Subsidence/underpinning on bungalow we want to buy

Bhanson

Hi everyone,

Hoping for some advice and guidance. Long term lurker on here and all of the posts on here have been incredibly useful so far, but I think I need to ask for some specific advice and check my workings out with you guys.

We've got a cash buyer for our house, desperate to get in and the sale is proceeding nicely - we're at a point were we just need to negotiate a completion date. On the sale of our house, everything is well *touches wood*.

The property we've made an offer on is a bungalow built in 1993. We offered asking price as there was a bit of interest in it. Mortgage ready to go and then a the property information sheet came back from the seller stating that the guarantee documentation for the underpinning work undertaken in 2003 will follow... Now, we'd not been made aware of any underpinning work/subsidence at the property by the seller or EA when making the offer and arranging viewings. But to be fair, we'd not asked about any of that either so maybe we've learned our lesson there! Subsidence is not an issue in the area generally.

The guarantee documentation for the underpinning is yet to materialise but the EA got a copy of a structural report the vendors commissioned in November 2016 (for their own peace of mind, is that normal?). They let me have a look at it and, to me as a layman, it basically says since the subsidence and underpinning there's been no further movement. Some of the walls aren't plumb but they are within accepted tolerances. So sounds alright - in terms of 'it ain't gonna fall down' but doesn't help with a) still no paperwork for the underpinning nor b) the insurance thing. The insurance thing being -

I've got some insurance quotes that range from £250 - £800 per year more than if it hadn't been underpinned.

Mortgage lender valuation yet to come back and the homebuyers we're having done is due to be carried out next week. So working in the dark to some extent.

Those surveys/valuations aside, my thoughts so far are -

If the underpinning paperwork/guarantees aren't in existence, we walk away and move into private rented until we find something else. Chances are this'll be out of our hands anyway as the lender is likely to need this assurance.

If that paperwork can be produced, we have reason to ask for a reduction in price (like I say, we offered full asking price (£185k) which seems to be about right considering other properties in the area). A sensible reduction to ask for might be, that £250 - £800 per year over the 35 years we're taking the mortgage out over... So say maybe £350 multiplied by 35 = £12k rounded to nearest £k. What do people think to that? Sensible or not? Need to wait for valuation etc??

My concern is that we're probably going to want to move again in the next 10-15 years, this might well put potential buyers off - the rationale for the discount is that we'd pass that on to whoever we eventually sell to (if we can - it's very off-putting even to me and I'd like to think I'm not really very risk averse).

Could anyone please offer any advice? Seen a few things on here saying subsidence = run a mile but can anyone offer any first hand experience of the same issue I'm facing??

Thanks in advance - and sorry for the war and peace!

lincroft1710

How much interest in the bungalow would there be once it became known it is underpinned? I would want to find out what caused it to be underpinned. If a tree which has now been removed, the bungalow may be OK if it was underpinned properly.

Whatever reduction you negotiate, when you come to sell you may have to agree a similar reduction, so the extra insurance premiums may not actually be paid for.

Bhanson

Thanks for the response!

I guess it's difficult to say, but I would suppose there'd be less people interested if people knew it had had that work... Unless it was priced accordingly?

Yeah, hopefully this guarantee will set out what caused it and how it was rectified so will report back with that.

Good point re. reduction - will have another think about how to negotiate that!

Chanes

If the guarantee for the work is valid and the works have been assessed and are found fit it would not worry me if there had been subsidence (obviously the underlying cause will have to have been fixed too)

It would have been much worse to have moved into the house and then it suffered from subsidence after that.

amanda_p

Just as a heads up, our house was underpinned 26 years ago after reasonably significant movement. It took years to undergo all the stringent tests, monitoring, soil samples etc.before the underpinning took place. Ours was the result of tree roots, the water table and being built in the dry summer of 1976.
We have all the surveyors reports and the final signing off papers.
If a house has been underpinned you have better foundations than all around you. It is unusual for there to be more problems especially if you have seen the sign off paperwork.Insurance companies do not charge more for an underpinned property. We stayed with our original insurers for 10 years after the subsidence in case of further movement of which there was none and then moved companies. No problem at all. We live in Essex and this is now a fairly common occurrence due no doubt to the clay like soil!

