaining misalignement of doors etc.

Don't walk away if you like it. Every older house has some problems. The London market is crazy crazy so now that you have secured it just go ahead before someone tries to gazump you.

I speak from personal experience. We were buying a house in SE London that had had a subsidence claim. We used it to try to get some money off - and ended up being gazumped instead! That was a year ago and the house has increased by over 250k in that time - while we still rent. Grrr.

Go for it!

kg1448

Thanks all for the helpful replies so far.

Doozergirl: We are not sure if the seller will be open to negotiation. If we are to try to negotiate on the price, we would do it tentatively through the agent, who seemed as shocked as us about the issue.

Yes I think the market may well have moved on, even though we first offered about 5 weeks ago.

Dominoman: Sorry to hear about your experience - I am well aware the same thing might happen if we try and renegotiate. You are probably right that we should go ahead. It just feels like a lot of money to spend if the problem is ongoing or if the sellers have covered anything up...

teneighty

Whilst the vendor's story sounds plausible I would never just trust someone's word in relation to something like subsidence.


I would want to see a copy of the original insurance company's report and recommendations.


I would also at least be getting the new drains inspected to establish that they are in fact new and have all the drains tested to make sure they are sound.


I would also get an independent chartered building surveyor (not a general practice/valuer) and speak to them first to ensure that they would report on any evidence of structural movement and not just put a generic clause in the survey that there is evidence of cracking so you need to consult a structural engineer.

Doozergirl

. The thing about drains is that you simply don't know they've come to the end of their life until the symptoms show in other places. We've replaced countless drains when renovating. It's something less to worry about.

To diagnose, they'll have run CCTV through the system and then done it again afterwards. If the house needed underpinning, the insurance company would have addressed it. We're now 6 years down the line, so there has been chance for ongoing problems to show. If the house needs work anyway, it seems a little pointless to cover up something (not even sure what you're alluding to here) while leaving everything else obvious.

When I read the time, I didn't read properly as I presumed that the house had been underpinned. This seems even less of an issue to me now. Do your checks, but don't panic about it.

Doozergirl

Teneighty, it would be better to speak to a structural engineer straight away, then?

kg1448

Thanks for these replies. On the subject of surveys, we have booked a valuation and homebuyer report through Countrywide, the bank's surveyors. Does anyone have a view as to whether we should just get a standard valuation through the bank and then commission a separate report through a different/independent company (or a structural engineer as suggested above, perhaps)?

If we go with the bank's surveyor, should we tell them about the previous subsidence issue before they do the survey, or just let them do the report and see what they say? If we mention the subsidence, could they put in more negative comments into the survey, ultimately affecting our mortgage application?

Thanks again!

dominoman

kg1448 wrote: »

Thanks for these replies. On the subject of surveys, we have booked a valuation and homebuyer report through Countrywide, the bank's surveyors. Does anyone have a view as to whether we should just get a standard valuation through the bank and then commission a separate report through a different/independent company (or a structural engineer as suggested above, perhaps)?

If we go with the bank's surveyor, should we tell them about the previous subsidence issue before they do the survey, or just let them do the report and see what they say? If we mention the subsidence, could they put in more negative comments into the survey, ultimately affecting our mortgage application?

Thanks again!

Get a basic valuation from the bank but no more. Don't mention your concerns of subsidence.

As you are worried about subsidence you need a separate structural survey, which will cost £600-£1000, but is well well worth it. Get that from a RICS surveyor (ask around if you can) and not from your bank.

A homebuyers report will be a waste of money. It will cost money but won't do anything to assuage your doubts.

Choose the order of your surveys. If you are mainly worried about the structure, but less about the valuation then get the structural (building) survey done first. If the guy says it is a disaster you can walk away and avoid paying the valuation costs. Or if you are more worried about the bank's view do the other way around...