HIPS (Home Information Packs) were introduced by the UK Government in 2007. Homeowners wishing to sell a property will need to have commissioned a HIP before we as an Estate Agent can begin to market the property for sale.

Information about HIPs

What is a HIP?

HIP stands for Home Information Pack. The HIP was introduced by the UK Government in August 2007. It is now a legal requirement for all UK homeowners wishing to sell their property to commission a HIP before the property can be marketed.

Packs will be valid for the whole period of marketing. If a seller withdraws the property from the market and then remarkets the property at a later date, the seller will not have to revise the HIP where re-marketing is within one year of the original date.

Why is the HIP being introduced

The Government is introducing HIP’s as part of wider reforms to cut carbon emissions and to improve the home buying and selling process. The HIP is designed to provide information about the property such as energy efficiency, boundary ownership, planning consent and title earlier in the process in order to improve the speed and certainty of transactions, with the aim of reducing wasted costs.

The idea behind HIP is for buyers to be able to make informed decisions before making an offer on a property, preventing unwanted surprises later in the transaction. The vendor benefits with less likelihood of a sale falling through and faster transactions.

The content of the HIP

Compulsory Documents:

1. Index of Documents

2. Energy Performance Certificate (EPC)

3. Sales Statement Tenure and Ownership

4. Land Registry copies (evidence of Title and Title Plan)

5. Local Authority Search and Drainage/Water Searches

6. Lease Service Charge and Ground Rent Details

Optional Documents:

1. Home Conditions Report (HCR) rates the condition of the property for the seller on a scale of 1-3 with comments and recommendations.

2. Home Use Form (HUF) covering further legal items.

3. Home Contents Form (HCF) listing fixtures and fittings included in the sale.

4. Legal Summary - List of Authorised Documents

Our obligation as an Estate Agent

The law requires sellers of residential property to have commissioned a Home Information Pack (HIP) before the property can be marketed for sale.

This means that we, as agents, will be required by law to ask the seller if they have commissioned a HIP and ask for proof that this has been done. If the seller has not had a chance to commission one and would like our help, we can do so on their behalf. We are not liable however to pay for the HIP – this will be the responsibility of the homeowner.

When is a HIP not required?

The few exceptions where a HIP would not be needed include:-

1. Mixed use property e.g. part shop, part flat

2. Properties over 5 hectares (about 12.4 acres) where the land is used for 'horticulture or cultivation, or breeding/keeping of animals/livestock, or grazing or woodland'. Note: the intention is to exclude farm-type properties - not houses with large 'grounds'.

3. Let properties where vacant possession is not offered

4. Building which are unsafe and not fit for human occupation

5. Buildings due to be demolished

6. Non-residential buildings

7. Dual use properties ( i.e. a shop and flat above) and being sold as one lot.

8. Part of a private sale (where the property is not marketed)

9. Part of a sale of a property portfolio

Who is responsible for the HIP?

The HIP duties apply to the person responsible for the marketing of the property – normally an Estate Agent. This means the agent must make sure it has been commissioned but is not responsible for covering the cost. We will therefore work with you to make sure you commission the right company at the right time and the right price. We have a joint responsibility to get the HIP in place.

Certain documents must be in the HIP but some documents can be added to the pack later, specifically: searches, leasehold and commonhold information.

The Estate Agent is obligated to provide a copy of the HIP to a potential buyer who asks for it.

The agent is expected to ensure that the correct documents are included in the HIP, but will not be responsible for the accuracy of the information contained within each document.

Charges

The cost of a HIP will vary greatly depending on the size and age of the property. Whether it is registered title or not, leasehold and whether a Home Condition Report (HCR) is commissioned. Without the leasehold and Home Condition Report the costs are most likely to be in the region of £299 plus VAT.

For larger and older properties the cost could be up to £1,000.

Home Information Bureau

One of the companies we recommend is the Home Information Bureau and their costs will be:-

• Immediate payment terms £325.00 plus vat
• Deferred payments (payable within 10 months) £375.00 plus vat

Additional disbursements for obtaining leasehold information from managing agents will be charged at cost (for the record the average seems to be £100-£300 and upwards).

How Bushells can help

• We can recommend a HIP supplier to you.
• We can give you expert advice on the detail of HIPs and the effect it may have on the timing and strategy of your sale.
• We can advise on what preparations are necessary.
• We will be able to obtain a HIP for your property with minimum fuss and within the shortest time if you need us to.
• An integral part of the new arrangements for HIPS is the facility for buyers and sellers to have access to an independent complaints handling and redress scheme where a dispute arises over the HIP. The Secretary of State has appointed the Ombudsman for Estate Agents scheme as an approved redress scheme. Bushells is a member of the Ombudsman for Estate Agents. Consumer Complaints 01722 333306 (open 09:30 to 16:30 hrs)

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