Dampness can occur for a variety of reasons including rising damp, penetrating damp, salt contamination, service pipe leaks and condensation.
Rising damp is caused by moisture from the ground rising up through a structure by means of capillary action. This will occur where there is a failure or lack of a damp proof course (DPC). Rising damp will inevitably lead to spoiled decorations, defective plaster, rot in timbers and can create an unhealthy environment in which to live.
The white evaporation salts and deteriorating paintwork on this wall suggest rising damp. Further investigation inside will be required.