Since December of last year all properties in England and Wales that have been marketed for sale have been required to have a Home Inspection Pack (HIP). Scotland will implement the scheme from December 2008 and already there are signs of disquiet north of the border.
The HIP is a comprehensive set of reports and documents that bring together all of the pertinent information a buyer would need to be well informed about the prospective property they would be interested in buying.
The UK government are pleased with the implementation of the scheme, the Housing Minister Caroline Flint said:
“Consumers are already benefiting from the introduction of HIPs. Search costs are falling as a result of increased transparency in the market, energy ratings can help people to reduce fuel bills, and first time buyers are receiving important information about their home for free.
“I welcome the fact that buyers are starting to act on their energy ratings, which could cut a million tonnes of carbon a year as well as helping families with their fuel costs.
“However, what is clear from the trials is that more buyers wanted to see the HIP but it was not always made available to them. That’s why we have taken action to increase awareness of the consumers’ right to see a HIP and to remind agents of their responsibility to provide the pack.”
So what does a HIP comprise? There are mandatory documents and optional documents within the pack.
- Mandatory requirements include a sale statement stating key facts about the property, local searches very much akin to LIM’s. Legal titles and the energy performance certificate – a professional report on the energy efficiency rating of the property and an environmental impact rating.
- Optional components a house condition report – very much akin to a building inspection report and a legal summary report.
Certainly the objective of the implementation of the HIP scheme was in its ability to aid transparency in the home buying process. The costs of a single HIP does range anywhere from $800 to $2,500 and is paid for by the vendor of the property.
As to implementing such a scheme in NZ. You would have to say that from a consumer perspective the greater the level of transparency and ease of access to pertinent information has got be seen to be of great benefit for buyers. Naturally initial reaction would be cold, especially to the cost; but living as we do in an ever more open and transparent business environment this initiative has got to be of value. We will just have to wait patiently to see if a future NZ government decides to implement such a scheme.