Bhanson

amanda_p wrote: »

Just as a heads up, our house was underpinned 26 years ago after reasonably significant movement. It took years to undergo all the stringent tests, monitoring, soil samples etc.before the underpinning took place. Ours was the result of tree roots, the water table and being built in the dry summer of 1976.
We have all the surveyors reports and the final signing off papers.
If a house has been underpinned you have better foundations than all around you. It is unusual for there to be more problems especially if you have seen the sign off paperwork.Insurance companies do not charge more for an underpinned property. We stayed with our original insurers for 10 years after the subsidence in case of further movement of which there was none and then moved companies. No problem at all. We live in Essex and this is now a fairly common occurrence due no doubt to the clay like soil!

That's interesting you say that because the insurers I've been getting quotes from all absolutely do charge more because it's been underpinned - usually about £250 more but up to £800 more for one of the 'big name' insurers. I've been looking on gocompare, money supermarket, etc, etc.

Might it be that if there's a lot of underpinned properties in an area they don't see an issue (like yours) but where there aren't many they are more cautious as the cause isn't as straightforward (like where I am)?

The sign off paperwork and guarantee is going to be crucial I guess

Slinky

amanda_p wrote: »

Just as a heads up, our house was underpinned 26 years ago after reasonably significant movement. It took years to undergo all the stringent tests, monitoring, soil samples etc.before the underpinning took place. Ours was the result of tree roots, the water table and being built in the dry summer of 1976.
We have all the surveyors reports and the final signing off papers.
If a house has been underpinned you have better foundations than all around you. It is unusual for there to be more problems especially if you have seen the sign off paperwork.Insurance companies do not charge more for an underpinned property. We stayed with our original insurers for 10 years after the subsidence in case of further movement of which there was none and then moved companies. No problem at all. We live in Essex and this is now a fairly common occurrence due no doubt to the clay like soil!

That's interesting, the house we are buying was underpinned 27 years ago (single storey extension only), I think it may have been built around the same time as yours. Our surveyor said he would not have spotted that it had been underpinned, there's nothing visible. It was the neighbours who told him. It's probate, and not all the paperwork is available, although we've seen copies of the receipt for building regs sign off for the work.


Haven't yet checked out insurance quotes, but hoping that 27 years with no on going problem will reassure them.

Bhanson

Slinky wrote: »

That's interesting, the house we are buying was underpinned 27 years ago (single storey extension only), I think it may have been built around the same time as yours. Our surveyor said he would not have spotted that it had been underpinned, there's nothing visible. It was the neighbours who told him. It's probate, and not all the paperwork is available, although we've seen copies of the receipt for building regs sign off for the work.


Haven't yet checked out insurance quotes, but hoping that 27 years with no on going problem will reassure them.

Have you checked insurance quotes yet?

I've just tried with a smaller insurance firm and they're getting back to me tomorrow - those listed with the big comparison websites are just hiking prices right up

dacouch

amanda_p wrote: »

Just as a heads up, our house was underpinned 26 years ago after reasonably significant movement. It took years to undergo all the stringent tests, monitoring, soil samples etc.before the underpinning took place. Ours was the result of tree roots, the water table and being built in the dry summer of 1976.
We have all the surveyors reports and the final signing off papers.
If a house has been underpinned you have better foundations than all around you. It is unusual for there to be more problems especially if you have seen the sign off paperwork.Insurance companies do not charge more for an underpinned property. We stayed with our original insurers for 10 years after the subsidence in case of further movement of which there was none and then moved companies. No problem at all. We live in Essex and this is now a fairly common occurrence due no doubt to the clay like soil!

Underpinning can be a problem if the whole property was not underpinned. If it is only partially underpinned then one part of the property is stronger than the rest which can itself cause subsidence.

Your comments regarding underpinning not affecting the cost of Insurance are not correct. A property having previous underpinning will cause the vast majority of Insurers to refuse to provide a quoitation

Slinky

Bhanson wrote: »

Have you checked insurance quotes yet?

I've just tried with a smaller insurance firm and they're getting back to me tomorrow - those listed with the big comparison websites are just hiking prices right up

Not yet, have emailed the EA today to find out who current building insurance is with. Will start with them. We'll need landlord's insurance though as we're renting it out for a while, so we may be in for an 'interesting' experience here.

nikongirl

I'm in a similar situation so will be following this thread with interest to see how you get on. I'll start another thread for mine!