Selling a house with foundation issues is not an insurmountable challenge, but it can lead to delays, discounts, and damage control.
As you’re preparing your home for sale, add a foundation examination to your personal checklist. It’s important to determine if your house has foundation issues because if it does, your pool of buyers may be limited since some mortgage loan companies may not close on a house with foundation problems. Government-backed FHA, VA, and USDA loans also carry stringent requirements regarding the structural integrity of the home, so foundational problems could delay or even end a deal.
Lenders’ reluctance to grant mortgages on homes with foundation issues stems from the fact that 80% of structural claims are caused by foundation movement, meaning a home’s foundation is the greatest source of structural liability, according to the National Association of Homebuilders.
If you aren’t sure if your house has foundation problems, or even how to determine if it does, we’ll walk you through how to find out — and what to do if you discover your foundation is on shaky ground.
If you’re worried about selling a house with foundation problems, we’ll offer some advice from our experts Jared Davis, a top real estate agent who works with 80% more single-family homes than the average agent in Richmond, Virginia, and Bruce Barker, president of the American Society of Home Inspectors Inc., about what your options are, what steps to take, and what to expect along the way.
How do I know if my home has foundation problems?
Start with a walk around the outside of your house to look for obvious signs of structural or foundation issues that warrant further investigation. “A qualified Realtor®, though, should be able to walk through a basement of the home — or look at it from the outside if there isn’t a basement — and be able to pick up on any warning signs,” says Brett Young, an experienced agent who sells 43% more quickly than the average Indianapolis, Indiana, agent.
Exterior signs of trouble you’ll want to be on the lookout for include:
- Foundation settling or sinking
- Foundation upheaval
- Gaps between the garage door and the pavement
- Gaps between the house and trim
- Exterior walls that appear to be bowing or bulging
- Foundation that is pulling up, causing a wall to rotate
- Large horizontal or vertical cracks
- Stair-step cracks in mortar
- Porch, deck or columns that lean or pull away from the house
- Leaning chimney or chimneys that have separated from the house
You can also spot signs of foundation problems inside your home. Interior signs of foundation problems to look for include:
- Doors and windows that stick or fail to properly open and close
- Cracks or gaps in the walls, floor, or foundation itself
- Diagonal wall cracks extending from the corners of doors and windows
- Sagging, sloping, or uneven floors
- Walls pulling away from the floor or ceiling
- Walls that bow outward, are bulging or no longer appear straight
- Sagging wood floor planks
- Cabinet doors not staying closed
- Leaks and cracks in and around the fireplace
- Damp crawl spaces or standing water around the foundation
If I see a foundation issue, what do I do next?
If you find signs of foundation issues, there are a few things you should do.
1. Get a professional opinion.
Davis advises that you should first call a structural engineer to take a closer look. “A structural engineer will look at the lot, drainage, soil, moisture, and other things. Calling a foundation repair company [first] is not the best option.”
A professional inspection can help distinguish genuine foundation concerns from “false signs” such as nail pops, seam breaks, hairline cracks in concrete, cracks in floor grout or tiles, and normal brick expansion joints. These issues are more typically due to wear and tear, a home’s age, or poor craftsmanship and do not necessarily indicate foundation issues.
“About 90% of cracks and settling are not structural,” Davis estimates.
Barker concurs: “Cracks are the most obvious sign of foundation issues, but they can be difficult to interpret.” He says additional investigation is necessary. Where are the cracks? What size are they — how wide and how long? What is the foundation material? Is the slab structural? Is there evidence of water movement?
2. Make a decision.
As the seller, you must decide whether to fix foundation issues or sell “as is.” Keep in mind that the foundation problem you see is usually the result of another issue, such as soil shifting or moisture, and you may need to address those issues to make any foundation fixes successful.
3. Call a professional to repair any issues you decide to fix.
Once you’ve had a professional inspection, if you need to repair any foundation issues, call a qualified foundation repair contractor.
According to the Foundation Repair Network, a foundation repair educational resource center for property owners, foundation work is not a do-it-yourself project. They recommend you get quotes from at least three licensed contractors whose foundation repair methods have been evaluated by International Code Council Evaluation Services (ICC-ES), a nonprofit organization that evaluates building products, materials and systems for code compliance.
“Don’t make your final decision based on advertising and cheap prices,” the network cautions on their website. “If it sounds too good to be true, it probably is.”
What causes foundation issues?
Most foundation issues are caused by soil and water, although some may result from poor construction. In order to fix a foundation problem for good, you may need to address its cause. The most common causes are:
- Dry, shrinking soil – As soil dries and shrinks in hot weather or due to thirsty nearby tree roots sucking the moisture out of it, it can cause the foundation to shift.
- Soggy, swelling soil – If soil becomes saturated due to heavy rain, sewer breaks, or plumbing leaks, it swells and expands, resulting in erosion or cracks due to the foundation being pushed upward.
