Buying a house with subsidence: is it a terrible idea?

Subsidence is the term given to the downward sinking or collapsing of the ground on which a property sits. Most if not all properties will experience a small amount of movement over the years, and in many cases, this goes unnoticed.

However, sometimes significant movement can cause instability to the property. As a property owner, it is important to take relevant action to protect a subsiding property from becoming extensively damaged before it becomes uninhabitable.

Is it safe to buy a house with subsidence?

If you’re thinking about buying a house with subsidence, you should be prepared to gather as much information about the property’s condition as possible, including whether it has previously been treated for subsidence.

This can be ascertained via a structural survey, which is typically carried out before a purchase is completed. If a structural survey reveals that subsidence is an ongoing issue, the surveyor should be able to advise on the severity of the condition and suggest the remedial works required to fix the problem.

From an investment perspective, buying a house with structural movement is generally considered to be less safe than purchasing a property in perfect condition. However, if the property only has minor subsidence, you might find yourself in a great position to negotiate a lower price.

Can you get a mortgage if a house has subsidence?

Buying a house with subsidence doesn’t necessarily mean that you can't get a mortgage, but it is much harder to get a mortgage with subsidence.

Thus while a property with minor subsidence might seem like a reasonable investment on account of a comparatively lower market value, it will be harder to finance the purchase with debt and your pool of potential buyers may be limited when you come to sell it.

Even when a property has had subsidence which has been resolved, it can still be difficult to find a bank or mortgage provider that is willing to finance the purchase. These properties can also be difficult to insure.

Never say never

While many standard mortgage providers will decline to finance a property with structural issues, this doesn’t mean buying a house with subsidence on finance is impossible.

There are specialist financiers which can help investors to secure a loan while also providing advice on the practical aspects of buying and owning a property with a history of subsidence.

You should speak to a specialist mortgage broker who may be able to advise you on mortgage lenders who could lend to you and allow you to buy a house with subsidence.

Will subsidence devalue my house?

Subsidence will devalue a property, even if the issue has been correctly dealt with and no longer poses a problem. Despite this, over 40% of property investors are still happy to consider buying a house with subsidence.

However, it is important to ensure structural issues are appropriately dealt with. In a recent survey, a little less than one-third of prospective purchasers said they would only be willing to buy a property with previous structural issues if structural analysis confirmed it was safe to do so. Almost 10% suggested they would use previous subsidence issues to negotiate a lower purchase price.

How much does subsidence devalue a property?

Each property is different, and the amount of devaluation will depend on the following:

  • How recent the issue is.
  • How severe the subsidence is.
  • Whether the property has had remedial work to address previous subsidence.

Even when a property has been underpinned to counteract the effects of subsidence, it will still be worth substantially less than a property with no current or previous structural issues. It is estimated that a property with previous subsidence issues will command around 20% less than similar properties in the area without a history of structural movement.

Do I have to declare subsidence when selling?

If you’re intending on putting a property with a history of subsidence on the market, it is unlikely that you’ll be able to ignore the issue. Even if the property has been subsidence-free for years or perhaps decades, it is only a matter of time before the existence of the problem rears its head to potential buyers.

This is because conveyancers will quickly flag up the issue of subsidence. If you fail to disclose the issue from the outset, you could run the risk of losing the trust of any potential buyers. Honesty is the best policy, and a combination of conscientiousness combined with practical strategies to deal with buyer queries will help to maximise opportunities to sell a property with subsidence.

Things potential buyers may want to know

Not all buyers are put off by previous structural problems. When you find a buyer who is willing to take a realistic and pragmatic approach to the issue, they will be likely to want to investigate further via a level three building survey.

Under a level three survey, a structural engineer will generate a detailed report complete with the cost estimates to:

  • Monitor the issue on an ongoing basis.
  • Resolve the subsidence via a technique known as underpinning.
  • Suggest how much it will cost to redecorate in the event of remedial works causing issues to the interior of the property (if required).

Historic subsidence

If subsidence issues are historic, your buyer may expect you to provide evidence of any previous insurance claims. In addition to this, you may want to provide specifications as to how the problems were resolved, along with any certificates (such as a Certification of Structural Adequacy).

Conclusion

Properties with subsidence can make for lucrative investment opportunities, provided the issues are dealt with adequately and in a timely manner. While financing might be an issue for those who aren’t able to make an outright purchase, there are specialist lenders willing to offer a solution.

If you are selling a property with subsidence, it makes sense to be completely cooperative and honest when communicating with potential buyers. It is also a good idea to keep all the relevant documentation available to help reassure a buyer that their investment is safe and practical.

Sign up to PropertyData for free

How PropertyData can help you

I'm an investor I'm a developer I'm an agent

Limit reached

Sorry, you've reached your monthly search limit. Upgrade your account today for more searches!

