If you believe the advertisements, if you pay more than £299 for a HIP then you’re clearly wasting money. However, given recent examples of providers illegally including mortgage documents in a HIP, taking three weeks to organise an energy inspection and carrying out searches on the wrong property, perhaps these cheap products might not be so cost-effective after all. These low prices mean that assessors are being paid only £65 to carry out energy inspections, a job that can take several hours. In one case, an assessor willing to do the work for this money had to travel 130 miles around the M25 to get to the property. Maybe he took advantage of the queues on the motorway to file the report from his car, because it produced an energy efficiency rating of 1, with no scope to improve this figure, which is somewhat unusual to say the least.
Personal search usage and performance
As reported last month, our concerns about the costs to consumers through the use of personal searches are being borne out. We currently have two cases that require a quick exchange. One seller paid for an authorised local authority search, the other wanted to save money with a personal search. As the first client had not instructed their solicitor when marketing the property, the time taken to get the searches would have meant the deal wouldn’t have gone through, but the HIP has put them in a position where the sale can be completed in time. However, in the second case, the use of a personal search may now stop the transaction because of concerns about whether the mortgage lender will accept it.
We are already seeing personal search appointment times start to stretch. In a recent case, much to the disappointment of the estate agent, the local authority could not make an appointment with a personal search agent for eight working days, introducing significant delays into the instruction. With the proportion of personal searches increasing, such delays and worse are expected to become commonplace.
Trading standards activity
Trading standards officers are actively carrying out inspections of estate agents to ensure that they are complying with the Home Information Pack regulations. We are aware of instances in Hampshire where officers have turned up unannounced at agents and asked for an explanation of how they are ordering HIPs and the processes they use to obtain these. They have also sent out questionnaires to all agents asking for acknowledgement of their processes and procedures.
HIPs for new-builds
There is some confusion over the requirements for a HIP for newly built homes. This is because under the original legislation, a HIP was required for all properties that were marketed for sale, including newly built properties, whether constructed or not. Currently, if a new property is being marketed that conforms to the older Building Regulations 2006 regime then it will NOT need a HIP. Therefore, to determine whether a new property needs a HIP, it will be necessary to check which building regulations it conforms to.
Media Coverage
We were pleased that the Daily Telegraph picked up on our concerns about the service offered by a major water company in their production of drainage searches, with some outstanding for over 30 days. The company involved should take heed of Thames Water, who are consistently producing high quality reports sometimes within a matter of hours.
http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2007/10/13/nhip113.xml
