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How Will New Hips Rules Affect The Market?


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HOLA441

My son was advised not to take his flat off the market and then reconsider selling later as the new hips rules come in then. Is this going to have a significant impact?

Are they available now? are they any use?

Or will they just be an additional problem when selling a house?

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HOLA442
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HOLA443
My son was advised not to take his flat off the market and then reconsider selling later as the new hips rules come in then. Is this going to have a significant impact?

Are they available now? are they any use?

Or will they just be an additional problem when selling a house?

You can get a fairly clear idea of what the changes are from:

Business Link: government guide to new HIPs rules

One technically big change largely affects EAs - the HIPs must be ready before a property is marketed. This means that the current situation, where you can put the house on the market and say, "HIP will be ready in a fortnight - more or less" will no longer hold. HIP first, advertising on Rightmove only when it's ready.

Second change is that vendors will now have to compete a "Property Information Questionnaire", cutely called a PIQ, which will be included in the HIP.

The PIQ is going to be a pain to fill in - all the details of any major work you've done to the house (repairs, new boiler, attic conversion etc et bloody cetera) together with an assurance that all the documentation for planning permission, tradesmen's guarantees (dpc, double glazing etc) and so on are available. And lot and lots of other stuff about drainage and so on all have to be spelled out.

It's really tedious stuff, BUT it looks to be almost the same as the forms which our solicitor made us fill out when we were selling the house, so you'll have to do the job anyway, if you get a sale. This way a potential buyer can see if you've got a Right of Way going over the land before he makes a bid. I approve in principle - as a potential buyer I can see that this could be useful stuff, but it is one more chore you have to do before you know if you're getting a sale.

EAs hate HIPs - they give away all sorts of info which EAs would rather you remained in ignorance. The most recent HIP I looked at revealed that the property is leasehold, which was not mentioned anywhere in the EA's literature!

You can see a sample PIQ, and more detail at the website linked above.

db

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HOLA444
I think the general idea is

Stay right where you are

Nobody moves

Nobody leaves

Now give us all your money

Oh crikey! You are as cynical as I am!

The HIPS fiasco was, well, a fiasco! It is indeed an un-necessary charge for entering the "free market"!

Surely people have surveys done anyway!

Why would you not?

P

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HOLA445
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HOLA446
Yet another stupid idea. Why on earth don't they just scrap HIP both old and new?

Crickey, I'm going to risk life and limb and completely agree with sibley :blink:

HIP was a complete waste of time and money, because there is no legal obligation attached to a survey, mortgage lenders wont accept them unless carried out by thier own 'approved' surveyors. I dont know of anyone who had there HIP survey accepted by a mortgage company.

The searches are a waste of time because by the time you come to sell there are either too old to be accepted or your solicitor will insist on doing them again as this is a nice little earner for them in the conveyancing scam.

And the energy rating crap is just completely bizarre.

What the property market needs is a fundamental change in the law, in that an agreement between a seller and a buyer to exechange a property for X amount is legally binding by both parties at the time of offer and acceptance, subject of course to satisfactory surveys and searches.

The scurge and pain in house selling/buying are the practices of gazumping and renegotiating the price down just before exchange.

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HOLA447

I think people have got used to the idea of HIPS so there will not be a big change although what HIPS did do was stop people advertising with EAs just to 'test the market'.

Two other Brown knee-jerk initatives and how they might affect the market:

Stamp duty changes - the current higher threshold reverts in the Autumn. Will we see a rush of FTBs just before then to benefit from the lower tax? This happened when the Government changed MIRAS and helped precipitate the last bubble bursts.

Then we have the 25% Government-financed equity on new builds. Presumably the money for that is running out?

To be honest, I haven't a clue what these might do, but I imagine the market will continue down for a long time to come, either quickly or slowly, until it hits the 40% plus off peak.

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HOLA448
My son was advised not to take his flat off the market and then reconsider selling later as the new hips rules come in then. Is this going to have a significant impact?

It's probably clear the way for VIs to trot out the old "this has caused the crash, not unaffordable prices!" line.

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HOLA449
doing them again as this is a nice little earner for them in the conveyancing scam.

My solicitor, a conveyancing specialist (Browns, actually in Buckinghamshire)

charges a flat rate of £250 - no sale, no fee.

They do it in very quick time, faster (on the three occasions I have used them)

than the opposite parties.

I have no objection to this fee.

What irritates me beyond word is the EA fee, which is not only exorbitant for

what I get, but is the nail in the coffin of many a little property project profit.

That extra £2,000 - £4,000 fee makes all the difference to doing, or not doing,

a project.

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HOLA4410

Out of the many houses we looked at, including the one we bought, I never once looked at, or even asked to look at the hip.

I dont even know if we have one................... or care.

They are the equivalent to tyre kicking when buying a car.

Edited by Boomer!
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HOLA4411
Out of the many houses we looked at, including the one we bought, I never once looked at, or even asked to look at the hip.

I dont even know if we have one................... or care.

They are the equivalent to tyre kicking when buying a car.

I was just thinking that. I've viewed about 15 houses this year and I've never been offered a HIP by the agent. I realise that the onus is probably on me to ask, but really, when should one be asking? Prior to viewing? Before deciding on an offer? Once an offer is accepted? I don't really understand how it was intended to work.

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HOLA4412

Ask when you arrange the viewing. I've had a few emailed to me, some available online and some just haven't been done after 6 months of being on the market. If that's the case you're the first person to look at the property.

:)

I think we should all be asking to see the HIPs. That way it'll get reluntant sellers financially committee to selling or at least staying on the market (They have to stay marketing the property for it to stay valid)

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HOLA4413

The thing I find annoying about HIPs is the upfront and potentially wasted expense if you decide not to sell a place.

