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Beer, crisps, HIPs and uncertainty

Having returned from a week in the sun, I have been reminded several times about fulfilling my promise to buy everyone in the mortgage industry a pint of beer and a packet of crisps.

Before you get too excited at the prospect of this hospitality courtesy of the Dring household let me restate the exact nature of my promise. I made two bets in Mortgage Strategy – first, that the government would go ahead with its plans to introduce Home Information Packs on June 1 2007 and second, that those lenders that have been berating the packs will provide a HIP service when they are introduced next year.

So editor Robyn Hall’s order for a pint of best and a packet of cheese and onion is premature. I’m afraid that he, like everyone else, will have to wait until next summer before they find out if the next round is on me (by which time I hope everyone will have forgotten about this rash promise, although I am reliably informed that moles have long memories).

On a more serious note, a number of people have also asked what effect the government’s decision will have on companies such as the one I work for, which have a vested interest in the launch of HIPs. Fortunately, eConveyancer remains largely unaffected because our main business is not dependent on HIPs. We generate 100% of our income from our online e-conveyancing system and this will remain the core of our business proposition for the foreseeable future.

But our business model is about collecting and disseminating information electronically and HIPs fit into that well. If HIPs go ahead we’ll be there and provide a service but if they don’t go ahead, so be it. Unfortunately, not all firms are in this position and some have invested and lost millions as a result of the U-turn.

Companies such as Righmove have abandoned their plans at a cost of 7m. It seems outrageous that on the one hand the government hassles companies to be ready for change and then, when it changes its mind, takes no responsibility for compensation. Rightmove was ahead of the game and has had to pay a price.

Regrettably, this type of muddled thinking by the government only encourages people to leave preparations until the last minute. Will the government abandon its plans for HIPs? I doubt it. After all I have vested interests being both a potential HIP supplier and a potential supplier of beer and crisps. All we can do is forge ahead with our plans and revisit them if the government gets cold feet.

Assuming HIPs are introduced they will represent a significant income earning opportunity for brokers. Every seller will still be required to have a HIP and at about 350 each there is still scope for them to earn a decent commission for each HIP they arrange. Anyway, time for a pint and a packet of crisps for me.


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