It would have needed attention sooner rather than later. Yes, building a second story would most likley require that the entire foundation be repaired and reinforced, or maybe even completely repoured depending on engineering and geological factors. Adding a second floor would also most likely require reframing the first floor entirely. Such a project is extremely expensive and foolish waste of money for most homes unless you purchase them for land value only and the neighborhood will support such an expansion. You are almost doing a complete teardown, and spending more money than a teardown, but without the newness of the new home that teardown gives you.

Repouring the foundation would involve removing all the walls, basically a teardown, am I understanding this correctly?

This is an original 900 square foot Craftsman house which is highly prized in my town, so tearing it down to start over seems a shame. Given the setback regulations and the very narrow shape of this particular lot, bumping out the back and/or building up are the only ways to add square footage. The 2nd story addition could be partially over the existing house and partially over the new construction. The 2nd floor can't come all the way to the front of the existing house but needs to be stepped back (due to setback regulations). The foundation crack is right around the middle of the house.

Most of the renovated houses in this neighborhood have undergone some combination of bumping out and up. Our preference is to just bump out, but since the lots are small (4500-6000 square feet) sometimes going up is the only option.

The value is almost 90% in the land in this town. Many of the houses are in teardown condition, but it's a highly desirable area and this house will sell with multiple offers even with the foundation crack.

There is no "average" cost for this type of situation. You would need real professionals giving you quotes for the specific issues they find. The original house might be built like fort knox and require minimal reinforcement to meet modern codes. On the flip side, it could be built on "unsupported dirt walls" and require pretty much complete demolition to get to the point where it could support a second story.

Based on your description, the repairs would cost between $3,000 and $5,000 around here.
Click on the pdf link in the lower left corner of the website for more info.

Here is a link that might be useful: Foundation Repair

Are you under contract with this property. In the original post, it says you are no longer interested in this property, but in your next post you speak in present tense as to your preferences as to how you would add on to the home.

Thanks for the additional information, it's been helpful.

No, I'm not nor have I ever been under contract for this property. It just came on the market last weekend and I seriously considered it but due mainly to the narrow 40' width of the lot I decided to pass. The present tense has to do with what could be done with this house or a similar one, since there are many houses from the 20s-40s in this neighborhood. I lost bidding wars on 2 other ones recently but neither had foundation cracks like this one; I'll probably come across more houses with cracks in the future. I mainly wanted to know in the whole scheme of things if large foundation cracks automatically meant taking the house down to the foundation, or if it could be repaired without such drastic measures. The answer "it depends" is ok too :)

annakathryn - My BIL used to fix those by jacking up the original house and replacing the foundation, then lowering it onto the new foundation. Sometimes even a new basement.

He also jacked up 1-story houses and built a new first story strong enough to hold a 2nd story and then lowered the old section onto the new one to be the 2nd story. You could even live in the top part during construction.

It's not cheap, but it's cheaper than rebuilding and it's cheaper than remodeling the old 1-story into something string enough to hold a 2nd story.

lazygardens - that's interesting because it's exactly what the listing agent was telling me I could do (move the first floor up to the 2nd story). But living in the top part during construction?!?! Wow that would be a trip.

I don't see how it would work in this case because of the setback requirements for the 2nd floor, but I suppose one could ask for a variance.

These houses don't have basements, by the way. The dirt in the right picture is the "basement".

No two houses are created the same, nor are their defects. You would need to hire a licensed Professional Engineer who specializes in structural engineering to find out for sure the root cause as well as what methods would be needed for repair. The P.E. should also be able to tell you if conditions exist that would just cause cracks to occur again despite repair.Hire one who also will provide estimates of repair as well.
That said, realize that such a repair is likely to make the house more difficult to sell if that day should come, as many people shy away from homes that required structural repair. Chances are it's value would not be that of a similar home that was not at some point structurally compromised.

"Such a project is extremely expensive and foolish waste of money for most homes..."

Or if you want to stay in the same location for jobs, schools, or any one of a million reasons.

It is not always about making money.

