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20th May 2009 EARLY DAY MOTION
Shadow Housing Minister, Grant Shapps, has tabled this Early Day
Motion calling for the suspension of HIPs. Please write to your local MP and ask them to sign the EDM, which is Number 1528.
1st May 2009
SPLINTA LAUNCHES PETITION TO RESTORE 'FIRST DAY MARKETING'
It is becoming ever clearer that the 6th April requirement to have a largely
completed HIP available before so much as a mention of a property coming to the market is made is causing very severe problems.
Sellers, buyers and estate agents are all being frustrated by this nonsensical legislation. This campaign has now launched
a petition on the Number 10 Downing Street website and invites your signature. Please click on the link
below and follow the instructions. We thank you for your support.
SIGN THE PETITION HERE
April 2009
The Tories have again pledged to get rid of HIPs and will
move the requirement for an Energy Performance Certificate to the end of a property sale, not at the start of marketing
as imposed by this government.
The pledge is contained in a policy green paper from shadow housing minister Grant Shapps called Strong Foundations. The paper will form the basis of manifesto promises at the next election - now less than a year away.
If you want to see the end of the useless, expensive, bureaucratic HIP, put an X in the appropriate
box on polling day.
6th April 2009 - Another Erosion of Liberty.
From 6th April the HIP rules are changing. No longer will
it be possible for the marketing of a property to begin when the HIP is ordered, instead the bulk of the pack will need to
be physically complete for marketing to be allowed. That means an estate agent cannot even mention to someone that a property
will soon be coming to the market. Good estate agency practice has always been to begin telling the public about a property
as soon as instructions are received from the seller but this government has decided to stop this happening. Most estate agents
consider the new restriction to not be in the public interest.
A new form, The Property Information Questionnaire or PIQ must now be completed
by the seller for inclusion in the HIP when marketing starts. This seven page document asks questions about the property,
rights of way, building works etc but in what many see as a serious defect, the PIQ does not have to be signed by the seller
nor does it have any legal weight. In fact, a disclaimer on it says that it is not a substitute for legal documentation. The
fact remains that a buyer solicitor will still want to see the official Sellers Property Information Form completed and signed
as truthful by the seller. The PIQ is yet another piece of window dressing by a government that knows full well that HIPs
have failed but insists on pursuing its defective and expensive policy to 'improve' the home buying process.
Also changing on 6th April is the ability of HIP's to contain what is known as
'insurance backed search information'. Up until this date such search information has been acceptable - the information being
provided by personal search companies where they have been unable (or unwilling to pay the charges) to obtain the information
from a Local Authority. Now it has been ruled that all Local Authorities MUST provide the requested information and may also
charge for it. IN THE COMING WEEKS THE PRICE OF HIPS TO HOME SELLERS WILL UNDOUBTEDLY INCREASE IN MOST AREAS OF THE COUNTRY.
However, in an all too familiar example of a lack of joined up thinking, the government is foisting the new rules on the market
before most Local Authorities have got around to setting their new charges for search information. The next few weeks are
likely to be chaotic for HIP providers - and consequently home sellers.
The ending of First Day Marketing is considered by this campaign to be yet another
unecessary burden on an already very fragile property market. For the first time it will become illegal to sell a property
at will - yet another small but significant erosion of our liberties.
The SPLINTA campaign calls for the HIP to be made voluntary (if it is as good as
the government says it is (but few others do) then surely sellers and estate agents will flock to buy them) and for the government
to suspend Stamp Duty Land Tax - which should only be re-introduced as a sliding scale tax, not a stepped tax as at present.
These measures would help the ailing property in its recovery.
25th January 2009
Last week the expected amendment to the Home Information Pack Regulations was quietly
slipped through and as a consequence, from April 6th 2009, the Property Information Questionnaire will be a Required Document
in the HIP at first point of marketing.
PRESS RELEASE FROM SPLINTA
8th December 2008
GOVERNMENT DOES NOT UNDERSTAND ITS OWN LEGISLATION.
Announcing changes to the Home Information Pack Regulations from April 2009, Communities & Local Government under
the stewardship of housing minister, Margaret Beckett, today showed that it does not understand its own legislation. The announcement
means that no-one will be able to sell their property until the Home Information Pack has been largely completed. At the moment
marketing can start as soon as a pack has been ordered.
