Am thinking of buying a half-finished house - advice!

My spouse and I are thinking of buying a half-finished house. It is one we would expect to spend the rest of our lives in.

Here's my question: what kind of pitfalls might accompany the purchase of a house that is only built to first fix level?

The house is finished up to roof level. Windows and external doors are in. The plastering is done- inside and outside. Electric sockets and lighting are installed, underfloor heating is in. There are pipes in position in the kitchen and bathrooms.

However, the outside requires considerable site work. Plumbing and electical work need to be done to second fix. All the internal doors and architraving need installation.

I don't know how good or bad the tradespeople were.

What kind of terrible structural problems could lay beneath the surface?

Sock it to me!

The main thing is to get a feel for how the builder dealt with the unavailability of funds and whether it was foreseen or not.

It it was sudden and unexpected you might infer that the work was done competently and compliantly up to that point in accordance with the builders normal practice.

If it was known about in advance the builder might still have acted as normal until the day the plug was pulled, he might have prioritized completion of some houses to have saleable units to generate some return.

OTOH, he might have tried to finish as many as possible, omitting items covered up, skimping on materials and employing unqualified tradesmen and inexperienced workmen to complete the work.

There is therefore a range of possibilities attaching to the possible standard of compliance of the house itself.


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This does not address the standard of completion of the estate or its location .

This might affect the eventual price of the house and/or its appreciation over time, as well as the hazards for a family living with children in an unfinished estate, with possibly limited access to schools, bus services, street lighting, emergency services, bin collection, phones and multi-channel TV.

Allied to this are the issues of groundwater and drainage.

The non-completion of the former can lead to the erosion of soil under foundations resulting in more serious problems for a house than even Pyrite in terms of settlement and structural cracking.

The non-completion of the latter can lead directly to serious health hazards and noxious smells around the estate making the place unbearable in the short term.


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Gambling is best done with sums of money you can afford to lose.
I wouldn't tie up my livelihood for thirty years on a whim.
And no, inspections like this don't come cheap.
But then, neither to mortgages, even today.

A thorough inspection on matters like this would require the attendance of a full design team [Arch. Struc. Eng, M&E Eng] including a QS to inspect, identify any defects/the extent of the required completions and put a valuation on the remedial work/completion work.

It would probably best be funded - if you could get anyone to take on the work - by a few potential buyers pooling resources to pay the professional fees.
Even though it might have to be undertaken on a limited liability basis, because few professionals might want something like this on the PI.
And you might be asked for payment up front, because many could see it is good money wasted if the report came out negative.

Nobody is interested in going to Court to get money out of people unless they have to.

ONQ
http://www.environ.ie/en/Publications/DevelopmentandHousing/BuildingStandards/FileDownLoad,22447,en.pdf (<br />)[broken link removed]

All advice on AAM is remote from the situation and cannot be relied upon as a defence or support - in and of itself - should legal action be taken.
Competent legal and building professionals should be asked to advise in Real Life with rights to inspect and issue reports on the matters at hand.

Thanks very much for your advice and expertise. Excellent post there. We will heed your advice.

If its a new build check its not local needs.....ie person building has to live it in for 5 years etc

+1 what tester1 has said also.

My comments above referred solely to the built work, because you specifically asked about structural problemsm but tester1 has reminded me to say that, assuming the built work is fine as far as its been completed, the most difficult issues may be planning, legal and contractual.


Planning

One kind the planning issue is the type that tester1 has posted about, a condition of the permission which may be restrictive.
There may be other planning issues, such as conditions requiring you not to build a part of what was applied for or to set back from a given boundary so much the plan is compromised in its workability or amenity.

You may have high levies to pay or bonds to enter into or you may have to take over payments or bonds or make new payments or bonds - you should check what these are and ensure that the legal route is open for you discharge these payments or bonds.

Finally on the planning front you may be out of time to complete the house under the five years of the original Grant of Permission, or you may be too late to seek ot extend the permission to allow you to finish off, assuming you can still apply to extend it.
In other words, you may need a new permission to allow the property to be finished out.
Given the extent of the works to date, you may not need permission but check.