I agree with Lazygardens. There are a host of processes like piers, posts, screws, ties, that can be used to remedy foundation problems. No need for a tear down to occur. Just get the engineer in there first, and then go from there.
The thing to do if you are house hunting in this neighborhood is to get the property under your control, first! Your contract should give you a Due Diligence period that should give you the time to get an engineer in there. If he tells you what you want to hear, you move forward. If not, you terminate the contract and receive your deposit back. But you have to get the property under your control first.

The thing to do if you are house hunting in this neighborhood is to get the property under your control, first!

Oh definitely, that's what would happen in a normal market. But this isn't a normal market. I realize how bizarre this sounds for people in the rest of the country, but this neighborhood is very hot and has been for years. Houses come on the market with a broker tour on Friday, open houses on Sat/Sun, and offers are scheduled for Tues or Wed. It's certainly possible to submit an offer contingent on an engineering review, but that offer is likely to be trumped by an all-cash, non-contingent offer or two. This is how we lost the last house we bid on, and why I want to be more educated about foundation cracks.

I had my architect scheduled to see this particular house yesterday (Monday), and he could have brought an engineer with him. But the more my husband and I thought about the other defects of this house that couldn't be changed, the more we thought we should pass. So we called Sunday night to cancel the appointment and will wait for something else to come on the market.

NO NO NO! You got my advice all wrong. Don't announce that you are making your offer contingent on an inspection. In fact, sweeten the offer by saying you will buy the property AS - IS.
The thing you have to remember is that your contract is going to give you the right to perform an inspection before moving on anyhow. So, in fact, ALL deals are contingent upon the inspection! Most RE contracts are written so that during this Inspection Period, the buyer can terminate the contract for any or no reason and they will receive the deposit back. Make sure you know the details of how your contract handles this Due Diligence period before you do this to make certain that you do have an easy out. Like I said, most RE contracts do.
To sweeten up the offer even more, you can write up the offer as a cash deal and then either finance the deal like normal, or refi into a mortgage shortly after closing. When using this tactic, you want to be certain that if you can not secure financing for some reason, and do not find this out until too late, you are still under contract for that cash deal.
By doing these two things you can present the sellers with an all cash deal and you agree to purchase the property AS - IS. Your offer will look better than most.

"ALL deals are contingent upon the inspection! "

You are seriously mistaken. I'm surprised that anyone in the field would make such a statement. The ONLY way that a deal is contingent upon an inspection is if the buyer submits a contract offer with an inspection clause.

BTW - "As is" is a meaningless term here if you plan on including a contingency clause. All that tells a seller is that you are going to try to renegotiate the sales price instead of demanding they make repairs.

"BTW - "As is" is a meaningless term here if you plan on including a contingency clause. All that tells a seller is that you are going to try to renegotiate the sales price instead of demanding they make repairs. "

Not always.

For years (until O has enough experience) I purchased 'as is' with an inspection clause.

At the time I wanted another set of more experienced eyes to look over the property in case I had missed anything significant.

I had not contention of asking for any concessions, I would simply walk away (and I did in one case).

I now no longer even use ANY inspection contingency, and often not a financing contingency or appraisal contingency either.

It is a lot easier when you actually control what is going on, and view it as the business deal it is.

The thing you have to remember is that your contract is going to give you the right to perform an inspection before moving on anyhow

That's not how it works with the PRDS form used here in Northern California. There's a clause that can be checked defining the "as-is" terms, and the only cancellation rights have to do with contingencies that have not been removed per the contract terms. If there are no financing or inspection contingencies, then the buyer is legally obligated to perform. There's no "out".

My last two offers have had no inspection contingencies; one had financing contingency with a loan pre-approval letter and proof of funds, the other was all cash, a totally clean offer. I got outbid on both.

I just heard from my Realtor that the house is now in contract right around the $898,000 asking price, so there probably weren't multiple offers on this one.

