Home Information Packs mandatory from 1/6/7


D

Daytona

NEWS RELEASE

Home Information Packs 'go-live' date announced
ODPM News Release 2005/0233

17 November 2005

Home Information Packs, which are being introduced by Government to
reform the home buying and selling process, will become mandatory from
1 June 2007.

Currently, one million pounds a day is wasted on failed transactions
as buyers often spend hundreds of pounds on valuations, legal advice
and searches on transactions that ultimately break down. By providing
key information at the beginning of the process, Home Information
Packs will prevent waste and significantly cut the number of sales
that fall through. The Packs are expected to cost around £600 +VAT
for the average home. Most of those costs are currently paid by the
buyer.

Housing Minister, Yvette Cooper said,

“Too many sales fall through because of delays and late information,
wasting money and causing great stress for buyers and sellers, that’s
why we are introducing the Packs. We have been working with all parts
of industry on the detail and this timetable will give them time to
fully prepare”.

The Government expects that confirmation of an implementation date
will act as a trigger to others who are waiting to begin their
training as Home Inspectors as well as provide certainty to
organisations who are already preparing to offer Home Information
Packs to consumers on a voluntary basis.

To date, seven assessment centres have been established and 1700
people from the surveying and property industry and from other
professions are undergoing training for the Home Inspector
qualification, with hundreds in the pipeline, waiting for the
implementation date to be announced. Research shortly to be published
by ODPM will confirm the number of home inspectors expected to be
required for June 2007 is between 5000 and 7400.

The next steps for the programme is to establish a certification
scheme which is required to provide quality assurance and manage the
Home Condition Report and Home Inspector registers. It is expected
this scheme will be operating by the summer of 2006. A ‘dry run’ will
follow later in the year designed to provide assurance to the industry
and the public in advance of mandatory introduction on 1June 2007.

Notes to Editors:
1. Consumer Benefits:

Provide Transaction Improvements by reducing the abortive costs to
consumers and the industry as well as reducing the number of failed
transactions caused by survey or valuation inspection finding.
Housing Stock Condition Improvements by a reduction in the incidence
of unexpected repair bills and encouraging better maintenance of
homes.
Greater Consumer Choice by reducing the entry costs to first time
buyers and creating a market of serious sellers.
2. Cost of Home Information Packs:

The Packs will cost around £600 plus VAT, and most of this is not new
cost. Included in this is the Home Condition Report, which is
expected to be cost around £300, for an average home, plus VAT.
The content of the pack includes searches and other information which
is currently paid for by the buyer, If several buyers pursue the same
home, then currently these costs are paid for several times rather
than just once with the Home Information Pack.
3. Market Impact:

Home Information Packs will make the market more efficient and
certain. They will make home buying more affordable and sustainable
for first time buyers, who will receive full information in packs
without having to pay for it.
Major players are now investing heavily in Home Information Pack
systems and intend to market these well in advance of packs becoming
mandatory. This means sellers and buyers will not have to wait until
June 2007
before they can benefit from packs, and there is less likelihood of a
‘spike’ of properties coming to the market immediately before
implementation of the mandatory scheme.
Industry accepts that sellers will not pay up front for HIPs. Thus
there is no impediment to sellers marketing their homes with HIPs both
before and after implementation.
4. Home Inspectors/Certification Scheme:

Only inspectors qualifying under a certification scheme approved by
the Secretary of State will be able to prepare home condition reports.
The scheme will be responsible for monitoring and auditing inspectors’
work. This will be robust to ensure that standards are maintained.
If inspectors fail to maintain the correct standard or act in a way
that is partial to one party contrary to the rules of the scheme,
their certification will be removed, along with that their ability to
produce HCRs.
Research on the number of Home Inspectors required provides a range of
estimates of between 5000 and 7,400 based upon assumptions around
numbers of HCRs required and Home Inspector productivity levels in
liaison with the industry. Details of the assumptions are described in
the full report, which will be published shortly. The report also
highlights the need to continuously monitor and revisit the range
estimates as more evidence on the assumptions and Home Inspectors
working patterns becomes available.
5. Home Condition Report:

The Home Condition Report will be an objective report on the condition
of the property that buyers, sellers and lenders will have a legal
right to rely on. Home Inspectors will have to have suitable
insurance that will be backed up by insurance of last resort provided
by the certification scheme.
6. Integrated Government Policy Benefits

Home Information Packs link into the Government’s wider agenda
including compliance with the EU directive for energy reports,
contributing to energy efficiency education among consumers as well as
contributing to more sustainable home ownership and communities.
7. For background information please visit
www.odpm.gov.uk/homeinformationpacks
 
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C

Colin Wilson

Currently, one million pounds a day is wasted on failed transactions

IANAL (and don't have a financial background)

Is it just me, or does this figure seem relatively insignificant ? -
most houses these days are £150k upwards, so this, in reality, is a
very small number of sales falling by the wayside.

I wonder if this also takes into account people who simply change
their mind and decide not to move.

Can anyone take a wild guess at what these information packs will cost
the entire housing market per annum, as I suspect it will far outstrip
the cost of failed sales.
 
