Home Information Packs
Release date: Oct 2006

The home buying process will undergo a major shake-up when Home Information Packs (HIPs) become mandatory on 1 June 2007.

At present, if a buyer likes a house, they make an offer 'blind' to its legal and physical condition before spending money on searches and surveys. However, for all residential property (except new builds) first marketed on or after 1st June 2006, the Seller will be legally required to produce a HIP including a search, the title deeds, lease, planning permission, building regulation approval FENSA Certificates, guarantees, energy-efficiency report and service-charge and insurance information for leasehold properties.

IN addition the Seller can voluntarily include a Home Condition Report (HCR) prepared by an NVQ-qualified home inspector. It will be a criminal offence to try to sell such a property without a HIP.

Here are some of the arguments for and against Home Information Packs:-

• Buyers will know what they are committing to before they make an offer. There will be less risk for sellers that the deal will collapse and jeopardise their own purchase.
• Evidence suggests that upfront information helps the sales process.
• Both parties benefit: buyers can decide at an early stage if they want to proceed the actual condition of the property.
• Ultimately, purchasers will be better-informed.

• Market slowdown: sellers who currently 'dip their toes' into the market and withdraw if they go off the idea of selling will have to bear the cost of the HIP even if they don't sell. This is likely to reduce the number of homes on the market.
• Some say HIPs don't go far enough, as no survey or valuation is included - and a low valuation is one of the chief reasons that a purchase falls through.
• Short shelf life: HIPs may become inaccurate or even redundant if a house is on the market for several months. If a seller wants or needs to update the information, they will have to pay for it. However, insurance may be a way around the problem.
• Vendors may object to the costs of providing the HIP when historically the Buyer has had to stand the cost, even though the Sellers would benefit if buying another property.

We at Close Thornton have over 60 years experience of residential property matters and are pleased to announce that as from 1st June 2007 Close Thornton will provide HIPS for all sellers through their Property Department and Solicitors Property Shop

For further information contact Denis Childs or Pauline Robertson
denis.childs@close-thornton.co.uk pauline.robertson@close-thornton.co.uk

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