THE introduction of home information packs in under a fortnight is still in doubt, despite the defeat of an eleventh-hour attempt by the Conservatives to derail the scheme. The Hip now faces a further challenge, this time in the courts. The Royal Institution of Chartered Surveyors (RICS) is taking Communities and Local Government (CLG) to the High Court next week, claiming that the department failed to carry out proper consultation on the Hip legislation. But homeowners are well advised to prepare themselves for the introduction of the scheme, which the Government still insists will go ahead as planned on June 1. From that date, anyone selling a home must provide prospective purchasers with a Hip, containing documents such as searches and an energy performance certificate.

The Government, which promised to reform homebuying and selling when it took office a decade ago, is determined to bring the current process up to date. An estimated one in four transactions fails between offer and exchange, costing buyers thousands of pounds in wasted surveys and legal fees.

The pack, by providing key legal details in advance, should knock weeks off the house purchase process and reduce significantly instances of failed transactions, especially those that involve gazumping. Those in favour of the plans – such as the Association of Home Information Pack Providers – still insist that they will reduce wasted costs and duplicated information-gathering.

But criticism of the plans has been fierce. Critics of the packs, such as RICS, the Law Society and Which?, fear that, far from easing problems in the housing market, the scheme will simply increase the amount of red tape involved in moving home and will cause the number of properties coming to market to fall. A severe shortage of properties on the market has pushed up house prices this year; while there are signs that some buyers are rushing to market ahead of the impending deadline for the launch of Hips, supply remains tight – and may well worsen if confusion over the introduction of the scheme is not resolved.

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Background

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• Home Information Packs (HIPs) - Q&A

• Legal challenge to Home Information Packs

Whether or not you believe Hips are a good idea, they are likely soon to be a reality. If you are planning to sell your home, you are going to have to get one – or move very fast, because in just two weeks’ time, on June 1, the Hip will become mandatory in England and Wales.

What is a home information pack?

HIPs, or seller’s packs, contain much of the information that have traditionally been gathered by a prospective purchaser’s solicitor or conveyancer over the course of a house purchase. HIPs must include: terms of sale, evidence of title, a property information form, a fixtures and fittings form, planning consents, replies to standard searches and an energy performance certificate (EPC). HIPs can also include a home condition report (HCR) which is similar to a survey, although these are no longer mandatory.

What about leasehold properties?

HIPs for leasehold properties must contain some additional information, including a copy of lease, details of service charges and regulations made by the landlord or management company. Some property experts say that the demands made of leaseholders could be problematic. “HIPs require owners to provide details of service charge accounts for the last three years, and requests for payments for the last 12 months,” says Roger Southam, chief executive of Chainbow, the residential property management firm. “But managing agents – the people who collect service charges and manage the upkeep of developments – are not legally obliged to give leaseholder the information they need.” Mr Southam believes that leaseholders will be “seriously disadvantaged” by the introduction of HIPs. “They will create delays and render some properties unsellable,” he says.

What is an energy performance certificate?

This is a new innovation and will form the main part of the HIP. The EPC should give prospective buyers an idea of how energy efficient the property will be and – it is hoped – should encourage sellers to make carry out repairs such as replacing window frames or insulating the loft in order to make sure that they get a better score and a quicker sale. The EPC will contain details of the property’s size, its average energy use per square metre, its carbon dioxide emissions, and an estimation of how much it costs to provide heat, light and water for the property.

EPCs will be issued by qualified energy assessors, but there are serious doubts as to whether there will be enough trained assessors ready to start work on June 1. While the Association of Home Information Pack Providers (AHIPP) claims that more than 3,500 trained and accredited operatives by June 1, Yvette Cooper, the Housing Minister, has admitted that just 1,902 energy assessors and home inspectors had passed the relevant exams by May 3.

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