I despair, I really do.
There I was – nailing my colours to the mast and saying that the prospect of the government not implementing Home Information Packs (HIPs) was as likely as FIFA asking Wayne Rooney or Zinadine Zidane to deliver a treaty on the need for restraint of violence on the football pitch and it goes and drives a very wide coach and a shedful of horses through the regulations by withdrawing the need for the Home Condition Report (HCR) to be a mandatory part of the HIP – it does my professional reputation no good at all.
So, having got that off my chest, I thought I would have a look at what we can learn from this debacle and review what it all means for the mortgage industry.
- Never trust politicians. I know you will say that’s stating the obvious but Rightmove and lots of other companies have and look what has happened – millions of pounds chucked down the drain in wasted resources, and quite a bit off the share price to put the boot in.
- Don’t apply to be a home
- inspector. There are apparently 1,000 disgruntled trainee home inspectors who thought they were going to be flavour of the month earning £80,000 a year and are not sure if anyone is going to need them to carry out any HCRs.
- Keep abreast of the Energy Performance Certificate (EPC) debate. At this point in time no one knows who is going to be qualified to carry out the dreaded EPCs – at one time the home inspectors thought they would have the monopoly, but now the government is talking about a fast-track qualification as they calculate that between 2,500 and 4,000 qualified people will be needed to produce EPC’s as part of the HIP. Presumably the talk about a fast-track, standalone qualification is needed as those disgruntled trainee inspectors may think once bitten twice shy.
- Don’t think its all been resolved. HIPs are going to be mandatory from 1 June 2007. Each HIP will have to have an EPC. There is likely to be an acute shortage of qualified home inspectors/energy inspectors to fulfil the demand – so what the government feared would happen on the 1 June (and why it dropped mandatory HCRs) is still likely to occur.
- What’s still left of HIPS? Quite a lot really; there are all the legals including details of title, copies of planning and other documents, searches, the seller’s property information forms and of course the EPC – you can, of course, also include a HCR but it remains to be seen how many of these on a voluntary basis will be included
- Who will be producing HIPS? A lot of the HIP providers that expressed their intention to provide the full monty HIP are still in the market for the watered down version, but some have gone rather quiet. HCRs were really the spine of the HIP and without that mandatory element, the commercial prospects and opportunities for taking percentages of the market have diminished. You are now likely to see a lot more local arrangements between estate agents and solicitors as the lawyers can now more easily put the pack together working with the estate agent. There are some big players around still though so there are likely to be winners and casualties when the dust settles.
- What does all this mean to the broker market? Taking the sting out of the information pack proposition is likely to reduce the prospects of any seismic change in the dynamics of the house transfer market – in other words, things are more likely to stay the same as before.
- Are there likely to be more changes by the government? Who knows? But I am certainly not going to stake my professional career on it.
