TREVOR KENT 
(past president National Association of Estate Agents and media property commentator)
AGAINST HOME INFORMATION PACKS
(FORMERLY SELLERS PACKS)

To Contact Trevor at his Gerrards Cross Office call 01753 885522 or email  trevor@trevorkentmedia.com 
He is ISDN radio equipped

click here for the Government's HIP website


ROUND-UP OF PRESS RELEASES & ARTICLES UP TO 2007   

FOLLOW THIS LINK TO LATEST COMMENT

Trevor Kent 9th November 2006  

 

HIPs must be terminated, but don't just take my word for it (despite the fact my word's been consistent since 1997 on this subject) no, read the recent comments by two very august bodies -  The Council of Mortgage Lenders  and the Royal Institution of Chartered Surveyors .  Then write to your Labour MP and say 'forget my vote, I'm not paying £500 for an Energy Inspector to nose round  my home before you give me  permission to put my house on the market'. Or write to your Conservative MP and say 'thanks for pledging to repeal HIPs because you know they're rubbish, my vote's yours come the election'.

 

Trevor Kent 6th November 2006  
 
CONSERVATIVES SCRATCH THE SURFACE OF HIP'S OPEN WOUND
 

The government are indeed launching their 'dry-run' of Home Information Packs this week through a joint initiative from the Department for Communities and Local Government (the old ODPM)  and their Association of Home Information Pack Providers (AHIPP).  "Despite the fact that the intended roll-out of mandatory HIPs will cover the whole of England and Wales from June 2007," says Trevor Kent former president of The National Association of Estate Agents,  " only six relatively prosperous towns in England have been selected, and even in these only a few convenient postcodes have been identified for trial".

 

Only last week Trevor Kent attended the 'launch' meeting intended to attract support for the dry run at one venue - Northampton. "nearly two hundred attendees accepted the government's wine and finger buffet as far as I could see," he said, " but all but a handful appeared to be  HIP providers, Home Inspectors (the new surveyors who will visit every home to draw up  the  HIP) and conveyancers - all potential big earners from HIPs". Only a dozen or so estate agents, whom the DCLG were are relying on to serve up  the guinea pig sellers on a plate, identified themselves at the meeting. "Agents will not co-operate with the government in a trial of what they believe to be nonsense legislation" Trevor Kent observes, "especially when they've already seen one climb-down with the withdrawal of Home Condition Reports from the Packs, there is  just no trust  whatever left in the DCLG to do a business-like job".

 

Commentators  seeking to monitor the progress of the dry runs can contact Chris O'Dea 020 7944 4400 ext 19511 at the DCLG for Cambridge and Huddersfield, Maxine Walker extension 19342 for Newcastle and Northampton, and Tracey Hayworth on 020 7944 3646 for Bath and Southampton. Pertinent questions might be on the lines of "even when they're free how many prospective sellers have  accepted a  HIP on their home?", another enquiry  continues Trevor Kent might be "are the prospective buyers even bothering to read the reports before offering on the houses they fancy?". The final stab that might just herald the end of Home Information Packs could just be to ask en passant, "do you think, in the light of your trial run experiences, that 3m people a year will spend £500 a time on a HIP and wait three weeks off the market whilst it's  being prepared ?". Armed with the answers from the poor old foot soldiers charged with implementation in the field, a final foray with their Commander in Chief Yvette Cooper might just elicit the response so many millions are pleading for, the white flag of surrender before more blood is lost.

 

end

 

Trevor Kent PPNAEA 

Property Market Commentator & Anti-HIP Campaigner

o 01753 885522

e pressrelease@trevorkentmedia.com

ISDN by arrangement

 
 
 

Press Release                        Conservatives

t (Press) 020 7984 8121
t
(Broadcast) 020 7984 8100
f
020 7984 8272

6th November 2006

Ref:2037/06

 

Sellers Packs so unpopular, Labour is giving them away (and you pay)

£4 million of taxpayers’ money being spent to ‘save Ministers’ faces’

The Government is today launching a “dry run” of the controversial Home Information Packs in six locations across England . The Packs, in a slimmed down form, will be compulsory from June 2007. Sellers face repeated £200 fines for trying to market or sell their home without a Pack. 

Yet today Conservatives are today exposing:

·                 The Government is spending £4 million of taxpayers’ money to provide “incentives” for the consumers to use Packs.

·                 In all of the six trials, home owners are being offered a free pack, paid for by the taxpayer.

·                 By contrast, from June, home owners will face a £500+ fee to buy a Pack. The Government has refused to say how much the new ‘half-HIPs’ will cost including VAT.

·                 The trial is entirely voluntary. But from June, home owners will be fined £200 by town hall officers for trying to sell their home without a pack. The fine will be repeated for continuing non-compliance.

 

Caroline Spelman, Shadow Local Government Secretary, said:

“This so-called dry run is a sham. The controversial Home Information Packs are so unpopular that the Government is having to give them away – with the taxpayer left footing the bill. In no way will a free trial provide a proper model for the potentially damaging effects to the housing market of these flawed Packs. The Labour Government is simply wasting £4 million of taxpayer’s money to save Ministers’ faces.”

 Notes to editors

£4 MILLION ON GIVING AWAY HOME INFORMATION PACKS

 “Mr. Pickles: To ask the Secretary of State for Communities and Local Government in what ways sellers will be encouraged to take up voluntary home information packs during the dry run.

 Yvette Cooper: Home information packs (HIPs) will be promoted by participating estate agents and local information campaigns. To get the trials going and to test the HIPs, there will be a limited number of free packs and reduced cost packs, for sellers who want to try them out, as well as full cost packs.”

 Hansard, 31 October 2006, col. 278W.

http://www.publications.parliament.uk/pa/cm200506/cmhansrd/cm061031/text/61031w0005.htm#06103178001356

 “Yvette Cooper: We will promote the voluntary take-up of HCRs, and have allocated £4 million to support their take-up and testing of home information packs.”

 Hansard, 16 October 2006, col. 1027W.

http://www.publications.parliament.uk/pa/cm200506/cmhansrd/cm061016/text/61016w0022.htm#06101719000723

 

COST OF THE PACKS FROM JUNE 

The Government has refused to say how much the new 'half' HIPs will cost. Previously, they estimated £600 - £700 + VAT for a HIP including the Home Condition Report (HCR). The HCR was to cost £300. Without the HCR, an Energy Performance Certificate will still have to be paid for. This suggests a price of £500-£600 including VAT.

 Government refuses to say how much they will cost…

 “Michael Gove: To ask the Chancellor of the Exchequer whether VAT will be levied on  (a) all and  (b) some of the items within home information packs.

 Dawn Primarolo: The extent to which VAT will be payable on the costs incurred by a prospective house seller in compiling a home information pack will depend on what is included in the pack, and on how the person chooses to compile it. It has not yet been finally determined by the Department for Communities and Local Government what the full contents of a pack will comprise, pending evaluation of the ‘dry run’. 

Hansard, 10 October 2006, col. 726W

http://www.publications.parliament.uk/pa/cm200506/cmhansrd/cm061010/text/61010w0016.htm#column_726W 

“Michael Gove: To ask the Secretary of State for Communities and Local Government what the cost of an energy performance certificate is expected to be including VAT; and whether the cost is expected to vary according to the size of the property.

 Yvette Cooper: The price of an energy performance certificate will be set by the market and not by Government. We expect these costs to vary according to the size, type and location of the property. Trials are planned to take place during November 2006 to assess the indicative time and costs of producing energy performance certificates.”

 Hansard, 16 October 2006, col. 1026W.

http://www.publications.parliament.uk/pa/cm200506/cmhansrd/cm061016/text/61016w0022.htm#06101719000723 

£200 FINES FROM JUNE

 “Mr. Pickles: To ask the Secretary of State for Communities and Local Government pursuant to the answer to the hon. Member for Meriden (Mrs. Spelman) of 2 October 2006,  Official Report, column 2535W, on home information packs, what period of time must elapse before a vendor could be fined £200 again for an on-going breach. 

Yvette Cooper: Where enforcement officers decide to take action following a breach of the home information pack duties, they will have the option of serving a penalty charge notice. The penalty charge is set at £200 in the Home Information Pack Regulations 2006. It will be for Trading Standards Officers to make the appropriate judgment regarding enforcement of the regulations.”

 Hansard, 24 October 2006, col. 1793W.

http://www.publications.parliament.uk/pa/cm200506/cmhansrd/cm061024/text/61024w0013.htm#06102472000529 

TRIAL AREAS - WITH THE FREE PACKS

 “From 6 November 2006, the Government, in partnership with industry, is rolling out area trials in six areas, Bath , Cambridge , Huddersfield, Newcastle , Northampton and Southampton , aimed to help test both the Packs and full Home Condition Reports.”

http://www.homeinformationpacks.gov.uk/home.aspx 

“Sellers with properties in the BA1-BA3, BS31, BS39 and BS40 postcode areas will be eligible to benefit from a Government funded incentive. The current incentive is a FREE Home Information Pack.”

http://www.homeinformationpacks.gov.uk/trials_bath.aspx 

“Sellers with properties in the CB1-CB5 postcode areas will be eligible to benefit from a Government funded incentive. The current incentive is a FREE Home Information Pack.”

http://www.homeinformationpacks.gov.uk/trials_cambridge.aspx 

“Sellers with properties in the HD1-HD9 postcode areas will be eligible to benefit from a Government funded incentive. The current incentive is a FREE Home Information Pack.”

http://www.homeinformationpacks.gov.uk/trials_huddersfield.aspx

 “Sellers with properties in the CB1-CB5 postcode areas will be eligible to benefit from a Government funded incentive. The current incentive is a FREE Home Information Pack.”

http://www.homeinformationpacks.gov.uk/trials_newcastle.aspx 

“Sellers with properties in the NN1-NN5, NN8 and NN9 postcode areas will be eligible to benefit from a Government funded incentive. The current incentive is a FREE Home Information Pack.”

http://www.homeinformationpacks.gov.uk/trials_northampton.aspx 

“Sellers with properties in the SO14-SO19 postcode areas will be eligible to benefit from a Government funded incentive. The current incentive is a FREE Home Information Pack.”

http://www.homeinformationpacks.gov.uk/trials_southampton.aspx

 ENDS 

 


 

Trevor Kent 26th October 2006  

  WE TOLD YOU SO MINISTER, AND THE FIVE BEFORE YOU

The welcome recent call from the  Council of Mortgage Lenders (a body that both Mr Blair and Mr Brown DO sometimes take notice of) to abandon Home Information Packs is timely indeed, but will it be heeded?

It had been immediately preceded by a Royal Institution of Chartered Surveyors claim that  the introduction of Packs by the government must be halted, a view  supported by the Conservative Party. The National Association of Estate Agents and individual commentators such as I have, of course, been brave enough to say this for years.

The Department of Communities and Local Government had recently disbanded their own Stakeholder Group of industry 'advisors' , no doubt because the DCLG could no longer stomach further 'drop HIP advice'  from professionals who understand the property market, advice hitherto so distainfully ignored

The department's own official so called 'Dry Runs'  planned to test HIP implementation in six English towns  in the first week of November, appear doomed before they begin with estate agents refusing their support. 

The final nail in the hoped for coffin for HIPs was an admission on 23 October by  the DCLG that their own MORI/BRE Baseline Study of 3000 estate agents' sales in May and June had been a fiasco with participants 'only in the hundreds'. Thus legislators will not  have their required reliable  picture of the market prior to HIPs to judge whether the packs  had improved the transaction experience  after introduction in June 2007. 

Someone in government ( perhaps Housing Minister number six) needs to take this dying initiative by the scruff of the neck and put  it down as quickly and  humanely as possible, before further millions are wasted. It will, of course, be too late for private individuals who have, in some cases, sunk their life savings into preparing to be  HIP surveyors. They have already suffered from the political incompetence and  business naivety of a totally discredited government , it will be the public's turn next, unless Home Information Packs are quickly consigned the the Graveyard of failed Labour initiatives - that's if there's still room for the interment. 

End

Trevor Kent PPNAEA   
Property Market Commentator & Anti-HIP Campaigner

o 01753 885522  
e
pressrelease@trevorkentmedia.com

ISDN by arrangement

Trevor Kent  11th October 2006  

A few hours in advance of the House of Lords debate on Home Information Packs (Wednesday 11th October 2006) I was able to advise the Conservative team critical of the policy, lead by Michael Gove MP in the Commons and Baroness Hanham in the Lords, that I believe a recent 'Baseline Study' of the property market ordered by the Deputy PM has been a failure.

