Subsidence in London: Is it even worth buying?

Ch1sp413

Hello everyone! 

Firstly, thank you very much for this fantastic forum. It's definitely helped us get our heads around the house buying process!

My wife and I are FTBs and we are getting increasingly concerned about the widely discussed topic of subsidence / heave. We’ve tried to gather as much information about the topic but we still have some concerns we were hoping some of you with more experience could help clarify.

We are looking to buy our first home in north London, in an area we know the soil is mostly clay and therefore prone to subsidence (environmental searches in this area typically deem the risk of ground movement as “Moderate”).

A few months ago, we had an offer accepted on a semi-detached mid-30’s house. However, few weeks into the purchase process, the TA6 revealed the house had suffered from subsidence due to a big tree in the garden, resulting in the house having to be underpinned. The events took place more than 15 years ago and haven’t been recurrent, the lender valuation and RICS L3 survey didn’t flag any evidence of subsidence either. At the time, we didn’t fully understand what it meant but our research revealed that houses with a history of subsidence are difficult to insure, have unreasonably high excesses and lose around 15-20% of their market value. After discussing this with our solicitor we decided to pull out from the purchase. Needless to say, the house is still up for sale 3 months later in a market where we’ve seen houses come and go within a week. 

As we started learning more about the topic, we realised subsidence is a common issue in London, with a statistic even showing that 1 out of every 50 houses suffers / has suffered from subsidence. 

The reason why we are so concerned is because all our life savings are going into the purchase of our first house but the risk of losing 20% of its value in the years to come because of a “moderate” risk of subsidence seems unreasonable to us to the point we are thinking we are better off renting and putting the deposit money elsewhere. This is particularly worrying going forward as we see further periods of drought like the one we’ve suffered this summer.

Are our concerns justified? Is the risk of subsidence as high as we think? Are the consequences of subsidence as terrifying as we’ve read? We are both puzzled as we always understood buying a house in London as being a safe "investment".

Thank you very much for your help in advance!

macman

Try south of the river: more gravel, less clay.

Doozergirl

That 20% number is entirely made up. 

Some people might be put off entirely, others won't really care. 

The question mark over insurance depends on how recently the work was undertaken.  

Frankly, I would rather have a house with foundations than without them.  Underpinning = foundations.  That is all it is, not quite sure why it's so scary
unless it's a surprise and you have to pay for the work.  

If you are worried about subsidence, buy a modern house with foundations! 

tooldle

As above, far better to have a house with additional stabilising (underpinning) than one without. As a previous owner of an underpinned house, i never had trouble insuring it and when selling it, broke the ceiling price for the street. 
Underpinning is a fix for subsidence. Describing a house that has been fixed as suffering from subsidence is a bit like breaking a window, repairing it, and still referring to said window as broken. 

Doozergirl

Good analogy! 

Thinking about it, maybe it's more like single glazing.  The underpinned house has some double glazing. 

You don't want to buy the house because it still has some single glazing yet all the other houses around are single glazed.  

The logical solution is to buy a house with full double glazing, or accept that the partially double glazed house is partially improved.   The logical solution isn't to buy a single glazed house and think it's worth more.  

TripleH

Parents had a house that was underpinned in the mid 70's.

They moved in in mid 80's, never had issues with it being underpinned. Wasn't even raised as an issue when sold Spring this year.

The biggest issue with it being underpinned was that the original tiled floor in the hallway stopped half a meter from the front door to be replaced with concrete.

This is the North of England.

Woolsery

The reason why we are so concerned is because all our life savings are going into the purchase of our first house but the risk of losing 20% of its value in the years to come because of a “moderate” risk of subsidence seems unreasonable to us to the point we are thinking we are better off renting and putting the deposit money elsewhere. 

I'd love to know where the safe 'elsewhere' is. I was chatting with a friend who's an IFA last weekend and he's losing sleep big time over where to put people's money, just for safety, never mind growth!

amanda_p

If the house was underpinned over 15 years ago it is unlikely you will have problems. Better the work has been done than buy and 3 years down the line after hot summers you have movement. We were underpinned 25 years ago as were quite a few nearby houses. Absolutely no difference in prices  when selling to those that haven't had remedial work done. As for insurance, you will have no problem with getting insurance or the price of said insurance. Subsidence these days is much more common than it used to be and is dealt with much quicker. Ours was caused by tree roots and a house built on Essex clay. Had no movement since.

Ch1sp413

Hello everyone!

Thank you very much for your kind replies. We feel a little bit more reassured about the subsidence / heave FUD going forward. We had another offer accepted earlier this month and so far the TA6 form reveals no insurance claims for subsidence nor there are any guarantees / warranties for underpinning in place.

Something I find intriguing is how the TA6 form directly asks questions concerning flooding, and even Japanese knot weed but doesn't ask directly about subsidence / heave / landslip, structural defects, or foundation issues. Instead, our solicitor will be raising these as inquiries since the building insurance provider needs this information. 

Is it typically the case that these need to be answered as part of an inquiry to the seller's solicitors?

Thank you so much for all your help!

deannagone

There are 3.6million properties in London.  If subsidence was a serious risk, they wouldn't be selling.., and yet they are/do.  I agree that the 20% figure is a gross exaggeration.  It seems the underpinning you are reading about was more due to a tree than clay soil.., and trees can be anywhere?

I think you are reading things that are playing on your concerns perhaps? 

If the survey found no signs of movement (and was a full structure survey), it looks likely the underpinning is working and has been for quite some years.

Woolsery

Ch1sp413 said:

Is it typically the case that these need to be answered as part of an inquiry to the seller's solicitors?

It's perfectly acceptable to write 'not known' or 'not to my knowledge' in the answers to questions that go beyond the vendor's knowledge or expertise. Some questions about historic settlement,  subsidence, foundations, heave etc could easily fall into this category.