What is a Home Information Pack?

A HIP contains a collection of important documents that are required when houses are bought and sold. These include various legal searches, land registry documents and an energy performance certificate (EPC), which is intended to tell you and potential buyers how ‘green’ a house is. These are the compulsory elements for all properties; leasehold properties require additional information and there are various other documents and reports that can be included if you wish.

Why have they been introduced?

The idea behind Home Information Packs is to make the process of buying or selling your house easier and quicker, by providing key documents when the property is first put on the market. Currently this information is not usually available until after an offer has been made and accepted. The goal is to deliver a more transparent and efficient process, thereby reducing the number of failed transactions, which currently cost consumers over £350m per year.

What is In a Home Information Pack?

There are two kinds of documents that a HIP may contain; those that are required (mandatory) for all properties and others that are authorised (optional), to be included at the seller’s discretion:

Mandatory

• Index of the documents contained within the pack
• Energy Performance Certificate
• Sales Statement summarising the property details and terms of sale
• Evidence of title from the land registry
• Local authority searches and a drainage and water search
• On leasehold properties, key information re the lease and the management company.

The elements in bold will be required before a property can be marketed from 1st January 2008. The other elements are required within 28 days.

Optional

• Home Condition Report (HCR) – a new form or survey
• Any warranties or guarantees that you have for your property (i.e. NHBC certificate)
• Other legal documentation which will be required for conveyancing (part of the current process) such as environmental, flood and ground stability (mining) searches.

Do all residential properties need a HIP?

Apart for the phased start by size of property, the vast majority do. There are a few exceptions, such as mixed use properties (i.e. a shop and flat) and properties with a sitting tenant.

What is an Energy Performance Certificate (EPC)?

An EPC will tell buyers and sellers about a home’s energy efficiency, using A to G ratings like those used on appliances such as washing machines and refrigerators. The certificate will also specifically show for each individual property, various improvements that could be made to cut fuel bills and carbon emissions, the costs of doing this and how quickly these will be recouped through reduced spending on energy.

What is a Home Condition Report (HCR)?

An HCR contains information about the physical condition of the property. It is prepared by a home inspector, who can also prepare EPCs. The HCR provides an objective report on all parts of the property, meaning that potential buyers can understand the condition of the property before making an offer, and where repairs are required, the extent and possible cost of these. If an HCR is included, offers can be made based on the facts about the property and therefore the sale is less likely to fall through or the price be renegotiated.

Should I use an HCR – and what will it cost?

An HCR is a voluntary document, and for the average property will cost approximately £200 - £250 on top of the required documents. Many buyers and sellers have found them useful in the trials you might consider using a HCR if you believe:

Your property is in good condition, you want a quick sale and you want to show potential purchasers that there are no hidden problems.

That your property is in better condition than others in the area, or has significant features that will help you achieve a better price.

Your property needs work in some areas, and you want to identify these in an objective way, thereby stopping purchasers trying to drive down the price by over-exaggerating the costs involved.

How much will a HIP cost?

This will vary according to the type of HIP you have (for example if you included any authorised documents) and whether your property is freehold or leasehold.

When will I have to pay?

There are a variety of ways to pay for a HIP, many of which allow you to defer payment until your house is sold. Ask our staff for the different options available.

How long will it take to put my property on the market?

Until 1st January 2008, a property can be marketed as soon as a HIP has been ordered (proof of this is required). After that date the property can be offered for sale as soon as the EPC and Land registry documents are ready. In most cases producing these documents should take 7 days or less. The rest of the documents have to be assembled within 28 days of marketing the property.

What happens if I take my property of the market?

A HIP is valid for one year from the date that the property is first marketed. You can take the property off the market and put it back on again within a year using the same HIP. However you will need to consider the terms on which the HIP was provided to you and your contract with your agent.

Do I have to update my HIP?

There is no obligation on you or your estate agent to renew anything in your HIP. If something significant happens whilst the property is in the market, then you may choose to do so, but it is the buyer’s solicitor’s responsibility to check if any documents need renewing.

How do I get my HIP?

We can order your HIP and explain all the choices with regard to which optional information to include and payment alternatives.

What happens if something goes wrong?

Although the HIP is a new document, a whole range of measures and safeguards have been put in place to help you if you have any questions or problems.

All reputable pack providers must subscribe to the Property Codes Compliance Board. This body sets and enforces standards with regard to insurance cover, complaints and redress procedures and overall quality levels.

All estate agents will have to belong to a compulsory approved redress scheme which covers complaints and compensation with regard to Home Information Packs should the relevant rules be deemed to have been breached.