Isn’t it time for a HIP replacement? If you have an ailment you get a professional diagnosis and if it is a progressive problem for which the prognosis is not good, you must act. Action could consist of treatment whereby the cause for concern is manipulated through medical or other methods. But in the worst case scenario it is necessary to remove the offending item.So it is with the government-inspired Home Information Packs, due for introduction next year. If ever there was a case for radical surgery on a policy not properly thought through this is it. Our industry, which largely concurs with this diagnosis, has to try to put all the pieces together to offer a workable solution. The Law Society recently warned that people could unknowingly end up breaking the law when the legislation is introduced. It reached that conclusion after it conducted a survey that found that 64% of people had never heard of HIPs. This is worrying given that anyone who markets their property after July 1 2007 could face a £200 per day fine if they do not have a HIP. The society’s concern was reinforced by the Council of Mortgage Lenders describing the packs – which could cost up to £3,000 – as a “political hot potato”. Not only that but there is a danger that their introduction could see people left at the mercy of cowboy providers as anyone can set themselves up as a HIP provider. And on top of that, the introduction of compulsory HIPs could lead to a shortage of homes on the market and rising prices, since many homes are spontaneously placed on the market at present. The packs will merely add a further cost to the sale process without resolving any of the problems associated with moving. With as many as 900,000 properties put on the market each year going unsold, this means the public will be forced to spend around £600m per year pointlessly. It is becoming increasingly clear that the introduction of HIPs is a gift to some and a nightmare to others. My worry is that the government has not thought through the implications of changing the house buying process. The potential reduction in housing supply as a consequence of the packs could cause massive house price inflation, preventing even more prospective first-time buyers from getting on the property ladder. The amount of money that has been invested in HIPs is mounting, with a number of HIP providers fully prepared and actively promoting their offerings. I recently found out that the cost of training to provide Home Condition Reports is around £7,000 so if an army of valuers have invested their money in this training the government will find it hard to make a U-turn, although it has been known to happen. HIPs are a case of damned if you do and damned if you don’t. Of course, with any new idea there is an accompanying opportunity but this idea could end up costing the poor old consumer again. Sally Laker – managing director, Mortgage Intelligence
- Top trends
The automated valuations market was in a spin last week after two senior members of staff at UKValuations defected to Hometrack. Chief executive officer Graeme Winser and sales director Guy Weightman resigned from the subsidiary of US lending giant Countrywide Financial Corporation to join Hometrack as director of new market strategies and sales director respectively. […]
I don’t want to sound like a broken record but mortgage fees are a cast iron rip-off. Don’t get me wrong, I think anyone who provides a service is entitled to be paid for it – lenders and brokers included.
Paymentshield says consumers are shying away from mortgage payment protection insurance as a result of the bad press surrounding the recent PPI investigation by the Financial Services Authority. A survey by Paymentshield polled more than 1,500 consumers and some 250 brokers on the impact of the regulator’s PPI investigation and how it has affected their […]
FRom Marie O’Reilly I am writing in response to Keith Butler’s letter headlined ‘Brokers should know about lenders’ processing times’ (Mortgage Strategy June 5). “Are there any lenders willing to publicly state their average application to offer times and allow these to be independently verified?” asks Butler. The answer is yes. He should visit www.accordmortgages.com. […]
The housebuilding market in its current form simply isn’t working. We are completely over-reliant on the biggest players in the industry – the largest nine are responsible for more than 50 per cent of the new homes built in the UK. But there is a reluctance to do more, particularly in this uncertain post-Brexit world. And with […]
News and expert analysis straight to your inboxSign up