The government has attempted to end the continued speculation of ‘will they, won’t they’ over the issue of Home Information Packs (HIPs), with the confirmation in parliament of the pack legislation.
Get the daily news delivered to your inbox
Designed to improve the house buying and selling process, HIPs have come under continued criticism from those inside and outside the industry. Under original plans, HIPs were designed to speed up the house buying transaction and help to improve the supply and demand problem currently facing the UK housing market. However, following criticism from a number of sources, including opposing government parties, consumer groups, industry bodies and those sceptical of HIP benefits, the original formula has been changed, so the only mandatory factor of the packs is the Energy Performance Certificate (EPC).
Number of concerns
Henry Pryor, founder of PrimeMove.com, admitted he had a number of concerns over the current format of HIPs. He said: “The idea of introducing these watered down HIPs as a tool to speed up the house selling process is both mistaken and expensive. In particular, the requirement to have EPCs produced for every house before it is marketed is madness.
“EPCs alone are expected to cost in the region of £150. Given that only about half of the two million plus properties that are marketed each year actually sell means that there will have been no need for an EPC to have been produced for around 1 million homes each year.”
Register for 'Adviser Finder' here
To improve consumer confidence in the packs and to raise awareness of the proposals in place, the government has begun its press campaign, and has confirmed that the Ombudsman for Estate Agents (OEA), will be responsible for redress within the scheme.
Bill McClintock, chairman of the OEA, said: “The government has started its consumer awareness marketing campaign in the national press. The public are becoming more informed about HIPs and the need for sellers to have one before they commence the sale of their homes.
“We are here to protect the consumer from any incompetence or malpractice by agents. Consequently, sellers should inquire that any agent they use to sell their property is a signed-up member of the Redress Scheme. It costs only £100 a year per office for an agent to be a full member of the scheme so they have absolutely no excuse not to sign up to our Code of Conduct and give their clients the protection they deserve.”
Fully behind HIPs
Mike Ockenden, director-general of the Association of Home Information Pack Providers (AHIPP) said that the regulation showed the government was fully behind the HIP strategy. He said: “The regulations offer clarification and industry wide reassurance that HIPs will happen on 1 June – there’s no going back.
Find out more about this weeks industry news
“I welcome these regulations, which have introduced a series of sensible and pragmatic steps to support the smooth implementation of HIPs – taking on board industry concerns.”
Dominic Toller, director of marketing and new business at LMS, admitted that the government plans put in place would help to improve market confidence on HIPs.
He said: “The laying of the regulations for HIPs sets us firmly on the final furlong for their implementation in June. These regulations demonstrate the government’s total commitment to HIPs and we are delighted the Department for Communities and Local Government is sticking to its guns in seeing HIPs introduced.”
Get the latest equity release news here
Karen Babington, sales and marketing director at Easier2Move, added: “We welcome this announcement on HIPs as it is an inescapable indication that these packs really will be introduced on 1 June 2007. The changes that have been made to the legislation since January are relatively minor and can be seen as an indication that the government has listened to the concerns raised by firms operating within this sector.
“In recent research we undertook, it emerged that 35 per cent of estate agents had still to choose a HIP provider. We hope that today’s announcement will act as a wake-up call to all companies that could benefit from offering HIPs and encourage them to start putting the appropriate processes in place.”
It is clear that the Department for Communities and Local Government needs to ensure the full launch of HIPs on 1 June goes without a hitch. However for that to happens, it seems a lot more education is needed, for brokers, estate agents, and the general public.
