HIP confusion could destroy market

There is a risk of the housing market imploding it the government doesn\'t sort out the confusion surrounding HIPs in the time it has before launch, says Sue Read

I promised myself I wouldn’t do this – I moaned about it months ago and I’m certain there will be acres of print in this week’s Mortgage Strategy devoted to the subject. Yes, you’ve guessed it – I’m going to talk about Home Information Packs. But in my defence, there are so many things I want to say about this fiasco that I can’t stop myself from writing about it.

I attended an information day a short time ago, set up by my network. No fewer than four HIP providers turned up to pitch for our business and I felt a bit like one of the dragons in Dragons’ Den.

Some of the firms’ presentations impressed me, others less so. And one of them worried me. First, the pitcher talked about ‘bestoked’ products. Presumably he meant bespoke. Then he told us that his scheme offered a warranty under which, if a home had not sold within a year, it would offer the seller a new pack free of charge provided they remained with the same agent. If my home had not sold within a year, my original agent would have long been given the heave-ho so that negated the warranty sales point for me.

There was confusion among the HIP providers as to whether there will be enough energy assessors available to keep up with demand. Nobody seemed to know how many inspectors have been trained or where they might be located around the country.

We got varying answers regarding the time HIPs would take to produce and whether searches would have to be repeated. The way prospective purchasers would receive their copies, in what format and at what cost was also muddled. Providers seem to think they can produce one document and agents will copy this repeatedly if necessary for purchasers, but the cost of this doing would be down to agents to decide.

Of course, free HIPs provided by agents will not be freestanding in that if a vendor terminates their relationship with an agent they will have to get another HIP organised. This could be a time-consuming procedure, involve new cost to the seller for which they had not budgeted and therefore mean that switching agents becomes less commonplace. This will not keep lazy agents on their toes. Yet again, agents slip through the net of accountability.

Much has been and will be written about the fact that we now have a temporary reprieve from HIPs until August 1. We will also see the phased introduction of the packs, starting with the requirement for only homes with four or more bedrooms to have them. Suddenly, my home has become three bedrooms plus an upstairs study. Who is going to police this provision? Big Brotherish implications immediately spring to my mind.

My plea to the government is simple and reminiscent of the way many of us learnt to cross the road when we were small – stop, look and listen. Yes, you have some egg on your face now but if you don’t sort this out you run a mighty risk that the housing market could implode due to the sheer confusion surrounding this scheme and that would be a whole crate of yolk.