Help!...underpinned house advice

mrhappyman

I have seen a house that I love - a 4 bedroom detached built in 1927 with a fantastic garden. But...the agent advised that the house suffered from subsidence in 1985 and was underpinned in 1985 or 1986 prior to sale. The underpinning was to the right side of the house, due to "either faulty drain pipes leading the water away from the house, or a constantly changing water table".

The current seller bought the house in 1996, and says that the house has not suffered with any issues since. She took out a mortgage in 1996 with C&G, and in 2010 a new mortgage with Barclays, so normal high street lenders.

The buildings insurers are also Barclays (and so not a specialist insurer) and the current premium is about £250. I've spoken with Barclays and they've confirmed that the house is insured with them and they are aware of the previous subsidence. I'm aware that AXA provide buildings insurance cover where subsidence occured over 10 years ago, and Legal & General where it occurred 15+years ago.

My main concern is reselling the property - I love the house and could see myself there for 10 years easily. But I'm worried about how people view these sorts of houses - it's certainly made me think and I can't be the only one!

How would you view this house if you were looking? I'm worried about a reduced pool of buyers concerned about underpinned houses, and risks with insurance and mortgages. The house is on for sale at £425k which is on the higher end for the houses where I am so a smaller pool of buyers to start with.

Who knows the future... I don't want to be stuck in a poor property market, wanting or needing to move but can't sell, or have to entertain offers below market value.

I've read the report by the original structural engineers who signed off on the work, and a guarantee of 30 years n the work but which expires this year. But the local council haven't yet confirmed if they signed it off (I'm not sure if they needed to in 1985/1986 as the rules were maybe not as stringent?). The house has had further extensions in 1996 and 2002 that the Council are aware of.

I'd be grateful for some advice and views please....

nubbins

I had an almost identical situation last year. Found a nice house, discovered it had a £60,000 subsidence claim 7 years earlier, no problems since but insurance was £1000 a year. I trawled the internet and came to the conclusion that it was like buying a CAT C car, it will probably be fine all the time you have it but when it comes to selling there can be problems and like you say your pool of potential buyers can be reduced. For me this was a home I could have lived in for 10 plus years but I wanted a 10% reduction which the buyer wasn't willing to go to. In the end it went for about 7% under ask but that was in a sellers market. I would not totally dismiss it, if you can get it for a good price and you plan to live there for a while but if you are using this as a 3-4 year next rung up the ladder then I would be cautious, if the market turns again and your property is up against non-subsidence houses then it will bottom of the list unless the price is low. The other factor is that in some areas underpinned houses are common and not so much of an issue.

Lord_Baltimore

Before people go to look for a house there is a list of things in their mind that they want and don't want. Top of the 'don't want' list is probably subsidence.

Don't be seduced by what is above ground; like an iceberg, 90% of the stuff that can sink you is below the surface.

Not only that, the £400-500k pricepoint is tough in my experience.

Davesnave

My experience is that houses in desirable areas can still sell OK with previous, subsidence, but yes, they'll probably achieve below the average price for the area.

During the Crash, we rented such a house, where the subsidence had not apparently been dealt with, but it was in a favoured part of a World Heritage city and among others with similar, and worse, problems. Obviously, at that depressed time, the owner decided it was better to rent it out and took it off the market.

Within two years or so, in a recovering market, that house sold at around 7% under the going rate, despite retaining the issues it had, plus a couple of others.

Last year, my daughter also had to make a decision involving a Victorian property in another fashionable area of a different city. In this case the subsidence was due to undergound springs, but that and other major issues had all been dealt with and signed off in the 90s.

For her, it was a no brainer, as it was the only property of its type she could afford in that postcode, and it came with structurally better features than many of its neighbours. It was obtained for about 10% below the going rate

Doozergirl

This is 30 years ago.

What people fail to understand is that houses that have been underpinned are far less likely to ever move than a similar house that hasn't been underpinned.

Reworded and asked if you would prefer a house with foundations or without, what would you choose?

The insurers don't see this as a particular risk anymore, given that they are providing cover at an average sort of price.

It may be personal preference as to whether they buy, but people don't seem to understand how and why houses move.

As a professional in the industry, I wouldn't have a problem with 30 year old underpinning at all. We've underpinned houses and never had a problem selling either. All houses move, most old houses lack any decent foundation, all houses need maintenance.

Lord_Baltimore

Doozergirl wrote: »

It may be personal preference as to whether they buy, but people don't seem to understand how and why houses move.