On 21st April 2006 Kevin Roper of the ODPM wrote to 3000 estate agents inviting them to assist in research to 'evaluate the current buying and selling process of homes in England and Wales'. He claimed that the 'aim is to provide a benchmark against which to measure the impact of the national roll-out of Home Information Packs'.

Agents were asked to fill in a brief transaction form for each property that completed, or was withdrawn from sale, between 15th May and 9th June 2006.  They were also asked to 'fill in a feedback form at the end of the study'.  Alex Chester at the Building Research Establishment was offered as the query point and MORI was said, by Mr Roper, also to be involved in the study.

As a long-term critic of the proposed introduction of Home Information Packs, I was naturally keen to learn of the progress of the creation of this  'Baseline'. Over the last month I have attempted to get progress reports from every party  involved - but to no avail. No one in government, the BRE or MORI would talk to me.

In desperation I had letters published in Estate Agency magazines asking agents to let me know how they got on with their participation LINK TO LETTER. The readership is collectively about 15000 agents.  To date I have had no letters from agents advising me that they had been involved.

I strongly believe that the Office of the Deputy Prime Minister (now the Department for Communities and Local Government) must have quietly withdrawn the study to save embarrassment. Yet, at  the same time, they fanfare  their investment of £4m to enable a group of commercial companies (already standing by to make millions out of the introduction of Packs) perform a 'dry run' of HIPs for them. Theirs is sure to be an objective report!

Home Information Packs are a disaster in the making, criticized on every hand by property professionals in every discipline of the industry.  Yet, Labour ploughs on regardless and without the help of the House of Lords LINK TO DEBATE and other critics such as I, 3m people a year will be soon be paying an average of £500 to put their homes on the market from June 1 next year.  This legislation must be repealed forthwith.

Trevor Kent PPNAEA   
Property Market Commentator & Anti-HIP Campaigner

o 01753 885522  
e
pressrelease@trevorkentmedia.com

ISDN by arrangement

Trevor Kent   21st September 2006

 

THE HIP's BROKEN - DON'T MEND IT

The Home Information Pack was invented in 1997 by Labour to apparently cure ills in the house sales market.  They suggested that 3m homeowners a year would be happy to pay for a survey to be done on their home, searches collected, energy efficiency checked, title deeds inspected and all this information given to anyone who wanted it (at a cost to the seller of  £1000). The Government also believed that these sellers would be happy to be fined £200 a day if they tried to nail a For Sale board up before they had bought their 'Pack'. Fat chance.

Public and commentators assumed, following the Housing Minister's announcement on July 18th, that HIPs were no more.  This is still far from the case.  The DCLG have dropped the need for the 'survey' to be included in the Pack but still insist the rest of the rubbish will have to be produced by sellers on and after 1 June 2007.

Before implementation, the Government is committed to evaluating a so-called 'dry run' to assess whether the Packs will work for the public. Today they have announced a £4m subsidy will be given to a group of companies already set up to make a business of producing HIP reports.  They seriously expect these companies, who stand to make millions when HIPs are finally introduced, to report in an unbiased fashion on how HIPs work.

"This plan brings to mind MORI being asked to enquire of 1000 turkeys whether they think a plan to abandon Christmas would be a good idea" says Trevor Kent.

There are no surveyors to prepare the Energy Performance Certificates, there are no buyers who will be interested in reading their reports, and their solicitors will not wish to rely on old searches provided in the Pack.  “Frankly the HIP is, and always has been a complete farce - a total waste of money and likely to cause house-price inflation” says Trevor Kent, former president of the National Association of Estate Agents.

"Every profession involved in house sales has called on the Government to abandon HIPs, yet they plough on regardless.  This is breathtaking arrogance, a true 'we known your business better that you do attitude' and, after today's announcement, a case of  'we'll put your money where our mouth is to prove it', as well." says Kent.

“This HIP business”, concludes Trevor Kent, “just has to be stopped and my guess is that the penny will only drop when the Government discovers that the public will not allow themselves to be part of this dry-run -  EVEN WHEN THEIR HIPS ARE PROVIDED FREE'.  

End

Trevor Kent PPNAEA   
Property Market Commentator & Anti-HIP Campaigner

o 01753 885522  
e
pressrelease@trevorkentmedia.com

ISDN by arrangement

Trevor Kent is former president of the National Association of Estate Agents and has been a fervent anti-HIP campaigner through the reigns of five Housing Ministers. He is still an independent single office estate agent and regularly broadcasts on property .    

OFFICE OF FAIR TRADING   11 September 2006  

 

Boost for consumer protection in door-to-door sales

The OFT today welcomed the Government's announcement that it will legislate to provide cooling-off periods on goods and services sold to people in their homes, even when the sales representatives have been invited to visit.

As the law stands consumers have the right to cancel within a seven day period when a sales visit is unsolicited, but an OFT study found that 94 per cent of consumers were unaware of these cancellation rights. Under the new proposals consumers will also have the same protection when buying goods from representatives irrespective of whether they have been formally invited into their home.

These changes will complement the forthcoming 'Unfair Commercial Practices' legislation which will take positive action on aggressive sales techniques used by representatives. This includes pressurizing consumers into buying a product or service, by outstaying their welcome in consumers' homes, or falsely claiming they will get a better deal if they sign up immediately to prevent them from buying elsewhere.  Jonathan May, Director at the OFT said:

'Extending protection in this way means that consumers shopping from home can be confident that they are protected from unscrupulous doorstep sellers.' More information and advice on doorstep selling can be found by downloading the

 OFT leaflet at www.oft.gov.uk

NOTES

1. A statistical summary of the responses to the Doorstep selling consultation has been published. For a statistical summary of responses to the doorstep selling consultation can be found on the DTI website - www.dti.gov.uk MEDIA enquiries: 020 7211+ Corinne Gladstone 8899 Terence Gibbons 8900 Lara Gorman 8133 Nick Spears 8901 Jonathan Marciano 8898 

Out of hours: mobile: 07774 134814 fax messages: 020 7211 8961

Copies of press notices: Ext. 8993

http://www.oft.gov.uk

PUBLIC enquiries: 0845 7224499 enquiries@oft.gov.uk

OFT reports and consumer information leaflets are available free from:

 --------------------------------------------------------------------

NDSREF: 137846

 Issued by : OFT Press Office

Contact : mark.kram@oft.gsi.gov.uk

HIPs SHOULD BE ALLOWED TO SINK WITHOUT TRACE

It's a misapprehension to believe HOME INFORMATION PACKS are no more since the government announced that the 'survey'  element would no longer be a constituent part. HIPS are, at the moment, still to be introduced for home sellers from June 1 2007 in their reduced form.

Another broadside has, however, been unleashed on HIPs today which will hole the already creaking hulk below the waterline, and it's come from friendly fire.

Estate agents and Home Information Pack Providers are still  bound by law to take an average of £500 off every intending house seller 14 days in advance of marketing in order to prepare the 'reduced HIP'. Many will sign up the sellers on their first visit to the home for sale when 'measuring up and advising on price'. If the sellers cannot pay cash for their HIP, a finance agreement will be offered.

The DTI has today announced that it is to legislate that all occupiers will soon be entitled to a  'cooling -off period' of 7 days during which time they will have the right to cancel any goods and services sold to them in their homes by invitation. The OFT confirmed today this will include those sales people selling mandatory  HIPs. Thus 'Home Inspectors' will now have to wait another seven days, for a possible cancellation, before beginning to prepare the Pack.

The result is that, thanks to one department of government not knowing what another is up to, even more potential chaos now reigns for home sellers and those who advise them. Trevor Kent, former president of the National Association of Estate Agents and a critic of HIPs since 1997 when they were first proposed, is exasperated by this latest news, "can anyone seriously suggest that Home Information Pack Legislation can be allowed to continue, when a home seller will now have to wait three weeks before being allowed to market their home, and become law-breakers with a £200 per day fine if they jump the gun and nail a For Sale sign up before their Pack is ready?".  Trevor added  "Maybe the DTI and the OFT already know 'reduced HIPs'  are still a nonsense and, perhaps,  they are trying to tell Mesdames Ruth Kelly and Yvette Cooper at the DCLG so. I only hope they're listening. They must grasp the nettle and consign  HIPs to the deep without further delay, before they themselves sink into oblivion as a direct result of this blind folly ".

End

Trevor Kent is a former President of the National Association of Estate Agents.  He has laboured tirelessly and without remuneration or vested interest (other than being an estate agent) to warn the public of the perils of Home Information Pack  implementation.

(o) 01753 885522
trevor@homeinformationpacks.com 

 

 

NOT GONE, NOT FORGOTTEN

WHAT NEXT?   If professionals and the public are rejoicing in the belief that HOME INFORMATION PACKS (HIPs) ARE NO MORE following the Minister's announcement printed beneath, then they are under a serious misapprehension.

 THE FACTS    What the government has said (unless there is a further U-turn) is that HIPs will still be mandatory on 1st June 2007, but that sellers will not, at the moment, be forced to pay for and include the 'survey' element known as The Home Condition Report.  Sellers will, however, still be required by law to buy Searches and pay for a surveyor to visit their homes to prepare a Energy Performance Certificate.

 THE COST?   What sellers will still have to pay for this newly proposed 'reduced HIP'  will depend upon the size, age and complexity of their homes, together with the cost of Searches for their area (which vary greatly by region). A HIP provider will also have to have sight of their Title Deeds and have an Energy Surveyor close at hand to keep travelling charges down.  It is quite possible a 'Reduced HIP' for an average 3 bedroom semi will cost £350 + VAT.   A South of England 4 bedroom commuter home could cost £700, a luxury home nearer £1000, and you've still paid even if you don't sell.

 THE LAW?   It is not yet clear whether the public and/or estate agents will still be liable to a £200 a day fine if they don't buy a 'Reduced HIP' when a property goes on the market (Yvette Cooper the Housing Minister had certainly planned this to be the case with the 'Original HIPs' ).

 USEFULNESS OF 'REDUCED HIPs'?   The Consumers Association, the only body to have supported HIPs from their dastardly conception on a table in 1998 by John Prescott, now say of mandatory 'Reduced HIPs', they are a "half-baked compromise ...... little value but of real expense to consumers and WHICH? cannot therefore continue to provide support."  Michael Gove, the Conservative Shadow Housing Minister, has called for "Government to abandon the whole scheme".  Buyers will not be interested in the 'thermal efficiency' of the house they want to buy, their solicitors won't be interested in Searches once aged a few weeks, and buyers will have to pay for new ones.  Mortgage Lenders will have no use at all for the 'Reduced HIP'.  A complete waste of time and money.

 THE HOME-OWNING PUBLIC AND ALL  ASSOCIATIONS, INSTITUTIONS AND CONGLOMERATES INVOLVED IN THE PROPERTY TRANSFER INDUSTRY SHOULD CONTINUE TO PRESS FOR 'REDUCED HIPs' TO BE  HUMANELY PUT DOWN AND BURIED ALONG WITH THE ORIGINAL PACKS.  RESURRECTION OF THIS IMBECILIC SCHEME SHOULD  NOT BE ATTEMPTED IN WHAT EVER MANIFESTATION, EVEN BY A GOVERNMENT WHO SEEMS TO THINK ITSELF OMNIPOTENT.

 There are 23 million home-owners in England Wales and Scotland (yes, Scotland is due their own style of HIP soon too), if you think what I think,  you should 'X'  them out come the election .

 Trevor Kent 
5th August 2006
 

 

 

 

18th July 2006

THE BEGINNING OF THE END ??

MINISTERIAL STATEMENT BELOW

DEPARTMENT FOR COMMUNITIES AND LOCAL GOVERNMENT

 Home Information Packs implementation.

The Minister for Housing and Planning (Yvette Cooper):   I am today setting out further details of the Government’s implementation strategy and dry run for Home Information Packs (HIPs).