The announcement stated:
"The Government fully expects the changes being made today will mean no extra burdens for estate agents, and for
example they will still be able to advise potential clients about properties they expect to be coming onto the market. Under
the changes made today, from April 6 sellers will need to have the basic HIP before their home is marketed, which is expected
to take 3 to 5 days to compile."
Leading anti-HIP campaigner, Nick Salmon, head of SPLINTA (Sellers' Pack Law is Not the Answer) ridiculed the statement
by pointing out that the new Property Information Questionnaire that sellers will have to complete before coming to the market
will in many cases have to be administered by the estate agent in order that it can be incorporated into the electronic version
of a HIP. "This will take administrative time and money. It is an extra burden on agents and the consumer will end up
paying" said Salmon.
Salmon admitted to being puzzled by CLG stating that agents 'will still be able to advise potential clients about properties
they expect to be coming to the market'.
"Apart from CLG obviously not knowing the difference between clients (who are sellers) and applicants (who are buyers)
ever since HIPs began it has not been possible for agents to tell buyers that a particular property might be coming to the
market, unless the order for a HIP had been made. This has killed the market for many agents and has deprived thousands of
home owners of opportunities to sell. I do not understand CLG saying agents can still publicise property not yet on the market."
According to SPLINTA the idea that HIPs will take 3 to 5 days to compile is an idealistic estimate. Nick Salmon explained
that, "The current type of HIP can indeed be completed without searches within a week but when the Property Information
Questionnaire comes in it will be likely to delay matters. Most home owners will find they can't get to the market much under
two weeks. That won't matter for some people but for those in desperate financial straits and needing to sell quickly the
delay could be catastrophic."
SPLINTA maintains that the Home Information Pack is a useless and expensive impediment for home owners and is of little
or no interest to potential buyers.
ENDS
Postcript. Over the last two days the offending paragraph in the CLG announcement has been mysteriously appearing and
disappearing from the CLG website. Is this evidence that the Minister has, in the manner of Hilary Clinton 'mis-spoken'???
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HIP HAPPINESS OR
HIP HORRORS?
We want to hear about your experiences of HIPs. Are they helpful? Do they speed up transactions?
Do more sales go through because of HIPS? Or are they a complete waste of time and money?
Whether you are a member
of the public or a property professional we want to hear from you.
Write to: Splinta Ltd P.O. Box 398 Stevenage
SG1 9DR
Or email SPLINTA
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HIPS - The Albatross Around the Neck of the Market.
By Nick Salmon FNAEA (Honoured)
This article first appeared in the November 2008 edition of The Estate Agents, the journal of the National Association
of Estate Agents.
The soap opera that is HIPs has now been running for a decade and regrettably shows no sign of running out of story lines.
The extraordinary fact is that after all the thousands of hours of consultations, debates, forums, seminars, and the miles
of column inches of articles and media comment, the Home Information Pack has ended up as an abject failure. Has there ever
been a piece of legislation that promised so much and delivered so little? I cannot think of any.
The irony of the HIP is that during its tortured gestation those who attacked the pack proposal were branded 'vested interests'
against all change, maintaining the status quo, and 'profiting' from the failures of the home buying process. Now that it
is born, New Labour's bastard love-child, sired by a succession of dogmatic Housing Ministers, is supported by other 'vested
interests' which profit from the pack. The 'antis' always had businesses if the pack failed to materialise but today's vested
interests will be out of a job if the pack disappears; as it will when the Conservatives win the next election. No wonder
there is a note of desperation in their 'bigging up' of the HIP and its supposed benefits. The reality is that the HIP in
practice is daily failing to deliver on its promises.
Let us remember what the pack was supposed to achieve. In 1998 the Government's stated targets for home buying were to
speed up the process, give greater transparency, and increase certainty. By reducing the fall-through rate, abortive transaction
costs would fall and the whole experience of home buying would become less stressful. How is it that such laudable and simple
goals have been so spectacularly missed? Part of the answer lies in the failure of Government to properly engage with the
property industry to develop the proposals. Ministers would deny it but it was clear to anyone closely involved in dealing
with the HIP proposals that Government policy would override practicality and that 'consultation' was a fig leaf to cover
what had already been decided. The louder the criticism of the pack became, the deeper the Government dug its defences. I
formed an irreverent vision of Yvette Cooper with hands clamped over her ears, stamping her feet and shouting,I'm not listening,
I'm not listening' as her civil servants tried to tell her the pack wouldn't work.
