Stand Attachment Pack
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Myths of Home Information Packs (HIP)
Home Information Packs (HIP) are becoming more widely accepted since the first date of implementation. However, with the Home Information Pack’s existence also comes some fallacies and myths which have been attached to them. Due to this we have decided to look at a selection of some commonly held misconceptions and some of the more unusual ones we have come across.
1. HIP stands for and is an abbreviation for Home Improvement Pack.
This a common mistake many make and one can certainly be forgiven for holding this belief. This error was recently made by the Communities and Local Government (CLG) when publishing a guidance document on Home Information Packs within their website. It has since been rectified.
2. A HIP only last for 12 months and then it must be renewed.
As long as the property is continually marketed (this does not have to be via the same agent) the HIP remains valid.
3. If my property doesn’t sell I do not have to pay for the Home Information Pack.
There are various payment options available when purchasing your Home Information Pack; including an upfront payment and quite often a deferred payment option. With both of these payment options you will ultimately need to pay for your Home Information Pack whether your property sells or you choose to take your house off the market.
There has recently been promotion of a ‘no sale, no fee HIP’ which does potentially mean if your property does not sell you may not have to pay. However, there is a large extra cost implication involved and quite complex terms and conditions attached to this payment option. Some terms related to this option dictates the pricing of your property in a falling market. Please read these terms and conditions carefully before entering to such an agreement
4. Home Information Packs are an increased cost in the buying and selling process.
It is true if you are selling a property without buying a property there is a ‘new’ cost in the selling process though this should not translate into large increased overall costs. However, if you are buying and also selling a property as is the ‘normal’ transaction, Home Information Packs costs negate themselves between the buyer and seller.
Due to the new Home Information Pack legislation organisations have been forced to streamline their operations in a slowing property market often reducing their costs which have ultimately been passed on to the end consumer. For e.g. search companies and local authorities have had pressure applied to reduce their costs to the consumer and also to increase their speed and efficiency returning information requested. This a direct result of Home Information Pack legislation.
5. Home Information Packs duplicate the work my solicitor will do, so I will pay twice.
The Home Information Pack provides official documentation which has always been required when selling your property for e.g. Land Registry documentation and the water & drainage search. There is no reason for this information to be supplied twice and the main difference it is now supplied at the start of the home buying and selling process.
You may be asked by your conveyance to pay for regional specific searches such as a Coal Mining Search in addition to the mandatory search provided within the HIP. If you prefer you can quite routinely order these ‘extra’ searches via your HIP provider.
Many conveyancers have reduced their costs associated with the buying and selling process due to the Home Information Pack being immediately available as this has reduced the time they required; though some, not surprisingly have not.
6. Home Information Packs are added bureaucracy and do not hold any importance.
We have often read and hear that the only document contained within the HIP of any interest to the buyer is the Energy Performance Certificate. The EPC shows good relevant information in a user friendly format the energy efficiency of the property.
Whilst there are plans to increase the added ‘usefulness’ of the information to the prospective buyer through various methods including the Property Information Questionnaire; the existing documents importance must not be disregarded. As stated above many of the documents within the Home Information Pack have always been required and considered essential by conveyancers though may not make particularly interesting reading to the home buyer.
7. Home Information Packs must be bought via an estate agent
Estate agents can arrange your Home Information Pack quite routinely on behalf of you, though it is quite unlikely that they are preparing the documentation in-house. Most agents have connections with a specialist provider who will prepare the Home Information Pack.
As is common, not just in this market; going direct and commissioning a Home Information Pack direct from a HIP provider may save you money.
8. The HIP doesn’t need to be completed until I have accepted an offer.
This statement is contrary to one of the main concepts of the HIP i.e. having the required information prepared to enable a smooth buying and selling process to take place therefore speeding up the process. Only completing the HIP once an offer has been accepted returns us to the position we were in prior to HIPs introduction with unexpected delays that can easily hold the sale up.
The time taken from ordering of your HIP to competition should generally be no more than 5-10 days and this is a question that should be asked of your prospective HIP provider.
9. HIPS are the reason the UK housing market has slowed down.
This is a myth that we felt must include but it is hard to find words for such a far fetched concept. How can Home Information Pack documentation which commonly costs £250 -£400 and provides useful required and essential information in the property buying and selling process cause such a slow down in the UK Property market?
10. Every property now requires a HIP if it is to be marketed.
Whilst it is true that the initial roll out of the HIP legislation via number of bedrooms has been completed i.e. number of bedrooms does no longer determine whether a property requires a HIP; there are still some HIP exclusions. For e.g. a private, non-marketed sale and mixed use properties remain exempt from requiring a HIP. More reading on Home Information Pack exclusions can be found here.
About the Author
HIP-Consultant.co.uk are a specialist HIP and EPC provider. For more information, article and Home Information Packs and Energy Performance Certificate provision please feel free to visit our website.
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