Upgrade

Upgrade to download PDFs

There are many places in PropertyData to export data as well-formatted PDF files, including Local Data, Plot Map, Valuations, property reports and more.

Basic


No PDFs

Pro


Download PDFs

Max


Download PDFs


Branded PDFs

Start your free trial now

Transparent data promise

Where does the raw data come from?

Property listings seen on rightmove.co.uk, zoopla.co.uk and onthemarket.com.

How often is the data updated?

The data is updated in near real-time.

What time period does the data cover?

This is a real-time market snapshot - the data covers currently listed properties. Once properties are removed from the portal, they are soon removed from this tab.

How is the raw data processed?

Duplicates from multiple sources are matched and reconciled as far as possible. Listings with obvious errors, where price or number or bedrooms appear out of range, are discarded.

What are the statistics used?

Averages shown are the interquartile mean, a type of average that is insensitive to outliers while being its own distinct parameter. The 80% range means that 80% of the listed properties fall inside this range.

Where does the raw data come from?

Property listings seen on rightmove.co.uk, zoopla.co.uk and onthemarket.com.

How do you know the square footage of properties?

We use proprietary technology to read the square footage of properties from agent floorplans. Although we cannot determine the square footage for all properties, we can usually get sufficient coverage. Agents are sometimes known to inflate square footage, and this should be borne in mind as a weakness of this data.

How often is the data updated?

The data is updated in near real-time.

What time period does the data cover?

This is a real-time market snapshot - the data covers currently listed properties. Once properties are removed from the portal, they are soon removed from this tab.

How is the raw data processed?

Duplicates from multiple sources are matched and reconciled as far as possible. Listings with obvious errors, where price or number or bedrooms appear out of range, are discarded.

What are the statistics used?

The average shown is the interquartile mean, a type of average that is insensitive to outliers while being its own distinct parameter. The 80% range means that 80% of the listed properties fall inside this range.

Where does the raw data come from?

Property "price paid" data provided by the Land Registry.

How often is the data updated?

Once per month when released by the Land Registry, typically towards the end of each calendar month covering up to the end of the previous calendar month.

What time period does the data cover?

You can customise the time period using the filter at the top of the view. The default time period is up to 9 months back from today's date. The latest data covers the period up to 2022-03-31, although some sales that took place before this date may still be added in the coming months.

How is the raw data processed?

No additional processes are applied to this data.

What are the statistics used?

Averages shown are the interquartile mean, a type of average that is insensitive to outliers while being its own distinct parameter. The 80% range means that 80% of the listed properties fall inside this range.

Where does the raw data come from?

Property "price paid" data provided by the Land Registry, and Energy Performance Certificate (EPC) data provided by Ministry of Housing, Communities & Local Government.

How do you know the square footage of properties?

We match the Land Registry data to EPC data provided by the MCHLG. Due to the fact that not all properties sold have had an EPC and vagaries of addressing in the UK, we are not able to determine the square footage of all properties, but we can usually get sufficient coverage.

How often is the data updated?

The private paid data is updated once per month when released by the Land Registry, typically towards the end of each calendar month covering up to the end of the previous calendar month. The energy performance certificate database is updated monthly.

What time period does the data cover?

You can customise the time period using the filter at the top of the view. The default time period is up to 9 months back from today's date. The latest data covers the period up to 2022-03-31, although some sales that took place before this date may still be added in the coming months.

How is the raw data processed?

No additional processes are applied to this data.

What are the statistics used?

The average shown is the interquartile mean, a type of average that is insensitive to outliers while being its own distinct parameter. The 80% range means that 80% of the listed properties fall inside this range.

Where does the raw data come from?

Property listings seen on rightmove.co.uk, zoopla.co.uk and onthemarket.com.

How often is the data updated?

The data is updated in near real-time.

What time period does the data cover?

This is a real-time market snapshot - the data covers currently listed properties. Once properties are removed from the portal, they are soon removed from this tab.

How is the raw data processed?

Duplicates from multiple sources are matched and reconciled as far as possible. Listings with obvious errors, where price or number or bedrooms appear out of range, are discarded.

What are the statistics used?

The average shown is the interquartile mean, a type of average that is insensitive to outliers while being its own distinct parameter. The 80% range means that 80% of the listed properties fall inside this range.

Where does the raw data come from?

Room let listings on SpareRoom, the UK's biggest room letting website.

How often is the data updated?

The data is updated in near real-time.

What time period does the data cover?

This is a real-time market snapshot - the data covers currently listed properties. Once properties are removed from SpareRoom, they are soon removed from this tab.

How is the raw data processed?

Listings with obvious errors, where price or number or bedrooms appear out of range, are discarded.

What are the statistics used?

