Sellers Packs To Be A Huge Flop

[laurejon]

The Government's planned home information packs, which it claims will speed up housing transactions and stop money being wasted on surveys, were condemned last night as "expensive, deficient and dangerous".

Home information packs will not need to include information on flood risk or land contamination

The pack, which it is estimated will cost the vendor as much as £1,000, will be compulsory for anyone selling a home after June 1 next year.

If the home is off the market for more than 28 days, the pack will have to be updated, involving more expense.

The scheme's opponents also fear that some people could face bills of many thousands of pounds if they try to sell property without a pack, or HIP.

There will be a fine of £200 a day for any property that is on the market without one, even if it is advertised on a private website or simply by a board in the garden. A Law Society survey last month showed that most people had never heard of the packs.

They will contain a mini survey, called a home condition report, searches and a report detailing the energy efficiency of the building.

However, Nick Salmon, a London estate agent who runs the anti-HIP pressure group Splinta, said that most buyers would still commission their own survey.

"A home condition report paid for by the seller raises conflict of interest issues," he said. "In Denmark, where they have had the packs for 10 years, 80 per cent of buyers have their own survey done."

The Government slipped out details this week of what would be in the packs. It emerged that they would not need to include information on flood risk, natural subsidence, radon gas or land contamination, leading to fears that many people would either not trust the packs or be left without vital knowledge about their prospective homes.

Mr Salmon said there were also fears that there would not be enough inspectors to carry out the home condition reports, because many people who had registered to do the job had not started training.

The job is expected to be popular with retired people and mothers returning to work but, because details about the packs have been so late in coming, many have delayed starting the courses.

Michael Gove, the Conservative spokesman on housing and planning, said the packs would cost nearly £1,000 for a detached home and £800 for a semi, compared with the Government's original estimate of about £600.

"If a sale falls through, sellers face being charged a second time to produce a new pack," he said. "Buyers will still need to purchase additional valuations, especially if, like most first-time buyers, they have a loan-to-value mortgage of 80 per cent or more.

"Their refusal to tell families whether the back gardens will be safe for their children or about potential flood risks delivers a serious blow to the credibility of these so-called information packs. The Government would be better to scrap the scheme than deliver expensive, deficient and dangerous information to potential home-buyers."

Mr Gove's view is shared by many estate agents, who will have to administer the new selling regime.

Jeff Doble, the managing director of Dexters agency, in Teddington, south-west London, said: "I am going to have to put my fees up and I don't like doing that because I don't think this is giving my clients value for money.

"You would be hard pushed to find an estate agent who supports the packs. The Government has not listened to any of the committed people in this industry."

The home condition report section of the pack will expire after six months. If a property is taken off the market for more than 28 days and is then placed back on the market, the pack creation process must start again.

Documents, including searches, cannot be more than three months old when they are created at this "first point of marketing", requiring the seller to pay for a new or updated pack.

The Government has also admitted that the home condition report is likely to replace valuation surveys in only about half of sales in the early stages. Critics say that is a gross underestimation.

If the loan-to-value ratio exceeds 80 per cent - around 40 per cent of cases in which a mortgage is required - a separate valuation is still likely to be required. That would mean most first-time buyers still having to pay for a survey

[astos]

The Government's planned home information packs, which it claims will speed up housing transactions and stop money being wasted on surveys, were condemned last night as "expensive, deficient and dangerous".

Home information packs will not need to include information on flood risk or land contamination

The pack, which it is estimated will cost the vendor as much as £1,000, will be compulsory for anyone selling a home after June 1 next year.

If the home is off the market for more than 28 days, the pack will have to be updated, involving more expense.

The scheme's opponents also fear that some people could face bills of many thousands of pounds if they try to sell property without a pack, or HIP.

There will be a fine of £200 a day for any property that is on the market without one, even if it is advertised on a private website or simply by a board in the garden. A Law Society survey last month showed that most people had never heard of the packs.

They will contain a mini survey, called a home condition report, searches and a report detailing the energy efficiency of the building.

However, Nick Salmon, a London estate agent who runs the anti-HIP pressure group Splinta, said that most buyers would still commission their own survey.

"A home condition report paid for by the seller raises conflict of interest issues," he said. "In Denmark, where they have had the packs for 10 years, 80 per cent of buyers have their own survey done."

The Government slipped out details this week of what would be in the packs. It emerged that they would not need to include information on flood risk, natural subsidence, radon gas or land contamination, leading to fears that many people would either not trust the packs or be left without vital knowledge about their prospective homes.