 The aims of the HIPs programme

 The aims of the government’s reforms to the home buying and selling process are three fold:

 (i)         to provide home owners with important energy efficiency information about their homes to help them cut fuel bills and carbon emissions.  This is vital as homes account for 27% of Britain’s carbon emissions.  Energy Performance Certificates will provide clear information about the energy efficiency of homes and how that can be improved.  The Energy Saving Trust estimate that following the advice in Energy Performance Certificates could save the average home owner up to £300 a year on their fuel bills The government believes it is important to implement these as early as possible given the importance of reducing carbon emissions.

 (ii)        to benefit consumers by cutting waste and duplication, speeding up home sales and reducing the number of failed transactions, which at present cost consumers around £350m a year in wasted costs.

(iii)       to encourage and support long term transformation of the home buying and selling industry by introducing greater transparency and competition to drive down costs and incentivise better service and clearer redress for consumers. 

Testing

There are three main components to Home Information Packs: searches and other legal documents; Energy Performance Certificates; and the home condition surveys that make up the other component of a full Home Condition Report.  It is essential that all aspects of Home Information Packs are properly tested before full implementation.  We need to be sure that consumers understand, value and can utilise the information that HIPs provide; that the assumed benefits will be realised; and that the different operating systems underpinning HIPs will work effectively.

As part of our ongoing programme of implementation, we have already successfully tested over 14,000 HIPs with searches, but largely without Home Condition Reports, in the dry run so far.  Over the course of the summer we propose to undertake further consumer research on Home Condition Reports; to study in greater detail the 250 HIPs that have been produced to date with some kind of survey; and to look to see what more we can learn from experience in other countries where HIPs have been introduced successfully or are currently being proposed.  From the autumn the emphasis of our implementation programme will switch to the testing of Energy Performance Certificates and Home Condition Reports.  Working with the industry and with consumers, we are proposing to support a series of area based trials and we will test proposals such as allowing sellers to start marketing their homes if they have already commissioned their HIP rather than having to wait up to 14 days. There will be independent assessment and monitoring of all aspects of the dry run.

Roll out

It is also important that reforms are introduced on a timetable and as part of a programme that maximises the benefits for consumers and the environment.

As part of the development of the dry run we have engaged in detailed consultation with a wide range of stakeholders and have gathered substantial information on the progress of implementation so far. As a result, we have concluded that there would be significant risks and potential disadvantages to consumers from a mandatory “big bang” introduction of full Home Condition Reports on 1 June 2007. In particular:   

·          Further testing is needed to ensure that Home Condition Reports deliver the assumed benefits for consumers and that the operating systems that support them work smoothly.  Design work on the dry run has made it clear that this cannot be completed in time for the results to be taken into account in by 1 June. 

·          A recent report from the Council of Mortgage Lenders identified the real possibility that some lenders might not be fully geared up to use HCRs until 2008-09.  In particular the industry’s plans for bringing in Automated Valuation Models means that many lenders will not have them in place by June 2007 and so will continue to seek separate mortgage valuation surveys where they could have relied on a Home Condition Report. 

·          There are concerns about the number of inspectors that will be in place in time for June next year. 

Moreover, because of our commitment to addressing climate change we do not want to jeopardise the successful introduction of Energy Performance Certificates at the earliest possible opportunity by pursuing the ‘big bang’ mandatory introduction of full Home Condition Reports at the same time. 

We believe that progressive market-led take-up of full HCRs could strongly benefit consumers.  Bearing in mind our commitment to the early introduction of Energy Performance Certificates, combining an Energy Performance Certificate and a full Home Condition Report at the same time is likely to offer significant additional benefits to buyers and sellers.  In particular, sellers offering full Home Condition Reports should be more likely to benefit from swifter sales and suffer fewer transaction failures, as accepted offers are much less likely to be re-opened as a result of new information coming to light. In addition, once Automated Valuation Models are in place, Home Condition Reports should mean buyers get cheaper and swifter valuations and mortgage offers. We therefore believe that there will be a significant incentive for consumers to top up their HIPs voluntarily to include full Home Condition Reports and that this is a product that the market can and should deliver. 

Therefore we have concluded that: 

·          HIPs will be introduced with searches and other key documents from 1 June 2007.

·          Energy Performance Certificates will be included in HIPs on a mandatory basis from 1 June 2007. 

·          We will work with the industry to facilitate market-led take-up of full HCRs. As part of this approach, we will explore with the sector a wide range of options to enable a successful and innovative market for HCRs, including options for supporting the provision of necessary systems, effective demonstration projects for HCRs, and will consider the case for pump-priming funding.    This market-led approach has the added benefit of giving industry more flexibility to innovate and adapt to consumer preferences.  

·          This means that the remaining aspects of Home Condition Reports will not be made mandatory from June next year, but HCRs will be authorised documents that sellers will be able to include in their packs 

·          Mandatory HCRs will remain on the table if the industry fails to make a success of the roll out of HCRs 

As part of the next phase of reform of we will also be setting out our plans for an ombudsman scheme for estate agents to strengthen consumer protection as well as further proposals to review competition and transparency in the industry to the benefit of consumers 

We believe that these arrangements will ensure that Home Information Packs are implemented in a way that maximises benefits for consumers and the environment and successfully enables the long term transformation of the home buying and selling market. 

 

 

14th July 2006

The Conservative Party has formally announced their intention to scrap Home Information Packs when elected. Their Shadow Housing Minister Michael Gove MP has recently given the government a number of 'grillings' in the Commons over their misguided policy on HIPs. A recent Early Day Motion will give you a flavour of what the Tories think. The support of 132 MPs across all three parties is impressive, particularly bearing in mind 'Front Bench ' Members cannot add their names to EDMs -  see this link

 

 

7th June 2006
Press Association release - SEE Trevor Kent's comment directly below

Controversy over Government's Home Information Pack plans

Home Information Pack plans have caused controversy

The Government has been challenged over its plans to introduce Home Information Packs across the country.

By June 1 next year all homeowners will need to arrange for a pack to be prepared, costing more than £700, before putting their homes up for sale.

But Michael Gove, for Tories, asked if ministers would declare it a success regardless of the outcome and told Housing and Planning Minister Yvette Cooper she was "all too well aware that every industry expert insists on the need for an appropriate dry run before we press ahead with this intervention in the marketplace".

"But so far only 200 of the 4,000 promised home inspectors have actually qualified. No specific geographical areas have yet been earmarked for dry runs, despite what your predecessor promised in 2004.

"We have no clear and unambiguous and independently audited criteria for judging the success of these dry runs.

"Can you actually tell us what the benchmark for success in the these dry runs will be or will ministers simply award themselves a pass mark irrespective of the results?"

But Ms Cooper, responding at Commons question time, said Mr Gove had been an advocate for those in the industry who opposed the packs because they made money out of the current system and warned him against becoming "the parliamentary spokesperson for the National Association of Estate Agents who may have their interests in this process".

"We have made clear for many months that we will introduce a dry run right across the country so that we can test the component parts of Home Information Packs and it is important that buyers and sellers should be able to see improvements and efficiency in the current system."

She urged the Tories to listen to the Consumers Association and "buyers and sellers right across the country" because they are "wasting loads of money in the current system and I don't think that's fair".

Copyright Press Association 2006

 

 


RESPONSE TO ABOVE PRESS RELEASE
FROM TREVOR KENT LEADING ANTI-HIP CAMPAIGNER & FORMER
PRESIDENT OF THE NAEA

 

"How dare Housing Minister Yvette Cooper stoop so low as to suggest her Tory Shadow counterpart Michael Gove MP is becoming the 'parliamentary spokesperson of the NAEA', " says Trevor Kent, the Association's former president. "as if the next government would make a major policy decision such as to scrap HIPs just on the say so of a single small professional body with a personal interest. ".

"Ms Cooper's problem is that she has inherited from five previous Housing Ministers a chalice brim full of bile and prejudice and she's not woman enough to grasp the nettle and tell her boss to drop the whole caboodle right now, before her brew poisons the whole of the property industry. Her's and her predecessors' only policy continues to be to belittle all constructive criticism ." he continued.

Kent claims that the government has known since 1998 that  their  proposed Home Information Packs have been ruled as unworkable and un-necessary  by every branch of the professional property industry.  The initial introductory Department under John Prescott  firstly sought votes by suggesting HIP introduction would 'end gazumping' , having been persuaded gazumping was a rare occurrence they then suggested HIPs would be the saviour of the first time buyer - (apparently rampant property price inflation had nothing to do with first timers' inability to buy, no it was the fact that sellers didn't tell buyers what might be wrong with their houses, that was the problem)!

Thus her gadereen rush to introduce HIPs and the turning of  a deaf ear to warnings from The Law Society, the RICS, the CML, the BSA, indeed just about everyone who knows what they're talking about, not just the NAEA.  The only support the government could find was from Which? the magazine publishers. To compliment their smoke and mirrors deception  that HIPs will be good for us,  the government even encouraged the creation of a 'new industry' -  Home Information Pack Providers and gave their newly formed Association a leg up -  to the extent of seeing one of their own staff (already provided to the ODPM 'on secondment' by HBOS) joining as Deputy  Director General. 

" I suggest Ms Cooper looks to her own house before changing the way others sell theirs," concludes Trevor Kent, "HIP introduction on June 1st 2007 will lead to  property market melt-down  of undreamed of proportions and  produce 3m very disgruntled voters in each and every  year 'till the Tories do the sensible thing".

Ends

Trevor Kent

Former President of The National Association of Estate Agents

Anti-HIP Campaigner and Property Broadcaster
trevorkent@homeinformationpacks.com  
or 01753 885522

 

 

 

TREVOR KENT'S PRESS RELEASE  - 10th April 2006

YVETTE COOPER'S 'DRY-RUN' OF HIPS - 'A WHITEWASH'

Trevor Kent, former president of The National Association of Estate Agents, and a fervent Anti-Home Information Pack campaigner, has poured scorn on the announcement from Yvette Cooper MP at the  ODPM that they are to institute a dry run to evaluate  the Packs' efficacy. The Housing Minister recently said that the dry run will  "make sure that all aspects of the Packs are properly tested before being fully introduced next year".

"What arrant nonsense this is" says Trevor Kent, " the ODPM's so called dry run is being conducted for them  exclusively by companies already totally committed mentally and financially to the introduction of the new scheme.  With multi-million pound investments already made by these participants with  the prospect of securing a share of the estimated 1.75m HIPs a year (at an average cost per report of £1000),  who's going to say to the ODPM  ' well actually our dry run findings reveal HIPs aren't needed and won't work' ?". 

Introduction of HIPs has been a Labour Manifesto pledge since 1997, but opposition has snowballed as professionals have realised the government is, at last, taking serious steps towards implementation despite  their dire warnings.  Trevor Kent suggests there is no public  support for the introduction of a legally enforceable two week delay before being 'allowed' to put one's home up for sale. He  also feels that owners will not be prepared to pay £1000 + for their HIP to be prepared by faceless Home Inspector/Conveyancer conglomerates and then see intimate details of their home and wealth posted on the internet and recorded in government departments for who knows what future snooping.   

"If Ms Cooper wants a serious and objective  report on whether Home Information Packs stand a cat in hell's chance of working and being accepted by the public, then she should include some of the 1000 branches of independent estate agents who wrote to her recently to tell her 'they won't' .  Or she could include some members of the Law Society's property division who recently said 'HIPs should come with a health warning'.  Even the Council of Mortgage Lenders have ' grave doubts'  now, and the Royal Institution of Chartered Surveyors  are less supportive than they were," Kent adds.

The Conservative Party have pledged to repeal Home Information Packs if they are returned to power at the next election , and Ian Liddell-Grainger MP is to introduce a 10 Minute Rule Bill immediately the House returns after the Easter recess, calling for their immediate abolition. In the meantime Trevor Kent  continues to chant the mantra that 'Sellers Packs Legislation Is Not The Answer' -  and if there is to be a dry run to find out that he's right, then it should be fairly and objectively conducted.

 Trevor Kent
Former President of The National Association of Estate Agents

Anti-HIP Campaigner and Property Broadcaster

trevorkent@homeinformationpacks.com  
or 01753 885522

 

 

10 April 2006

HIPs to hit where it hurts
Tentative first time sellers will suffer most with the introduction of HIPs, says
NAEA

Struggling first time sellers are likely to be hit the hardest by Government plans to introduce Home Information Packs (HIPs) to the housing market in June 2007, according to research by the National Association of Estate Agents ( NAEA ).  

