Press release: 20 June 2007
Consumers should be warned that from August 1st estate agents could use the new Home Information Packs (HIPs) legislation to tie-in around 200,000 property sellers creating a situation comparable to the much-criticised sole agency agreement. Careful home sellers will be keen to learn that they can now avoid this potential 'HIP Trap' by purchasing a Home Information Pack (HIP) independently of an agency selling agreement, such as the new Local HIPs service from the popular property website Home.co.uk.
Following the UK government's recent revision of its long-awaited home-selling reforms, from 1st August only sellers of homes with 4 or more bedrooms must commission a Home Information Pack before putting their property on the market. Legislators still expect estate agents to organise the provision of HIPs in this first phase of the reforms and pass on the cost to the seller. However, to avoid the inevitable conflict of interest that will arise if a seller feels they need to change their selling agent, Home.co.uk have launched a fully compliant HIP solution that is available direct to the home seller.
According to figures from Home.co.uk, 27% of residential properties on the market will need a HIP from 1st August. That equates to around 200,000 sellers of homes currently for sale in the comprehensive Home.co.uk Search Index who could find themselves tied to a single estate agent.
Home.co.uk's consumer advice to sellers is simple: "Avoid the 'HIP Trap' by first sourcing your HIP independently of a selling agreement & then decide who will sell your property. " The huge benefit for home sellers of acquiring their HIP independent of a selling agreement is that they remain free to choose how to sell their property.
The HIP Trap
Vendors that commission a HIP via their estate agent are likely find themselves tied to that agent, even if they deliver poor service, as the HIP may not be easily transferable to other agencies. There are a number of reasons why the next agent down the high street will not want to accept a HIP produced by a competitor. For instance, the HIP may be incomplete, deemed noncompliant with the current legislation or simply have their competitor's branding on it. In any such instance the next agent of choice may insist that the vendor purchases a second HIP at additional cost. Moreover, unless a price was agreed in writing with the first agent, the seller could be charged over-the-odds for the HIP by the first agent, even though they didn't actually sell the property, as they attempt to recover costs.
"Sellers often try 3 or 4 estate agents before they manage to sell and therefore it is vital that sellers purchase their HIPs independently of their selling agent," urged Doug Shephard, Director at Home.co.uk. With most HIPs currently costing somewhere between £400 and £600, sellers really need to ensure that they only need to buy it once (Home.co.uk's Local HIPs are £408 +VAT for a 4 bedroom freehold property). However, attempting to sell a 4+ bedroom home without a HIP after the August deadline is not advisable as vendors will potentially face fines of £200 for every day the property is on the market.
Home.co.uk Local HIPs are fully compliant with the latest government legislation and are produced in association with the Home Information Pack Co. Ltd, a member of the new industry body AHIPP (Association of Home Information Pack Providers). Local HIPs are compiled by experienced local solicitors together with local property professionals who are in the best position to know and appreciate the idiosyncrasies of the property transfer process in their area. HIPs produced with this level of attention to detail are simply the best HIP option available to home sellers.
"We are very excited about our close relationship with Home.co.uk. Having designed a HIP solution suitable for any selling method, be it selling privately, via an online estate agent or using a traditional high street estate agent, we will bring complete flexibility to the market place, creating greater independence for home sellers throughout England & Wales," commented Dean Thompson, Managing Director of The Home Information Pack Co. "August 1st looks set to change the property industry as we know it. Our tailored HIP offering, in the form of Local HIPs, combines local professionals in each region by calling upon the services of trusted practitioners, to deliver the precise legal information required in the production of Home Information Packs."
"We worked hard to ensure our online HIP quotes and ordering service would be ready to roll by the original deadline set for 1st June," commented Doug Shephard. "The initial response from potential home sellers to our Local HIPs has already exceeded our expectations and we can only expect the number of requests for HIP quotes to rise further as the new August 1st deadline approaches."
Buying a HIP outside of an Agency selling agreement allows to the seller to remain in control of their property sale. Home sellers can then choose how they wish to sell their property, be it through a traditional high street estate agent, an online agent or to sell the property privately. Despite the growing popularity of online agents and private sales, the majority of vendors will opt to instruct one or more traditional agents to sell their home, but with their HIP sourced independently they will remain able to change agents should the need arise.
Home.co.uk fully expects that over time the majority of sellers of UK property will opt to purchase their HIPs independently of their selling agent. Private house sales and online estate agents will also almost certainly continue to increase in popularity thanks to the selling power of the Internet. Only time will tell if these trends continue but one thing is for sure, thanks to HIPs, home selling in England and Wales will never been the same again.
Notes for Editors
Over the last 24 years, Home.co.uk has become established as a dynamic, innovative and ethical service. By providing the UK's most comprehensive Property Search and Estate Agents directory coupled with detailed House Price analysis, Home.co.uk delivers the real power of the Internet to inform and empower estate agents, homebuyers, renters, landlords and sellers in across the UK.
Phone: 0845 373 3580
Back to Home.co.uk Press