Mr Salmon said there were also fears that there would not be enough inspectors to carry out the home condition reports, because many people who had registered to do the job had not started training.

The job is expected to be popular with retired people and mothers returning to work but, because details about the packs have been so late in coming, many have delayed starting the courses.

Michael Gove, the Conservative spokesman on housing and planning, said the packs would cost nearly £1,000 for a detached home and £800 for a semi, compared with the Government's original estimate of about £600.

"If a sale falls through, sellers face being charged a second time to produce a new pack," he said. "Buyers will still need to purchase additional valuations, especially if, like most first-time buyers, they have a loan-to-value mortgage of 80 per cent or more.

"Their refusal to tell families whether the back gardens will be safe for their children or about potential flood risks delivers a serious blow to the credibility of these so-called information packs. The Government would be better to scrap the scheme than deliver expensive, deficient and dangerous information to potential home-buyers."

Mr Gove's view is shared by many estate agents, who will have to administer the new selling regime.

Jeff Doble, the managing director of Dexters agency, in Teddington, south-west London, said: "I am going to have to put my fees up and I don't like doing that because I don't think this is giving my clients value for money.

"You would be hard pushed to find an estate agent who supports the packs. The Government has not listened to any of the committed people in this industry."

The home condition report section of the pack will expire after six months. If a property is taken off the market for more than 28 days and is then placed back on the market, the pack creation process must start again.

Documents, including searches, cannot be more than three months old when they are created at this "first point of marketing", requiring the seller to pay for a new or updated pack.

The Government has also admitted that the home condition report is likely to replace valuation surveys in only about half of sales in the early stages. Critics say that is a gross underestimation.

If the loan-to-value ratio exceeds 80 per cent - around 40 per cent of cases in which a mortgage is required - a separate valuation is still likely to be required. That would mean most first-time buyers still having to pay for a survey

The government will not abolish these packs.

This is why,

The government will benifit from a potential £110m VAT windfal from the packs and the home condition register could be used to conduct a council tax revaluation by stealth.l

[Rain'ard]

That’s wrong that bit of news L J IMHO

It will be illegal to withhold any negative knowledge in HIPs

Any profit my by the transaction will prosecuted under the proceeds of Crime Act.

I will be pleased to be corrected by any Lawyer on the board.

The government will not abolish these packs.

This is why,

The government will benifit from a potential £110m VAT windfal from the packs and the home condition register could be used to conduct a council tax revaluation by stealth.l

I think they’re a great idea. Kirsty Alslops is against them so I’m all for them.

I will at least stop greedy sellers trying it on if it’s going to cost them.

[brassfarthing]

EAs are much lambasted on this board for being "vested interests" in HPI. They are also VIs in their opposition to HIPS.

EAs aren't keen on HIPS because they fear it will reduce the number of properties coming onto the market, as the timewasters (people who get valuations and put their houses on the market just to 'test the water' even when they have no intention of selling) will be put off.

Good thing too.

And if packs only have a shelf life of 6 months, that's even better as sellers and EAs will have to price houses reasonably to maximise their chances of a sale. This should be good news for prospective purchasers.

I'm a VI myself here in a way, as TWICE in the past as a buyer I've wasted £500 on surveys only for the sale to fall through. All this means is that the next buyer comes along and pays the same for the same survey. It's a mad system.

Flood plain information? Do me a favour, Gove. You can find this information within a minute on the web. As for sellers not telling you whether the garden is safe for your children to play in? That is nanny-ism gone bonkers. Open your eyes and have a look for heaven's sake!!

The government will not abolish these packs.

This is why,

The government will benifit from a potential £110m VAT windfal from the packs and the home condition register could be used to conduct a council tax revaluation by stealth.l

VAT is charged on surveys at the moment, which HIPS will largely replace!

[backtoparents]

1. Which paper?

2. I'm having a little trouble working out precisely who has condemned the packs. Is it the lawyers who will lose out on conveyancing work? The EAs who will see some collapse in their worth? Or the Tories who will oppose anything to embarass the government?

HIPS = Death To Kite Flyers.

Bring it on!

btp

[cupidstunt]

1. Which paper?

2. I'm having a little trouble working out precisely who has condemned the packs. Is it the lawyers who will lose out on conveyancing work? The EAs who will see some collapse in their worth? Or the Tories who will oppose anything to embarass the government?

HIPS = Death To Kite Flyers.

Bring it on!

btp

Torygraph - they've got a lot of there facts wrong!

http://www.telegraph.co.uk/news/main.jhtml.../nhousepk17.xml

[astos]

VAT is charged on surveys at the moment, which HIPS will largely replace!