Of those currently in the first time seller bracket (24 to 34 year olds), 76 per cent said withdrawal costs incurred via the HIP would discourage them from putting their homes on the market.  A massive 80 per cent of respondents in the survey’s 16-24 age bracket also stated that such costs would, in theory, deter them from putting a home on the market.   

Currently any home put on the market with an estate agent can be withdrawn from sale – if it does not find a buyer, or the owners need to stay put for whatever reason – without incurring any costs.  From June 2007, when HIPs are introduced, homeowners will have to pay the fee for their HIP when they remove their home from the market, regardless of whether the property has sold or not.   

Chief executive of the NAEA Peter Bolton King says; “Those on the lower rungs of the housing ladder clearly need all the help they can get in order to find their feet financially.  This is the age at which children come along, and families are most likely to be looking for more space.   

“With the anticipated cost of the HIP set at between £600 and £1,000, plus VAT, and high levels of stamp duty to contend with, many first time sellers may find that the next step up the ladder is simply too much of a stretch for them, and be forced to stay put.  This will, of course, impact on the rest of the housing market, slowing it right down and causing frustration for first time buyers and those further up the housing ladder alike.”

- Ends -

Notes to editors  
The
NAEA survey also found that a significant number of experienced sellers were deterred from putting their homes on the market by the potential withdrawal costs of HIPs, with almost 68 per cent of those aged 55+, 69 per cent of 35 – 44 year olds and 71 per cent of 45 – 54 year olds in agreement.   

The Halifax First Time Buyer Annual Review published in January 2006 confirmed the average age of the first time buyer is now 33 years old.  

About the research  
This research for the NAEA was carried out online by Tickbox.net between
24 February 2006 and 28 February 2006 , amongst a nationally representative sample of 1295 UK adults aged 16 plus.  

Tickbox.net is a leading market research organisation, carrying out consumer, corporate and niche market surveys online amongst a 50,000 plus member panel.  

Tickbox.net is a member of the BMRA (British Market Research Association), follows the codes of the MRS (Market Research Society) and is fully registered and compliant with the Data Protection Register, as well as being the preferred research supplier of the PRCA (Public Relations Consultants Association).  

 About the NAEA  
The National Association of Estate Agents (
NAEA ) is the UK ’s leading professional body for estate agency personnel, representing the interests of approximately 10,000 members who practice across all aspects of property services both in the UK and overseas. These include residential and commercial sales and lettings, property management, business transfer and auctioneering.  

The National Association of Estate Agents is dedicated to the goal of professionalism within high street estate agency. Its aim is to reassure the general public that by appointing an NAEA member to represent them they will receive in return the highest level of integrity and service in both sales and lettings. Each NAEA member is bound by a vigorously enforced Code of Practice and adheres to professional Rules of Conduct. Failure to do so can result in heavy financial penalties and possible expulsion from the Association.

 

 

TREVOR KENT'S PRESS RELEASE  - 20th February 2006

A nervous and almost shifty-looking Housing Minister, Yvette Cooper, failed to impress on 'Tonight with Trevor McDonald' on 20th February, when asked to justify the billion pound introduction of Home Information Packs due next year. "Critics queued up to pick holes in her system that will force home sellers to write a cheque for £1000 or more, and wait two to three weeks before being allowed to put their homes on the market" reports Trevor Kent, former President of The National Association of Estate Agents and one of the country's most vociferous critics of the scheme.  

 Kent continued " The programme confirmed that I am not a cranky lone voice in the wilderness as the ODPM has suggested, by highlighting heavyweight criticism from important bodies in the home-sale industry such as the Council of Mortgage Lenders, the Law Society and the NAEA".

 Cooper and by implication, her boss John Prescott, seemed to be able to find only one reason why three million people a year should have to lash out good money for a HIP - "First time buyers should be aware of the risks and  protected from abortive costs if a property turns out to be in poor condition". Yet everyone knows, except her it seems, that first time buyers are a fast disappearing breed due to house price inflation, and all experts accept that HIPs will exacerbate inflation dramatically, making it harder still for them to buy.

 " A Home Information Pack will be between 100 and 200 pages long and will contain some very personal details of intending sellers' homes, wealth and life-styles. It will be available not just for prospective purchasers of the home for sale to inspect, but also goodness knows what governmental departments and  quasi-official snoopers to delve in to, as each report will be centrally recorded" concludes Trevor Kent, " this crazy, expensive, unnecessary rubbish must be stopped, and soon".

  

Trevor Kent
Former President of The National Association of Estate Agents
Anti-HIP Campaigner and Property Broadcaster
trevorkent@homeinformationpacks.com  
or 01753 885522

 

 

 

 


Tuesday 31 January 2006

Home Information Packs should carry Health Warning

The Law Society has warned that a crucial “health warning” must be carried on all Home Information Packs (HIPs).

In its response the draft HIP regulations, the Law Society has suggested that the warning should reinforce to the buyer the risk of taking on substantial liabilities and commitments without the benefit of independent advice.

Kevin Martin, Law Society President, is concerned that without the warning there will be serious risks to the consumer:  “HIPs contain important legal documents on which professional advice must be obtained. Without appropriate warnings there is a real risk that a buyer could be pressurised into buying a property without independent advice.  Buying a home is often the biggest single purchase most people make.”

Commenting on the need for the packs to be dated and authenticated, Kevin Martin, said: “Currently there is no provision within the regulations for information within the HIP or the HIP itself to be authenticated or confirmed by the seller. This is a serious defect.”

Mr Martin said: “It is essential that HIPs will, in fact, bring the benefits to consumers that the Government claims.  Packs should be seen as part of the conveyancing process and not just a component of the marketing process. They should contain the best possible information to assist buyers and their solicitors to move transactions forward as quickly as possible.

Ends

28 February 2006  

 RESALE MARKET OF NEARLY NEW PROPERTIES COULD SUFFER WITH ADVENT OF HIPS

The NAEA predicts lengthy delays during resale of new build property  

The National Association of Estate Agents (NAEA) is cautioning the Government that the introduction of Home Information Packs (HIPs), designed to speed up house buying, could in fact cause frustrating delays for many people trying to sell a property which still has time to run on its new home warranty.

According to the Council of Mortgage Lenders*, most new properties are covered by a guarantee scheme to protect buyers against any major structural faults which may develop in the first 10 years after the property is built.  The anticipated delays will probably arise from the Home Condition Report (HCR) element of the HIP, due to be mandatory from June 2007, and its application with regard to new build properties with an exisitng warranty. 

The HCR requires a survey by home inspectors on all property for sale to bring to light any flaws before it goes onto the market, which could affect a property’s saleability.

Stewart Lilly, chairman of the NAEA Land and New Homes Groups explains: “If the HCR highlights any wear and tear on the property at this stage, the seller will naturally be inclined to get these fixed before it goes on the market, in order to achieve the best price.   A claim on the 10 year warranty can take up to nine months to deal with, depending upon the severity of the problem.  During this period the homeowner may not be able to market the property as for sale, causing extreme frustration. It may also have an impact on valuation.”

Many copies of new homes warranties are issued each year, as a result of the original being mislaid by the property owner.  These normally can take a while to re-issue through the system.  As Stewart Lilly explains; “The advent of the HIP will undoubtedly increase the volume of requests for copy documents which the warranty providers have to deal with, as people will need the warranty certificate to complete their HIPs.  This means that many sellers of new build properties under 10 years of age may have to wait a bit longer to actually put their homes on the market, as by law a property will not be able to be marketed without a complete pack”

Peter Bolton King, Chief Executive at the NAEA, concludes: “This is yet another delay with regard to HIPs that the Government has not considered.  We will continue to lobby on this issue on behalf of consumers until all these points are cleared up.”

 -Ends-

 

 

CML news & views news & views

the clock is still ticking!

Home information packs:  

• Time is running out for the successful introduction of home information packs (HIPs) in June 2007. There are still many unanswered questions, and the government has yet to publish a detailed timetable setting dates for resolving the key issues. 

• Among all the uncertainty, lenders have continued to give a clear and unequivocal message.  The introduction of HIPs will not alter the need for a reliable valuation, which is a fundamental requirement for prudent lending and provides security for lenders and borrowers. 

• Once all the outstanding issues have been resolved, firms operating in the housing market will need 12 months to build their systems and ensure that these are given a real and robust test. The government has assured everyone working in the industry that it will not introduce HIPs until it is absolutely clear that they are going to work. 

• The industry needs more information about the potential market impact of HIPs. There are good reasons for expecting a glut of properties on the market before June 2007 – as sellers rush to avoid paying up to £1,000 for a pack – and a shortage thereafter. The government need to do more to assess the possible impact. 

• We also need a detailed cost-benefit analysis of the effect of HIPs. Yes, there will be benefits from a more efficient method of buying and selling property – but the benefits need to be measured against the significant costs for the industry and consumers.

 • We will continue to work with the government to introduce HIPs as efficiently and effectively as possible. But if the implementation plans are flawed or cannot be completed in time, the government must be prepared to re-consider its proposal for introducing HIPs in June 2007.

“In contrast to all the uncertainty about the government’s plans, there is a clear message from lenders: 

HIPs will not change the fundamental requirement for a reliable valuation of a property”

the clock is still ticking!

Home information packs:

Valuation: a key issue 

With the proposed introduction of home information packs (HIPs) now only a little over 15 months away, there is still too much uncertainty about the government’s plans. Three months have elapsed since the government announced its revised implementation date of June 2007 – yet we have still to see a detailed timetable of events leading up to the planned launch date. The need for that timetable is now more pressing than ever, so that everyone understands when they are still able to shape the rules, and when the rules have been cast in stone so that systems can be built in confidence that there will be no further changes. 

In contrast to all the uncertainty about the government’s plans, there is a very clear message from lenders

about HIPs. The reality is that they will not change the lender’s fundamental requirement for a reliable valuation of a property providing security for a loan. A valuation provides an independent, reliable, indemnified and timely assessment of a property’s worth. It is an immutable requirement for prudent lending, protecting both lender and borrower. 

The home condition reports (HCRs) contained in HIPs will not be an automatic substitute for the valuation that lenders need for every transaction. Over time, robust HCRs that can feed seamlessly into lenders’ information systems may reduce the number of physical inspections that lenders need to make. Where this can happen, consumers could benefit from lower costs, which would help to offset the charges they will have to pay for HIPs.

 In the majority of cases, however, lenders will still need a valuation report, for which there will be a separate charge. In particular, lenders are likely to need a valuation report for: 

• both low- and high-value properties;

• properties in rural locations or other areas where comparing the value of another property is difficult;

• properties built using non-traditional or unusual materials or methods of construction;

• older properties, or ones where the buyer wants to borrow a large sum relative to its value;

• borrowers with credit risk or other problems. 

Home condition reports

We do not have figures for the numbers of properties that fall into all of the above categories. But we do know, for example, that some 40% of all mortgages for house purchase have a loan-to-value ratio of 80% or more. In these cases, lenders are likely to require a separate inspection, regardless of the HCR.

“In November 2004, former housing minister Keith Hill gave an ‘absolute assurance that we will not bring this system in until we are absolutely clear that it is going to work’ ” 

Ultimately, it will be for individual lenders to decide when they can rely on HCRs and when they require an additional valuation, bearing in mind the need for responsible lending. Some may decide not to use HCRs at all, but continue to carry out valuations as they do now. Others may look at paper copies of HCRs to help decide what type of valuation to commission. And some lenders may want to use automated systems to sift

HCRs electronically, perhaps choosing to use AVMs for properties with good condition ratings. Partly as a result of the uncertainty over government plans for HIPs, the extent to which individual lenders will rely on a combination of HCRs and AVMs is not clear at this stage. But some idea of the different approaches the industry may adopt emerged at a seminar we held in January, looking at the operating environment when HIPs come into effect. The chief executive of Hometrack, Mark Witherspoon, confirmed that AVMs were not seen as a replacement for traditional valuation techniques, and argued that lenders were more likely to use them for remortgaging decisions than house purchase. Graeme Winser, the chief executive of UK Valuations, pointed out that while the accuracy of AVMs had improved dramatically over the last 18 months, further improvement would be more difficult to achieve. And others pointed out that AVMs could work well for some properties but were less reliable when applied to newly-built homes.

