See the horizontal metal flashing that runs across the inside of the exterior wall, about one foot higher than the floor? Light penetrates gaps in the wall under the flashing.
In other words, the exterior siding is open to critters, bugs and the elements. This house was not a sealed envelope. Heated and cooled air escaped through the walls.
This is wrong.
This is not a surprise; it is, instead, another example of why we are taking this house down to studs — find what’s wrong, fix it.
This is not permitted by building code today.