The nature of the HIPs debate dramatically altered when the pack was chosen as the vehicle for delivering Energy Performance
Certificates. To criticise the proposals was now to be not only a 'vested interest' but also to be against measures to combat
climate change. EPC's muddied the waters and conveniently diverted attention away from improving the buying process. Constrained
by the E.U. Directive requiring EPC's to be implemented and in the absence of any other viable delivery mechanism the Home
Information Pack had to be introduced; and never mind whether or not it actually improved the home buying process. In effect
the HIP had been hijacked by Brussels bureaucrats.
Fast forward to the present day. So far as I am aware there have been only two claims for the success of HIPs to date.
One is that search fees have been reduced in some areas. The other is that the pack is responsible for reducing transaction
times by a few days. Forgive the sarcasm if I say I am underwhelmed. Forcing sellers to pay several hundred pounds for a pack
in order that some search fees are shaved by a few tens of pounds doesn't make economic sense and as for the alleged reduced
transaction times, where is the robust statistical evidence,preferably from an independent source rather than the pack providers?
There are those who would like to think that the pack has revolutionised the marketplace. I deal with sellers and buyers
every working day and can say with total certainty that after all the fireworks of the last ten years the pack amounts to
a damp squib. Vendors shrug their shoulders when told they have to pay for the HIP, seeing it as little more than a stealth
tax; applicants never ask to see it before going to view properties; and solicitors, after an offer is accepted, if they ask
for it at all, largely ignore it and get on with taking up enquiries and commissioning Official searches. The Home Information
Pack simply hangs as a useless and expensive albatross around the neck of the property market contributing nothing to transparency,
speed or certainty in the home buying process and failing to alleviate any of the stresses. I know that some agents are now
treating HIPs as a revenue stream but if anyone is having a better experience of the practical effects of the pack on buyers
and sellers I'd be fascinated to hear from them.
The recent consultation by CLG on the proposal to include a Property Information Questionnaire and Leasehold Summary in
the HIP suggests that they have recognised that the pack has failed. In principle the PIQ is a good idea and drawing together
leasehold information early in the selling process is sensible but would it not make more sense to let the PIQ take the place
of the HIP and go back to having buyers commission the searches after acceptance of offer? SPLINTA has proposed this in their
response to the consultation but has also restated that a root and branch reform of home buying is required if we are to obtain
substantial and cost-effective beneficial change. The PIQ, like HIPs, merely tinkers at the edges of the process.
Leaving EPC's out of the equation, if there was an opportunity to go back to the drawing board we should be considering:
· A coherent databank of Land Registry, Local Authority, Utility Company and Environmental Agency information that can
be accessed by a purchaser or their legal advisor at the touch of a button.
· A Review of the current adversarial system of conveyancing leading to a simplification of the process, to the point
of removing 'caveat emptor' and introducing a notarial system of property transfer.
· The development and introduction of e-conveyancing.
· A national protocol for pre-contract deposits to be put down by sellers and purchasers at the time an offer is accepted;
such monies to be applied to abortive costs of either party if one withdraws from the transaction before exchange of contracts.
· A national protocol for binding pre-contract 'lock-out' agreements that restrict a seller's ability to treat with another
buyer after an offer is accepted.
· Buyers to be required to make full disclosure of their finances for purchase at the time an offer is made.
It is worth recalling the words of the 1998 Government research document that spawned the Home Information Pack. It said:
'There is a need to better balance the risks of the transaction between buyer and seller'. I venture to suggest that following
through on the suggestions outlined above would go a long way further in meeting this need than HIPs alone will ever achieve.
SPLINTA - Sellers' Pack Law Is Not The Answer
Every consumer would like the home buying and selling process to be a certain, open and stress free process. The HIP will
not achieve that end because: it cannot deal with human nature; it does not impose any obligation on a buyer to have their
finances in order or be in a position to exchange a contract when an offer is accepted; it does not bar a seller from accepting
a different offer whilst the sale to the first buyer is in progress.
SPLINTA is campaigning for the HIP to be dropped entirely and for government to go back to the drawing board with industry
to create properly beneficial changes to the home buying system. If this is not achieved then we call for the removal of the
restriction on First Day Marketing and for the Energy Performance Certificate to be made a voluntary document up to the point
of exchange of contracts.
___________________________________________________________
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