Is it time to scrap HIPs?
October 17, 2008
There is no doubt that when legislation relating to Home Information Packs was brought in the year before last there was a great deal of controversy and dissatisfaction amongst both homeowners and various industry groups, such as estate agents. Officials from the Labour government have been insisting that these packs are a good idea, and that they will make the house selling process far faster. However, whilst Labour officials continue to defend these HIPs officials from other parties are insistent that they need to be scrapped.
The housing market in the UK is already in complete turmoil. Estate agents have recently announced that they are selling an average of less than one property per week, and the downturn in the housing market has been profound over recent months. A number of factors have been blamed for the crisis that has hit the housing market, from the falling house prices, which have made would be buyers fearful about being plunged into negative equity, to lack of mortgages, which has made it difficult for buyers to get a mortgage.
However, HIPs have not managed to get away without some degree of blame, and various officials including estate agents and even Tory Party officials, have said that the necessity to have Home Information Packs for residential properties being marketed for sale in England and Wales has had a dampening effect on the housing market. In fact, the Tory Party has gone as far as to say that there is a clause in the current legislation that would allow the government to suspend HIPs if necessary, and that this is something that the government needs to do as quickly as possible.
The Tory Party has already made it clear that if it gets into power HIPs will become a thing of the past.
However, in the meantime one official from the party has stated: “If Gordon Brown genuinely wanted to help the beleaguered housing market, he would use his powers to suspend this harmful regulation and save homebuyers’ money. These little-known provisions to suspend Hips were introduced for a reason - to undo the regulations quickly if it all went wrong. The next Conservative government will scrap this unnecessary red tape completely, but a suspension now would deliver those benefits sooner rather than later.”
An official from the Department for Communities and Local Government, however, has responded: “We have absolutely no plans to suspend HIPs. First-time buyers are also receiving the information in the HIP for free, helping to reduce costs for households looking to get on to the property ladder.” He continued: “It is widely acknowledged by experts that the current challenges are a result of global economic pressures also being experienced in the USA and other parts of Europe.”
At present it seems that the Labour Party is sticking to its guns and is determined to make HIPs work, but with all the speculation over whether Labour will get into power when elections come around again these packs could become a think of the past.
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HIPs are here to stay, but only if they continue to improve and offer added value.
The next phase of their development will be the “exchange ready” HIP which will include contracts. planning information and replies to standard enquires plus a full official local authority search ( not the half- cocked personal searches which have sprung up exponentially). these HIPs will cut the times to exchange especially if the Buyer has already a mortgage agreed in principle.
The Conservatives are still in the process of compiling information on HIPs. It would be highly unlikely they would seek to scrap a product which although flawed at inception had evovled into something worthwhile and value for money