Never-ending story

Home Information Packs have been a feature of the Government’s housing agenda for the best part of 11 years, yet it is questionable whether it is any closer to achieving its objective of streamlining the UK house buying process. Clare Bettelley examines the stumbling blocks in the way of HIPs’ future success.

Connells’ conveyancing services director, Roger Wilson, describes Home Information Packs as “a glossy compendium of documents that no-one looks at”, which is a widely held view in the estate agency market.

So, the Government’s challenge is not only to transform HIPs into the comprehensive sellers’ guide they were designed to be, but simultaneously transform the mindset of industry players, to help achieve this goal. But the industry has had little incentive to engage in the packs, given the Government’s comedy of errors in rolling them out.

Former shadow environment secretary Frank Dobson first mooted the idea of a seller’s pack in his report, No To Gazumping, prior to the 1997 general election.Three housing ministers, several U-turns and an Opposition anti-HIP campaign launch later, and HIPs continue to simmer on the political backburner.

Labour’s recent battering in the local elections is arguably the major stumbling block for HIPs – a government fearing a thrashing at the polls in 2010 is clearly reluctant to make the tough decisions required to enable HIPs to reach their full potential, regardless of how desperately needed these are. Third parties’ vested interests in the delivery of HIPs is compounding the problem, particularly where local searches are concerned.

Local authorities and lawyers have been criticised for their approach to the delivery of the packs, the former for restricting access to search data, with the latter seemingly shying away from accepting a large number of searches for fear of putting their name to sub-standard data.

So, is the HIP here to stay and if yes, how will it be developed and, most importantly, by whom? Will it be legislation that forces the hand of progress or will the luxury of a free market suffice? Conservative U-turn Ironically, having invested much of its political energy lambasting HIPs, the Torries’ position on them is now closer to Labour’s than one might think. The Tories have made no secret of their plan to scrap HIPs if they are voted into power in 2010 - a move that is understood to cost the UK economy around £300m. But the Tories’ threat is misleading. Grant Schapps, shadow housing minister says: “When we said we’re going to scrap HIPs, we’re going to scrap the shell around the Energy Performance Certificate, and so EPCs will continue. I think breaking them out of the HIP will actually get them promoted quicker. “I don’t want to throw the baby out of the bath water and get rid of things, which have improved and if, for example, there have been some positive spin offs, which I’m sure there have been, then clearly a future incoming government would be mad to do away with anything that has been helpful. “ He adds: “There’s no dogma about this whole thing at all as far as I’m concerned. We simply think that it ought to be faster and easier and less stressful to buy and sell a house.” This seems to suggest the Tories consider HIPs a step in the right direction, in terms of simplifying and speeding up the house buying process, so it thus seems logical to assume that HIPs are here to stay in one guise or another.

HIPs were introduced in the 2004 Housing Act, to improve the house buying process and minimize the number of transactions that fall through by providing buyers with comprehensive information about their prospective home. But what we now have is something quite different. For a start, their target audience has shifted; rather than being a helpful property manual for prospective buyers, it has essentially become a lawyer’s pack, with the majority of estate agents claiming that clients have taken little, if any, interest in their content.

Part of the problem seems to be their name, which has clearly been sullied by all the political wrangling. Mike Ockenden, director general of the Association of Home Information Pack Providers says: “The reason I don’t like the word anymore is because it’ has got political connotations and emotional connotations; it has got stigma.” “The idea of information upfront, which is essentially what it is, is the right one, so let us call it the buyer’s information dossier, or something that doesn’t evoke this emotion.” Slow burner Despite the connotations of the pack’s name, Ockenden insists that they have already achieved positive results. He says: “The inconvenient truths are that we know that transactions are getting to completion quicker, average cost of local authority searches have reduced by £35 since HIPs were introduced and speed to market has improved. We also know that leaseholder information collection is getting more attention now than it ever has done in the past. “The fact is that HIPs are enshrined in primary legislation whether we like it or not.

And if what we are saying is that the principle of HIPs is right but we don’t like them, by going back to primary legislation and doing away with them means that all we are going to do is go through a process in parliament to reinvent the wheel and call it something else.” He adds: “The challenge to all of us is to take the start of the HIPs initiative - albeit abysmally implanted by the Government - and get behind it and give it a chance to deliver the benefits it was supposed to do.”

Research conducted by Connells certainly supports Ockenden’s claims about HIPs’ success, revealing that sellers with HIPs completed their transactions 12 days earlier than

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