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19 August 2009

Estate agents continue to profit from Hips

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by Kay Mitchell

Estate agents continue to profit from Hips

Consumer magazine Which? Money is urging homebuyers to shop around for Home Information Packs (Hips) after it was revealed that a pack can cost twice as much through an estate agent rather than buying from a specialist provider.

Hips were introduced in August 2007 to speed up the home buying and selling process as well as providing consumers with a faster and more cost effective service.

However, many have branded them “a waste of time” with some believing they have contributed to the slump in the property market.

Homeowners in England and Wales must now have a Hip in place before they can market their property.

According to Which? Money, one of the most expensive Hips is provided by Halifax Estate Agents (at £413 for a three-bedroom freehold property), while Fridays Property Lawyers offered the cheapest at £189 for the same property.

However, top of the list for the most expensive provider for a flat was at £516 from estate agent Spicerhaart – compared with Hip Save at £224.

James Daley, editor of Which? Money, warns vendors not to be fooled into thinking you have to buy a Hip from your estate agent and advises “shopping around for the best deal”.

Mr Daley also cautions that for those who don’t have a Hip in place before their house or flat is on the market, could face a fine of up to £200 a day.

The news follows on from a report in May this year that indicated estate agents are receiving commission from Hip providers.

An investigation by Channel 4 News found that estate agents are operating a scam linked to Hips which is adding as much as £150 to the cost of selling a home.

The end result is that vendors end up paying a higher fee for a Hip.

The Royal Institution of Chartered Surveyors was investigating the issue as part of a wider review of commission within the property industry.

A Hip contains title deeds, searches, property information questionnaire and an energy performance certificate.

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