 

What the industry needs 

A number of other factors will determine the extent to which lenders can rely on HCRs. In particular, any databank of HCRs must have a single point of access to minimise the technology requirements. There  should also be no charge for lenders who want access to the databank. Use of HCRs will still depend on how reliable they prove to be. The government therefore needs to encourage the development of a home inspector certification scheme as soon as possible, and commit to contributing start-up costs if necessary. And to realise the full potential of its plans, the Government must liaise with the Land Registry on complementary initiatives like the introduction of e-conveyancing. 

We support the government’s broad objective of improving the home-buying process. We have therefore sought to work with the government to ensure that outstanding issues that could jeopardise the launch of HIPs are addressed. To ensure that HIPs are launched as successfully as possible, the Government now needs to: 

• Publish a detailed timetable of key dates leading up to the implementation of HIPs, allowing everyone who will have to work with them, including lenders, to plan how their industries and their individual businesses can prepare. The timetable needs to cover issues like the setting up of an HCR databank, the introduction of qualified home inspectors and the setting of standards for technical and business processes. We advise the government that it should be working towards implementation between October 2007 and January 2008, because of the amount ofwork still to be done and the need to avoid the busiest times of the year for the housing market. 

• Publish its plans for a ‘dry run’ of the system. We believe that the dry run should provide a real and robust test of the process from start to finish. It cannot begin until a scheme for certifying home inspectors is in place, for such a scheme is crucial in delivering confidence both in professional standards and in the quality of HCRs. In November 2004, the former minister for housing and planning Keith Hill gave an “absolute assurance that we will not bring this system in until we are absolutely clear that is going to work.” If the dry run shows that the implementation plans are flawed or cannot be completed in time, the government must be prepared to re-consider its proposal for introducing HIPs in June 2007. 

• Publish its plans for addressing the potential market impact of the introduction of HIPs. Everyone with a stake in the property market, including individual buyers and sellers of property, could be affected by the proposals. It is difficult to predict exactly how the market will react to HIPs but in the months leading up to their introduction there could be an over-supply of property as sellers try to avoid the costs of packs, while first-time buyers hold back for them. But, after they are introduced, the market could be weak with fewer sellers and less choice. The government needs to do more work on the potential market consequences, so that everyone can be better prepared. 

• Undertake a rigorous cost-benefit analysis of the introduction of HIPs. There will be significant costs for lenders, although the government seems reluctant to acknowledge that there will be a financial impact on the industry. Other sectors will also incur costs, and so will consumers. Lenders acknowledge that there will be benefits from a more efficient means of buying and selling homes, but they must be measured carefully against the costs. 

Our recent seminar heard how the introduction of the Danish equivalent of HIPs had affected the number of transactions in that country. The chief executive of the Danish Association of Estate Agents, Palle Ulstrupp, said that packs had deterred speculative sellers of property and that there were consequently up to 25% fewer homes on the market since their introduction. He also said that there was a fundamental mistrust by buyers of HCRs commissioned by an estate agent marketing the property.

 Conclusion 

We will continue to work with the government to implement HIPs as efficiently and effectively and possible. The best chance of delivering this is to ensure that the outstanding issues are addressed and that firms have at least 12 months to build and test the systems that will fulfil the government’s objectives. At the same time, we will continue to express lenders’ concerns about the proposals. Where those concerns echo the views of other professionals in the industry, they must still be communicated to the government. Earlier this month, for example, the Home Builders Federation (HBF) echoed our call for a proper trial to ‘road test’ HIPs. And he would endorse the HBF’s concern that consumers should not become “unintended losers” of a scheme originally devised to serve their interests.

 

 

 

 

Well over 500 influential estate agency proprietors with some 1500 offices between them , including Trevor Kent of course, recently subscribed to the sentiments in this Press Release issued in February 2006

ESTATE AGENTS FIGHT FOR CONSUMERS' INTERESTS.

 Property professionals tell government "You've got it wrong" over plans for compulsory Home Information Packs. 

A powerful group of estate agents, joined by chartered surveyors and solicitors has written to Housing Minister, Yvette Cooper MP calling on her to drop plans for the introduction of Home Information Packs (HIPs) in June 2007. The group say HIPs will be "detrimental to the consumer; could dislocate the property market and will fail to significantly improve the home buying process." 

500 heads of firms representing over 1,650 offices in England and Wales are warning government that HIPs will cost home sellers and buyers over £600 million pounds every year in extra costs yet will fail to deal with the problems of delay, frustration and abortive cost in home buying. 

The letter's signatories include household names such as Knight Frank and Savills, but it is not only top firms that are up in arms. Hundreds of smaller firms and local agents from all over the country, dealing in all price ranges, have signed up too. 

London estate agent, Nick Salmon, a fellow of the National Association of Estate Agents leads the group and says that HIPs will have very serious consequences for the public. 

"The government is about to con the consumer that HIPs is a magic cure for the problems incurred in home buying whereas in fact it will be an expensive disaster for everyone except the commercial enterprises that have set up to cash in on this new, annual billion pound market. There will be a 30% reduction in the number of properties put up for sale each year as sellers are deterred by the £700 to £1000 cost of a Pack. That reduction in supply will cause massive house price inflation." 

"Buyers and sellers will be disappointed and angry to discover that the expensive HIP will leave them still facing most of the problems currently inherent in the property buying system including gazumping, gazundering, and chains. The government are forcing us over the edge of a precipice by pushing this through and it is the consumer who will pay. This is 'Prescott's Penalty' on the housing market and it must be stopped." 

"We would all like to make home buying easier but the government is deaf to any constructive criticism levelled at HIPs. So now the property industry is coming together to protect the interests of the consumer and calls upon the Housing Minister to shelve the implementation." 

ENDS

 

 

 

news telegraph From
Christopher Booker's notebook
(Filed: 22/01/2006)

Prescott plans a new disaster for house sales

John Prescott, the man who doesn't pay his council tax, will soon face another major embarrassment. This is the chaos he will unleash by introducing a serious new complication to homebuying, due to cost homeowners £1 billion a year - all because he wishes to disguise his need to obey a Brussels directive.

From June 2007, it will be illegal for anyone to offer a house or flat for sale without paying up to £2,000 for a 100-page "Home Information Pack", prepared by a certified inspector. This "HIP" will contain details of legal and council searches, and a "Home Condition Report", checklisting the kind of details obvious to a fairly rudimentary visual inspection. (Buyers will still need to commission a full structural survey and valuation.)

This is a flimsy cover, however, for the real motive behind Mr Prescott's HIP scheme - his obligation to comply with EC directive 2002/91 requiring every home put on the market to have an "Energy Performance Certificate", based on a formula which measures the size of a property against recent fuel bills.

The more closely surveyors, estate agents and lawyers look into Mr Prescott's scheme, the more horrified they become, not just by its pointlessness, but by the damage it is likely to inflict on the property market. According to his officials, it will require up to 7,500 inspectors, each needing 18 months' training. The latest figure for inspectors in the pipeline is only 1,800, so when the scheme comes into force in 18 months, less than a quarter of the required number will be available.

Nevertheless, anyone caught by trading standards officials selling a home without an HIP will be liable to a summary penalty up to £500. The shortage of inspectors means that, unless Mr Prescott is allowed a postponement from Brussels, delays of months, even years, will be inevitable, creating havoc across the domestic property market.

The initial cost of commissioning an HIP will be incurred by the estate agent, to be added to the bill when the property is sold. Although the Government's estimated cost for an "average" property is only £700 including VAT (quite onerous enough for sellers on low incomes), in many cases the cost will be as high as £2,000, and perhaps even more. Few vendors will wish to pay such sums more than once, particularly when the cost of copying a 100-page report for each prospective buyer could be £15 or more. Gone will be the days of offering a home through more than one agent.

One horrified observer of this "disaster waiting to happen" is Philip Collings, formerly the IT director for Railtrack, who has just launched a website (www.hipfreehomes.com), explaining some of the more glaring flaws in the scheme. He points out that, of the £1 billion a year it will cost to run, the Government will take £87 million in VAT, and that the details of each property will have to be registered on a Government website, making it easier to carry out revaluations for council tax.

But Mr Collings also believes he has spotted a loophole in the scheme, by which homeowners could avoid having to pay for HIPs. Although he is not revealing the details yet, for fear of counter-action by Mr Prescott, he is inviting property owners who are likely to sell within two years to register their interest on his website, so that in due course he can sign them up, for a modest fee, to an arrangement which he believes could save them thousands of pounds and months of hassle.

Christopher Booker's notebook
(Filed: 22/01/2006)

 

 

 

TREVOR KENT Says

Despite opposition from almost everyone devoted to the house buying and selling industry (including many surveyors who have spoken to me privately) the Government presses on with the HIP, but for what ?  Votes - unlikely, prestige - unnecessary, bloody mindedness - possibly, or perhaps there is another agenda to do with future tax raising and cost saving ?   It has been suggested that the Quango "hubs" to be set up to collate and centrally record the Home Inspection reports may be used by the Government to produce the report on housing stock insulation required by the Kyoto agreement.  It is also felt in some quarters the Government will also use the data base to carry out a revaluation for Council Tax or other tax raising initiatives (and all paid for by sellers)

What we do know is that the Government misguidedly forges ahead and has presented draft regulations for the preparation of HIPs, you can study these on this link to the ODPM site www.odpm.gov.uk/index.asp?id=1150984.  Despite a previous slamming by the Select Committee, and a mauling by both Houses of Parliament in debate the Government still cannot see the folly of their ways. We are left with a law that will make it an offence from 2007 for ANYONE to put their house on the market without having first bought a survey of their home (for the buyer to look at), a  contract style property report, local searches, guarantees and planning permissions.  So, no for sale board, no advert, no phone call to a hot prospect - nothing for at least 3 weeks whilst someone prepares your HIP (Home Information Pack). The Government say one of the monopoly HIP providers will do all this for you at 'no up-front cost'.  What of the cost however, if granny dies and you decide not to sell, or you lose the one you're after (probably because of the delay in getting yours on the market because of the need for a HIP), who pays the £1000 then? You've guessed it - you.  Most HIP providers plan to enter intending home sellers into a credit agreement to ensure payment of the £1,000+ for their HIP.

Read the Office of The Deputy Prime Minister's latest on HIPs by hitting the link to ODPM site  then read what The Times thinks of the ODPM's plans below.  Finally consider whether you wish a 20 page survey of your home to be recorded on a Whitehall computer and available for the public and Government agencies to read (at your cost) and the loss of your right to market your home on the day you chose.

Trevor Kent

Former President of The National Association of Estate Agents
Anti-HIP Campaigner and Property Broadcaster

trevorkent@homeinformationpacks.com  
or 01753 885522

 

 

 

 


THE TIMES
October 31st, 2005


ANYONE selling a house will have to spend up to £1,000 providing an information pack for buyers as part of a shake-up of the housing market to be published by the Government today.

The Times has learnt that John Prescott will finally publish draft laws creating home information packs (HIPs), amid mounting concern that the measures will destabilise the housing market and increase significantly the costs of moving. The Government maintains that its plans will reduce the cost of buying a house, particularly helping first-time buyers.

Under the regulations leaked to The Times, from spring 2007 anyone selling a home will have to provide potential buyers with a sheaf of documents including evidence of ownership, local authority searches and a new “home condition report” before they can put their house on the market. Opposition politicians and industry groups said yesterday that the plan would create a new army of unregulated pack providers who could exploit buyers and sellers. There are also concerns that buyers will have no confidence in the home condition report provided in the pack and will pay to have a full building survey done themselves.

“Home information packs will be a breeding ground for cowboys happy to ignore problems, or worse not qualified to identify them,” Sarah Teather, the local government spokesman for the Liberal Democrats, said. “Most buyers will simply not trust the report of a home inspector paid by the seller and will end up paying for their own survey.”

Whitehall sources admitted that they were uncertain about the market impact of the new policy, which could lead to a glut of houses for sale before 2007 followed by a scarcity of property after the policy comes in.

The consumer watchdog Which? supports the policy in principle but is concerned that there is insufficient redress against rogue estate agents or control over the content of home information packs. Inspectors who provide surveys will be required to have liability insurance, because they will be held responsible for serious errors, but no provider has yet come forward and the Government may have to step in.

