House information packs will halt housing market boom |
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Wed, 28 Jun 2006 13:05
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LONDON - The British government says that the selling trend in the housing market could fall by 10 percent when the £1,000 sellers’ packs are made mandatory next June. These packs are designed to help first-time buyers, but it is expected that most sellers will not go through the hassle of ordering one.
A new report by the Department for Communities and Local Government, says that the number of houses on the market will fall by or 242,831 when these packs are made mandatory. The report estimated how many home inspectors will be needed.
“There has been concern that there will be a reduction in the number of properties marketed upon introduction of Hips. An allowance of 10 per cent for market reduction arising from Hips has therefore been assumed," the report added. Meanwhile, these sellers' packs have been slammed by Persimmon, one of Britain’s biggest housebuilders.
“These Hips are mooted to prevent gazumping and speed up the housebuying process, but they won’t achieve either of these things. They may even slow down the market by reducing the number of properties put up for sale, which would lead to a surge in house prices,” said John White, executive chairman of Persimmon. “I would hope they are not introduced. It would be folly to risk disrupting the housing market and I am not sure what it will achieve.”
A survey by the Oxford Economic Forecasting (OEF) also predicts that the number of houses sold would go down when these packs debut in June 2007. The study added that the introduction of Hips would distort the market. The Tories have also been very critical of these packs. Michael Gove, the Shadow Housing Minister called them as "extensive new red tape.”
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