Articles
Home Information Packs
Cheyney Goulding is aware that the Government proposals for Home Information Packs, “HIPs”, will affect our clients. The regulations will apply to everybody who buys and sells residential property and also clients who are in the business of developments in the residential sector.
It seems that the Government is committed to these HIPs believing that this will make it easier for people to buy and sell their homes. We are not convinced that the Government is correct and indeed suspect that the process will become slower and more costly as a result of this initiative for all those involved. However, as HIPs are to be introduced, Cheyney Goulding is preparing for their introduction in order to facilitate the new arrangements in the property sector.
What are HIPs? They are a collection of documents about the property to be offered for sale. They are produced by the seller for the potential purchaser. Note that this has to be available for the potential purchaser and not part of the conveyancing transaction. They will include legal and financial information together with general data from the seller and a report on the property’s physical condition and energy efficiency. The idea is to give the buyer sufficient information to enable him/her to make an informed judgment about the price at which the property is being offered for sale. We doubt whether certain aspects will assist, and it seems unlikely that the buyer will rely on a limited seller’s survey in the pack, and this may lead to an increase in litigation at the end of the day!
HIPs will apply to all property sales except:
- sales of non-residential property,
- sales of tenanted property, or,
- the grant of leases for periods of less than 21 years.
As one can see, the majority of the transactions will be caught by these provisions.
Originally, it was proposed that failure to comply with the new law would be a criminal act, but it has now been “reduced” to a civil offence, whether it be the homeowner or his estate agent who will be liable to a fine of £500 for every offence committed. It is to be noted in particular that an offence will be committed every time a prospective buyer is offered a particular property for which a HIP has not previously been prepared, so beware!
The date for the introduction of HIPs is June 2007. Accordingly, Cheyney Goulding will keep you informed over the intervening period to ensure all the proper procedures are in place.
If you have any queries concerning Home Information Packs, or property in general, please contact Michael Willgoose.