T

Tumbleweed

IANAL (and don't have a financial background)
Is it just me, or does this figure seem relatively insignificant ? -
most houses these days are £150k upwards, so this, in reality, is a
very small number of sales falling by the wayside.
eh?

the million pounds a day would have nothing to do with house prices, it
would be number of sales that fall through, times the wasted cost on the
sale....things like solicitors fees, survey costs, estate agents costs,
etc. If that was £1000 per sale (£400 each for buyer and seller and £200 for
the estate agent to relist the house) , that would be 1,000 falling through
a day.

Tw
 
C

Colin Wilson

the million pounds a day would have nothing to do with house prices, it
would be number of sales that fall through, times the wasted cost on the
sale....things like solicitors fees, survey costs, estate agents costs,
etc
OK, I wasn`t sure how to interpret the headline figure - cheers
 
R

Richard Faulkner

Daytona said:
Home Information Packs, which are being introduced by Government to
reform the home buying and selling process, will become mandatory from
1 June 2007.

Currently, one million pounds a day is wasted on failed transactions as
buyers often spend hundreds of pounds on valuations, legal advice and
searches on transactions that ultimately break down.
At the governments £700 a time, this translates to around 500,000
transactions a year failing, with around 1,000,000+/- succeeding.
By providing key information at the beginning of the process, Home
Information Packs will prevent waste and significantly cut the number
of sales that fall through. The Packs are expected to cost around £600
+VAT for the average home. Most of those costs are currently paid by
the buyer.
So £600+VAT, (probably another government underestimate), will be spent
on every property which goes on the market, whether it proceeds to a
sale or not.

I wonder how many people currently put houses on the market where nobody
shows any interest, therefore no money is spent, and withdraw them from
the market at no real cost to anyone. If it's 500,000 p.a., then one
million pounds a day will be wasted...... due to the cost of the Home
Information Pack.
 
T

Tumbleweed

Richard Faulkner said:
I wonder how many people currently put houses on the market where nobody
shows any interest, therefore no money is spent, and withdraw them from
the market at no real cost to anyone. If it's 500,000 p.a., then one
million pounds a day will be wasted...... due to the cost of the Home
Information Pack.
I suspect those houses wont be going on the market anymore. When you say 'at
no cost to anyone', there is of course a cost to the estate agents, who
market them, and to the people who go and see them, and perhaps even make
offers on them, when the 'vendors' are just fucking about. This is probably
the only good thing about the packs.
 
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tim \(moved to sweden\)

Tumbleweed said:
I suspect those houses wont be going on the market anymore. When you say
'at no cost to anyone', there is of course a cost to the estate agents,
who market them, and to the people who go and see them, and perhaps even
make offers on them, when the 'vendors' are just fucking about. This is
probably the only good thing about the packs.
And what's going to stop the buyers fucking about.

Every one of my 5 house sales has been interrupted
by the buyer fucking about even when presented with full
information and personally I'd like to see some sanction on
them.

tim
 
T

Tumbleweed

And what's going to stop the buyers fucking about.

Every one of my 5 house sales has been interrupted
by the buyer fucking about even when presented with full
information and personally I'd like to see some sanction on
them.

tim
Well there will be fewer houses for sale so less for them to choose from,
but i know what you mean.
 
T

Troy Steadman

Tumbleweed said:
Well there will be fewer houses for sale so less for them to choose from,
but i know what you mean.
In 1990 (or whatever year it was) there was a drought in the SE. We
were renting and cracks appeared in our walls. Our landlords called in
a surveyor and so did their insurance company. The verdicts were
(respectively):

1) The house is falling down and needs underpinning*.
2) There is nothing wrong whatsoever.

Each staked their professional reputation on it.

I conclude people will be able to shop around for whatever Information
Pack they desire.

* The compromise was to redecorate and recarpet the whole house and put
glass measuring patches over the cracks. In the event the rains fell
and the cracks closed up.
 
R

Richard Faulkner

Tumbleweed said:
Well there will be fewer houses for sale so less for them to choose from,
but i know what you mean.
Can I be the first to predict the market rising in around Nov 2007!!
 
T

Tumbleweed

Richard Faulkner said:
Can I be the first to predict the market rising in around Nov 2007!!
Sorry, it doesn't qualify unless you either write a 500 line diatribe about
how Gordon Browns actions will cause it, or a 20-point explanation giving
the reasons why your theory overrides what is actually happening.
 
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R

Richard Faulkner

Tumbleweed said:
Sorry, it doesn't qualify unless you either write a 500 line diatribe about
how Gordon Browns actions will cause it, or a 20-point explanation giving
the reasons why your theory overrides what is actually happening.
Bollocks!!
 
P

Phil Richards

tim said:
Every one of my 5 house sales has been interrupted
by the buyer fucking about even when presented with full
information and personally I'd like to see some sanction on
them.
When you say presented with "full information" exactly what are you on
about? The Estate Agent will be acting in your interest and are unlikely to
reveal what you don't want to want any prospective buyer to know prior to
making an offer. I doubt for one minute you would have forked out for an
impartial survey so the prospective buyer can be made aware of any
structural defects in advance of putting in an offer. And lastly it is in
the interest of the buyer to instruct a decent solicitor to question the
seller in the buyers interest.
 