- Inadequate drainage that causes erosion – Soggy soil can be the result of inadequate drainage, which can lead to soil erosion. That, in turn, destabilizes the foundation, causing buckling of walls and uneven settling. The source can be clogged gutters and downspouts, low areas near the foundation, or land sloping toward the house, all of which can create pooling.
- Poor construction – If the soil wasn’t properly prepared and compacted, or if your home is built on more than one type of soil, it can cause differential settlement.
How much does home foundation repair cost?
Whatever the cause of foundation issues, you can expect to pay an average repair bill of just under $5,000. More specifically, the national average ranges from $2,137 to $7,426. Of course, that depends on the type of problem needing fixed and other factors, such as where you live and the type of material your foundation is made of.
Of course, as with any home damage, there are extreme cases that require much higher repair costs. For this post, we’ve gathered estimates for the more common foundation issues a homeowner might face. A breakdown of costs for specific repairs could look like this:
- Simple crack in a poured concrete wall: $350-$4,000. Cracks are often caused by either settling soil or variations in the soil’s moisture. Vertical cracks tend to be cheaper to fix, and are done so by filling with a polyurethane-based or epoxy-based filler, then sealed.
- Repair of minor cracks by injecting epoxy or polyurethane foam: between $250 and $800. They should be addressed to prevent moisture ingress that could lead to structural issues. Cracks that are wider than one-eighth of an inch should be seen by a structural engineer.
- House settling or sinking: $1,000-$25,000. If your home has settled significantly, contractors can raise it back up and shore it up with foundation piers for $1,000 to $3,000 per unit, or by slabjacking or mudjacking — a process that involves pumping a concrete mix under the foundation to raise it up. This typically costs between $500 and $1,300.
- House shifting: $700-$25,000. Depending on the severity of the shifting, this is usually repaired by installing piers, mudjacking, foam jacking, or reinforcing the walls.
- Crumbling foundation: $500-$20,000. Water or old age are the usual culprits. Minor issues can be addressed by using epoxy and polyurethane fillers. Bigger issues will need to address the cause and could require installation of piers.
- Bowing foundation walls: $700-$15,000, depending on how many and how bad the damage is. Bowing walls are caused by shifting soil, water damage, or sinking. Bowing walls can be fixed by applying carbon fiber strips with epoxy or reinforcing the walls with anchor plates and steel rods. For severe bowing, piers may need to be installed.
- Underpinning the basement: For $1,000 to $3,000 per pier, contractors will excavate and install hydraulic piers to raise the foundation.
Additional costs could include:
- Obtaining a soil report – Soil testing generally costs between $700 and $1,800, but a pH level test with information about pesticide residue, heavy metals, and industrial chemicals can run $1,200. To get a more detailed report for all contaminants and shifting soil factors can run as high as $5,000.
- Hiring a structural engineer – The cost for a residential structural engineer averages $513. Many of them charge $100 to $200 per hour.
- Obtaining a building permit – The national average for building permits is $1,281, but costs vary regionally and the type of permit you need.
- Dealing with hidden obstacles – If tree roots cause your home’s foundation to heave, the tree may have to go. Depending on its size and accessibility, it can cost anywhere from $200 to $2,000 to take it down.
Are there buyers who will consider a house with foundation issues?
Yes. There are plenty of buyers who will still consider purchasing a home with foundation problems — though you will likely end up selling at a lower price.
House flippers look for a bargain; since they intend to renovate the home anyway, they may not be concerned about your foundation issues … as long as the price is right.
Some buyers may use foundation issues as a bargaining tool to get a lower price. Young mentions one buyer who was only able to purchase a home after the price had been lowered to reflect the problem with the foundation.
A buyer might be able to get a rehabilitation loan that allows for the repair to be done after the sale. The lender finances the house for the anticipated appraisal amount after the work has been completed. The difference in the amounts is used to perform the repair.
A top agent will have experience selling homes with foundation problems and can guide you accordingly.
Should you repair foundation issues before you sell?
The short answer is … maybe. It depends on the severity of the issue and on the market — and on a myriad of other factors.
Edmond (Buddy) Eslava, an appraiser with the Appraisal Consultant Group in the Mobile, Alabama, area says it’s “significantly wiser” to have them fixed before you sell so you can command a higher price point.
Conversely, Jerin Harper, from Harper Certified Appraisals in Oregon, believes it is not necessary to fix foundation problems prior to listing unless it comes at a reasonable cost. If a seller is considering fixing foundation issues, she says, “It is wise for a seller to educate themselves on any foundation issues and to get at least three bids from licensed contractors.”
When making a decision on whether or not to fix foundation issues, consider the pros and cons:
- If you had your house stabilized or “piered,” it can be considered an asset when you’re selling it.
- Repairing the foundation sets the stage for stand-out curb appeal.
