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14 May 2010

New Government confirms abolishment of Hips

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by Kay Mitchell

New Government confirms abolishment of Hips

The new coalition Government has confirmed that it is proposing to scrap the Home Information Pack (Hip), while retaining the Energy Performance Certificate (EPC), which is required under European law.

For many months now, the Conservative party pledged to scrap the packs “in a matter of weeks” if it won the General Election.

The news will be welcomed by estate agents and mortgage brokers who have frequently called on the Government to review the packs, believing them to have contributed to the fall in house prices that followed for many months after they were introduced.

However, scrapping Hips will be devastating to those involved in the Hip industry, who had between them injected millions into the project over the past few years.

The packs were introduced in August 2007 and, according to the Government, were designed to speed up the home buying and selling process.

However, despite the controversial packs being branded “a waste of time” and detrimental to the housing market, the Association of Home Information Pack Providers (AHIPP) recently claimed that Hips have benefited the market.

Defending the packs recently, Mike Ockenden, director general of AHIPP, said: “Anyone with an ounce of sense would have known that it was the collapse of the banks and the following recession which forced the [housing] market to stagnate.

According to the Association, homeowners started to become wary of the property market in April 2007 – prior to the introduction of Hips, with the number of new homes marketed falling 25% by July of that year.

Furthermore, an Ipsos MORI poll commissioned by AHIPP revealed that 85% of people had not been discouraged from selling as a result of the introduction of Hips.

However, commenting on the decision to scrap the packs, Peter Bolton King of the National Association of Estate Agents (NAEA) said: “This is great news for the housing market and for house buyers, few of whom have paid much attention to these pointless packs.

“It is also good news for sellers, who will no longer need to shell out hundreds of pounds for a piece of pointless regulation that benefits no one.”

However, the NAEA has called for the decision to implemented sooner rather than later to avoid confusing consumers and damaging the property market.

Currently, a Hip costs in the region of between £250 and £350 but it is unclear how much vendors will now have to pay for a standalone EPC.

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