Buying a house with subsidence

RMBB

Hi, we are looking to buy a property which had a subsidence claim about 2 years back. Repair work done, monitored and insured. We got a structural survey done which has discovered new cracks which could be 'progressive' given the history.
We love the house - but how risky is this?
Insurance: AXA currently insures the property and has told us that they are willing to insure us (new policy) as well.The premium is about 300+ a month and subsidence excess of 1000.
My solicitor is very very wary - and has warned us that AXA can choose to not renew the policy the future and then we will have trouble finding a new insurer with the subsidence claims history. Is that really such a big issue?
Resale value: People who have tried to sell houses with subsidence - has it been such a big issue? What if we get the seller to fix it so it is part of the property history - but no claims during my tenure. That's if I'm lucky and it doesn't come back!
Extensions - This property has a lot of extension possibility which we like. But does the issue of subsidence impact that by any chance?
We love the house and not sure what to do

lessonlearned

In a nutshell, walk away and look,for another property.

Sorry I know thats not what you want to hear.

I have renovated several houses, included listed buildings but I would not contemplate a house that had suffered subsidence. It's just a step too far for me.

Not because subsidence can't be fixed, it usually can, but because insurers, lenders etc can be so picky.......you might get a mortgage this time but that is no guarantee that lenders will be so accommodating in the future.

Your solicitor is right to be wary and has issued clear warnings and guidelines. I suggest you give this one a miss.

SG27

Usually after about 10 years after the subsidence is fixed insurers tend to be not bothered. If it's a definitely fixed, the house is long term and you don't mind the extra monthly cost it might be worth having a think about.

Doozergirl

I disagree with lessonlearned, that one should automatically walk away. Not having the experience of owning, rectifying and selling just means that you don't have the experience, not that others shouldn't if they're not automatically afraid.

If the house doesn't have present movement then there is no reason to refuse a mortgage. We've sold so many and not one lender has ever batted an eyelid at a rectified problem.

The one major stumbling block is that if you are buying with a mortgage, they're not going to lend where there is ongoing movement.

Because of that, this is the type of house where you really do go for the big discount, fix it once and for all and make profit. I'd be inclined to pay for work from savings on the house purchase than go back to the insurer on a second claim - unless it is the original work that hasn't been carried out successfully, in which case they should definitely pay.

Lots more homework required. What caused the previous movement, how was it rectified. Where is the potential new movement, what is the cause of that etc. I would hire my own structural engineer.

Extending a house with subsidence is always possible, obviously it's important that the existing problem is fixed. Foundations for an extension may need to be deeper or of a different method than is usual.

Doozergirl

Also, I never seen it written anywhere that insurers can suddenly choose not to renew where they have had a previous subsidence claim.

I am sure that whoever dealt with the original claim is legally obliged to renew the insurance and pass it to subsequent owners.

If you decide to break loyalty and move insurers and then suddenly find you can't get cover, that's a different issue.

I'd just want confirmation in that letter from AXA that they will continue to do so for as long as you are loyal.

Landofwood

300 quid per month for insurance is surely enough of a reason to walk away

robotrobo

Landofwood wrote: »

300 quid per month for insurance is surely enough of a reason to walk away

that certainly beats my £8 a month for my 2 bed det bungalow ,which as boiler cover included as well

WeAreGhosts

we walked away from a property that had previously had subsidence but was now fixed.
the present insurer would continue to insure, but we wanted to renovate it without living in it and they wouldn't insure it when it was empty. tried to find quotes for when it was going to be empty but it was going to be expensive and excess about £6000!
vendor can't sell the house. it's still up for sale months later.

dacouch

SG27 wrote: »

Usually after about 10 years after the subsidence is fixed insurers tend to be not bothered. If it's a definitely fixed, the house is long term and you don't mind the extra monthly cost it might be worth having a think about.

That's not usual at all, that's fairly unusual unless you look at specialist Insurers who will want you to have a structural survey carried out (At your cost) and will then provide a bespoke quotation which will almost always be considerably more expensive than the standard market and typically not as wide cover.