First time buyers- previous subsidence claim on house we want to buy.

[MoonlitCastle]

Hello. I'm hoping that someone can shed light on this.

DH and I finally found what we thought was our perfect first family home. Our offer was accepted and then we were told about a subsidence claim that the vendors made back in 1996. Turns out the front of the house developed a large crack due to some trees in the front garden.

Long story short, the insurance company paid for it all to be sorted. Mature shrubs were removed and tree cut back, cracks fixed, external drainage all fixed and property declared structurally sound in the same year (1996.)

In 2002 the vendors noticed some internal cracking and again brought it to the attention of the insurance company thinking it might have been the same problem. Told it was not subsidence but just normal shrinkage, and they paid out 4k for internal plastering and redecorating costs.

We still want to buy the property. I got a local builder who has extensive experience in subsidence and has done underpinning in the past to view the property with me again. He took a good look and said he wasn't worried. That the cause was dealt with and there were no signs of further damage. We have also scheduled a full structural survey for a week's time.

My main worry is the cost of insurance. The vendors insurance policy covered all their claims and expires in 2022. They acknowledged that switching the policy into our name would mean a premium would be added for the remaining three years, and they have offered to cover the difference until the policy expires by reducing the house price accordingly.

I don't know where I stand with getting home insurance after the three years are up. Anyone have any idea? Will I really struggle to get the house insured? Will it be madly expensive? The claim was made in 1996 - 23 years ago now - but the other internal cracks claim was made in 2002 - 17 years ago. Will I be penalised or made to pay some extortionate premium? Would this be a dealbreaker for some? Any problems anyone can see?

I bought an underpinned property. I insure it with AXA and as long as the subsidence event is over 15 years ago it doesn't have to be declared with them. My insurance premium is very reasonable (about £20 pm)

Wow, thank you Pez82. Super helpful to know!

Sorry OP, I wouldn't. I've just spent two years trying to sell a house that we didn't think had an issue. It wasn't an issue for us, wasn't an issue buying it, or living there, it wasn't an issue for the solicitors, or insurers. But it was an issue for THREE buyers. All had put in an offer. Some knew about said issue. All three pulled out because of it. Never again I'm afraid.

Thank you, Doje. Also very helpful to know. Do you know why exactly they all pulled out, at which point and why? Did they get structural engineer's reports etc? In our case we most likely would not be ever selling the house on.

I wouldn't - I used to live in an area liable to subsidence and we were very careful when buying property.

You can't say that you'll never need to sell the house! You don't know what will happen in the future.

Ours was a different scenario. We had a mineshaft in the front garden. The Coal Board said it was totally fine, safe, not a problem at all etc. It was covered completely by them insurance wise. The first buyers backed out after the searches. They wanted to extend and thought it might be a problem. (We checked with a couple of surveyors - they said it wouldn't be a problem). The second lot also wanted to extend, knew about the mineshaft before offering (most of West Yorkshire is built on to of coal mines!) were fine with it and then all of a sudden weren't. The third lot, I'm not sure why they pulled out exactly.

I understand you saying you're not planning on selling, but circumstances might change. We bought that house thinking we'd be in it forever. Life happened, circumstances changed, we changed out minds & wanted to move.

Thank you Doje

Sorry OP, I'm the doom and gloom amongst my friends that move house too! They all seem to move within 3 months though! 😂

This one of several classic self fulfilling prophecies with houses that frustrate me.

Subsidence, Japanese knotweed - if it’s been treated and you have evidence, why does anyone care? Yes it could reoccur. Or it could occur in pretty much any house, particularly for both these issues in the SE.

But people get spooked, which means banks get spooked, insurers get spooked, and everyone goes round and round and it becomes a problem, when it’s literally not and you have paperwork to prove it!

Sorry for highjacking OP, FWIW I would go ahead subject to getting the reports and insurance quotes mentioned here. Good luck.

Well this is exactly it, LeatherFace. I wanted to dig deeper into the whole issue (even if it does mean spending good money on it) instead of just running scared. The vendors apparently have all the relevant paperwork stating the property is structurally sound, but we are getting our own surveys and structural engineer's report too. Thanks for your opinion, and thank you to everyone else too. All valid points which require careful consideration.

We bought a house that had been previously underpinned. It had been underpinned in 2001 and we bought in 2010, at which point we needed to insure through a specialist broker so insurance was a bit more expensive but not ridiculous.

When we sold in 2017, it wasn’t an issue at all getting normal insurance. Being 15 years past the underpinning was key, and then it seems insurers don’t worry about it any more. Nor did it affect the price we were able to sell for.

I worried our buyers would pull out of it because people are so negative about it but really you’re buying somewhere that you know has been sorted out. It’s stronger than before! And despite being ridiculously anxious over very minor things, they didn’t mention the subsidence at all.

Interestingly I know 2 other houses in the terrace are now having issues with subsiding (1 found out because they tried to sell & it was discovered, another because they were hoping to do building work after moving in). So buying our already underpinned house was the much better deal!

I would not buy
It definitely affects the future marketability
If there are 3 houses 1 with an issue and 1 without people will buy the 1 without

I wouldn't recommend buying a property with any fixed/not fixed subsidence. They are difficult to sell unless you are prepared to take massive cut in price or prepared to handle couple of fall through because people get cold feet after survey or talking to other people.

Re affecting future sales & marketability, this wasn’t our experience at all. We sold for over asking (and for a lot more than we’d paid / any other house in our road had sold for) on the first day of viewings.

It is a tricky one because people are so negative, talk about it massively affecting value etc. And then in part it becomes a self-fulfilling prophecy. I was anxious when selling because of all the negative messages you get if you google etc. The reality was it was an easy sale.

Thank you to everyone for their advice and experience. Very grateful. Survey booked for next week... fingers crossed....

Our house has been underpinned.
We live in London Clay as does everyone for miles around. The structural engineer who did our survey said every house not underpinned here should be and us better for it.

We were told that once an insurance company has paid for the works they are obliged to continue insuring it. This has been the case with us, we took buildings insurance with the same company and they still insure us 13 years later.

And there have been no problems.

If you love the house, it is in tne location you want, the price us good and you intend to stay for many years, I wouldn’t be put off.

And to echo a pp: we fought off other bidders to get our offer accepted.

Thanks HotpotLawyer. This is it - the house is in the perfect location. It is in London, hence the clay soil issue is true for us, too. But the house is perfect in so many other ways, not just the location. We do intend to stay for at least the next ten years. Thank you for your opinion. By the way, if you don't mind me asking... did your insurer hike up your premium extortionately?

The buildings insurance is higher than average, but they didn’t hike it up between us and the previous owners. And over the years it has either remained the same amount (so gone down in real terms) or this year it went down in cash price too. Santander.

Thank you! I think Santander are the current insurers on the seller's home. Really helpful to know.