Buy-to-let
Since the scheme hit the market it has been dogged with controversy and has received a less than enthusiastic welcome from property professionals and buyers and sellers. So one year on, have HIPs delivered on what they were meant to achieve – improve the marketplace by helping to stop property transactions falling through, along with supporting the mortgage market by helping them to keep abreast of individual property transactions?
Peter Bolton King, chief executive of the National Association of Estate Agents (NAEA), the residential sales arm of the National Federation of Property Professionals (NFOPP), comments:
"Since the conception the packs have been surrounded by a catalogue of disasters and so far rather than helping to improve the home buying and selling process they have served as a hindrance and nothing more than a purposeless piece of red tape.
"The launch of HIPs onto the marketplace was far from smooth with delays and u-turns, together with a fundamental error on timing. Indeed the debate still rages whether the timing of the launch has had a crippling effect on what is an already a rocky time for the property industry. Indeed, there is still no clarity on the long term plans for the abolition of "first day marketing" scheduled initially for December 1st last year. At a time when the market place needs ‘stabilisers’, many of our members believe that this legislation, and the cack-handed way in has been introduced, has had a destabilising effect on market confidence.
"For example a common complaint from some of our members is regarding the additional time it takes to secure all the supplementary information needed for the pack, adding extra time and stress to the sellers move. It seems that there is a major problem obtaining the details required for a HIP. They are hard to get hold of quickly and cheaply, particularly the leasehold information and searches from local authorities. Another complaint is factored towards the cost of compiling a HIP as they can be priced from £300 to £500, which in the current climate may simply be too much of an extra financial burden to sellers on what is already a costly process, thereby acting as a deterrent."
Peter continues: "However, despite the gloomy outlook for the packs in 2007 it seems that 2008/9 might bring a change for the better. We welcome Caroline Flint, the Housing Minister’s decision to work with property professionals such as the NAEA to take another look at the content of HIPs. We have always maintained that in their present state, they are of little use to either seller or buyer and therefore we embrace the opportunity to come up with a package that includes real benefits to the customer and will actually assist the buying and selling process – after all, that was the original intention of this legislation.
Sir Bryan Carsberg’s recommendations in the recent ‘Carsberg Review of Residential Property’ endorses the Association’s strong standpoint that HIPs should become a voluntary requirement.
Peter concludes: "We have long opposed the imposition of HIPs and have always seen them as the wrong answer to simplifying the house buying process. Quite simply, the government tried to force ‘square pegs into round holes’. However, I’m confident that by working with the minister together with all the other key bodies in the industry we shall be able to rectify the situation and come up with a system that works cohesively and efficiently for both buyers and sellers. Hopefully, this time next year will be a turning point for the ill-fated packs and we shall all have something to celebrate."
