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The Effect Of Hips On Property To Buy

Dec 27, 2007
2007 saw the introduction of a new legal requirement for anyone selling a house - Home Information Packs.

They're more commonly known as Hips, and since a few weeks ago, are now mandatory for anyone offering their property to buy in England and Wales.

So what really is a Hip, and how will it affect you?

Well the origins can be traced back just over ten years. A proposal was first made to address the problem of gazumping in the Labour party's 1997 manifesto.

Later research showed that a staggering 28 per cent of sales fell apart before contracts were exchanged, but gazumping actually happened in less then 2% of sales.

The research identified a need to make house sales faster, more transparent and easier for people to understand. Making it easier and safer to find a property to buy would theoretically bring even more confidence to the market, keeping property prices stable.

Hips were finally announced in the Queen's speech in November 2003.

The original plan was that every house for sale would need one by the 1st June this year. But just ten days before, the government announced they would actually start in August - and that would be for houses with four or more bedrooms.

This was extended to cover three bedroomed properties in September, and then all houses in December.

Every pack must contain a set of documents that are no more than three months old when the property is first marketed.

They include a sale statement, the title documents for the property, and an energy performance certificate. This will help people considering buying your home assess its energy consumption, and see what measures they could take to cut their fuel bills and carbon emissions. You must also get local authority and drainage searches done.

If the property is leasehold, your Hip must also include a copy of the lease, a building insurance policy and contact details for the landlord or managers of the land.

So how did the introduction of Hips this year actually affect the availability of property to buy?

Robert Moore is the surveying partner of Anker & Partners estate agents in Banbury, Oxfordshire.

He saw a definite trend of people rushing to get properties on the market before Hips came in.

And he believes it has stopped some people putting their house up for sale.

He said: "Hips have deterred people who weren't really serious about selling their home, because it now costs them money to speculatively put their house on the market. But that's not a bad thing."

It was hard for Robert to see if Hips affected the amount of property to buy on the market, because of other factors affecting the world of property this year.

He said: "The supposed downturn in the market and the problems with Northern Rock happened at roughly the same time as Hips came in, so it's very hard to make a true assessment.

"We are still seeing some people who have a generally low awareness of Hips. For people who don't keep up-to-date with the property market, they are not aware of the new hoops you need to jump through until they find property to buy and want to put their house on the market."

However Robert did note there was still a temporary work around with Hips, which allowed people to put their house on the market even if they haven't got a pack completed. As long as the pack has been commissioned, it is legal to offer your property to buy.

This condition is unlikely to last long into 2008.
About the Author
Further information about property can be found at http://www.propertytoday.co.uk
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