The average shown is the interquartile mean, a type of average that is insensitive to outliers while being its own distinct parameter. The 80% range means that 80% of the listed properties fall inside this range.

Where does the raw data come from?

Property listings seen on rightmove.co.uk, zoopla.co.uk and onthemarket.com.

How often is the data updated?

The data is updated in near real-time.

What time period does the data cover?

This is a real-time market snapshot - the data covers currently listed properties. Once properties are removed from the portal, they are soon removed from this tab.

How is the raw data processed?

Duplicates from multiple sources are matched and reconciled as far as possible. Listings with obvious errors, where price or number or bedrooms appear out of range, are discarded. Yields are calculated by comparing only properties with the same number of bedrooms, e.g. 3-bedroom properties for rent with 3-bedroom properties for sale.

What is the yield calculation used?

The calculation used is (average_weekly_asking_rent * 52 / average_asking_price), expressed as a percentage. It is a top-line gross yield, meaning no expenses are considered.

What are the statistics used?

The average shown is the interquartile mean, a type of average that is insensitive to outliers while being its own distinct parameter. The 80% range means that 80% of the listed properties fall inside this range.

Where does the raw data come from?

Property listings seen on rightmove.co.uk, zoopla.co.uk and onthemarket.com.

How often is the data updated?

The data is updated in near real-time.

What time period does the data cover?

This is a real-time market snapshot - the data covers currently listed properties. Once properties are removed from Zoopla, Rightmove or Spareroom, they are soon removed from this tab.

How is the raw data processed?

Duplicates from multiple sources are matched and reconciled as far as possible. Yields are calculated by comparing only properties with the same number of bedrooms, e.g. 3-bedroom properties for rent with 3-bedroom properties for sale. For the SpareRoom data, hypothetical properties consisting of two to six average double rooms with shared bathrooms are used to derived average rent. For all sources, listings with obvious errors, where price or number or bedrooms appear out of range, are discarded.

What is the yield calculation used?

The calculation used is (average_weekly_asking_rent * 52 / average_asking_price), expressed as a percentage. It is a top-line gross yield, meaning no expenses are considered.

What are the statistics used?

The average shown is the interquartile mean, a type of average that is insensitive to outliers while being its own distinct parameter. The 80% range means that 80% of the listed properties fall inside this range.

Where does the raw data come from?

Property "price paid" data provided by the Land Registry.

How often is the data updated?

Once per month when released by the Land Registry, typically towards the end of each calendar month covering up to the end of the previous calendar month.

Zoopla Zed-index

What time period does the data cover?

The data covers transactions in the last six years

How is the raw data processed?

No additional processes are applied to this data.

What are the statistics used?

The average shown is the interquartile mean, a type of average that is insensitive to outliers while being its own distinct parameter. The 80% range means that 80% of the listed properties fall inside this range.

Where does the raw data come from?

Property listings seen on rightmove.co.uk, zoopla.co.uk and onthemarket.com.

How often is the data updated?

The listings data is updated in near real-time. The Land Registry data is updated once per month when released, typically towards the end of each calendar month covering up to the end of the previous calendar month.

What time period does the data cover?

The price paid data shown goes back to January 2015. The listings data is a real-time market snapshot - the data covers currently listed properties. Once properties are removed from the portal, they are soon removed from this tab.

How is the raw data processed?

Duplicates from multiple sources are matched and reconciled as far as possible. Listings with obvious errors, where price or number or bedrooms appear out of range, are discarded.

What are the calculations used?

Average sales per month are for the last 3 finalised months. Turnover is average sales per month divided by total for sale. Inventory is 100 divided by turnover.

Where does the raw data come from?

Property listings seen on rightmove.co.uk, zoopla.co.uk and onthemarket.com.

How often is the data updated?

The listings data is updated in near real-time. The Land Registry data is updated once per month when released, typically towards the end of each calendar month covering up to the end of the previous calendar month.

What time period does the data cover?

This is a real-time market snapshot - the data covers currently listed properties. Once properties are removed from the portal, they are soon removed from this tab.

How is the raw data processed?

Duplicates from multiple sources are matched and reconciled as far as possible. Listings with obvious errors, where price or number or bedrooms appear out of range, are discarded.

Where does the raw data come from?

We receive data on the extent and corporate ownership of all land titles in England & Wales from the Land Registry.

How often is the data updated?

The data is updated once per month when released, typically in the first few days of each calendar month.

What time period does the data cover?

This is an ownership snapshot - the data represents ownership as recorded by the Land Registry at the last monthly export.

How is the raw data processed?

No additional processes are applied to this data.

Where does the raw data come from?

We source different expert forecasts Savills, Knight Frank, OBR

How often is the data updated?

The data is updated annually when new forecasts are released, typically towards the beginning of the year.

How is the raw data processed?

We calculate a consensus forecast using a simple mean average.