Home Information Packs

by Roland Finch
NBS Technical Author

One of the first things the Conservative / Liberal Democrat coalition government did on coming to office, was to suspend home information packs (HIPs) in England and Wales. The move was warmly received in most quarters, with the possible exception of those people who had invested time and money in training to become HIP inspectors. (It should be noted that this only applies to England and Wales – HIPs were never compulsory in Northern Ireland and the requirement for Home Packs remains unchanged in Scotland.)

The idea behind HIPs was itself quite sound – that buying and selling of property could be speeded up if more detailed information was available to the prospective purchaser of a particular property at the time it was put up for sale.

The truth is, however, that HIPs were probably doomed to failure before they were even launched. There are two main reasons for this. Firstly, one of the key components, and possibly the single most useful item when involved in property transactions, is the Survey.

The problem with surveys is they take some time to compile, and can be quite expensive, so it was agreed after much debate that they would not form part of the statutory requirements for the contents of the pack.

The other obstacle was the cost. Starting at around £300, this was enough to deter many prospective sellers from putting their properties up for sale. In addition, the limited shelf-life of some components of the pack, such as the local searches, meant that if no sale was made, they would need to be updated, with an additional cost.

Add to this the decision by lenders that they would not rely on the contents of the pack and would continue to commission their own valuation surveys and it is easy to see how the slimmed down HIP came to be regarded with scepticism by buyers and sellers alike.

However, not all the documents which were a mandatory requirement of HIPs will disappear completely. One thing which will remain is the statutory requirement to produce an Energy Performance Certificate (EPC).

Because its origins lie in an EU Directive, this requirement applies throughout the UK. The EPC must be ordered before marketing starts and be available before the transaction is completed. Similarly the various other documents - searches, evidence of title, property questionnaires and so on - will be necessary for making the sale, but it is no longer a requirement for them to be available in advance.

For example, the RICS, among others, has been lobbying for continued use of documents such as their 'home condition report' as an alternative to a full survey.

There are also many additional documents which will be required, even though they may not have been included in the HIP, particularly if the property has been the subject of building work.

Common examples include operation and maintenance instructions for boilers, cookers, heating, and suchlike, as well as guarantees for various products, and the property itself if it is covered by a warranty scheme. There are a number of clauses in Section A37 of NBS which allow Specifiers to give direction as to the nature, type and format of these documents.

There could be requirements for evidence of testing for sound resistance, air tightness, as well as the integrity of gas and electrical installations. Clauses which govern these procedures may be found in Section A33.

Finally, there will be some requirements with regard to ongoing health and safety. There is still a widely held misconception that 'CDM does not apply to domestic work'.

While this may have been partially correct for the 1994 Regulations, the definition of 'Client' in the Construction (Design and Management) Regulations 2007, is given as 'someone carrying out work in furtherance of a business'. Although this is generally interpreted as excluding 'domestic' Clients, it will include housebuilders, and is likely to extend to 'second home' owners or 'buy to let' Clients, or where the property in question is not the principal residence.

This will mean attention must be paid to things like the appointment of CDM Coordinators and the preparation of a Health and Safety File on completion.

So whether or not HIPs continue, there is a need for comprehensive records to accompany any property transaction. And the potential for trouble if they are not anticipated.

Related NBS information:

Articles:

• Commercial property – case update

Selected links:

• Property development

October 2010

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