Buying house with subsidence via probate

[bootsyjam]

Have found our dream home and the subject header says it all:(
Had a full survey and chatted to the surveyor today after receiving his report and it wasn't pretty. As most will know you're not going to get a yes or no answer from a surveyor but after some gentle cajoling he said that in so many words that it's subsidence for sure. After more research on what he flagged then it's not really arguable at this point.

To find out what type, how severe, what to do to stop it will entail hiring a Structural Engineer and will cost 3-5k+ as it won't be a simple walk around.

Does the fact that the property is being sold via probate mean anything at all in what happens? Do we have to shoulder the burden of discovery ourselves and it's just tough luck?

As if buying a place with subsidence wasn't bad enough already!

Any advice will be gratefully received:)

We bought a house with known subsidence that was in probate.

They vendors insurance was transferred to us. But it took ages to complete the sale.

We also had a retention on the mortgage because of it.

We had the trees removed that were causing the issue and the monitoring went on for ages. Once we'd completed the structural works (no underpinning but some remedial tie ins of the bricks and the cracks) the mortgage company sent their surveyor out and the retention was lifted.

From when we viewed the house to having it repaired and signed off from the insurers took almost 4 years. 18months of that was buying the house.

But, we bought the house for £175k. We spent about £50k. 10 years ago. We have had an extension since (90k) but the house is now valued at an eye watering £650k.

It worked out well for us, but we lived in a pit for a good long while and with some uncertainty too. And I don't think we'll ever move again, me and DH actually had to take it in turns to deal with all the emails and phone calls (one month each) because it was ridiculously intense at times, juggling everything.

Good question !
2 simple answers 1) we were naive and had the confidence of youth on our side so didn't negotiate a reduction. The place was a total doer upper anyway and in a bad state so was priced accordingly . The surveyor (I chatted him up relentlessly!) also told me on the qt that it wasn't too bad in his view.

2. we were buying in london during a property boom with flats increasing in price by £10k a week (I shit you not ). It was that flat or no flat. And we were confident we could turn it into a lovely home and not lose financially. So, desperation!

We bought for £160k (double the selling price of my pristine small-town house I sold at the time) , then sold 5 years later (in 3 days flat even after being v open about the previous Structual stuff) for double that . Nuts frankly.

Its sold again twice since, the latest for £750k. Even more nuts.

@catwomando
@JuneOsborne
Thanks once again for the interesting and informative replies.

I see that the situation with the flat does help explain your confidence/desire to buy it!

We're offering over 900k in a busy market except the risk is obviously a lot higher due to the sums of money involved. And we have 2 small children (1 month old and a 2 year old).

We've kicked the problem back to the vendor and their insurance but what's clear is the following:

1. If there is subsidence identified by a structural engineer then it's going to be a LONG process to get it done.
2. Causes cannot be identified and rectified immediately, there is an element of discovery after repairs have been carried out
3. Following on from 2), it's going to be interesting/impossible to negotiate a change in price that reflects the seriousness of the subsidence as it's an ongoing process
4. There's a good chance/practical certainty that if we live in the house while repairs are ongoing then it's going to be pretty unpleasant living conditions for quite a while. Which should (hopefully) also be a factor in any price negotiation.
5. Even simple repairs like drains and then internal work takes time and we should be looking at a minimum of a year to get it sorted out.

Many thanks once again.

Hi @bootsyjam I read your thread with interest as we are in a v similar situation.

I wondered if you went ahead and if you were able to find a mortgage? We have a mortgage offer from a lender who know about the subsidence assessed and are satisfied with the movement, yet have withdrawn this offer because they won't accept the buildings insurance subsidence excess we can get on the property, which is £2,500 as opposed to their standard £1,000.

We will now have to either find a new mortgage lender or walk away, which is heartbreaking.

@Hazelmond Or get the owner to sort it out on their insurance. That’s mostly what happens.

@TizerorFizz yes, that was the first route we went down. The current insurer couldn't meet anywhere near the £1k excess.

I’m not with you. The owner has the excess on their policy. They fix the house. You get insurance after subsidence is fixed. It’s a much better insurance proposition when all the work is done.

I wouldn’t buy it. It will also affect resale value if you want to sell in the future.

Hi @bootsyjam @Hazelmond ,

It’s been a while since the last posts in this thread, and I find myself in a situation similar to what many of you have experienced. I’ve made an offer on a house that has visible cracks at the front, and after consulting with a structural engineer, they suspect subsidence. Speaking face to face with the engineer, they believe the issue is likely caused by a tree on the street that hasn't been trimmed by the council but should be trimmed every 3 years, and they think underpinning won’t be needed. The seller is a company representing an estate, so I assume it’s a probate property.

