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Last Updated: Wednesday, 19 July 2006, 08:14 GMT 09:14 UK
What is going on with HIPs?
By Ian Pollock
Personal finance reporter, BBC News

Yvette Cooper, housing minister
Yvette Cooper postponed the house condition report

Once again the government has hesitated over its plans to introduce the compulsory use of Home Information Packs (HIPs) when home owners put their properties up for sale.

On Tuesday, Housing Minister Yvette Cooper said she would not require the HIPs, which come into effect next June, to include a Home Condition Report (HCR).

Why bother with HIPs at all, then?

After all, supplying information about the state of your house upfront to a prospective buyer has always been the central part of the new system.

At first glance, the government appears to be caving in to pressure from estate agents and others in the house buying industry who have lobbied against the idea.

Trevor Kent, former president of the National Association of Estate Agents, welcomed the latest development gleefully.

"I hope she will realise in due course that even this watered-down version of the HIP will be both expensive and unnecessary, and I call on her to drop the whole concept before any more millions of tax-payers money is wasted."

There is little doubt that HCRs have now fallen down the government's scale of priorities.

It says that making house sellers provide Energy Performance Certificates for their properties is now more important than speeding up the transaction process.

Vested interests

It was only in April that Ms Cooper backed the government's plans vigorously.

This is not a U-turn. We are bringing them in on a phased basis
DCLG spokesman

"There are a lot of vested interests who make money out of the current process who are complaining about these changes," she said at the time.

The government first committed itself to introducing HIPs in England and Wales back in 1997.

It has long claimed that their introduction would be the answer to gazumping, failed house-buying chains and money being wasted by buyers.

But the progress of the idea since then has been slow and tortuous, including a small trial in Bristol and delayed legislation.

At first sight, Ms Cooper's statement gives the impression that the government may never enforce the use of home condition reports, which are simply a type of house survey by any other name.

She said she hoped they would still catch on, as they should still make things quicker and easier for people buying and selling houses.

But a spokesman for the Department for Communities and Local Government (DCLG) said making HCRs mandatory was still an option:

"The first stage is to see how they work on the ground. This is not a U-turn. We are bringing them in on a phased basis," he said.

There will be a series of further tests and pilot projects, he pointed out.

"It's about the timetable for bringing them in."

What is going to happen now?

Earlier this year the government decided to have a dry run of the new HIPs.

You might as well do the whole thing in one go
Paul Broadhurst, Association of HIP Providers

About 14,000 have been used so far in house sales, but crucially, nearly all of them did not involve an HCR.

In fact, only 250 have done so.

So it is hardly surprising that the DCLG is now not sure that, in their present form, they are quite what is required.

The dry run will continue this autumn, but will use HCRs.

However, that simply is not soon enough for the government to be happy to make them compulsory next June - hence the delay.

Some people in the house-selling industry have been keen on the idea of HIPs, seeing them as a business opportunity as well as a good idea for buyers, and have been gearing up to use them.

Various estate agents, surveyors, solicitors and IT companies formed the Association of HIP Providers.

Their spokesman, Paul Broadhurst, said the latest decision to delay the compulsory surveys was "disappointing - wholly unnecessary."

He argued that as Energy Performance Certificates will be compulsory next year, the surveys might as well be, too.

"The energy efficiency reports will cost between 200 and 250, in any case. Most of that cost is due to travelling to and from the property. You might as well do the whole thing in one go."

Nothing to inspect

Behind the scenes, many professionals, such as surveyors, building engineers and quantity surveyors, have been doing the training courses which will qualify them to carry out the HCR inspections and charge sellers for their services.

Unless it's mandatory, there's no real need for what I've been learning
Howard Betteridge

About 400 have qualified so far, with 4,500 or so in the pipeline.

Ms Cooper said she was worried that not enough had been trained so far.

But those who have qualified from the courses feel the rug has been pulled from under their feet.

One of them, Howard Betteridge, said he was shell-shocked.

"I've paid 9,400 for this course, I've had to borrow most of the money from the bank. Unless it's mandatory, there's no real need for what I've been learning."

One day, he may make some money from selling their skills. And one day, the HCRs may become compulsory.

But the government's determination to push them through has clearly waned.




SEE ALSO
'U-turn' claim over house packs
18 Jul 06 |  UK Politics
Anti house-pack campaign launches
12 Jul 06 |  UK Politics
Why buyers distrust house surveys
26 Feb 05 |  Business
Home sellers' packs to become law
18 Nov 04 |  Business

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