Housing Minister Yvette Cooper has defended the launch of Home Information Packs (Hip) saying they will be "good for consumers and will cut costs and waste."
Speaking yesterday as the government launched further draft regulations for consultation of the packs – despite widely being expected to publish the final recommendations - Cooper argued it was "crazy that over £1m a day was wasted on legal fees or valuations for properties that then fall through."
"Home Information Packs will actually save money and cut waste in buying and selling homes, that’s why consumer groups have been campaigning for this for so long, she adds.
But Richard Barnett, senior partner at Barnett’s Solicitors, says the fact the government only published draft regulations yesterday is significant, suggesting the government is still interested in hearing representations from the industry.
“The good thing is the government is looking for more consultation because if yesterday it had brought out the final regulations as it currently envisages them then costs could be increased and the process could take longer rather than speeding it up,” he says.
However, Patsy Cutsworth, a spokeswoman for the Office of the Deputy Prime Minister (ODPM), denies the government was in a position to issue final regulations yesterday saying: "We orignally had a closed consultation with stakeholders and during that consultation it was suggested to us that we needed to open the consultation up to the wider housing industry which is what we are doing now.
"Once we have done that we will be in a position to publish the final regulations."
Barnett also raises serious concerns regarding the requirement that a legal pack make up part of the Hip. He argues if there is a delay in the sale of a property then making the legal pack a compulsory part of the Hip might mean the information in the legal pack is incorrect later on in the sales process, requiring the work to be done again increasing both the time taken to sell the property and the cost involved.
But, Louise Hanson, head of campaigns at consumner watchdog, Which? says: "The doom-mongers should look more positively on Hips. There might be delays but they might well speed the whole process up. There are also delays with the present system. Hips are going to give poeple more information about the biggest purchase in their life and that's got to be a good thing."
The introduction of Hips is designed to reduce the number of property sales that fall through each year, the government arguing at the moment more than a quarter of all sales fall through after an offer has been accepted, nearly half because of the problems which emerge when surveys or valuations are carried out.
It argues by providing this information at the beginning of the sales process Hips will prevent waste and significantly cut the number of sales that fall through.
It also claims Hips do not increase costs for people buying and selling an average home and that the estimated total costs for buyers and sellers for an individual purchase are expected to be around the same or cheaper than at present, with some early costs switching from buyer to seller.
The draft regulations, which set out the detail of Hips for consultation are, says the government, exactly as provided for in the Housing Act.
The general content and cost of the pack remains the same as discussed in Parliament during the course of the bill. Most of the information in the pack already has to be provided under current arrangements, but this is often very late in the process.
The contents include:
For leaseholders, the pack will also include:
The packs will include Home Condition Reports (HCR) similar to condition surveys currently carried out. Moreover, only inspectors qualifying under a certification scheme approved by the Secretary of State will be able to prepare HCRs.
The consultation period on Hips is open for the next 8 weeks those interested in providing views during the consultation period should go to the ODPM website.
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Matthew West on 020 7484 9893 or email [email protected].IFAonline
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