Hips slammed by new report from expert
A flagship government housing policy has received a severe blow to its credibility, with the release of a new report today.
Sir Bryan Carsberg, who formerly ran the Office of Fair Trading, was commissioned to write a report on the UK residential property sector by the Royal Institution of Chartered Surveyors, the Association of Residential Letting Agents and the National Association of Estate Agents - and the results will make uncomfortable reading for many ministers.
The government's new Home Information Packs, or Hips, have been progressively introduced over the past year, and are now mandatory for all home sales in England and Wales. Costing around £350, the packs contain a set of documents relevant to the property being sold, and are passed from buyer to seller. The documents included are local authority searches, title documents, guarantees, and a special energy performance certificate showing how environmentally-friendly the home is.
Sir Bryan's report is strikingly negative on the impact of Hips on the market as a whole: the expert even recommends that they should be either made voluntary, or scrapped entirely. This is because, he says, the packs costs counterbalance the benefits they provide. "They don't make a useful contribution to the process," the report claims. "They don't speed up transactions and they are in danger of becoming out of date too quickly."
Sir Bryan added: "Some would summarise the position by saying that the Hip provides the worst of all worlds - it omits much of the most useful information but still imposes significant costs on the property transaction. It is simply not appropriate for legislation to lay down how consumers should conduct transactions unless there is a substantial public interest in the transaction and I do not think there is in the case of buying and selling residential property."
The latest criticism forms the latest setback for Hips, which have been beset by a series of delays and legislative reverses. Originally proposed in the Queen's Speech of 2003 and the Housing Act of 2004, the start date for the policy's implementation has been put back on multiple occasions, with its terms also progressively watered down. Most recently, the introduction of First Day Marketing - the requirement to make all the documents contained in a Hip available on the first day the property in question is put up for sale - has been delayed to December 31st this year by housing minister Caroline Flint.
However, Hips are not the only aspect of the residential property market which was criticised by Sir Bryan in his report. Elsewhere, there was sharp criticism for estate and lettings agents: today's professional mortgages and graduate mortgages seekers, as well as other customers, were found to be largely in the dark about how well agents were qualified for providing property advice to them. Accordingly, the report recommends that they sit an exam before being allowed to sell homes in the UK.
"I think that the markets for estate agencies, letting agencies and managing agencies are not working well because clients are not well informed about the qualifications of different agents and about what to expect from them in the way of service," Sir Bryan added.
Sir Bryan Carsberg, who formerly ran the Office of Fair Trading, was commissioned to write a report on the UK residential property sector by the Royal Institution of Chartered Surveyors, the Association of Residential Letting Agents and the National Association of Estate Agents - and the results will make uncomfortable reading for many ministers.
The government's new Home Information Packs, or Hips, have been progressively introduced over the past year, and are now mandatory for all home sales in England and Wales. Costing around £350, the packs contain a set of documents relevant to the property being sold, and are passed from buyer to seller. The documents included are local authority searches, title documents, guarantees, and a special energy performance certificate showing how environmentally-friendly the home is.
Sir Bryan's report is strikingly negative on the impact of Hips on the market as a whole: the expert even recommends that they should be either made voluntary, or scrapped entirely. This is because, he says, the packs costs counterbalance the benefits they provide. "They don't make a useful contribution to the process," the report claims. "They don't speed up transactions and they are in danger of becoming out of date too quickly."
Sir Bryan added: "Some would summarise the position by saying that the Hip provides the worst of all worlds - it omits much of the most useful information but still imposes significant costs on the property transaction. It is simply not appropriate for legislation to lay down how consumers should conduct transactions unless there is a substantial public interest in the transaction and I do not think there is in the case of buying and selling residential property."
The latest criticism forms the latest setback for Hips, which have been beset by a series of delays and legislative reverses. Originally proposed in the Queen's Speech of 2003 and the Housing Act of 2004, the start date for the policy's implementation has been put back on multiple occasions, with its terms also progressively watered down. Most recently, the introduction of First Day Marketing - the requirement to make all the documents contained in a Hip available on the first day the property in question is put up for sale - has been delayed to December 31st this year by housing minister Caroline Flint.
However, Hips are not the only aspect of the residential property market which was criticised by Sir Bryan in his report. Elsewhere, there was sharp criticism for estate and lettings agents: today's professional mortgages and graduate mortgages seekers, as well as other customers, were found to be largely in the dark about how well agents were qualified for providing property advice to them. Accordingly, the report recommends that they sit an exam before being allowed to sell homes in the UK.
"I think that the markets for estate agencies, letting agencies and managing agencies are not working well because clients are not well informed about the qualifications of different agents and about what to expect from them in the way of service," Sir Bryan added.