When HIPS were introduced in Denmark, 80% of buyers still paid for a survey. So VAT on both!

[tomr]

When HIPS were introduced in Denmark, 80% of buyers still paid for a survey. So VAT on both!

Won't the extra £1000 just come off the sale price? I suppose the VAT on £1000 is more than the SD.

[cupidstunt]

There are still a large number of sellers who are "economical with the truth" when it comes to selling their property. They know the obvious problems with thier homes but won't tell prospective purchasers 'cause their house is worth what their asking for it! They're quite prepared to let prospective purchasers waste hundreds of pounds to get a survey. Of course these same people would be appalled if someone did it to them! HIP's will stop all this nonsense.

As an aside I think the inroduction of HIP's could cause a dramatic slide in House prices. I f we get the prdicted rises in IR's this will slow down the "market" With depressed prices, people will rush to put their homes on the market to beat the HIP's deadline. With a glut of properties and more rising IR's it can ony mean one thing!

[brassfarthing]

When HIPS were introduced in Denmark, 80% of buyers still paid for a survey. So VAT on both!

I keep hearing about what happened in Denmark, with no information at all about how their sellers packs compared to the British plan. It's really simple: if 80% of the people don't trust the sellers pack then the sellers pack is presumably no good. So make them better. Is that what they did in Denmark? Was the 80% figure repeated in the second year? Information please!

If the HIPS are thorough, and backed by stiff legal sanctions against misleading info, then people shouldn't ned to get a buyer's survey.

And what if they do? Supposing that you see a few properties but this time you have the benefit of a sellers pack. Won't it help you to filter out the dodgy ones BEFORE you put in an offer and finance a survey of your own? In that way, HIPS are already performing a valuable service. If you then wanted to go ahead and get a further report done you're free to do so but the chances of getting knocked back at this stage (as I have been twice) are greatly reduced.

This is a good development for buyers, and as such, should be welcomed by people keen to get on the housing ladder.

[Robbrent]

EAs aren't keen on HIPS because they fear it will reduce the number of properties coming onto the market, as the timewasters (people who get valuations and put their houses on the market just to 'test the water' even when they have no intention of selling) will be put off.

I admit it I have a Vi (I am doing the the qualifacation) but I know plenty of EA's who are relishing the introdution of HIP's.

It's not like the Torygraph to get it's facts wrong,

[brassfarthing]

There are still a large number of sellers who are "economical with the truth" when it comes to selling their property. They know the obvious problems with thier homes but won't tell prospective purchasers 'cause their house is worth what their asking for it! They're quite prepared to let prospective purchasers waste hundreds of pounds to get a survey. Of course these same people would be appalled if someone did it to them! HIP's will stop all this nonsense.

As an aside I think the inroduction of HIP's could cause a dramatic slide in House prices. I f we get the prdicted rises in IR's this will slow down the "market" With depressed prices, people will rush to put their homes on the market to beat the HIP's deadline. With a glut of properties and more rising IR's it can ony mean one thing!

I agree totally with your first paragraph.

I don't agree with the second. Or at least, I think it's very unpredictable whether ther'll be a rush to beat the HIPS deadline or not. If people are serious about selling they might even welcome the HIPS as a vluable marketing tool. The 3 occasions I've sold a property, given the price of a house, I've been disappointed about how little impact on a prospective purchase the EA blurb alone has.

[CrashConnoisseur]

The government will benifit from a potential £110m VAT windfal from the packs and the home condition register could be used to conduct a council tax revaluation by stealth. [astos]

The latter perhaps, but the VAT's not that significant. I suspect the main reason is the usual neo-Stalinist drive to micro-manage our lives.

EAs are much lambasted on this board for being "vested interests" in HPI. They are also VIs in their opposition to HIPS.

EAs aren't keen on HIPS because they fear it will reduce the number of properties coming onto the market, as the timewasters (people who get valuations and put their houses on the market just to 'test the water' even when they have no intention of selling) will be put off. [brassfarthing]

Huh? In general, Estate Agents only get paid when a property is sold. So-called "timewasters" would cost the EA money in making valuations and advertising for no return.

1. If HIPs were a good idea they would not need to be compulsory. Sellers would want to have them done to help sell their property and buyers would have a choice.

2. If HIPs were going to save us money there would be no need to recruit many thousands of additional inspectors and support staff -- all of whom will have to be paid for.

[CrashConnoisseur]

Duplicate post due to forum glitch -- caused by adverts?

Edited June 17, 2006 by Jeff Ross

[geneer]

flop or not To quote jeff wayne....."yet still theyyyyyyyyyy come!"