Bill Wroye:

""ALL deals are contingent upon the inspection! "
You are seriously mistaken. I'm surprised that anyone in the field would make such a statement. The ONLY way that a deal is contingent upon an inspection is if the buyer submits a contract offer with an inspection clause.

BTW - "As is" is a meaningless term here if you plan on including a contingency clause. All that tells a seller is that you are going to try to renegotiate the sales price instead of demanding they make repairs."

I feel pretty confident that all commissioned RE contracts include some sort of an inspection clause for the buyer. Do you use one that does not?
The ONLY way that a deal IS NOT contingent upon an inspection is if the buyer submits a contract offer without an inspection clause.
AS -IS is a term that tells the seller that you do not expect to request repairs. Just because a buyer is willing to buy a property AS - Is, has no bearing on whether or not the buyer has the right to perform an inspection.

AnnKathryn Wrote:

"If there are no financing or inspection contingencies, then the buyer is legally obligated to perform. There's no "out"."

I never mentioned to draw up a contract w/o an inspection contingency. People, as you can see from above, mistakenly think that just because a buyer is willing to buy a property As - Is, that it means they have no right to an inspection... not true.
I would be interested to see the inspection clause from the contract that you are using, to see what "outs" may or may not be entitled to the buyer. I am betting there are some.

"I feel pretty confident that all commissioned RE contracts include some sort of an inspection clause for the buyer. "

You may be confident, but you are wrong. Again, kinda shocked that anyone in the industry would not know something so basic.

As for "As is" - all houses are sold as is. That is basic contract law. The inspection contingency only allows a buyer to back out of the deal. It absolutely does NOT commit a seller to making any repairs. Of course, a seller may choose to make repairs to convince the buyer not to exercise that contingency. They could just as well offer to lower the contract price or tell the buyer to take a hike.

Most RE contracts probably have similar verbiage like ours. Consumer protection being the main reason for this escape clause:

10.2. Inspection Objection Deadline. Unless otherwise provided in this Contract, Buyer acknowledges that Seller is conveying the Property to Buyer in an "as is" condition, "where is" and "with all faults". Seller shall disclose to Buyer, in writing, any latent defects actually known by Seller. Buyer, acting in good faith, shall have the right to have inspections (by a third party, personally or both) of the Property and inclusions (Inspection), at Buyer's expense. If (1) the physical condition of the Property, (2) the physical condition of the Inclusions, (3) service to the Property (including utilities and communication services), systems and components of the Property, e.g. heating and plumbing, (4) any proposed or existing transportation project, road, street or highway, or (5) any other activity, odor or noise (whether on or off the Property) and its effect or expected effect on the Property or its occupants is unsatisfactory in Buyer's sole subjective discretion, Buyer shall, on or before Inspection Objection Deadline (para. 3):

10.2.1. Notice to Terminate. Notify Seller in writing that this Contract is terminated; or

10.2.2. Notice to Correct. Deliver to Seller a written description of any unsatisfactory physical condition which Buyer requires Seller to correct.
If written notice is not received by Seller on or before Inspection Objection Deadline (para. 3), the physical condition of the Property and Inclusions shall be deemed to be satisfactory to Buyer.

10.3. Inspection Resolution Deadline. If a Notice to Correct is received by Seller and if Buyer and Seller have not agreed in writing to a settlement thereof on or before Inspection Resolution Deadline (para. 3), this Contract shall terminate on Inspection Resolution Deadline (para. 3), unless Seller receives Buyer's written withdrawal of the Notice to Correct before such termination, i.e., on or before expiration of Inspection Resolution Deadline (para. 3)....
..
10.6. Due Diligence-Physical Inspection. Buyer's Inspection of the Property under para. 10.2 shall also include, without limitation, at Buyer's option, an inspection of the roof, walls, structural integrity of the Property and an inspection of the electrical, plumbing, HVAC and other mechanical systems of the Property. If the condition of the Property or Inclusions are not satisfactory to Buyer, in Buyer's sole subjective discretion, Buyer shall, on or before Inspection Objection Deadline (para. 3), provide the applicable written notice pursuant to para. 10.2.

