HIPs suspended with immediate effect

20 May 2010 | By Natalie Thomas

Pickles today laid an Order suspending HIPs in England and Wales with immediate effect, pending primary legislation for a permanent abolition.

The Secretary of State says he has taken this swift action in order to avoid uncertainty and prevent a slump in an already fragile housing market.

He believes HIPs are currently holding back the housing market because sellers are having to fork-out extra cash, sometimes hundreds of pounds, just to be able to put their home up for sale.

The government believes suspending HIPs will reduce the cost of selling a home, remove a layer of regulation from the process and provide a welcome help to the housing market during the recovery.

Sellers will still be required to commission, but won’t need to have received, an EPC before marketing their property, and the government will consider how the EPC can play its part in the new drive for a low carbon and eco-friendly economy.

Pickles says: “The expensive and unnecessary Home Information Pack has increased the cost and hassle of selling homes and is stifling a fragile housing market.

“That’s why I am taking emergency action to suspend the HIP, bringing down the cost of selling a home and removing unnecessary regulation from the home buying process.

“This swift and decisive action will send a strong message to the fragile housing market and prevent uncertainty for both home sellers and buyers.

“HIPs are history. This action will encourage sellers back into the market, and help the market as a whole and the economy recover.”

Housing minister, Shapps, says: “This is a great example of how this new government is getting straight down to work by cutting away pointless red-tape that is strangling the market. Rather than shelling out hundreds of pounds for nothing in return we’re stripping away bureaucracy and letting home owners sell their properties.

“But we’re also showing our commitment to a greener housing market by keeping Energy Performance Certificates and making them more relevant in helping buyers make informed decisions on the energy costs of their new home.”

David Smith, senior partner at Carter Jonas, says: “In 1997, Tony Blair announced that he was going to remove the uncertainty in the house buying process and introduced the Home Information Pack. It’s now 13 years on and the same level of uncertainty exists so HIPs, very clearly, were not the answer.

“The estate agency process still needs to be radically overhauled and bringing it in line with Scotland and Northern Ireland, where an offer is more binding, would be no bad thing.

“We need to remove the extreme uncertainty and emotional drain that surrounds house buying and selling. It needs to be simpler, more transparent and considerably less stressful.”

Mike Ockenden, director general of AHIPP, says: “We are hugely disappointed to hear that Grant Shapps has reneged on his promise to review the packs before any other action was taken. Over 3,000 jobs will go and 10,000 will be affected as a result of the suspension of HIPs and £100m revenue will be lost to the Treasury in VAT receipts.

“However, we want to work with the government and we still want the consultation we have been promised. We are not suggesting that HIPs should be retained. AHIPP has accepted that they will be scrapped.

“We have been proposing for months that a legal or exchange ready pack be instructed at the start of the sales process. We think it would be crazy to throw the baby out with the bathwater and remove at a stroke all the good things that have come about with HIPs, and the lessons we have learnt.

“If we do this, then the opportunity for reform will have been lost for a generation.”

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