Several times I have been in a position where we have wavered between selling a house and letting it. It is annoying to have to spend a chunk of money on a HIP and then find a tenant more quickly than a buyer, at which point its wasted.

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HOLA4414

Amazing...the English really do respect the law even if it's an ass

IGNORE the damn law...what are they gonna do? Will the OFT invoke anti-terror laws?

Can you imagine the Greeks or Italians or the Spanish getting so worried?

Another reason to sell privately.

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HOLA4415

I know HIPS are a complete pain and makes putting a property on the market to " just see" , expensive. And I agree even with the searches etc solicitors like to do their own and I can understand why. However, I think there is ONE advantage for a buyer (although I am sure most buyers haven't a clue what a HIP is), you can look at the HIP before putting in an offer or having to pay a solicitor and see if there are any obvious problems with the searches, and having the sellers property info form (or the equivalent) in the HIP you can also see if there has been planning / building regs etc gained for improvements / lofts etc. This is useful, if the seller does not have these in place they are not only expensive for the seller to obtain but also TAKE AGES. These things are good to find out before you start the process with a solicitor and start paying. And I suppose with the sellers form included that also saves time for the solicitor, normally they get sent out after offers are accepted and can take ages to get filled in etc.. I think loads are going to come unstuck with the newish building regs and planning. Lofts are a nightmare, building regs are strict, every ceiling in the house should be fireproofed, all doors fire doors, has to have a fixed ladder or stairs, and now all sorts of regulations on ventilation which can mean the roof coming off. I know you can get indemnity insurance but building regs unlike planning and the old 10 year (?) rule, that is if you can get away with it for 10 years you are in the clear, building regs go on for ever so as a buyer if these things have not been done you are liable not only for the work needed but the cost of retro building / planning and just one plan to support your application will cost you £10000. So it is useful for the buyer to know these things from the start

Edited by Sybil13
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HOLA4416
Amazing...the English really do respect the law even if it's an ass

IGNORE the damn law...what are they gonna do? Will the OFT invoke anti-terror laws?

Can you imagine the Greeks or Italians or the Spanish getting so worried?

Another reason to sell privately.

in which case you will still need to provide a HIP.

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HOLA4417
I think people have got used to the idea of HIPS so there will not be a big change although what HIPS did do was stop people advertising with EAs just to 'test the market'.

Two other Brown knee-jerk initatives and how they might affect the market:

Stamp duty changes - the current higher threshold reverts in the Autumn. Will we see a rush of FTBs just before then to benefit from the lower tax? This happened when the Government changed MIRAS and helped precipitate the last bubble bursts.

Then we have the 25% Government-financed equity on new builds. Presumably the money for that is running out?

To be honest, I haven't a clue what these might do, but I imagine the market will continue down for a long time to come, either quickly or slowly, until it hits the 40% plus off peak.

Can't see there being a rush of FTB's in the Autumn unless prices have finally fallen in line with lending levels, Council of Mortgage lenders have said the average FTB's mortgage is at 3x's loan to income, that is 50% down on the 2007 average of nearly 6x's.

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HOLA4418
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HOLA4419
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HOLA4420
Yet another stupid idea. Why on earth don't they just scrap HIP both old and new?

Well said, whooooooooopeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee!

I like it when you make sense

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HOLA4421
In principle, I think HIPS (and the EPC) are great - a house is a major purchase for most people and a better informed buyer can only be a good thing. It may be hassle upfront for the seller but will probably lead to more robust chains.

I can see why EAs don't like them (in any sales situation Knowledge=Power) but they would seem to be good news for buyer and seller? (unless the seller is trying to hide something). If you are selling a quality, well-maintained home then HIPs should act as a differentiator.

I agree. They DO have the potential to save the buyer going a long way down the road before discovering some important fact. But if people just take the dreary 'HIPs are a waste of time' mantra at face value and don't actually ask to see it before engaging a solicitor, then the HIP is not going to help them. But in that case, it is not the HIP which is failing.

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HOLA4422
Yet another stupid idea. Why on earth don't they just scrap HIP both old and new?

Because if they are done right, they save a buyer from going ahead and later discovering some factor which throws the deal. This helps the seller too, in that he does not waste say 3 months on a deal which will collapse when some fact comes to light.

[:rolleyes::rolleyes: Of course, if you think house prices are going up, it could help the seller]

Edited by D Vardy's Shadow
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HOLA4423
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HOLA4424
Because if they are done right, they save a buyer from going ahead and later discovering some factor which throws the deal. This helps the seller too, in that he does not waste say 3 months on a deal which will collapse when some fact comes to light.

[ :rolleyes::rolleyes: Of course, if you think house prices are going up, it could help the seller]

waste of time. the buyer cant rely on it, the process of buying is unchanged and the whole thing was a sham.

could have been good...a complete buyers pack...but no. another Nulab failure.

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HOLA4425
Yet another stupid idea. Why on earth don't they just scrap HIP both old and new?

I like the HIP. I am interested in energy efficiency particularly. I really think they should include a full survey too.

I know that property flippers and estate agents hate them but I don't think that should be a reason not to give people information about the biggest purchase of their lives. House buying is a daunting process for many that is made worse by the average estate agent trying to push you into long term financial commitments based on little thought about your long term ability to pay. They hate HIPs because it gives people information. Information means thought and thought means less certainty for the agent.

Granted, the information isn't up to much at the moment but over time with more details included the HIPS will become useful.

In principle Sibley do you think that more information about the house you are buying is a good thing? If so, then you'll agree that some form of HIP is a good idea.

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