Like many, I’m unable to afford a property in both perfect condition and location (London!), so I’m considering whether to proceed with the purchase despite the potential issue. I’d really appreciate hearing from anyone who’s been in a similar situation recently. Specifically, did you go ahead with the purchase? Which mortgage providers or insurers were okay with subsidence issues? And how did you handle negotiations with the seller?

Currently, I’ve had an initial inspection with a structural engineer, but I haven’t applied for the mortgage yet. I’m considering HSBC or NatWest, but I’m unsure how strict they are with properties affected by ongoing subsidence.

One more thing – @TizerorFizz are you suggesting to ask the seller to fully resolve the subsidence issue (including the 12-month observation period) before proceeding with the purchase?

Looking forward to hearing your experiences and advice!

@Fawnblue I would say it’s always best to get the current insurance company to deal with any claim. It’s usually best practice to get work done before it’s on the market. I think it will be difficult to get insurance on a property where you, and they, know there’s a claim pending. If you cannot afford the repairs, what option do you have regarding getting this resolved? I don’t think you have any insurance options until it’s repaired. Who do you think should pay for the repairs? I’d be surprised if it’s mortgageable.

Have you discussed what repairs are needed.? Is the SE isaying they should monitoring the cracks? Or is the timeframe a full repair? Usually they will need to excavate around the foundations and nome of this is cheap. How do you propose to sort it out if there’s no money available? Would you just leave it and hope for the best?

You also have the problem that the tree is still there drinking water from the soil leaving the soil around the house desicated. This means the house is still liable to subsidence. Who is dealing with the tree? Who would carry out the repairs that might be caused by the tree not being cared for?

Honestly - can you afford the repairs? If you cannot, then it’s almost certainly the vendor who sorts it out. Or it’s sold to a builder. I’d not entertain it if you don’t have the mioney readily available.

@TizerorFizz Thanks so much for your comment – lots of food for thought there! To answer your questions:

The tree is still there, and the structural engineer just suggests the council trims it back every 3 years, so the tree maintenance would all be handled by the council (it's actually due for a trim in the next financial year anyway). The structural engineer doesn’t think underpinning is needed for the subsidence, but aesthetically, some work would be needed to make the front look nice (like repairing or replacing the lintel). He also suggested that once the tree is trimmed, they would monitor whether the cracks have stabilised, and after 12 months, we'd know for certain whether the subsidence has stopped after the change in seasons.

I’ve set aside cash for renovations, including things like repointing, replacing lintels and windows, rebuilding the extension, and rewiring/plumbing. However, the budget isn’t endless and as it is London, everything is more expensive. So I’m concerned about any costs that go beyond what the structural engineer has suggested as the most likely scenario for the subsidence.

Additionally, I can’t afford the property without a mortgage, so I do need insurance and I’m trying to figure out how to navigate that whilst I work out if we even want to progress with the purchase. I’ve mentioned this to the estate agent, but he keeps deflecting by saying there’s a cash buyer waiting in the wings and that he wasn’t aware of any subsidence issues, as previous surveys didn’t show anything. But then he tells me to put everything in writing so he can send it to the seller and will try his best.

I’m really torn between thinking this could be a fixable issue that would let us create a beautiful home, and worrying it’s a no-go area because of the subsidence. I’d really appreciate any further thoughts you might have! If it would help, I can provide more details about the property too. Any advice you have would be super helpful!

Your big problem is insurance. Your second big problem is buying a house with unresolved subsidence. Have you asked any insurance company about insuring this property? What would you do if the subsidence gets worse in a dry summer? It’s an unresolved issue and I think you need to ascertain if it’s mortgageable as well. I think that’s doubtful.

In these cases, a buyer putting right such defects might need deep pockets and the best solution is that the vendor claims and rectifies the issues. If they don’t want to, a cash buyer (builder?) is the only possible answer. Even if you patch it up cosmetically (a lintel needing replacement is not cosmetic either) you don’t know what else might happen.

You also have the issue of upkeep of a tree you don’t own. Where are its roots? Are they damaging anything? I wholly appreciate this house could be good but in my view you need money to buy it and repair it. What would you do if a corner subsided? You have had no trial pits dug so you don’t actually know what’s going on beneath the house.