Caroline Spelman, the Shadow Secretary of State for Local Government Affairs and Communities, said that the packs would do nothing to stop gazumping or to speed up the process of buying a house. “Instead, sellers will be saddled with an extra cost of up to £1,000; lenders will probably demand their own assessments; and many buyers will want their own survey instead of the one they are given,” she said. “Labour’s sellers’ packs will simply put up the cost of selling a home, create more red tape and ultimately undermine a fragile housing market.”

The draft regulations show that the Government has decided to press ahead with a medium-level home condition survey, against advice from the Royal Institution of Chartered Surveyors.

The survey, costing an average £350, goes into greater depth than the current valuation carried out by a mortgage lender, but is not as thorough as the homebuyers survey and valuation or a full building survey.

Jeremy Leaf, spokesman for the institution, said that the home condition survey was just a tick-in-the-box exercise, rating the condition of each element of the structure.

A spokeswoman for the Office of the Deputy Prime Minister said that inspectors would have to be trained for at least 18 months. Existing surveyors would also have to train before they were allowed to carry out inspections.

One surveyor said: “Because the certification requirement for inspectors is the same whether you are an experienced surveyor or the man in the street, as anyone can become a home inspector, there is every chance that a seller who fears something is wrong with his home will commission the latter to do his survey.”

 

 

 

THE TIMES
July 29, 2005

Who will pay for Home Information Packs?

Home Information Packs are all very well, but who is actually going to pick up the bill for them?

HOME INFORMATION PACKS (Hips) have been back in the news this week, after the Government announced the progress it has made in the training and certification of Home Inspectors — a crucial element to the success of the entire project. The announcement seems to have been a bit of a wake-up call for the industry as a whole, which is curious, given that Hips have been in train since 1997.

When this Government came to power, it decided to reform the way in which houses are bought and sold and the original thinking behind this was to call a halt to gazumping. Once it was established that gazumping actually had very little impact on the market, it was decided to begin a root-and-branch review to discover how many sales fall through, and why. The research pointed to 28 per cent of all transactions falling through after terms had been agreed: and, further, that almost half of these were because of problems with the valuation or survey, at an average cost to the buyer of £1,000.

“If you look at England and Wales compared with housing markets in other countries, we are at twice the European average in terms of the amount of time it takes to buy or sell a house,” said Yvette Cooper, the Minister for Housing and Planning. “The estimated cost of failed transactions is about £350 million.”

While many areas of the industry have welcomed Hips, and companies such as Rightmove, the property portal, have already invested millions in their technology infrastructure, those who have yet to start a business plan are in danger of missing the implementation date of 2007. This is more critical than it sounds: once this comes into force, it will be a civil offence to market a house without a pack.

Not everyone thinks that Home Information Packs are going to make the house-buying process smoother, however. Trevor Kent, a former president of the National Association of Estate Agents, believes that the cost to the seller of a pack will be about £1,500 — almost double the current average cost to a buyer of getting a survey done, plus all the local searches and associated costs — although the Government estimates the cost to be about £650, and he questions how often the Home Condition Report (HCR) — the survey element — will need to be updated. Although Keith Hill, Ms Cooper’s predecessor, told The Times in March that he envisaged the HCR would have a shelf life of six months, the Government now says there will be no time limit on the HCR while the property remains for sale, the only requirement being that it has to be carried out no more than three months before the house is put on the market.

Mr Kent is also concerned about those estate agents who may seize this chance to offer a “one-stop shop” for sales, mortgages and Hips. He says that they may follow the lead of realtors in the United States, who, he says, raised their fees from 6 per cent to 8 per cent on the back of such a monopoly. Of course,,, the main concern to independent agents — of whom Mr Kent is one — is who will pay for these packs up front. “I think there is a market solution to this which is about promoting competition as well,” Ms Cooper said. “It would be wrong for us to end up being protectionist about this and to end up saying we are not going to introduce improvements that will benefit all consumers because we want to protect bits of the industry that can respond.”

While you might think that Mr Kent is being unduly alarmist about agents’ fees heading north, there is one concern about Hips that has not really been addressed. The Government wants to have the packs available at the very beginning of the marketing process — which is fair enough: if you can see that a property needs work that is beyond your budget, you are not wasting yours or the sellers’ time (and your money) by going to view it and getting a survey.

However, most people get details of five, six or more properties that seem to fit the bill before whittling the list down,  are we going to be staggering out of agents’ offices laden down by so many information packs? I have a draft pack on my desk which is almost an inch thick. And what about those who do their browsing online? Are packs going to be sent out in the post too? Our local sorting office won’t deliver anything heavier than a chequebook.

Estate agents with lots of properties on their books are going to be piled floor to ceiling with Hips, and although this prospect may rise a smile, are prospective buyers going to be charged to take away packs? An agent might not want to pay for, say, 35 copies of a pack on a property, so will just prepare one — and then get the office junior to photocopy it each time a buyer wants to see a copy, charging you, what — £1 a pack for the privilege? If the Government really is serious about making the whole buying and selling process more transparent, then isn’t this the perfect opportunity for proper regulation of estate agents to be introduced, along with Home Information Packs?

 

 

 

 

 

THE TIMES
July 25, 2005

Door opens for house surveyors 

New laws on property sales will mean huge demand for reports, many done by newly trained inspectors SURVEYORS are to lose their monopoly on inspecting homes for sale as part of a shake-up in the law on buying and selling houses.

Ministers will announce today that they are to open up the role to other professionals as part of the introduction of compulsory reports on homes before they are put on the market.  

Yvette Cooper, the Minister for Housing and Planning, told The Times that Home Information Packs will be a legal requirement in England and Wales from 2007.  A new army of inspectors will have 18 months to seek qualifications under the scheme, which will be modelled on the CORGI (Council for Registered Gas Installers) registration system for gas fitters.  Ms Cooper said: "A lot of people effectively already have the skills and experience and it's just simply making sure they are properly certified and qualified."  Only chartered surveyors may currently do surveys because they involve a valuation for the mortgage lender.  But the new report will not require a valuation and will open up the role of home inspector to a wide range of industry professionals, who will undergo a "conversion" course, as well as to people with no experience.

The Government would like to attract more women into the profession and is hoping that a certification scheme will silence critics who have called it a "burglar's charter". Inspectors will undergo checks on their competence and personal history, including any criminal convictions.  They will also be required to have insurance because they will be personally liable for errors in the report.  The number of inspectors needed is expected to be about 7,000: more than 1,000 candidates have registered. Only one in ten buyers currently pays for a survey, so the increase in demand will be enormous.  More detail will be announced when Ms Cooper meets estate agents' representatives, solicitors' leaders and mortgage lenders to discuss how the Government will implement the Home Information Pack. Ministers want a "dry run", which would introduce the packs in one area in the middle of next year, to iron out problems before they become compulsory early in 2007.  The cost is projected to be between £800 and £1,000 and will be met by estate agents or inspection firms at the outset, then recovered from the seller on completion, along with estate agents' and solicitors' fees. The National Association of Estate Agents is against this, arguing that it will be a crippling financial burden on independent agents who may have 100 properties on their books.

Kevin Martin, who has just become President of the Law Society of England and Wales, said that the information packs will be costly and of doubtful benefit to buyers. There was also no evidence that this would speed up the house-selling process, he added, saying "buyers will want to have their own surveys". 

 

 

 

Press Release

  FOR SALE TODAY OR NOT GONE TOMORROW
SAYS ESTATE AGENCY COMMENTATOR TREVOR KENT

Government plans to introduce controversial Home Information Pack (HIP) legislation will deprive home owners of the right to sell when they want to.  Properties will not be allowed to be put up for sale until a pack is prepared.  The mechanism involved could delay marketing for weeks.

Trevor Kent is a member of an anti-pack campaign group, which asked a representative number of estate agents the following question 'On obtaining instructions to sell, what percentage of clients demand, or need, immediate marketing? ‘.  Respondents said that 89% of home sellers expect their property to be put on the market with no delay at all.  Findings also suggest that, whilst getting on to the market quickly was less important for top price range properties, it was 'very important for owners of medium and lower priced homes' - the mass market in fact. 

Agents say that, currently, they start marketing immediately they have confirmed their terms and the property details are approved.  They instantly put up sale boards, text buyers, place advertisements on the internet and make telephone calls to 'red-hot' applicants.  Trevor Kent says this process is not understood by government officials, who seem obsessed with having the Pack in place before an estate agent can so much as 'whisper' that a property may become available for sale.  Selling before a Pack will be illegal, the pack will cost upward of £1000 and might take 3 weeks to prepare.

Home owners making an offer for another property will demand that the marketing process for their present home begins immediately or they will risk losing out as a prospective purchaser for their next one.  In a recent government trial of one component of the pack by the Building Research Establishment (the survey) they found there was difficulty in getting sellers to take part because they themselves would not accept a 'delay in the start of marketing' which the trial required.

Trevor Kent says ‘Property professionals, who deal with home sellers every day, are constantly warning the government that there will be much public anger if they are forced to delay marketing by up to three weeks.  Civil servants argue that the time delay whilst preparing the pack is well spent because it means an eventual sale is 'more likely to stand up'.  Professionals do not agree, pointing out that the small risk of transaction failure, already down to less than 15 per cent of deals, is small beer compared to making 'First Day Marketing' illegal.  

‘The government is ignoring its own research which shows that buyers are not interested in seeing a Pack before viewing a property. There is simply no justification for delaying marketing and taking away the right to sell while the Pack is being prepared.  When home owners wake up to the implications of this proposal there will be a political backlash, especially when people find out that their enforced Home Information Pack will cost them £1000 and delay the 'For Sale' board going up by three weeks‘.  

Despite protestations the Bill got through Parliament and is now an Act.  The Government plans to have a 'dry run' in July 2006, no doubt to see whether HIPs will work.  In the meantime they have to decide;

 

(a) What goes in them. 

(b) Who can prepare them. 

(c) Who can read the reports when recorded on Government computers. 

(d) How 10,000 new surveyors (or Home Inspectors) will be trained, regulated and insured. 

(e) Prepare the public for a 3  week delay before marketing and a cost of £1,000. 

(f) Teach the industry how to use HIPs.  

(g) Ensure half a dozen major companies don't monopolise the HIPs' marketing and with it the whole buying and selling process and end up charging the public 6% agency fees as in the USA.

Mr Prescott, I wish you luck.

 

Trevor Kent

Former President of The National Association of Estate Agents
Anti-HIP Campaigner and Property Broadcaster

trevorkent@homeinformationpacks.com  
or 01753 885522

 

 

 

The Housing Bill, containing the proposals for Home Information Packs, received its Third Reading in the Commons on Tuesday 18 May. The full transcript can be read in Hansard from this link on:

http://www.publications.parliament.uk/pa/cm200304/cmhansrd/cm040511/debtext/40511-06.htm#40511-06_spnew1

It is worth noting that to the fury of the Opposition parties the government effectively guillotined the Bill by severely limiting the time allowed for debate. One example, of many - Robert Syms MP: "The Government are again forcing a diktat on the House and we wish to make it clear that we oppose their manner of conducting business in the Chamber."

Lib Dem and Conservative speakers tried their best to obtain fundamental amendments to the clauses relating to Home Information Packs (not least a well argued effort to make them voluntary rather than compulsory) but were consistently defeated by dogmatic Labour speakers who will brook no criticism of their proposals - despite there being many, major concerns from all the key bodies directly involved in the home buying process. The Bill passed the Third Reading.

Perhaps the situation was best summed up right at the end of the debate by Bob Spink MP : "The process will cost more, but we shall achieve less. The Bill is a typical socialist measure (laughter). The compulsion to produce the home conditions report will increase the cost of selling houses. Hon. Members laugh now, but they may not do so in two or three years, when their constituents knock on their surgery doors. It will deter some sellers from entering the property market. The statutory requirement means that home information packs must be in place before any marketing can occur. That will unduly reduce the number of houses (for sale).

It's law now, but that doesn't mean it will work. 

trevorkent@homeinformationpacks.com  
or 01753 885522

 

Below are comments, letters and articles devoted to the subject

SUCCESSIVE HOUSING MINISTERS PLEDGE TO IGNORE PROFESSIONAL ADVICE ON HOUSE SALES CHANGES

John Prescott has set about the task of changing the age old system of house sales, his plans have not been well received by the industry, but he seems to be more determined to go ahead the more concerns he hears from property professionals.

