An Inch on the HIPS...

The way we buy and sell a house is to change radically within the next 6 months, according to Elena Round, of Hand Morgan & Owen Solicitors in Stafford.

From 1st June 2007 the much talked about Sellers Home Information Packs - or HIPs, as they are commonly referred to - come into force.

For some time there has been considerable concern about the process of selling a house in the UK and the Government has been looking at ways to speed up the process to bring us in line with other European countries. 

Elena explains, “It has been a particular concern that a large number of transactions fall through early on in the process when buyers have incurred considerable costs in obtaining survey reports and searches.  Presently the buyer pays these costs up front, and when a sale falls through the buyer has no recourse to recoup the costs they have incurred.”

“The thinking behind the introduction of HIPs is to enable buyers to have “full” information on a property before they incur any costs.  The sellers will have to prepare the HIP before they even put the property on the market for sale – and they will incur the costs of producing the HIP.”

The packs will include a statement of sale, standard searches, the legal title, an energy performance certificate and where appropriate any leasehold information.

Initially it was also proposed that the pack would contain a home condition report, but there has been a recent change of heart on the part of the Government and it is not a compulsory requirement at the moment.
 
“The suspension of the requirement of the home condition report means that buyers will still have to incur survey costs early in the house buying process and this surely defeats the whole ethos of the home information pack,” comments Elena.

Presently the scheme is being piloted in a number of areas within the UK.  Some property practitioners remain sceptical about the packs and whether they will come into play on 1st June.  Whilst, others are predicting a surge in houses coming onto the market early in 2007, as sellers rush to avoid having to provide a HIP.

It is important to use a solicitor to produce your HIP as they are regulated by the Law Society and their HIPs will comply with the highest industry standards. 

Elena warns sellers “Beware as not all HIP providers may be regulated!”

“In addition, a HIP from your solicitor is yours alone and is fully portable – you may take it from one estate agent to another.  Beware of large estate agency chains that may offer a “free” HIP, but then tie you into selling with them.  It could be difficult to change estate agent if you then become dissatisfied with their services.”

For more information on HIPs please contact Elena Round on 01785 211411