You can sell a house with subsidence, but it is often more difficult, often impacting the price the property sells for. Subsidence means that the ground underneath a property has shifted, which can impact your options when it comes time to sell – because, although you can absolutely sell a house with subsidence, you’ll need to ensure this is disclosed in full and upfront.
The good news is that properties with varying degrees of subsidence are commonly sold at auction.
This makes sense because a proportion of buyers are professionals and developers who won’t rely on traditional financing, given that buyers will find homes with subsidence difficult to mortgage normally they will have experience with this type of repair or rebuild project.
If you’re hoping to move or sell an investment home and have just found it has experienced subsidence, we’ve outlined everything you need to know about your ability to sell.
Key takeaways
- There is no doubt that it can be harder to sell a house with subsidence, but that’s mainly due to the need to disclose the issue, and because some mortgage lenders will rarely, if ever, offer financing against a property with this problem.
- Repairing the subsidence first might be an option. Still, it can be complex and costly and developers who intend to rebuild or renovate the property in any case are less likely to be deterred by subsidence, especially if it isn’t structurally significant. Also it may be harder to get insurance against further movement.
- Auction sales are often considered the easiest way to sell a property affected by subsidence, as many buyers are either cash buyers or have access to alternative finance, though full disclosure remains essential.
Find out how much your property with subsidence will sell for at auction.
Let us know the details of your property and we’ll provide you with our recommendations for the guide price and reserve price
Understanding the Complications When Selling a House With Subsidence
Subsidence can occur for various reasons and can be minor or severe. In the latter scenario, the movement under the house may have caused structural issues, which could mean the home needs to be rebuilt from the ground up or requires more extensive remedial work.
However, not all cases of subsidence are serious, and it’s more likely that minor subsidence has occurred over time and has become noticeable due to tiny cracks in the walls or other cosmetic issues.
It’s always important to have a structural engineer report on the cause and severity of subsidence, and this might mean selling for less than you otherwise could have. That said, there is no reason you cannot sell, particularly if your property is being marketed to the right audience who are accustomed to dealing with subsidence and will see this as an opportunity to add value to the property.
As a seller, you must ensure that any potential buyer is fully aware of subsidence and has access to the professional report from your structural engineer outlining the repairs required to strengthen the foundations.
Related reading: Can you sell a house with structural issues?
Key Aspects of Selling a House With Subsidence
We mentioned above the issue around some traditional mortgage financing, and that’s because lenders won’t often secure a mortgage against a property with subsidence, although that could depend on how serious the problem is.
However, it’s often better to focus on selling to buyers who aren’t dependent on traditional mortgage financing; many auction participants finance their property acquisitions themselves. Here’s why:
For a homebuyer, the concept of tackling subsidence can be daunting, and some may disregard a property immediately because they aren’t familiar with the problem.
Costs of correcting subsidence can potentially be high, which is less of a concern for property professionals who have access to the resources and expertise to do so and have a good understanding of the required budget.
Auction buyers often purchase properties with ‘defects’ because this presents a viable commercial investment. They may intend to rebuild or rectify the subsidence, at which point they will be able to sell the property at a profit.
Auction buyers aren’t exclusively property professionals, but many are. This offers sellers the opportunity to market homes that might otherwise be hard to sell to this audience.
It also means that sellers can leave subsidence as-is without needing to consider a sizable investment to sell their property at all.
The Benefits of Selling a Property at Auction Due to Subsidence
While the exact cost and extent of the remedial work required to correct subsidence will vary, this usually involves underpinning the property or rebuilding, which is why this is seen as a t challenging scenario under which to sell.
However, the speed, transparency, and nature of property auctions mean sellers can achieve reasonable prices for properties with almost any defect or issue, including homes that have been long-term vacant and require complete renovation.
As a seller, putting your property into an auction means you’ll usually be able to finalise the sale within just a few weeks, including time spent listing and marketing your home, the auction process itself, and the final payment, which typically falls due one month later.
This offers a compelling benefit, especially if the alternative is spending several months correcting subsidence, which could have a knock-on impact on your other plans.
Buyers who attend property auctions regularly are used to seeing properties sold as-is, without expecting sellers to present each lot in perfect condition. Provided you include detailed information in your legal pack, there is no scope for pricing negotiation, which means when the hammer falls, the sale is legally binding.
Related reading: Can you sell a house in need of repairs?
How to Sell a Subsidence Property at Auction
If you’re new to property auctions, we recommend contacting your closest Clive Emson team in the first instance or visiting our knowledge pages, which are packed with guidance and information about how auctions work and what to expect.
In brief, you’ll need to submit a document called a TA6 Property Information Form, which acts as the disclosure, and ensure you include a survey and remedial report that sets out how serious the subsidence is, the impacts it’s had, and the repairs the structural engineer believes will be necessary.
From there, we’ll help you organise photography and video walk-throughs, advise on the optimal timing, and ensure your property is entered into a subsequent auction once it has been marketed to the buyers most likely to show serious interest. You can find out how to sell a property by auction here.