Over the last five years, what was then, The Department of Transport Local Government and The Regions (strangely not the Department of Trade or even the Lord Chancellors Department) has investigated claims that the current system is too long drawn out, too cumbersome and fraught with disappointment for those seeking to buy or sell a home.  Their five years of consultations were firstly under the guidance of previous ministers Nicholas Raynsford followed by Stephen Byers then tucked firmly under the wing of Lord Falconer who’s previous property “experience” includes the disposal of the Dome, and then Lord Rooker at the newly created Office of the Deputy Prime Minister.  The basic plan the Government favours is to legislate that all sellers intending to put their homes on the market must first prepare a “Sellers' Home Information Pack”.  It is intended this document should include a survey of the property, a contract of sale and answers to all legal queries which would normally have been raised later in a transaction by a prospective buyer. 

CRIMINAL  It was intended by Lord Rooker that it would be a criminal offence to begin marketing a home before the Home Information Pack is available for inspection by anyone wishing to buy.  It would, however take at least 4 weeks to prepare. (One in the Government's own pilot scheme took 52 days!) The ODPM has subsequently indicated the penalty for marketing without a pack will be civil not criminal.  

BIG BUSINESS  INFLUENCE    There seems little support for the proposals from any quarter within the professions connected with house sales.  A leading critic is Former President of the 9,500 strong National Association of Estate Agents, Trevor Kent.  He accepts sales can take many months, he also agrees that both buyers and sellers often loose money and suffer disappointment when sales, particularly those in “chains” fall through.  Nevertheless he believes the Government proposals to be totally misguided and by and large have been high-jacked by Big Business interests.  He believes a number of massive firms seek to dominate the lucrative buying and selling market  with Home Information Packs and eventually lift moving costs to levels enjoyed in the American market whose organisations have over-seen costs rise to near 6% of transaction values. 

MONOPOLY & COST TO THE PUBLIC  Trevor Kent says “The reason estate agency in the UK provides a 1.5% service is because of competition.  The Government’s Sellers Home Information Pack would cost each intending seller between £700 and £1,500 (depending on their sale price) to prepare – if big business can create a stranglehold by  initially offering to fund the cost of these “packs”, their end charges will become horrendous”.  Owners will be forced to sign “sole selling rights” contracts with a new breed of agency/conveyancers and even a sale to Mum will involve massive fees. 

COVENTRY  -  2002 A national meeting of 300 Estate Agents in Coventry heard David Woodward from the Office of the Deputy Prime Minister spell out the form the “Pack” will take, but Trevor Kent reports that both Woodward and the Government had a rough ride from agents who foresee the total decimation of the property transfer market and certainly there was no support in the room for the initiative.

2002  National Association of Estate Agents vote in General Council to advise the Office of the Deputy Prime Minister that they withdraw all support for the Governments Sellers Pack system as currently proposed.  There are 9,500 members of the NAEA.

 2002  The Council of Mortgage Lenders, the influential body representing 98% of the countries Banks, Building Societies and Insurance Companies who lend money for house purchase, hold a one day conference devoted to Sellers'  "Home Information  Packs".  They announce they too doubt the effectiveness of the proposed changes and urge the Government to re-think their strategy.

THE LAW SOCIETY representing conveyancing solicitors who undertake the bulk of the housing transactions in England and Wales said of Sellers Packs 14/11/02 "The Law Society also has grave concerns about the Government's plans to make a Home Information Pack compulsory for people selling their homes.  The Society believes strongly that use of the pack should not be compulsory as this would load significant extra costs on to people on low incomes who are selling their homes.  Commenting on the Pack proposals, Law Society Chief Executive Janet Paraskeva, said: "Improving the home buying process is something to which the Law Society is committed.  However a compulsory sellers' pack containing information such as a survey which will soon be out of date, and is expensive to provide, is not the real answer.  Electronic conveyancing and the increased use of the National Land Information System will substantially improve the home-buying process more effectively than the provisions proposed."

 

The Editor
The Bucks Free Press
Gomm Road
High Wycombe
Bucks
HP13 7DX

Sir,

Bureaucracy can damage your house sale

Any reader contemplating the sale of their home in the future would be well advised to spend a few moments contemplating their recent “extension and improvement” history. 

Some do work on their houses with no permission at all – I’m sure they are already aware they will face legal problems when they come to sell.  I am more concerned with those who have “done it right” by getting Planning Permission and Building Regulations Consent, but have forgotten to obtain a “Confirmation of Completion Certificate” from their Council, following a final inspection.  Buyers’ solicitors’ demands for such documents can and do cause serious problems, delays and sometimes lost sales. 

The Government intends to legislate soon that every seller should have a legal “Home Information Pack” prepared, at the seller’s cost (many hundreds of pounds round here) BEFORE an agent is permitted to begin MARKETING.  Failure to have details such as Building Regulations Completion Certificates to hand,  may mean the law would delay my nailing up a “FOR SALE” board for weeks after a decision to go to market, as Home Information Packs will demand all these details are available first.

 The Government’s proposed Home Information Pack also demands (with civil sanctions for failure), that sellers should also provide a survey (at their own cost) before they will be allowed to market their home.  I estimate the total average upfront cost for a Sellers Pack will be well in excess of £1000 in South Bucks, and this does not include the further expense of  “updating” the Pack if you don’t sell in 3 months.

 If readers believe such details and costs would damage their prospects of sale I urge them to write to The Minister at the Office of the Deputy Prime Minister, at Eland House, Bressenden Place SW1E 5DU and tell him so.  I hope he replies to you - he won’t speak to me!

Yours etc,  
Trevor L Kent PPNAEA  

 

Mail on Sunday Consumer Affairs Correspondent, February 2002

Home sale packs may have to be scrapped
By Sean Poulter

Plans to introduce compulsory sellers’ packs for house sales may have to be scrapped following opposition from estate agents.  The scheme, designed to make the selling process easier, was announced before the last election and included as a manifesto commitment.  But the proposal, from Stephen Byers’s Department of Transport, Local Government and the Regions, has been fiercely criticised.  Estate Agents have questioned the value of the packs, which would cost up to £750 and contain a survey, land searches and a draft contract to show potential property buyers.

Agents say introduction of the packs could add £500million a year to home-buying costs.   And they do not want the extra work involved in helping people put together the packs before a house is put on the market. 

A conference hosted by the National Association of Estate Agents this week revealed overwhelming opposition to the plan. (As Trevor Kent reported elsewhere on this site).  A London estate agent said “Home owners and estate agents who failed to produce a seller’s pack when they marketed properties could face prosecution and hefty fines.  “Estate agents could end up with a criminal record.”  Buyers would not trust the Home Condition Reports in the packs, which would result in them carrying out a survey of their own, adding further expense to the process.

As a result, the single most expensive element in the proposed packs – the survey – “would become a complete waste of money.”  Surveyors are also concerned that there are not enough of them to complete the packs.  As a result, families could face long delays before they were able to put their homes on the market.  The Law Society has also challenged the proposals from the Department of Transport, Local Government and the Regions.   It believes that the development of conveyancing on the internet, making land registry searches and eventually, local authority planning information available on the web, will achieve the aim of speeding up house purchases.  Labour backbenchers are furious that the proposals would force owners of low-price homes to carry out an expensive survey before putting their property on the market.  Lord Falconer, former Minister for the Dome, is currently carrying out a consultation exercise on the sellers’ packs.  Housing Minister Nick Raynsford has signalled he is ready to consider changes to the scheme amid growing pressure from MPs.  The scheme, however, is backed by the Consumers Association, which says the packs would help “take some of the misery out of the house purchase business.”  Apart from speeding up the process, it would avoid the need for several buyers chasing one property to each arrange their own survey.

 “Lets hope the Mail on Sunday is right” said Trevor Kent, February 2002.  

 

 

Council of Mortgage Lenders (CML) a powerful body who represent 98% of house purchase finance providers immediately issued a statement 14/11/02 making it clear they too are not enamoured with Packs either.  I quote their statement in full:-

"Following the announcement of a draft Housing Bill in today's Queen's Speech, the Council of Mortgage Lenders reaffirms its support for the Government's aims to speed up house-buying.  But the CML says it is important not to overstate the potential impact of sellers' packs, and to recognize that they are not a panacea.  Other initiatives, such as the National Land Information Service and e-conveyancing, are likely to have a greater impact on speeding up house-buying.  And these other measures, unlike sellers' packs, would not introduce extra costs to the market.

The CML supports the introduction of legislation to introduce sellers' packs that is enabling, not prescriptive.  But at the same time, the Government should prioritize and speed up full implementation of NLIS and e-conveyancing, and set dates by which all market participants must use these systems.  After this, it will be in a better position to assess whether there is still a perceived benefit in implementing the legislation to introduce sellers' packs."

Peter Williams, CML Deputy Director General, commented -

"Sellers' packs may well have a part to play in providing more upfront information to buyers - albeit at a potential cost.  However, they are far from the most important new initiative to speed up transactions.  The Government, and all those involved in conveyancing, must make sure that they do not get sidetracked by sellers' packs away from other important market developments.  Setting targets and providing funding to get the National Land Information Service up to full effectiveness and implement e-conveyancing should be the most urgent priorities."

They updated this stance on 17/6/03 saying:

 

CML responds to Housing Bill proposals

Tuesday 17 June 2003

In publishing its response to the proposed Housing Bill today, the CML has emphasised that lenders support the Government's objective of making home-buying easier, quicker and less stressful. But the CML also raises major concerns about how the Government's plans to introduce home information packs will work in practice.

A fundamental requirement is that lending remains prudent. This means that lenders must retain the right to commission a valuation to make sure that a property represents adequate security for the loan. The Government suggests that lenders will usually be able to rely on information contained within the pack, but this will not be sufficient in all cases. Lenders would therefore like to see the right to commission a valuation upheld in the Bill.

Another key issue is the impact the requirement to produce a home information pack could have on the supply of properties coming on to the market. Lenders are concerned that the Government may have underestimated the cost of producing packs and that the proposals could deter potential sellers from putting a property up for sale. So far, the Government has not said how it will monitor the effects of its proposals on the market, but lenders would like to know what plans there are to do this.

Lenders are also concerned about the need to ensure there are enough suitably qualified home inspectors. And at this stage it is particularly important to make rapid progress in two specific areas in order to meet the proposed timetable for implementing the Bill's proposals in 2006:

  • Lenders need to be sure now that their information systems will enable them to draw on information contained in home condition reports that will be logged on a central databank.

  • They also need an assurance that home inspectors will have suitable indemnity insurance. There is already a shortage of this type of insurance in the market and the CML believes that it will be difficult for a new profession providing a new product - with no claims history - to obtain cover. We therefore believe that the Government may have to agree to underwrite indemnity insurance for a period of time.
Commenting on its submission on the Housing Bill, the CML's Deputy Director General Peter Williams said:

"We share the Government's desire to make the home-buying process easier, less stressful, more transparent, more certain and faster. But we continue to have major concerns about how the proposed legislation could be implemented. There is an urgent need now for the Government to settle the practical problems raised by lenders that act as a barrier to successful implementation.

"We have been involved in the debate about the introduction of home information packs since they were first suggested but, six years further on, there are still many important practical issues to be resolved. Our fear is that if the proposals are implemented without addressing the myriad concerns, the introduction of home information packs could create more problems than they solve for people buying and selling homes."

 

£1,000 logbook plans for homes

Sean Poulter, Daily Mail
18 June 2003

HOMEOWNERS will have to spend up to £1,000 creating a seller's pack 'logbook' for their house before putting it on the market under plans unveiled yesterday. The proposals, published by Deputy Prime Minister John Prescott, triggered a hostile reaction from industry leaders. The pack must include a full structural survey, a guarantee for any recent work, details of fixtures and fittings and a local authority report on planning issues.

But the president of the National Association of Estate Agents warned that producing them will cost between £600 and £1,000. Melfyn Williams said the packs were likely to add to the stress and frustration of moving home, with the result that as many as 30% of people will be put off.

Banks and building societies also said they would not be prepared to rely on surveys done by sellers - effectively rendering the main element a waste of money.

The idea of seller's packs has been pushed by the Government for six years but, despite a series of trials, the industry has never been convinced that they are a good thing.

The theory is that once a property goes on sale, the pack will speed up the conveyancing process and remove the opportunity for gazumping*.

