Introducing the HIP
Latest news: Delay in launch
Home Information Packs were due to launch in England and Wales on 1st June 2007. However, on 22nd May the government reacted to increasing pressure from the property industry and delayed their launch until 1st August, when there will be a phased introduction. HIPs will be launched initially with properties that have four bedrooms or more. Initial sellers will also only be required to have commissioned, rather than completed a pack before they put their property on the market.
The reason cited for the delay is a lack of accredited energy assessors who will be needed to produce the required energy performance certificate. The government ruled out launching HIPS with no energy performance certificates.
What are Home Information Packs?
Home Information Packs, or HIPs, are a set of documents that a seller prepares about their property. Traditionally, each prospective buyer would have to collect much of this information themselves. By placing the onus for this on the seller the idea is that the home buying process will be speeded up and fewer sales will fall through.
There has been considerable debate as to whether they will work. A fundamental part of the pack, the Home Condition Report, designed to replace the surveys that buyers carry out, was dropped from the original proposals.
The typical cost of a Home Information Pack is expected to be around £500. If you take your home off the market and then remarket it within a year, then you can still use the initial pack that was created for you.
Some estate agents are offering free Home Information Packs if you sign up for their services. In these instances it’s worth checking the small print for any charges that apply should you wish to change estate agents at a later date.
There are five compulsory documents that each Home Information Pack must contain. In addition to the compulsory documents, there are also optional extra such as the Home Condition Report (referred to above), a legal summary and other details about the home and its contents.
The five compulsory documents are summarised below.
Index
The index is simply a list of what each Home Information Pack contains and, if necessary, it should contain an explanation of why any of the compulsory elements is missing.
Energy Performance Certificate
This is a new development which consists of a report on the energy efficiency of the home being sold. A current rating of A to G will be assigned by a Domestic Energy Assessor (A being the best and G the worst).
Most homes are expected to be either a D or an E. A potential energy efficiency rating will also be included, as well the steps required to achieve that rating.
Sale statement
The sale statement contains basic address details and whether the property is freehold, leasehold or commonhold.
Standard searches
This area of the pack contains information such as the local land charges register, planning details, road building proposals and details of water and drainage services.
Evidence of title
Relevant title details from the Land Registry form the last component of the pack.