There are two different references to inspections in the contract used in my county. One is an explicit inspection contingency that can be checked or left unchecked; when unchecked then the contract is considered "not contingent on inspection". The other is a buyer's right to inspection that is up to the buyer to exercise. I think that's what ncrealestate is referring to when he says that the buyer always has the right to inspect; whether that right allows the buyer to cancel the contract is what people seem to be disagreeing about.

The buyer's right to inspection allows the buyer to discover if there were any defects known to the seller that were not disclosed on the myriad disclosure forms, and therefore demand repairs. Seller is relieved of obligation to repair if the "as-is" box is checked. Anything that the seller knew about but did not disclose would allow the buyer to get out of the contract, as far as I understand it. So if the seller of the house in my original post had known about the foundation crack but didn't disclose it, and I discovered it while doing my buyers inspection, it's possible that would be sufficient to get out of the contract. I believe I'd have to prove that the seller knew and purposely didn't disclose, but I'd have to check with my Realtor on that one.

Where I live, all inspections are done by the seller prior to listing on the MLS. Buyers always have the right to do their own inspections, but it's not common.

When I sold my house two months ago, the buyer did not check the inspection contingency box on the contract. However he did exercise his right to inspect by bringing his inspector through before close of escrow. If he'd found anything that I hadn't disclosed, he could have asked for a repair. In fact he tried to do that by asking us to repair a cracked glass pane in the front door; when my Realtor pointed out that the crack had been disclosed, the buyer had no legal right to either back out of the contract or demand repairs.

"When I sold my house two months ago, the buyer did not check the inspection contingency box on the contract. However he did exercise his right to inspect by bringing his inspector through before close of escrow. If he'd found anything that I hadn't disclosed, he could have asked for a repair. In fact he tried to do that by asking us to repair a cracked glass pane in the front door; when my Realtor pointed out that the crack had been disclosed, the buyer had no legal right to either back out of the contract or demand repairs."

Interesting how different parts of the country handle RE inspection differently.
Here, disclosure of a defect to the buyer does not preclude the buyer from asking the seller to fix it, or the buyer from backing out of the contract. The buyer can back out if they don't like the smell in the house or the noise of a car driving by.

Here, disclosure of a defect to the buyer does not preclude the buyer from asking the seller to fix it

Ours was an "as-is" sale, which is also common here given how much is already disclosed. The standard disclosure form is about 20 pages long, plus there's a Realtor's disclosure, earthquake & flood zone reports, and multiple inspections (roof, house, pool, termite, etc), all packaged up and given to any buyer who requests it. This is paraphrased from the standard contract:

17. Optional "as-is" provision. Only if checked here __ it is agreed that buyer is purchasing the property in its present "as-is" condition including:
    A. Full disclosure of seller to buyer
    B. Buyer retains right to inspect as detailed in paragraph 13 + all contingency rights
    C. Paragraph 18 (pest control) and 19 (seller's obligation to repair or correct) are deleted from this contract
    D. No exceptions to "as-is" provision unless
    __ paragraph 18 is included
    __ other ________________________

18. Seller's obligation to repair or correct: Unless this contract includes the "as is" provision in paragraph 17, seller shall make repairs...etc.

We just bid on another house with a cracked foundation which was disclosed in the inspection report. This crack didn't seem to be of great concern as both the inspector and our builder thought it could be fixed with epoxy. Epoxy, really? I'm learning a lot about foundations during this process!

The sellers have received 2 other offers and we've been outbid by at least $40K, so we won't be buying this one either.

Annkathryn,
Could you tell us what town and state you are looking in? I am always trying to keep tabs with the different markets of the Country.
I have heard of concrete pools being repaired with some sort of epoxies too. And when I had a footer addition done to my home, the engineer advised using epoxy to glue the rebar into the existing footer. As you probably figured out, it aint your ordinary Elmers glue.

ZIP Code is 94041. The past 2 houses I've written offers for have been off market sales so won't be found on the MLS.

Here is a link that might be useful: Local MLS