That's the crucial point. Non-professionals will form their own view and this will impact on resale prospects. This may be an ill-informed view but imo it will have a dampening effect nonetheless.

ellie27

For your average house hunter that would be an instant no-goer I would think. It would be for me.

However we are buying a house on a private road, a small private road which has 2 other houses on it, and I know that would put many people off too!

benstaton

I'm waiting to exchange on a house that was underpinned 8 years ago.

We got a member of the Institution of Structural Engineers to check it out, in addition to a full building survey by a member of the Royal Institution of Chartered Surveyors. Expensive, but necessary in a situation like this, and worth every penny for peace of mind alone.

The engineer said "if there's an earthquake, this will probably be the last house left standing"!

I think the most important thing is to ensure that no further movement has occurred since the underpinning work was carried out. If that's the case, then the property probably has better foundations than the one you are living in now!

There are people like you and me out there, who will consider buying an underpinned property. I think you just have to accept that it might take a little longer to sell, and the price may have to be adjusted accordingly. You also have to accept that you're stuck with the insurer who originally carried out the underpinning work (they are legally obliged to continue insuring the property), or go to a specialist insurer, of which there are many.

When it comes to selling, do your best to make it easy for buyers. Make sure you have all the necessary documentation (building regs, architects drawings etc), give information about insurance implications, supply copies of surveys etc. Before selling, I would even consider paying a few hundred pounds to get an up-to-date structural engineers report, and make it available to reassure potential buyers.

Subsidence is a very common problem. Don't let it put you off if you're satisfied that subsidence is no longer an issue, can live with the fact that it might take a bit longer to sell, and are OK with having limited insurance options.

mrs_z_2

Just bought a house that was underpinned almost 20 years ago.

We were worried about it at first, but ended up getting a structural survey done which came back okay. All valuations also turned out right, and didn't have any trouble getting insurance so decided to go ahead.

For us, it was about location, and it's also quite common in our area so less likely to put people off, but I'm guessing you might lose some buyers as the internet seems to be full of fear of underpinned properties.

Tough call - think about how much you love the place, and whether you'd be able to take a hit or keep the house on the market longer when you're looking to sell.

mrhappyman

I'm really thankful for everyone's replies - all very sensible and reasoned comments. I'm sorry for not replying individually to you all even though you've taken the time to post.

I believe that subsidence in our city is fairly rare, due to generally the good quality of soil or so I've been told (flooding in some areas is more of an issue but this house isn't at risk at all). I called up four different local estate agents for their views and they all replied that they didn't believe that a 30 year old underpinned house was compromised on the market, as long as there were no further issues and a clear paper trail, and they would not suggest that the seller if it was their client, discount the house. A couple of the agents noted that a house that had subsidence/underpinning did carry with it a stigma as it was a subjective issue where otherwise the house is fine.

All I have seen to date are the original plans showing where the underpinning was required/had been done, report from engineer and sign off, and a 30 year guarantee from the local construction company - I don't think either the engineering company or the builders are around any more as I couldn't find anything on the internet. I'm still waiting for the (slow) local council planning department to tell me if they would have needed to know a house was being underpinned (at the time in 1985), and if so, are they aware of and did they sign it off.

I think everyone who has posted has pretty much covered the main and probably all the issues. My understanding in summary is: make sure all the paperwork is in place and the necessary engineer/council signs off are there, ensure it's checked by a structural engineer and surveyor to make sure there hasn't been movement since the underpinning and that the issue seems resolved and future wise, it is structurally sound and should remain so...but, when it comes to sell, especially if it's a difficult market at the time, expect to encounter a smaller pool of buyers and be prepared to keep it on sale for longer (and possibly be prepared discount the price).

If the paper trail is fine and the engineers and surveyors are happy with it, I think there will always remain a difference between the technical aspects versus the subjective stigma which will put off some buyers. The truth is, it's probably impossible to predict!

The house is on at £425k, which is probably about the market value for it and the finish to the house is in very good order and nothing really needs work. Bearing in mind the extra costs of reports, and to take into account the issues when it comes to selling, what do people think I should ask for in terms of discount, if any? I would normally want to ideally try and secure the house for around £410-£415k depending on interest on other buyers etc, but I'm not in a chain so offer that incentive to the seller. But this price of £410-415k would be but for the underpinning.

All views gratefully received...

themull1

Personally i wouldn't buy a house that has been underpinned, but some people would. I live practically on a motorway, which isnt for anyone, but i'd rather have the motorway than kids footballs in the garden!!