Legal

Legal aspects can include accommodating existing of rights of way or agreements with adjoining properties - or not doing so, where work has been carried out in suc ha way as to attract legal action or liability for the new owner.
You could also find you are relying on a permanent right of way or access [as opposed to a temporary builders access]that has been assumed but may not have been finalised, or may simply not be there or if there, not discussed.
You need to take competent advice unless you have free and unencumbered title or else identify and know all those matters which could be a burden on the title.


Contractual

Contractual matters could include the sub-contractors for the windows [for example] not yet having been paid for his items, which may or may not be built in to the house.
This could result, or have resulted in, a lein on the property in the form of a court order or Lis Pendens.

More subtle concerns arise if you find that the existing windows are low-spec and of poor quality, but the deal offered for sale involving completion of the house may require you to continue to use him.
In such a case you would be putting a noose around your neck, becoming contractually bound to a poor quality supplier

As with the legals, you should try to obtain good title to the building and all goods on site free from past ontractual arrangements and not subject to ongoing or possible future legal proceedings.
In short you have to ensure that there are no outstanding liabilities accruing to the previous developer or builder that could somehow be transferred to you.


Conclusion

Taking over an existing build like this is a bit of a minefield as you can see and the advice given above is not exhaustive, but hopefull this fleshes it out a little.

Thanks to tester1 for reminding me to say this.


ONQ
http://www.environ.ie/en/Publications/DevelopmentandHousing/BuildingStandards/FileDownLoad,22447,en.pdf (<br />)[broken link removed]

All advice on AAM is remote from the situation and cannot be relied upon as a defence or support - in and of itself - should legal action be taken.
Competent legal and building professionals should be asked to advise in Real Life with rights to inspect and issue reports on the matters at hand.

ONQ, I can't thank you enough for such a comprehensive reply. Anyone in Ireland who googles "thinking of buying an half-finished house" comes upon this thread and it should prove to be useful counsel to all.

Thanks to everybody else who replied.

(bows)

Thanks galwayhous,

Spreading the word and improveing the use people get from this website is the best thank you you can give AAM.

We try our best on AAM to give good advice without taking jobs from building professionals - its a recession, people need information and services, and those who can afford to pay should do so.

However, in many cases on AAM you meet people who don't access professional services very often and don't think in such terms. They may not even know of the kind of services available or that need to be sought.

We are only too happy on this forum to point them in the right direction as we hope we have done with you, but - and its a big but - my signature file below is not just for show. You really *do* need to engage competent professionals to look after your interests in the real world.

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For example, I haven't really addressed the Health and Safety issues.

If the house was being built for sale to the market by a developer/builder [as opposed to for a person who intended to live in it] this makes it into a commercial undertaking and the Health and Safety legislation comes into play.
This occurs regardless of whether the house is finished or not - the main players must be appointed as soon as preliminary or feasibility design is over and the building design is underway.

If this is so, there should be an initial Health and Safety Plan, and the start of the Developed Health and Safety Plan. There should be letters notifying the HSA of the appointment of the Project Supervisor for the Design Process and the Project Supervisor for the Construction Stage.

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BTW you did say "house" and I assumed "greenfield" with nothing under or over it.
Apartments aren't houses and need Fire Safety Certificates as well as planninmg permissions.
All new commercial buildings need Disability Access certificates and I give some rules of thumb below.

1. Work cannot start on site without an Access Cert.
2. Building work that requires Planning and a Fire Cert will require an Access Cert.
3. All non-domestic building work that starts on site after 1st Jan 2010 will need a certificate before works begin.

Its useful to retain someone competent to ask such questions.
As you can see the requirements to obtain statutory approvals can be a bit of a minefield.
I mention the H&S Fire Cert and DAC for completeness, in case someone reading here may be thinking of buying a half-finished apartment.

ONQ
http://www.environ.ie/en/Publications/DevelopmentandHousing/BuildingStandards/FileDownLoad,22447,en.pdf (<br />)[broken link removed]

All advice on AAM is remote from the situation and cannot be relied upon as a defence or support - in and of itself - should legal action be taken.
Competent legal and building professionals should be asked to advise in Real Life with rights to inspect and issue reports on the matters at hand.