- A stable foundation can add value and help you sell at a higher price.
- Making repairs before you sell could cost thousands of dollars that you might not have had to spend if a buyer didn’t ask for them.
- If the house needs significant foundation repair that you don’t take care of, you’re likely to turn away a large pool of buyers and attract a group of house flippers who want a deep discount on the price.
- Foundation issues can reduce the sales price by 10% to 15%.
Do I need to tell buyers about foundation issues?
In most states, if you know about any foundation issues, you’re legally bound to disclose them. If you don’t fix foundation issues, Davis says, they are “100% a disclosure issue” and can be a reason for a price adjustment.
Even if you aren’t aware of any problems, when the buyer orders a home inspection, the inspector will look for indications of foundation issues. Inspectors have to “tell what they saw,” Barker adds. “That’s why the homeowner should care.” Inspectors are required to report their findings, although he says they do not draw conclusions as to causes. “We just point out defects; the homeowner can call in an engineer or contractor.”
The buyer will get a report from a structural engineer if the home inspection turns up anything. At that point, the buyer can buy it, walk away from the deal, or negotiate a lower price.
What can I expect if I decide to sell my home “as is”?
If you think the challenges of fixing the foundation outweigh the benefits, selling a house with foundation issues is not inconceivable. Two viable options are:
1. Sell “as is.”
This means that you won’t do any repairs and make no guarantees that anything is in working condition. A seller can even specify certain items “as is” rather than the entire house. Be advised that you will still be held accountable for complying with state and federal disclosure regulations.
One of the downsides is that you’ll likely get a lower offer. Although you’ll attract flippers and investors, you’ll likely reduce your pool of potential buyers. Surveys indicate that 48% of younger buyers want turn-key homes.
An experienced real estate agent can help you decide if this is the route you should go. Getting an experienced agent who can set expectations and priorities and keep the deal together is key, Davis believes.
If you decide to sell “as is” or directly to a cash investor, the right agent can walk you through the process and help sell the house quickly for the most money. HomeLight’s Agent Match tool can help you find a top agent to guide you. This free service can help you locate experienced agents in your zip code who know your market.
2. Sell direct to a cash investor.
Another “as is” sale that requires little to no prep work, this type of sale avoids the complications and delays often associated with financed purchases, so it can be a valid option if time is an issue.
Investors can include flippers looking for properties to renovate and resell; buy-and-hold investors who want to rent out properties; and iBuyers, who generally want a house in good condition in the $200,000 to $500,000 range.
With HomeLight’s Simple Sale platform, you don’t need to worry about repairs — or open houses or agent commissions. HomeLight’s network of investors will buy houses in almost any condition. Simply answer a few questions about your home, how much work it needs, and your selling timeline, and get a cash offer within 48 hours. If you choose to accept it, you could close in as few as 10 days.
What else should home sellers know about foundation issues?
Lots of questions arise when a home has foundation issues. Here are some of the more common ones:
- Does insurance cover foundation repair? It depends on what your policy covers, but usually, flooding, earthquake damage, and settling are not covered by insurance.
- How long does foundation repair take? Small cracks can be filled in hours, but more severe issues can take much longer. For example, bowed walls may take a couple days, while installing piers to correct settling can take a week. In general, Davis says foundation repairs can be done quickly. “I’ve never had a delay in closing [due to foundation repair].”
- What is the most common mistake sellers make related to foundation damage? One big mistake is trying to cover it up instead of fixing it, according to Davis. He has seen sellers use caulk, paint, and temporary piers to try to hide or inexpensively fix foundation issues. Beware: this could leave you legally liable.
The bottom line — inspect, disclose, share, negotiate
Foundation problems are intimidating and can be costly, but they aren’t necessarily deal killers. Keep in mind that if you live in an established neighborhood with older homes, you’re probably not the only one dealing with foundation issues, Davis points out. Buyers looking in your area will likely encounter similar issues with other homes, so if yours is in otherwise good condition, it might not deter them.
Some things a top real estate agent may suggest include:
- Get the foundation inspected. The problem may not be as bad as you imagine; it’s good to know what you’re dealing with.
- Disclose known foundation issues to buyers in writing. In most states, this is required by law.
- Share the inspection report with the buyers. They’ll also want to know what they’re facing if they were to purchase your home, and you just saved them a step in the process. This removes a question in the buyer’s mind and reassures them of your transparency.
- If you have repair estimates, share those with the buyers too. This may also reassure them, or at least they’ll know what level of repair the home needs.
- Negotiate accordingly. Expect to lower the price to allow the buyer to account for the cost of fixing the foundation if you don’t do the work.
If you’re selling a house with foundation issues, a top agent can give you firm footing in each step of the way. Find the most effective, experienced agents in your area today with HomeLight’s Agent Match.
Header Image Source: (glenda / Shutterstock)