Estate agents and conveyancers argued, even before they were introduced, that Hips added an unnecessary layer of bureaucracy and deterred speculative sellers from putting their homes on the market. The Tories promised they would scrap them if they won power . They kept their word.
Since abolition of HIPs just over a week ago estate agents have claimed that there has been a significant increase in properties being placed on the market.
The increase is particularly pronounced in the Midlands and north of England, according to the various estate agency chains included in the Countrywide group: 53% in the east Midlands, 63% in central and west Midlands, 50% in the north-west and 58% in the north-east. In contrast, new registrations increased by 26% in Greater London, 32% in the south-east and just 17% in the south-west.
Robert Scarff, managing director of Countrywide's estate agency division said "The increase in activity kicked off as soon as the government announcement was made. There have been no reports of buyers questioning how the Hips suspension will affect them or if it will add to their costs. This supports our view that the government was 100% right in their decision to suspend the scheme. "
Stephen Armitage, of Winkworths in Sheffield, claims that his office has experienced a 20% increase in registrations since the abolition of Hips, with most new sellers coming from the lower end of the market: "The properties coming on our books are more in the £100, 000 to £150, 000 range, probably homes belonging to people with less disposable income to put towards the house move. The market has been more challenging in the north, and paying £500 for a Hip would be a sizeable outlay when there is no certainty that they can sell. "
Good news for all ? The sudden increase of properties on the market may have an adverse effect on house price increases in the short to medium term. How ironic that with HIPs having been blamed for the housing crash, that their abolition may spark the much feared “ double dip “. The last few days have seen an increased number of buyers and sellers withdrawing from transactions citing concerns of an increase in capital gains tax.