T

tim \(moved to sweden\)

Phil Richards said:
When you say presented with "full information" exactly what are you on
about?
I made sure that those things that I knew would be discovered
were explained to the buyer and asked that they were happy.
In particular,at my last sale there was a 70 and not much lease
remaining.

I asked the EA and my Sol to be sure that the buyer was happy
with this as soon as possible during the process because if he
wasn't, I wanted to apply for an extension ASAP.

Of course, after the normal 8-10 weeks of peeing about, three
days before exchange the short lease became a problem and
the guy wanted me to refund him the cost of obtaining an
extension.

It took a long time to explain to him that the house would be
worth more with the lease extension and as I considered that
he was negotiating in bad faith, he was getting no reduction.

But the whole deal nearly fell through because of this.
The Estate Agent will be acting in your interest and are unlikely to
reveal what you don't want to want any prospective buyer to know prior to
making an offer. I doubt for one minute you would have forked out for an
impartial survey so the prospective buyer can be made aware of any
structural defects in advance of putting in an offer. And lastly it is in
the interest of the buyer to instruct a decent solicitor to question the
seller in the buyers interest.
IMHO there is no point hiding the answers to questions that
you know that they are going to ask.

So much easier to tell them up front and have them walk
away before any money has been spent.

tim
 
P

Phil Richards

tim said:
I made sure that those things that I knew would be discovered
were explained to the buyer and asked that they were happy.
In particular,at my last sale there was a 70 and not much lease
remaining.
Sounds like you were very honest there. Pity more sellers and their agents
aren't.
I asked the EA and my Sol to be sure that the buyer was happy
with this as soon as possible during the process because if he
wasn't, I wanted to apply for an extension ASAP.
Though lease length is one of the basics the EA should be able to relay to
a prospective buyer before the offer. It's the nitty gritty issues both
parties solicitors get involved with once the conveyancing process gets
underway which slows things down.

For example when I bought my flat earlier this year it took the solicitors
weeks to sort out some buildings regs issue which the solicitors made a
right meal out of. When I raised the question for the sellers solicitors as
to why it was never picked up when they bought it so as they had the
answers my ones were looking for, all I got back was that point was never
addressed and was completely new to them.
IMHO there is no point hiding the answers to questions that
you know that they are going to ask.
And then the solicitors will no doubt find more questions you never
expected to be asked.
So much easier to tell them up front and have them walk
away before any money has been spent.
Directly or through your friendly Estate Agent? I viewed around 25
properties around this time last year, in only two case I met the seller
face to face. And in any case most EA I wouldn't trust, they are out there
to make their few percent out of the sale, hide a lot of the facts away and
go cold when you give them negative feedback.

And when I bought my flat earlier this year, despite that two previous
sales had fallen through, my request to the EA for a copy of a survey which
they had on file was promptly declined. At least with the HIP a prospective
buyer has the chance to see a condition report before making a commitment.
 
R

Richard Faulkner

Phil Richards said:
Sounds like you were very honest there. Pity more sellers and their agents
aren't.
And the buyer still pissed about at the last minute. They're a bit like
women: no matter how much you give, or change, it's never quite right or
enough - once you have dealt with enough buyers who shit on you, you
reach the point where you have to give it back - unfortunately.

I sold a house in 1999 and, before it went on the market I got the
following:

Structural engineers report
Electricians report
Gas installations report
Timber and Damp report

After their survey, the buyers got the following:

As above.

Total waste of time and money on my part.

The day before exchange, they asked for a significant reduction because
of work needed.
And when I bought my flat earlier this year, despite that two previous
sales had fallen through, my request to the EA for a copy of a survey which
they had on file was promptly declined. At least with the HIP a prospective
buyer has the chance to see a condition report before making a commitment.
The trouble is that the report will be full of caveats and most buyers
will not trust it.

All the other legal stuff will be a godsend, but the condition report is
a government scam which we believe is designed to comply with some
international global warming agreement - Kyoto?
 
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M

me

Phil Richards said:
For example when I bought my flat earlier this year it took the solicitors
weeks to sort out some buildings regs issue which the solicitors made a
right meal out of. When I raised the question for the sellers solicitors as
to why it was never picked up when they bought it so as they had the
answers my ones were looking for, all I got back was that point was never
addressed and was completely new to them.
This sort of thing seems too common, I suspect it is a factor of
solicitors protecting their PI policies by ticking every box they can
think of now, whereas previously they would have said 'who cares'
regarding many things.
And when I bought my flat earlier this year, despite that two previous
sales had fallen through, my request to the EA for a copy of a survey which
they had on file was promptly declined.
Presumably this survey was paid for by the aborted buyers, and sometimes
they will go 'we paid £xxx for this, if they want to know what it said
they should either pay us something for this one, or go and get their
own.'
 

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