How many surveys have been done? Very odd comment from agent. How many times has it been marketed and remained unsold? Has the agent actually seen any surveys? Sounds dubious to me.,

My house is in a similar situation, though I have gone through all the monitoring by the insurance company and they ascertained it was the tree, and there's now an agreement with the local authority that they pollard the tree right back to the trunk every two years instead of the previous schedule, which was every three years and not cutting it back so far, and I have a certificate of structural adequacy. The house is still moving a little bit but not very much, and 10 years later, it's not really causing me issues, although I do worry about selling.

I don't think I would've bought it if I'd known about the subsidence, but I appreciate you wouldn't be able to afford something similar that didn't have the subsidence. Usually the existing insurer would continue, but if the property has been empty, that might be an issue, as regular insurers don't tend to insure empty properties. I would also be surprised if you'd get a mortgage on a house with current subsidence.

Thanks to both of you for your insights.

@TizerorFizz , you're right about the lintel repair being structural, and I definitely have a lot to learn! As for the soil specialist, our structural engineer has quoted £2-3K for the assessment, so I'm holding off on that until I better understand whether the purchase is actually pursuable. The property's foundations are believed to be fairly shallow, given the lack of a cellar and the property's age.

A bit more context: the neighbour's property appears to have undergone repairs in the past as I can see fixed cracks in the lintel amongst other signs. The tree in question is at the boundary line between our properties, though it sits beyond the front garden on the far side of the public pavement (if that makes sense). I've reached out to the local council's tree officers but haven’t received a response yet. While they likely won’t provide specific information about either property, I’m hoping to learn more about the process for regularly pollarding or trimming the tree, similar to what has been done for @SierraSapphire ’s property.

Regarding insurance, I’ve spoken with a mortgage broker who specialises in properties with subsidence history. We discussed how difficult it is to obtain insurance for properties with past subsidence issues. Insurers are generally unwilling to cover properties with a subsidence certificate less than two years old (99 out of 100 won't look at it), though they’re ever so slightly better with properties with 10 year old certificates (95 out of 100 won't look at it). However, with recent changes in the insurance market (eg. RSA pulling out of house insurance), it’s becoming even more challenging to secure coverage for properties with recent subsidence.

One option we considered was the sellers raising a claim and extending their insurance to transfer the coverage, but this requires careful handling of the insurers’ goodwill. Another would be to forgo subsidence coverage and get insurance that doesn’t cover it (assuming the lender allows this), then wait until the subsidence stabilises before obtaining full coverage.

We’ll have another talk with the structural engineers and also reaching out to a builder to get a clearer estimate of the potential costs of addressing the subsidence ourselves, considering the purchase price. In the meantime I've asked the estate agent/seller for info regarding subsidence and waiting for the response. Honestly, I’m anticipating that there may be a significant hurdle with the purchase (the sellers might even give up with us and just go with a cash buyer), but I feel it’s worth gathering all the necessary information before making a final decision. I’ll feel more confident about my choice either way, if I’ve fully explored all the possibilities.

@Fawnblue

Yes I agree to looking at possibilities but I think you will meet dead ends. The only way this can be reasonable for you is the seller dealing with it and you continuing their insurance. If they have it of course. I doubt insurers would partially insure a property. I know a soil investigation would be needed and your SE should be able to give you a ball park figure for rectifying subsidence if they don't think underpinning is necessary. However without ground analysis that's a bit of a guess. You can ask the council about their pollarding plans but with local government finance, I would not expect much there either. It's very hard if you don't have the money.

Hi @FawnBluesorry I’ve been meaning to reply back all week. After a huge amount of research and consultation - I wish I’d typed up the detail at the time - we did find an insurer and go ahead with the move.

Our situation was that the sellers had put in the insurance claim for subsidence about 1 year prior and carried out remedial work. We decided to proceed only after consulting multiple specialists. The existing insurer wouldn’t cover us (possibly because the property had been empty - it was probate) but I did eventually find an insurer who would meet the mortgage lender’s terms of max £1k excess.

We may have to relocate again within 5 years and if we do, prospective buyers will see that we have had a mortgage from a high street bank and insurance cover; there will also be documentation to support that subsidence is treated and is no longer an issue. Still, I’m realistic that just mention of that word will be enough to put some prospective buyers off.

@Fawnbluehappy to share details of the insurers if you want to DM me

A house should be insurable after remedial work. The house is in better condition and is future proofed. Before it's done is problematic. The vendor here hasn't done anything. It's always best for the vendor to sort it out. Bad luck not to continue with insurance. Maybe excess too low?

Ah OP I wouldn’t bother it sounds like a lot of stress and hassle to me.