Buying a house with an uninhabitable structure

Lumen

Sorry this is a bit long, I need to get it all out.

I'm sale agreed on a nice looking house in the DLR area and have just had the surveyor in. I'm waiting for his full report but he's advised that the main house is OK (neither crap nor excellent).

BUT...

On the site is a 50sqm studio/granny flat with kitchen, bathroom, bed/living room. This structure was adapted from an outbuilding and is not fit for human habitation due to (at least) serious damp and ventilation issues. I asked how much it would cost to fix and he advised that it would be better to knock and replace (50k-80k).

Unfortunately there is no record of the building ever having planning - it's just been bodged into living space over a period of time. It was cited in appeals to extension plans for the main house, and investigated by the planning authority who rather confusingly deemed it non-exempted but without planning permission and were happy to leave it alone, perhaps as it was not recently constructed (7 year rule?).

So aside from the cost of demolition and rebuild I'd presumably not get planning to do so. The neighbour who fought a determined (and quite reasonable) campaign of planning objections would be highly unlikely to let this one go under his nose.

The site is already quite overbuilt considering its location (outside the M50). There's not a lot of land to spare around the main building, so if there wasn't a structure there already I can't see that I'd get planning to build one.

Somewhat bizarrely this structure has in recent times been rented out despite its unsuitability.

From a risk-averse perspective I suppose I should consider the structure to be a shed, but I was planning to use it as guest/au pair accommodation and I can hardly put family or employees in an unsafe/unsuitable building, morally or legally.

So my options seem to be:

1. Pause/walk away until they've remedied the structure and can provide certs of compliance or whatever. I actually don't think this will happen as they just want to get rid and probably don't have the money or the inclination to do the work. More likely they'll find a less fussy buyer and sell at a lower price.

2. Be the less fussy buyer, take it on at a discount and attempt to remedy the problems myself. I guess it would need to be a very hefty discount to correct for the hassle and risk (like at least 100k). Again, they'll probably just try and punt it to someone who doesn't care that it's a heap.

So either way I don't get the property, which I otherwise like a lot.

Am I likely to have any joy getting planning to knock and rebuild a badly built and non-compliant structure?

I am part financing this purchase with a mortgage so the bank will presumably have a view.

Thoughts?

Cuddlesworth

50-80k? Is there any other problems besides the damp? Because that's odd to me for just damp and considering the planning issues around it.

You could get a damp expert out to look at whats actually causing it, its probably no damp proof course combined with no real barrier between the floor and the earth. You could inject a damp proof course into the existing walls and redo the floors. It does work if done right. When the building dries out there won't really be the same mold/ventilation issue, although it takes the whole of a hour to put a vent into a wall if needed. Injection costs 1k upwards in time/materials/tools(could be much cheaper at this point), floors around the same. Up to you if its worth the time/hassle.