Previous attempts to put the idea on the statute books have been lost due to a lack of parliamentary time. But it is now set to become law next year after being included in a new Housing Bill unveiled by Mr Prescott.

One major problem with the packs is that information will become out of date, particularly if a property takes some time to sell.

A planning application for a road or phone mast, which could wipe thousands off a property's value, might not be highlighted. Buyers might then be faced with expensive legal action to win compensation.

Another problem is the slowness of many local councils. Sellers waiting for an answer on planning issues may have to delay advertising their home for many weeks.

Mr Williams said: ' At the moment, people get stressed and frustrated once the sale is created. Under the current proposal, the stress will be there when they want to get their house on the market but cannot do so, because they have to wait for third parties to produce information. We believe there should be more research to see if the pack is necessary.'

The Council of Mortgage Lenders said its members would not be willing to rely on a survey carried out by a seller and would want to conduct their own before authorising a loan.

This duplication of surveys will be good news for surveyors, but could put up the amount spent on moving home in the UK by an estimated £300m a year.

Peter Williams, director general of the CML, said: 'We have major concerns about how the proposed legislation could be implemented.

'Our fear is that the introduction of information packs could create more problems than it solves for people buying and selling homes.'  

 

Contact Trevor Kent on:
trevorkent@homeinformationpacks.com  
or 01753 885522

 

PRESS RELEASE ISSUED BY THE OFFICE OF THE DEPUTY PRIME MINISTER ON THE FUTURE OF HOME INFORMATION PACKS
25 July 2005

Trevor Kent says "hardly an endorsement for the future of this madcap policy - just read the veiled criticisms from 'the Stakeholders' at foot of this release" 


  HOUSING Industry and GOVERNMENT PARTNERSHIP ENSURES SUCCESS  spells success for the introduction OF Home Information Packs INTRODUCTION

HOME INFORMATION PACKS DRAW ONE STEP CLOSER 

The introduction of Home Information Packs - aimed at transforming home-buying and selling - has received a major boost with plans announced today, showing there has been real progress following discussions between Government and the  industry about how the scheme could operate, including the architecture and ownership of the programme, Home Information Packs (HIPs), including the structure of a certification scheme, and the shape of a ‘dry run’ planned for 2006.  

Home Information Packs, which will be introduced early in 2007, will inject much needed transparency into the home-buying and selling process by bringing together key information about a property's condition, energy efficiency and ownership before homes are marketed. The 'dry run' will enable all elements of the pack to be tested.  

Housing Minister, Yvette Cooper, said Home Information Packs would bring real benefits to those buying and selling homes in England and Wales and would help re-shape the housing market. 

 “The programme’s development, including proposals for the Home Condition    Report Registers and the ‘dry run’ in 2006 is in good shape and industry  involvement with Government and collaboration should ensure that public confidence continues     to grow in the build up to, and after, the packs’ introduction early in 2007.” 

The partnership is looking at a number of options as to how to find solutions, and it is envisaged that the Certification Scheme might operate, including  a Not for Profit company predominantly owned by industry and approved by Government. in 2006 Once the operating criteria are agreed with the industry later this year, details are finalise, the company is expected to be established in shadow form. as soon as possible this year. The scheme is likely to will develop and oversee the standards operating within the market for the Home Condition Reports and the accreditation of Home Inspectors who will prepare them.  This should help reassure consumers and lenders alike, and secure widespread support for the new scheme..  It will also provide a means for sellers wishing to select their own inspector.

Draft Regulations covering the legal content of the packs will be published shortly, followed by drafts later in the year covering search information, the Home Condition Report and Certification Scheme and the way in which Home Condition Report Registers are to be held and accessed.  These Regulations will have been the subject of close working with key stakeholders, and it is unlikely that there will be any  will be no surprises for them when the Regulations are finally laid later this year.

quickly and effectively.  so as to ensure a sufficient number of Home Inspectors can be trained by 2007.This should provide the confidence to organisations and individuals to go ahead with their training program The Housing Minister announced today that the Awarding Body for the Built Environment's (ABBE) Diploma in Home Inspection, which has been approved by the Qualifications and Curriculum Authority, is also now endorsed by the Office of the Deputy Prime Minister.

Government and industry will continue to work together to ensure that those wishing to come forward as home inspectors, particularly experienced surveyors, are able to demonstrate the required standard quickly and at an acceptable cost. This will enable sufficient home inspectors to be available in time for HIP introduction, which will include an assessment of energy efficiency as required by the European Directive.

Mary Martin, Pro Vice Chancellor of UCE Birmingham, and Director of ABBE, a 'spin out' from the university, said, "We are delighted that ABBE's Diploma in Home Inspection has been endorsed by the Office of the Deputy Prime Minister. We look forward to continuing our partnership with the ODPM, our assessment centres and the property industry to ensure that Home Inspectors are adequately trained and ready when Home Information Packs are implemented".

Agreement has also been reached on the need for ODPM has also confirmed that a 'dry run' to will be undertaken in 2006. , following discussion with stakeholders. This is expected to  will involve for example track ing a representative sample of transactions, by buyers, sellers and others involved in the process, from the point of enquiry marketing  through to completion. Estate agents and others will be invited to participate fully in the exercise. Other work will be commissioned to ensure that as many projected benefits as possible are realised for the consumer, but also including improvements to the condition and performance of the housing stock.

The costs of a pack will normally be met by the seller and could be deferred until a sale is completed.  Such costs will be offset by savings on the cost of buying a new home and by faster transactions. Competition between pack providers is likely to keep costs down for both buyers and sellers. ODPM will work with pack providers, local authorities and others to ensure that the packs can be put together quickly when people decide to move home.  In strictly limited circumstances, where there are problems in obtaining one or more elements of the pack quickly, sellers will nevertheless be able to market their homes with an incomplete pack. 

Work will continue on the programme, in partnership with key players, during the summer months and further update will be given details will be released in the autumn.

From early August 2005, those involved in the implementation of the packs and those from the wider housing industry will be able to register for their personal copy of ODPM's HIP electronic newsletter, which will provide updates from Government, details of training events and more.

 

Notes to Editors:

  • Stakeholders Comments (please see below)

About Home Information Pack

       The Government is committed to making it easier for people buying and selling homes in England and Wales through the introduction of the home information pack.  Legislation to introduce home information packs was introduced in the Housing Act 2004 which became law on 18 November 2004. 

·        The home information pack proposals are the outcome of extensive research into the home buying and selling process, and a major consultation about options for improvements.  Research across a range of housing markets confirms the present home buying and selling process in England and Wales is among the slowest in Europe, is fraught with delays and failed transactions, encourages problems and does not look after the interests of home buyers and sellers. The problem is that under the present system key information required to inform buyers’ and seller’s decisions only becomes available after terms have been negotiated and agreed.  As a result of this, research showed that 28 per cent of transactions failed after terms had been agreed. Home information packs will address this by ensuring key information is available up front.

·        Compulsory home information packs will be introduced throughout England and Wales in early 2007. 

  • Scotland – The Housing Bill, which is currently before the Scottish Parliament includes a power to introduce measures similar to Home Information Packs in Scotland.

 

The Benefits of Home Information Packs are:

 

Provide Transaction Improvements by reducing the abortive costs to consumers and the industry as well as reducing the number of failed transactions caused by survey or valuation inspection finding. 

Housing Stock Condition Improvements by a reduction in the incidence of unexpected repair bills and encouraging better maintenance of homes. 

Greater Consumer Choice by reducing the entry costs to first time buyers and creating a market of serious sellers.

Integrated Government Policy Benefits by linking into the governments wider agenda including compliance with the EU directive for energy reports,

contributing to energy efficiency education among consumers as well as contributing to more sustainable home ownership and communities.

More information about Home Information Packs, including proposed contents of the packs can be found at: www.odpm.gov.uk/homeinformationpacks  

Public Enquiries: 020 7944 4400

INDUSTRY UPDATE 25 JULY 2005

 Home Information Pack Programme - Stakeholder Endorsement:  

Which?

Louise Hanson, Head of Campaigns, Which? said:

"Today's announcement is an important step forward for HIPs. Which? has campaigned for their introduction as an obvious help to home-movers, but with their introduction there is also an opportunity for industry to play a vital role in making the whole home-moving process much less stressful for their clients and constructively assisting them to understand the huge benefits they will bring."

 

Countrywide 

Harry Hill Managing Director of Countrywide plc said:

 “Countrywide plc is pleased to note the progress to date and once again offers its full support to a project that will undoubtedly improve the home-buying and selling process. We welcome confirmation of the early 2007 starting date, as industry can now invest with confidence and ensure that it plays its part in the successful introduction of Home Information Packs.”  

Law Society 

Kevin Martin, President of the Law Society said:

"The Law Society has been playing a full part in the ODPM stakeholder group to ensure that Home Information Packs work as well as possible for consumers, and that solicitors are in a position to play a leading role in their preparation. We are pleased that there will be a dry run of the current proposals which will test the new scheme.

 

Rightmove 

Ed Williams, Group MD of Rightmove said

“Rightmove welcomes the government’s update.  It creates the certainty needed to plan for and invest in a successful implementation of our industry solution for HIPs early in 2007.  This will benefit home movers and estate agents alike.  We have started on our £15m investment, reflecting the scale of the changes required by the industry.  The approach being taken to key aspects of the implementation provide participants in the market such as Rightmove with a range of commercial opportunities.”

  

National Association of Estate Agents:

 "The NAEA are pleased to be working with the Government on trying to improve the home buying and selling process.

"In respect of the Home Information Pack programme, the NAEA's continued input will ensure that our thoughts are represented throughout the development to try and ensure that the proposals are practical for both consumers and our members. The lack of first day marketing continues to concern us greatly but we will continue the dialogue with Government to hopefully address this and other issues."

  

Royal Institution of Chartered Surveyors

Commenting on the Minister’s statement, RICS Residential Property Faculty Chairman, Jeremy Leaf, said:

 “RICS welcomes ODPM’s intention to work closely with RICS and other stakeholders as the home buying reform programme moves towards the implementation stage.  There are still some difficult issues which need to be sorted out, but we are confident that these matters can be resolved.  We are encouraging all RICS members involved in home buying and selling to start preparing now for the introduction of HIPs in early 2007.”

  

Home Condition Report Trade Association

Hugh Dunsmore-Hardy Chair of the national steering group behind the formation of the National Association of Licensed Home Inspectors (NALHI)a new trade body for Licensed Home Inspectors said:

 "On behalf of our steering group we welcome the Minster's statement as a timely call for all potential Home Inspectors to undertake the educational process and assessment now so as to be ready for 2007. NALHI as an emerging Trade Association will play its part in encouraging recruitment to this new profession and working with the industry towards the successful implementation of HIPs".

 

Council of Mortgage Lenders

Peter Williams, Deputy Director General of the Council of Mortgage Lenders, comments: 

"The CML welcomes and supports the Government's openness, and its consultation with industry professionals in moving towards the implementation of HIPs.  We look forward to resolving the remaining issues of concern, and settling details over the summer period so that the industry can have certainty and a minimum of 12 months to build systems and train staff before the packs become compulsory."

 

Surveyor and Valuers Association

Brian Scannell, Managing Director of SAVA said:

"SAVA is leading the field in the recruitment and assessment of potential Home Inspectors, and for their sake we are delighted that the regulatory and business framework to support the introduction of Home Information Packs is coming together so quickly.  We have spent over six months assessing candidates for the ABBE diploma and almost two years putting in place the support services needed by Home Inspectors, but there was always a concern that the market would not be ready for their services.  The solutions being developed by the Government in partnership with our industry will put paid to the cynics.  There is no doubt in my mind that we will all be ready for HIPs by next summer.  Home Inspectors can now proceed with absolute confidence in their new career." 

 

Home Information Pack Trade Association  

Ian Turner, Chairman Ian Turner of the Trade Association said: 

"This announcement from the Housing Minister provides significant added momentum to the introduction of Home Information Packs. The Association made up of most of the major Home Information Pack providers will be fully supporting the Ministers desire to see a successful 'Dry Run' in 2006 and many of the members are already investing significantly in preparation."  

ENDS  

 

Trevor Kent is a former president of The National Association of Estate Agents, a leader of the Anti-Home Information Packs Movement and a practicing agent.

01753 885522
trevor@trevorkentmedia.com