how do foundation repairs affect the sale of a home? and would a tax creidit be negative

Asked by Uno, 77072 Tue Jun 30, 2009

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TCP Real Estate’s answer
TCP Real Est…, Agent, Austin, TX
Mon Jul 27, 2009
In Houston, we have many areas around town that are affected by foundation issues. It usually is not a problem, however you need to make sure any foundation repair is done through a reputable company with a transferrable warranty. Many buyers are aware of foundation shifts and depending on the area and the extent of the damage, you may not have a problem selling the home.
1 vote
Samantha, it does seems that as long as the repairs were made by a reputable company it wouldn't be an issue at all. I think I would make sure I contact a good contractor and make sure they receive the appropriate permits. It seems like a good idea to make sure the company provides you with good documentation and a warranty.
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T.E. & Naima…, Agent, Dallas, TX
Tue Jun 30, 2009
Texas has two types of homes: those that have had foundation movement and those that will.
No, that is an exaggeration, but the compressible soil in Texas does create an environment where movement due to rain or drought can cause shifting inside the house structure.

Homes that have had noticeable movement and foundation repairs scare some buyers off, even though a solid foundation is more desirable than an undiagnosed problem of doors sticking, for example. New homes look clean and nice inside, but do we know what will happen to the soil over the next 15 years? A 10 year old home that had piers added to prevent movement can be more desirable, but it is the buyer's perception that overrides any logic. Some buyers, even with a lifetime gurantee, shy away. More experienced homeowners who are simply moving may be more receptive to an engineers report plus a lifetime warranty on a foundation.

Sorry, you asked about a tax credit being a possible negative, but I don't understand the question.
1 vote
Sahar Samadi…, Agent, Houston, TX
Mon Dec 15, 2014
Severe foundation problems will affect the price of the home. It is a matter of attracting the right buyer who is wiling to purchase a home in need of foundation repair. Foundation repair can be very costly.

Also, consider the neighborhood of where the home is... are there are other homes in the area that have foundation problems as well?

For tax matters, please consult with your CPA.

Best Regards,
Sahar Samadian, REALTOR
Realty Associates
0 votes
Gary Birtles, , Scottsdale, AZ
Tue Nov 25, 2014
I think it depends on how bad the damage is. If the damage is very substantial, it could very well hurt the value of your home. I would consult a Realtor, they will be able to see the damage and let you know. You may want to consider having some repairs done before selling. That is the safest option.
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Michael Vazq…, Agent, Houston, TX
Fri Jul 5, 2013
In Houston, you either have or will have foundation movement. I have bought and sold and represented dozens of homes throughout the Greater Houston area and the foundation is rarely an issue. In some cases, you will need to educate the buyer and/or the buyer's agent if they are not familiar with foundation repair and settlement. The question that I would ask is, "Has the plumbing under the foundation been replaced?" In many neighborhoods where foundation is a well known issue, the plumbing is cast iron. If the foundation needs to be repaired and the plumbing is still cast iron, there is a possibility that the plumbing will break. This will add a few thousand dollars more to a repair budget. However, if the foundation has been repaired, the plumbing has been updated and you have everything documented, the buyer and buyer's agent should feel confident is contracting your home.

For tax advise I would contact a CPA.

Feel free to contact me if you have any further questions.


Michael Vazquez, Broker
Venture Realty
0 votes
Nasyim Segal, Agent, Houston, TX
Wed Mar 27, 2013
Keep in mind that many times the foundation repair companies will offer a transferrable warrant with the terms of the repair. As a seller it's always the right thing to do to disclose any slab repairs, but you can supplement that with offering the warranty transfer. The terms and conditions of the transfer depend on the company you use to do the repair, but more than likely it is a one-time transferrable warranty for the life of the repair.

Nasyim Segal, Broker Associate
0 votes
julie, , Dallas, TX
Wed Mar 27, 2013
If you find a house that has had foundation repairs already done, do not be afraid of considering its purchase solely based on that fact. If the repairs were done correctly, fully disclosed and with proper transferable warranty, this could actually be an asset. Since the entire DFW metroplex is built on very expansive soil, remember the old saying – “There are two type of homes in Dallas, those with foundation repairs already done and those that still need to have it done”.

Conversely, if the house you ‘must have’ is just beginning to shows signs of foundation troubles make sure your inspector is experienced in assessing distressed properties. If the inspector finds a need to perform foundation repairs, don’t turn your back to the property. Instead, discuss possible solutions, adjust the price you are willing to pay based on the extend of the repairs. Discuss with your real estate agent how to implement the repairs and make sure the following is described in writing:

What are the repairs that need to be completed
Who is doing the repair. This should be a contractor of YOUR choice.
Time of completion for the job.
Who does the final inspection and how is it determined that job is completed.
Who’s paying for it.
How is it going to be handled if the job is NOT completed satisfactorily.
With spring fever here, this is the time when the residential market is the most active. If you are in the process of looking for a new house, do your homework and inspections, paying particular attention to the home’s foundations.

Keep an open mind and use the house foundation conditions to your advantage.

0 votes
Yichin Tsai, Agent, Bunker Hill Village, TX
Tue Jun 30, 2009
Not necessarily. Texas Soil movement is very common so foundation repair is common. Also, foundation repair usually has transferrable warranty, so not necessarily a negative. However, if there's a foundation issue not fixed while selling the home, buyer would usually try very hard to negotiate big price reduction to reflect the costs needed for future repair.
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0 votes
Amber Carril…, , Houston, TX
Tue Jun 30, 2009
Hi Uno,
That's a good question. A solid foundation is a huge part of a stable home. When it comes to a cracked foundation, different financing programs will flag it and not allow. How bad is it? Have you gotten an estimate on it? Most owners are really surprised sometimes about how inexpensive it can actually be. When a buyer obtains FHA or VA financing, the appraiser will definitely flag a bad foundation and require that it be fixed. Everything is negotiable though as well. Hope this helps. Please let me know if I can be of any further assistance. Thanks and good luck!

Amber Carrillo, Broker/Owner
It Homes
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