View more on these topics

Hip operation

The Government is pressing ahead with the controversial home information packs.

The legislation for the long-running Housing Bill is due to be fully implemented by 2007 but the majority of the general public and even many people within the industry remain unaware of the consequences of the bill for the housebuying and selling process.

Probably the most significant aspect of the Bill for the housing market is Part V, referring to the introduction of home information packs.

First ushered in by the Government in 1998 as sellers’ packs, the original proposals failed twice to make it to the statute book, leading to the Government’s determination that, this time round, the rejuvenated and renamed home information packs (Hips) will make it into law.

The journey has not been without hitches and the granting of royal assent by no means indicates the end of the road for those pushing for changes to the proposals.

National Association of Estate Agents chief executive Peter Bolton King has been actively lobbying on the bill throughout its passage through Parliament. He says: “The main concern of our 10,000 members across the UK is to maintain consumer rights and a healthy market. We are concerned that Hips will restrict activity and increase delays and costs for those selling or buying a property.

“We have been working particularly hard to maintain the right to day one marketing.At present, for someone selling their home, the estate agent is able to start actively promoting it straight away, for example, by placing a picture in the local paper or contacting potential buyers from their database.

However, under the new proposals, this marketing will have to wait until a Hip has been prepared – a process that could take several weeks. By remaining inflexible on this, the Government is taking away a historic consumer right.”

The NAEA-backed amendment to allow agents to start marketing properties while a Hip is being prepared was defeated at the final stage in the House of Lords but the association remains optimistic.

Bolton King says: “Obviously, we are disappointed that these proposals will be going through without major amendments. It was particularly frustrating that the Liberal Democrats failed to take the opportunity to stand up for the rights of consumers when it really mattered. They had consistently spoken in favour of retaining day one marketing yet chose not to support the amendment which would have allowed a period of 14 days between marketing and a Hip being made available.

“However, we did achieve significant concessions from the Government to enable continuous scrutiny of the proposals as they are being developed. In particular, we welcome the news that there will be a full national pilot scheme prior to the introduction of any compulsory scheme. Our organisation will be involved in overseeing this pilot as part of the industry stakeholder group and this will offer us further opportunities to ensure that the bill achieves its fundamental aim of imp-roving the housebuying and selling process for consumers.”

Paul Smith, chief executive of Spicerhaart, the UK’s biggest estate agency group, is pleased to see the bill finally passed but remains cautious about the details of the pilot scheme. He says: “Having test-run home information packs in our own branches, we share the Government’s view that, in theory, the packs will help the homebuyer. However, details of how the packs will be tested and implemented remain very unclear. The significant costs of producing packs make it hard to see who will volunteer for the Government’s proposed pilot scheme in 2006.”

>From its own trials, Spicerhaart views current estimates of a 600 cost to the seller to produce a pack as an under-estimate. It reckons the real cost is more likely to be closer to 1,000 and, with an estimated shelf-life of six to 12 months, sellers may have to pay again for a second inspection if their property does not sell. For lower-income families, this could mean having to borrow money just to put your house on the market.

Smith says: “Only a compulsory Govern-ment-funded scheme will properly test the marketplace and enable the industry to iron-out all the issues associated with home information packs so they meet the Government’s aim of speeding up the home buying and selling process.”

Leading mortgage conveyancer Homefast is optimistic about the changes for the mortgage industry. Managing director John Brian says: “We believe that most aspects of home information packs can and should be introduced before the suggested 2007 regulation changes. Anything that speeds up the conveyancing and remortgage processing can only be positive and can only help the consumer as well as the mortgage industry.”

The next stage for the Housing Bill will be drawing up the secondary legislation in mid-2005. The national voluntary trial is set to take place in the second half of 2006 before the compulsory trial and the legislation will come into effect in 2007.

Significantly, the Government added a clause at the last minute to give the Secretary of State the power to suspend Hips in the light of any future difficulties.

Bolton King says: “This at least provides an assurance that if real problems arise from the introduction of Hips, any future Government has the ability to take immediate action -a pledge that the Conservatives have already made should they win the next election.”

In the meantime, there is still time for the industry and the public to get used to the proposals and for those concerned about the current proposals to try to bring about the changes they feel are very much needed.


Hatch quits after split at Penrose

Penrose Financial Public Relations founding partner Louise Hatch has left the group following a series of boardroom disagreements.

Sesame leads our Super League

Sesame is ranked the highest-earning IFA company, according to IMAS Corporate Advisers’ latest research.

Network Edge: John Hayden

Choosing the right network first time will prove the most cost-effective choice in the long term. Stick with well-established ones and be wary of fringe operators who come into the market without the resources to carry on.

Tom Baigrie on protection

How many times have you had to make a call or arrange a new meeting with a client to tell them of an unexpected loading, exclusion or decline? The way to avoid it is to set their expectations properly at outset you have to know quite a lot about underwriting.


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm