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ddsg
Foundation repairs - risks

I'm hoping to get a bit of advice on a home I'm looking at purchasing. My wife and I found a beautiful place in a perfect location at a reasonable price, but it looks like the foundation will need to be replaced. The house was built in 1920 and according to a report done by a structural engineer, the foundations have "reached the end of their useful life". The walls aren't leaking, but the concrete has crumbled away in a few spots due to moisture permeating through.

I know that as a general rule, houses with foundation issues are to be avoided since you have no idea how much it will cost to have it all fixed. That said, what would the risks be if I get quotes from various companies to do an entire foundation replacement and have that amount removed from the purchase price? Given that we'll be replacing the entire foundation, I'm having trouble thinking up of any hidden costs that could be added to the quote we receive. I'm sure I'm missing something though. Does anyone have any experience or advice with this kind of situation?

Thanks!

A. Spruce
Re: Foundation repairs - risks

1 - When you contact said foundation contractors for bids, make sure that they know you DO NOT own the house, and that you will be paying them for their time and efforts. It's bad enough to lose a bid honestly, it's infuriating when the job was never there to begin with.

2 - It is unlikely you'll get the owners to agree to replace the foundation for you (subtract cost from asking price ), but it is certainly an negotiation tool, if you can get 1/2 to 3/4 of the cost deducted, consider yourself lucky.

3 - As far as hidden surprises, there's always hidden surprises with a project of this magnitude. By the vary nature of "hidden" and "surprises", there is no accounting for them before jumping in feet first, except for adding at least 25% to the budget. If you are prepared financially for these surprises, then when they don't occur, the surprise is a good one (more money in your wallet ), as opposed to a bad one (unforeseen circumstances and the inability to pay for them ).

JLMCDANIEL
Re: Foundation repairs - risks

Consider this, the house will most likely need to be jacked up for the replacement. At the same time it will be leveled. If the house is out of level, the leveling can cause damage to plaster walls. It may also require plumbing and electrical changes.

Jack

MLB Construction
Re: Foundation repairs - risks

to piggy back on the previous responses.

1. electrical to be moved and reconnected. if it isn't up to code it will have to be at the reconnection.

2. plumbing to be moved and reconnected. you might need a new sewer line out to the street.

3. gas and water company to disconnect and reconnect their lines and maybe replace them out to the street

4. if you have oil heat the soil will have to be tested, especially if you have a supply pipe running under the basement floor. if there ever was oil dripping you could have yourself a clean-up bill of a few thousand dollars or tens of thousands of dollars.

5. if the house is that old are the sills and carrying beams even strong enough to support the house.

6. since so many things will be disconnected anything that's not up to code will have to be made so. just something as simple as hardwired smoke detectors throughout the house and that bill could run as high as several thousand dollars.

7. as jack stated, raising and lowering a house in or out of level can cause many or major problems throughout the house.

8. as spruce stated....i'll bet $10,000 that there will be some surprises that any of us have mentioned or can't even think of yet.

MtMan54
Re: Foundation repairs - risks
ddsg wrote:

I'm hoping to get a bit of advice on a home I'm looking at purchasing. My wife and I found a beautiful place in a perfect location at a reasonable price, but it looks like the foundation will need to be replaced. The house was built in 1920 and according to a report done by a structural engineer, the foundations have "reached the end of their useful life". The walls aren't leaking, but the concrete has crumbled away in a few spots due to moisture permeating through.

I know that as a general rule, houses with foundation issues are to be avoided since you have no idea how much it will cost to have it all fixed. That said, what would the risks be if I get quotes from various companies to do an entire foundation replacement and have that amount removed from the purchase price? Given that we'll be replacing the entire foundation, I'm having trouble thinking up of any hidden costs that could be added to the quote we receive. I'm sure I'm missing something though. Does anyone have any experience or advice with this kind of situation?

Thanks!

