Buying a home is one of the biggest investments the average American will make in their lifetime. Given that most homebuyers are signing on the dotted line for 30 years worth of payments at the time of purchase, it’s no surprise that many are wary of taking on homes that need serious work.
But what does this mean for houses with foundation problems and the people who own them? Here’s what you need to know about selling a home with foundation issues.
Foundation Issues 101
Finding foundation problems in a home can be scary, but it is also incredibly common. There are many types of foundations and some are more appropriate to certain environments than others. No foundation, however, is ever fully immune to problems.
What Causes Foundation Problems?
House foundation issues can come from a single event or flaw or they may result from a combination of factors. Common causes and contributing factors include:
- Destabilizing events, such as floods or earthquakes
- Poor initial construction
- The presence of nonporous soils beneath and around the foundation
- Leaks within a home
- Ongoing extreme dampness from any source
- Extreme temperature changes
- Frost heaving
Age can also play a role, as houses tend to “settle” over time in response to natural changes in the environment. With nearly half of America’s housing stock built before 1970, this is no small consideration.
How to Tell if a House Has Foundation Issues
Common signs of foundation problems in a home include:
- Floors that are uneven or sloped
- Cracks in windows, walls, and doors
- Gaps between decorative molding and floors or ceilings
- Windows and doors that no longer open and shut properly
- Broken concrete, inside or outside the house
- Cracked tile
- Uneven or dislodged wooden flooring planks
- Water infiltration in basements or crawlspaces
- Bowing walls or ceilings
- Out-of-square walls and corners
- Chipping or flaking concrete
- Cabinets separating from walls
It is important to note that not every sign of an imperfect foundation indicates a serious problem. Benign small cracks may form in basement concrete as houses age.
Assessing Foundation Issues Yourself
As a general rule, small cracks 1/4 inch in size or less are not cause for concern. Hairline cracks in your basement’s concrete mortar are also rarely a reason for alarm.
When shrinkage cracks occur, homeowners should take action. Shrinkage cracks tend to be L-shaped and may appear where foundations change levels.
They are not dangerous but need to be sealed to prevent leaks which could lead to real problems. These repairs are often quick and inexpensive.
Cracks in masonry joins are cause for more serious concern. Unattended, they may lead to bowing or bulging in walls and reduced structural integrity.
Horizontal cracks in your foundation are a sign of deep and potentially dangerous damage to your home. They must be addressed right away by professionals to protect the safety of your home and family.
Getting a Professional Assessment
If you are planning to sell your home and unsure how concerned you should be about your foundation, there are three levels of assessment available to you.
First, your realtor can walk through your home. Most experienced realtors have a good idea of what indicates normal settling and what might be something more. If they see signs of possible problems, they will likely recommend that you get a second opinion.
For that second opinion, you can have your home inspected by a certified home inspector. They will be able to tell you if anything in your home might present a barrier to selling it as it relates to relevant safety codes. If they give you the all-clear, you are free to sell without worry.
If the home inspector recognizes signs of serious foundation problems, they will recommend that you hire a structural engineer. The engineer will conduct an independent assessment and give you a report on the state of your foundation. This report will outline:
- The problems, if any
- The recommended repairs
- A general estimate of repair costs
These reports are valuable. They provide you with the information you need to make informed decisions about selling your home.
Can You Sell a House With Foundation Problems?
House foundation issues don’t have to stop you from selling your home. It is perfectly legal to sell a house with foundation problems, as long as you do not attempt to disguise or lie about the condition of the house.
State laws around disclosure during home sales vary in their specifics. In every state, however, sellers must disclose “material defects” in a property. This includes foundation problems.
Moreover, being upfront about your home’s foundation issues is important because:
- Foundation problems may impact buyers’ eligibility for certain mortgage and mortgage insurance programs
- Undisclosed foundation problems discovered by inspectors during the sale process can cause sales to collapse
- Being untruthful can lead to a bad reputation among buyers and local realtors, making it impossible to sell your home
- Lying about the state of your home opens you up to lawsuits from buyers
This, then, leaves homeowners with two options when it comes to selling their homes.
Sellers can fix their foundation problems themselves and then sell their homes using the traditional listing process. Or, they can sell their homes “as-is” and let the buyer deal with the problem.
Each option has its costs and benefits.
Fixing Foundation Issues Before Selling
If you want or need to get top dollar for your home, you will need to repair the foundation damage before you sell.
In some cases, this an easy decision to make. Minor damage to a foundation can cost as little as $500 to repair. That is a small price to pay to get full market value for your home.
Depending on the cause and your policy, your homeowner’s insurance may cover some or all of your foundation repair costs.
In other cases, you may face cost- and labor-intensive interventions such as:
These repairs can cost $15,000 or more depending on your situation, the size of your home, and your geographic location. They can also be stressful and time-intensive for homeowners to manage.
The Benefits of Fixing Before You Sell
Fixing before you sell comes with a range of benefits that can outweigh the inconveniences, however. Once you have fixed the foundation problems in a home, you can:
- Sell using the traditional real estate process
- Attract a wider range of buyers
- Get top dollar for your home
Since repairs can be less expensive to handle than many homeowners fear, this can be a good option. It can be particularly helpful in competitive markets or when selling a property otherwise worth a large sum.
Homeowners without ready cash who live in a seller’s market can often see good returns by taking out a loan to cover the cost of the work. They can then sell their house for its best possible price, pay off the loan, and pocket the rest to come out ahead.
Selling “As-Is” with Foundations Issues
Not all sellers can or wish to remediate their foundation problems before selling. This can be especially true for:
- Landlords looking to offload unrewarding properties
- Individuals who inherited a home they cannot keep or need to sell to settle an estate
- Couples liquidating their assets as part of a divorce
- Homeowners dealing with health issues or other personal challenges that do not allow time or energy for intensive repairs
When you sell a home with foundation issues “as-is,” you disclose the full state of the home upfront. The buyer agrees to purchase the home and deal with the repairs themselves. This lets homeowners off the hook legally and financially.
The tradeoff is that homes sold “as-is” almost always sell at discounted prices since the buyer will have to invest heavily in repairs post-purchase.
This is where your inspection reports can come in handy. Knowing how much the repairs should cost can help you negotiate a fair price for your home that reliably accounts for both its market value and the repairs.
Selling With Foundation Issues To A Cash House Buyer
- A streamlined sale process
- Cash payment for the home
- Willingness to purchase properties that need work
When you deal with cash house buyers you can avoid realtors, home stagers, and most of the other costs that come with traditional sales. Typically sellers can expect to sell their homes at a discount, but this can be a welcome sacrifice if it gets them out from under the burden of:
- Continuing to be responsible for their home and its costs
- Dealing with foundation repairs
- Dealing with other responsibilities waiting on the home sale such as a move or closing an estate
Where to Turn for Help
If you are unsure which option is best for you, contact a trusted real estate professional. They can:
- Advise you on whether you need further inspections
- Explain your local market conditions and what to expect
- Estimate the market value of your home if the foundation was not an issue
From there, you can contact a home inspector or engineer as needed to get an estimated repair cost.
Next, contact your insurance company and review your policies. See what funds, if any, are available to you for repairs.
With all of that information in hand, you will have what you need to make a smart and informed decision.
Don’t Let Your Foundation Scare You
Getting the facts about your home’s foundation problems can take the fear out of a scary situation. Start gathering the information you need to become an informed and empowered seller. Or if you prefer to sell your house as-is but can’t list it on the MLS, we can help. Call us and we’ll make you a cash offer to buy your house as-is so you can literally walk away from your foundation issues in a matter of days.