I've passed a few times on homes that had musty smelling basements. Personally I wouldn't touch one....

Does it visually appear that there is water damage?

Normally, a faint musty smell isn't too big of a deal, especially in an older home. However, what you're describing is not faint - it's overwhelming. And overwhelming musty smell is never a good sign and I'd pass. If you love the house and really want it, spend the 150 bucks to have an inspector come out just for the basement issue and maybe he can shed some light on to what's going on.

Is the house old? Our old house had a rather musty smell i nthe basement but I wouldn't describe it as overhwelming.

In my area (New England) even "dry" basements (meaning, never have water in them) need dehumidifiers in the summer or the basement gets funky smelling. If the homeowners did not run a dehumidifer that could cause the smell, especially if they have books and papers in the basement. I would get an inspection, make sure it explicitly includes investigation of any issue in the basement. If there is no evidence of water damage, past flooding, etc., I would get an estimate from a remediation company. My concern is that the basement is finished. Is it carpeted?

I have asthma also and have a nose like a bloodhound when it comes to funky smells (mildew, dog smell, cat litterbox, smoke or any type). I have noticed others are not as sensitive to it as I am, so it is possible the owners don't even smell it.

Get a contract on the house with an inspection clause. Hire a very good inspector. After you get the inspection report, it will be time to decide how to proceed. If the report indicates serious problems, you can always walk.

BTW, most basements tend to smell musty if they don't have proper air circulation. If the house has forced air heating/cooling and the basement was not set up for conditioned air, that may very well need doing.

That can be fixed by added ductwork, returns, and diffusers (supply grills). The expense will depend on the level of difficulty. Basements are usually easy compared to the upper levels of a house.

There is a small chance that a larger furnace/HVAC system may also have to be installed.

I just wonder what your asthma would develop into if you lived in that house.

I agree with creekside, this is a home you'd love to own, don't be too quick to walk away, it may be wonderful, make an offer with a good inspection, find out why it smells. Also depending on the requirements necessary the seller may fix it or contribute an acceptable amount to remedy the situation.

Thanks so much for all the information! We will get it thoroughly checked out by our home inspector. I'm still on the fence...I adore the house, but my son also has a lot of allergies, so I do worry about how the house would potentially exacerbate his condition. It seems like every house we've looked at this year, and seriously considered, has had something wrong with it! It's so hard to find the perfect house! Again, thanks for the advice!

You'll never find the perfect house :). Just do your best and find something that you're very happy with and is as close to perfect as you like :).

It's so hard to find the perfect house

>There is no such thing!

Have an inspector look at it to see if there is water coming in somehwere, if it is a finished basement, its odd that the smell is so strong. A dehumidifier should fix the problem if its just a typical basement smell..

I have bad allergies - I've walked into basements that hit me like a wall, instant headaches from mold, and I've turned and walked right out. But there have been others that were just a little musty that weren't as bad.

Depends. If it has carpeting, and especially if that carpeting is old, I'd consider it...of course, remove the carpet, install a ceramic tile floor and anything that contributes to the growth of mold, mildew or dust mites.

Are the walls exposed? We've got a few areas on the north face of our house that have mold on the cinder blocks behind the paneling, when we purchased the previous owners didn't have proper grading, and there were areas between the house and the concrete terrace that were open allowing water in. We rectified these problems, sealed the openings with concrete, applied a basement paint / sealer to the walls, works wonderfully by the way, filled a step crack with hydraulic cement, and we run a dehumidifier in the basement. Now, no musty smell. It takes work, but well worth it. We also opened up the heating ducts to the basement - previous owner kept them closed to keep heating costs down, I'm assuming. Makes a big difference.

Look at the grading of the land - is there proper sloping so that water drains away from the house?

We also installed glass block windows with window vents, but kept two original windows in case we needed to run a fan (say if we're painting) for air circulation, and an emergency exit in case of a fire.

Good luck. Don't let it pass you by, you'll always wonder, what if? Hopefully the inspection will go well.