News: DCLG slammed over HIPs spin

Thu, 25 Oct 07

The latest DCLG stance on HIPs is misleading and completely lacking substance, according to the National Association of Estate Agents...

Their latest letter talks of the “smooth implementation” of HIPs and the “good feedback from agents and consumers” but lacks any facts or figures to support these claims. Meanwhile, the picture being reported by agents on the ground is in fact very different.

Both NAEA President Stewart Lilly and Chief Executive Peter Bolton King were astounded by the claims made today, as evidence would suggest the market is in fact being affected by HIPs. Surveys conducted by both the NAEA and RICS recorded a drop in the number of 4 bedroom plus properties on the market following the first phase implementation of HIPs.

Unavoidable nuisance

63% of NAEA agents surveyed reported decreases over and above the seasonal norm of on average 37%. Meanwhile, 53% of RICS respondents noted a decrease in 4 bedroom, or larger properties, coming onto the market with new instructions falling by an average of 51%.

In addition to this, agents have been reporting delays in the time taken to put the Packs together and a general lack of interest from consumers. One NAEA member from South Wales commented in a recent survey: “HIPs have without doubt not speeded up the house selling and buying process.” Another from Yorkshire added: “The public appear to be disinterested in HIPs, which are an 'unavoidable nuisance'”.

 Stewart Lilly comments: “This latest communication from the government is blatant spin. It lacks any substance whatsoever – if there are in fact statistics to back up the claims then we would urge the CLG to make them public to save further embarrassment. We obviously welcome relevant information being released by government and would expect at least a balanced view that accepts that there are problems.

"The implied message from the CLG is that everything since the introduction of HIPs for 3 and 4 bedroomed properties is wonderful and rosy,” continues Stewart. “Our members are continually reporting to us that this is not the case.

“A number of HIP Providers are not supplying packs as quickly as promised. There are on going problems surrounding the supply of searches and their acceptance by the legal profession. Leasehold information is, as we expected, slow to obtain. Perhaps most worryingly the public are expressing little interest in this watered down HIP."

Ridiculous assertions

Peter Bolton King added: "The above problems clearly show that it is ridiculous to suggest that the implementation is trouble free. In addition, whilst saying that it is "monitoring the impact of HIPs", the CLG does not bother to make any comment on the effect HIPs are having on the market.

“The NAEA and others believe that there is clear evidence that new instructions in England and Wales are way below the normally expected levels even taking into account the slightly slower market caused by the interest rate rises. The government says that there is good feedback from consumers. Where is the evidence for this and why has there still been no publication of the HIP trial data? One can only assume that the government does not like what the results are telling them?"

 Stewart Lilly concludes: “The reduction in supply following the initial launch of HIPs is set to have a significant impact on agents’ businesses. Ironically, the government itself stands to lose by this – its own forecasters reported last year that if there was more than a 10% reduction in the number of housing transactions in England and Wales then the government could lose as much as £3.5 billion.

“A sobering thought surely, even for a department desperate to save face by ploughing on with a useless initiative. Once again we urge: scrap HIPs and let energy performance certificates stand alone in their own right, as the only sensible part of the whole HIPs scheme.”

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