What you need to know NOW – Information for Sellers of Residential Property
What is a Home Information Pack?
From 1 August 2007, the Government says that you will no longer be able to put a home with four or more bedrooms on the market without having purchased a Home Information Pack [HIP] – a collection of all the documents and information about your house produced in a hardcopy format as a paper file or electronically as a CD or email attachment.
The HIP must be made available to prospective purchasers of your property so that they have to hand all the information pertinent to your property to help them to make an informed choice about whether or not to proceed with the purchase.
This is a major change to the way that residential property is bought and sold in England and Wales and will bring our system closer to that operated in Scotland and in other European countries such as Denmark.
The introduction of the Home Information Pack supports several larger ambitions for the current government; the move to e-conveyancing and the creation of a national property database. There are also other anticipated benefits such as swifter moving ‘chains’ in the house moving process and a reduction in gazumping.
For the first time in England and Wales, however, the onus will now be on the seller to pay for and provide searches (such as the local authority search or mining search) and an Energy Performance Certificate which will measure the energy efficiency of the property. Originally, there was to be a requirement for a new type of survey - "The Home Condition Report" carried out by a specially trained "Home Inspector", but the requirement for these moved from 'mandatory' to 'voluntary' on 18 July 2006 - although the Government is still keen for the Property Industry to adopt these.
This means that the initial price for a basic Home Information Pack (i.e. one containing the minimum sufficient information to put the property on the market) is likely to be closer to the £300 mark, rather than the figure of £800 to £1000 which has been often quoted in the Media as the likely price of the original pack. A fuller explanation can be found in the "What will the Home Information Pack contain?" section of this website.
How will the introduction of the Home information Pack affect me?
Following the introduction of the HIP, there will be several things that you will need to consider carefully before selling your property:-
· The time scale for your move
· The estate agent with whom you sell your property
· When your property can be advertised for sale.
· The additional cost you will incur in purchasing your HIP.
An estate agent CANNOT market your property – i.e. display sales particulars about your property or arrange viewings – without a copy of the Home Information Pack for your property. Nor can you circumvent these rules by, say, offering to sell your house to a friend in a social setting such as a bar or restaurant! You still need to purchase a Home Information Pack. However, in yet another U-turn, the Government recently announced that properties can be marketed if you can prove that you have ordered your HIP and that you can submit it to your estate agent within 14 days of them starting to market your property. Whether these regulations stand after the announcement of a delay to the launch of Packs on 22nd May 2007 will be reported on this site shortly.
