Home Information Packs - HIPs

Home Information Packs - HIPs

May 2010 Home Information Packs are scrapped

On May 20th 2010 the new Conservative/Lib Dem coalition government abolished home information packs (Hips) with immediate effect. This move is expected to encourage more sellers to place their properties on the market, now they no longer have to incur the fee for HIPs - an average cost, outside of London, of around £500. Property sellers are still legally required to pay £70 for an energy performance certificate within 28 days of placing their house on the market.

HIPs were introduced in August 2007, starting with four-bedroomed houses and then in December 2007 including all properties. The government hoped that the packs would improve and speed up the buying and selling of houses. Estate agents generally found HIPs instead to be a hindrance to the property market, deterring many sellers from placing their homes on the market.

HIP's were made compulsory for all residential property from December 14th 2007.
From 6th April 2009 the Home Information Pack must be available on the first day a property is marketed for sale. Buyers should ask the vendor or estate agent for a copy. It should be supplied to potential buyers free or at a nominal charge to cover copying, postage ciosts etc. From 6th April 2009 the Home Information Pack must contain a Property Information Questionnaire (PIQ) containing information such as flood risk at the property, details of the lease if applicable, whether there have been structural alterations to the property etc.

Home Information Packs (HIPs) have been introduced by the government in order to improve and speed up the house buying and selling process. Home Information Packs have been implemented on a phased basis from 1 August 2007 in England and Wales. The packs were initially due to become mandatory on June 1st, but the government delayed their introduction until August 1st, after pressure from the property industry.

The HIPs packs should provide more information about a property that is for sale, enabling buyers to make more informed decisions and hopefully reducing the number of failed sales. It has been estimated that around £1m a day is lost through sales failing at the last stage - this is often due to delays in obtaining searches.
HIPs should save both parties time and money by reducing the risk of the terms having to be renegotiated due to later disclosure of information. The packs are to be made available to anyone interested in buying the property.

Four-bedroomed Houses - August 2007
Three-bedroomed houses - September 10th 2007
All Residential property - December 14th 2007

From August HIPs packs have been legally required for the sale of all four-bedroom properties and larger, this is estimated to be 27 per cent of UK residential properties.
Three-bedroomed properties have required HIPs from 10th September 2007.
From December 14th 2007, all residential properties sold have needed to have a home sellers pack.

Who pays for HIPs Packs?

The packs are paid for by sellers and are likely to increase the cost of selling a house by around £300 to £600. Prices are not regulated, so the market will dictate the costs. HIPs Packs can be either purchased from specialist providers or from estate agents or you can organise them yourself. Estate agents marketing homes with Home Information Packs now legally have to be registered with the Ombudsman for Estate Agents (OEA). This will enable customers to complain to this independent body, if they are not happy with the service they receive.

The contents of Home Information Packs

HIPs contain key information and specific documents about the property, including an Energy Performance Certificate (EPC), Title Deeds and Local Authority Searches.
These are documents which the buyer's solicitor would require during the conveyancing process; the new document is the Energy Performance Certificate (EPC).
This is a report rating the energy efficiency of your home - rates range from A to G, with A being the most energy efficient. The report also gives recommendations for cost-effective ways to improve the rating. The reports cost about £200 and is the most expensive part of the HIPs Pack.

HIPs packs contain both 'required' and 'authorised' documents. The compulsory 'required' documents consist of:

An index - showing the contents of the HIPs Pack.
Property Information Questionnaire (PIQ) - General information on the property
A Sale Statement - name of seller, the address of the property up for sale, and whether freehold, leasehold or commonhold
Evidence of the title - whether the property is registered and proof the seller is the owner
An Energy Performance Certificate (EPC) - report from a qualified energy assessor
Sustainability information (for newly built homes)
A Drainage Search - details of drains serving the property (from local water company)
A Local Search - copies of any planning, building regulations and listed building consents and approvals and details of such local changes, such as, any new roads planned within 200 metres of the property
Copies of any warranties and guarantees on new properties (from local authority)

Leasehold properties require:

A copy of the lease
Regulations made by the landlord
Building insurance details and receipts

A HIPs pack can also contain 'authorised' documents:

A Home Condition Report - a basic survey of the property undertaken by a qualified Home Inspector.
A Home Contents Form - a list of exactly what is for sale.

You will not require a HIPs pack if :

You are a landlord selling a property without vacant possession
If without first marketing the property, you sell to a member of your family or a friend
A stranger knocks on your door and makes you an offer

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