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I purchased a 60 year old house last year and a few months ago I noticed an odd wavy pattern in the paint just above the floor trim. The wood floor was also noticeably darker in that area, so I decided to pull back the quarter round and see what was going on.

wavy paintWood Damage
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This wall is on the outside corner of the house. I have not noticed any dampness/water in the plaster wall or on the floor up to this point. The wood that came off when I pulled back the quarter round is dry, very light and crumbles when I break it apart.

I'm currently planning a bathroom reno, and I'm wondering if this is something that needs to take priority.

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Doesn't look like any kind of water damage - that would leave stains. Wood breaking easily during inspection is most likely rotten big time. –  sharptooth Mar 18 '13 at 6:42
    
It doesn't look like pest damage and if it is dry then it may be the remnants of former water damage that has been remedied. What is the exterior wall, siding, brick, concrete? Is there a basement or crawlspace that you can inspect from underneath? –  maple_shaft Mar 18 '13 at 13:51
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2 Answers

This looks like a slow water leak, over a time, perhaps caused by:

  • Ice dam
  • gutter overflow
  • improper flashing near window.
  • damaged roofing

Is there access below this spot? You will likely have apparent sub-floor damage.

Its good news that the area is dry now. Perhaps a roof replacement fixed the source. At a minimum, you should expose that stud bay side-to-side and 12" high, until you find solid, undamaged base plate and no stud damage.

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Certainly looks like rot. Going by the staining, it looks like wet rot. Its certainly something you to sort before any renovations take place. It might be an idea to contact a specialist. The PCA (Property Care Association) are the approved governing body for all damp and rot contractors within the UK. If you visit their website, you will be able to find a qualified and approved rot specialist within your local area that can take a look at it.

Alternatively, you can visit this web page for treatment information: http://www.wisepropertycare.com/wet-rot/treatment-solutions/

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I don't see the UK mentioned in the original question. However, if the OP happens to be in the UK, this may be a valid answer, so I am not down-voting it. "Cheers!" –  ShoeMaker Mar 25 '13 at 11:15
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