HIPs mandatory from 1st June 2007 for house sales

HIPs mandatory from 1st June 2007 for house sales

	Published : Fri, 18 Nov 2005 10:05 By : James Rowe Print this Story

LONDON: The government announced that it plans to introduce the system of home information packs (HIP) in 2007. From 1 June 2007, anyone wanting to sell his or her home will have to fill in details in the HIP providing local authority searches, copies of guarantees of any work carried out and a home condition report, based on a survey by a licensed home inspector. An HIP pack would cost 1,000 pounds plus VAT.

Housing minister Yvette Cooper said the system will facilitate speedier home buying, provide transparency and cut costs for first time buyers. The system was slated to come into force on 1 January 2007.

Cooper said too many sales fall through because of delays and late information, wasting money and causing great stress for buyers and sellers. "That’s why we are introducing the Packs. We have been working with all parts of industry on the detail and this timetable will give them time to fully prepare".

The Council of Mortgage Lenders criticised the timing saying it will disrupt the housing market activities at its busiest period. The council's deputy director general Peter Williams said there are risks of disrupting normal house sale activities during the peak spring and summer period.

The council said people will tend to sell their homes earlier than planned to avoid paying the fee of 1,000 pounds, thereby creating a spike in the market. The council wanted the government to at least publish a detailed timetable to ensure that the industry and the consumers are made aware of the procedures. It wanted the date to be postponed to 1 January 2008.

A spokesperson for the Office of the Deputy Prime Minister said it would provide details to organisations drawing up the packs and those training as home inspectors. She said 1 June 2007 has been selected after listening to views from across the industry. "It provides the industry with the time needed to ensure that HIPs can be implemented smoothly and successfully and deliver real improvements for consumers."

She added that by providing key information at the beginning of the whole process, HIPs will prevent waste and significantly cut the number of failed sales.

The government had come out with statistics showing an amount of 1 million pounds is wasted in a day on failed transactions as buyers spend money on valuations, legal advice and searches.

The Royal Institute of Chartered Surveyors described the timeframe as "tight" mainly on account of dearth of qualified home inspectors. It is estimated that as many as 5,000 home inspectors would be required to implement the system. Some 1.700 people from the surveying and property industry are now undergoing training to become the first lot of home inspectors. The government has outlined guidelines for the qualification.