Hi, This house sounds like a handyman special so if you are not a handyman I would think twice. Thanks

dj1
Re: Foundation repairs - risks

ddsg, So there you have it: warnings from all directions. If the bone is too big to chew on, walk.

ddsg
Re: Foundation repairs - risks

Thank you all for the information. We definitely have a lot to process and to think about. We'll definitely look at each one of those things and also bring it up with the foundations expert if we decide that we're still interested.

One of our concerns is that, since all the houses in the area were built in the 1910s/1920s, we'll have similar issues with all the other places we find. The engineer's report says that the concrete used at the time is only good for 100 years or so, and we're coming up on that now.

Given that, this could be an opportunity as I know that the house has been on the market for a while now (offers did not come in for a good deal of time since the sellers had priced it much too high - the foundation issues were discovered recently) and the sellers want to offload as they're paying two mortgages until it sells.

dj1
Re: Foundation repairs - risks

With the new information you provided:

1. You have your mind set on this particular home.

2. The seller has 2 mortgages - that means he's is "motivated" to some degree. Nobody likes making 2 payments every month.

3. Make him an offer and ask him to participate in a new foundation. Explain to him that with this condition out of the way, you are a qualified and a sure buyer. Maybe you will convince him that sitting on house that won't sell will drain his bank account, and sometimes it's better to allow some repair and unload the house fast.

4. Offer him a quick escrow: 30-45 days, he would love that.

5. In the meantime, see if you can get a couple of estimates, but be frank with the contractors and disclose to them that you are only a potential buyer.

dj1
Re: Foundation repairs - risks

And one more thing: Get yourself a good representation.

eman
Re: Foundation repairs - risks

I know someone who had to have their house temporarily supported and their whole foundation replaced. It cost over 30,000 dollars.

There are a few possible scenarios here. The prior owners knew this would need to be done and already feel that the house was priced accordingly, in which case you will have a hard time getting anymore money.

They knew this was needed, and built some negotiating room into their asking price so they could be ready to give you the price drop you'll be looking for as soon as your home inspector found the problem.

They did not know this would need to happen, in which case there may be SOME negotiating room for it. How much will depend on how badly they want to sell and whether it will still allow them to walk away from the deal without having to put more money on the table than they can afford. People who still have a mortgage tend to have less flexibility than people who have already paid the house off. The former will have to put money on the table to walk away once the price sinks below a certain level, and the latter will not.

In addition to all the complications MLB mentioned you can expect that you will have to do drywall work and paint throughout the house as it will move and crack in various places while the work is being done. So there will be a lot of repairs and expense involved above and beyond just removing old foundation material and putting in a new one. Some of it you will not know until you get started and it could be in the thousands.

Mastercarpentry
Re: Foundation repairs - risks

Think of it this way: If all the houses there have failing foundations, what is that going to do to your property value when they are falling down all around you? How many other homeowners there are going to have the bucks to redo their foundations? Not many, nor will they be paying to bulldoze their newly-condemned house that nobody will be living in. It's a ghetto waiting to happen so stay away- in this case location is everything and this is a bad location.

Here in SC, many communities were built by textile mill companies which towns grew around. Materials and methods used to build these "mill houses" were fast and cheap; good workmanship made them last. Now these are all at least 60 years old, and almost all have structural issues of one kind or another. Many which were not maintained well are gone or falling in standing and condemned. Though the geographical locations are often still good, none of these houses has much value because of what stands around them. $45-50K for a fully rehabbed 3 bedroom is top money. "Fixer-uppers" go for half of that or less. Tax auction sales can get you one for under $5K with about $10-15K more putting it into barely liveable shape, to be rehabbed as you go along. Bargains? No way. No matter how nice you make them, the neighborhoods keep the value down and will keep doing that for another 50 years till the rest of the 'mill houses' around them are bulldozed and new ones built. And even then, the old house won't pull what the new one next to it does on a sale, all other things being equal. For cheap living it can't be beat and the right ones make good rental properties but that's about it- nobody wants to live in the 'mill village' anymore if they can afford to do better. And just 25 years ago many of these were considered to be nice neighborhoods and good locations.

You're in a similar fix and the only advice that will save you is to move elsewhere. It's not going to get any better while you're still alive.

Phil

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