Hips to be extended to all properties

The government's controversial home information pack (Hip) scheme will be rolled out to all properties in England and Wales from December 14, it was announced today.

The packs, which are already compulsory for all homes on the market with three bedrooms or more, are designed to speed up the selling process and reduce the number of sales that fall through.

They offer potential buyers upfront information about a property, including title deeds, search information and an energy performance certificate (EPC) rating its energy efficiency.

The communities and local government department said the roll out to all properties would reduce the upfront costs faced by first-time buyers and allow homebuyers to reduce household fuel bills and carbon emissions.

It said early monitoring of the scheme showed it had gone smoothly, with Hips taking an average of seven to 10 days to prepare and costing between £300-£350, less than the £400 anticipated before the scheme was launched.

However, critics of the scheme have said they are a waste of money, and suggested they will cause a further slowdown in the housing market.

The Royal Institution of Chartered Surveyors (Rics) said the full introduction of Hips would "wipe 300,000 properties off estate agents books" as speculative sellers withdrew from the market.

Following the introduction of the packs on homes of four bedrooms or more on August 1, it reported a 51% fall in the number of homes of that size coming on to the market.

A 37% fall in the number of three-bedroom homes brought to market in September, when Hips were rolled out to cover properties of that size, was also blamed on Hips.

Rics, which took legal action against the government at the beginning of the summer over the packs, and in doing so delayed their introduction from the planned date of June 1, said a full roll out would hit first-time buyers.

The organisation's spokesman Jeremy Leaf said: "With prospective buyers and sellers currently taking a 'wait and see' approach to moving, activity in the housing market is grinding to a halt."

Leaf said accessibility to the housing market for first-time buyers would "go off the scale" as the supply of properties dried up.

"A lack of smaller properties for purchase will force first-time-buyers to remain in the lettings market where rents are already climbing at the fastest pace in over eight years," he said.

"If the housing minister genuinely wants to improve the plight of first-time-buyers, she should not continue with this flawed policy."

Strong argument for scheme roll out
But the government said an independent report it had commissioned from consultancy Europe Economics had found no impact on transactions or prices, except a short-term delay in new listings while a seller commissioned the pack.

It said the report had concluded the impact was short lived and marginal, and found strong arguments for carrying on with the planned roll out.

The housing minister, Yvette Cooper, said: "Hips and EPCs are already helping consumers to save hundreds of pounds off their fuel bills and are cutting search costs too.

"All homebuyers will be able to benefit from energy efficiency advice, with those receiving low green ratings of 'F' and 'G' especially targeted for support and grants to make improvements to cut their costs and carbon emissions."

The high number of leasehold properties among one- and two-bedroom properties has forced the government to temporarily amend the Hip regulations to allow homes to be put on the market with only a lease document included in the pack.

It had originally required other documents to appear, including statements of service charges and details of managing agents, but these have proved hard to obtain quickly.

The items will become compulsory in six months time, but in the meantime the government has asked the deputy chief executive of the Land Registry, Ted Beardsall, to look at how the provision of leasehold information can be improved.
Hilary Osborne
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