The coalition government have announced that HIPs packs are to be suspended from 21 May 2010. HIPs will therefore no longer be required when you market your property although you must still commission an EPC. EPC’s are required as part of EU regulations so even if the government wanted to abolish them along with the HIP they would have struggled to do so!
The Law Society has said that they are aware of the problems in the property market and are trying to come up with innovative ways to address issues that were not properly dealt with by the HIPs packs. HIPs were created with a view to helping buyers by providing them with a pack very early on in the transaction which contained important information about the property. Unfortunately, there were a number of flaws with the HIPs packs which meant that certain information was not included and the pack was therefore not as ‘full’ as it should have been.
The Law Society stated in its press release on 21 May 2010:
“The Law Society has always supported the idea of buyers receiving information about a property they wish to buy up front. The Society wants to develop innovative solutions to properly address some of the issues that HIPs have not resolved. ”
The Law Society are proposing a complete and comprehensive set of documents, prepared by a solicitor, so, really, another form of HIPs.
Yes, the HIPs packs were controversial and were lacking in many ways, but the reason they were introduced was to help homebuyers by giving them vital information and documentation on a property from the outset. Very importantly, it also meant that buyers were not left saddled with the costs of local searches on properties they would not necessarily be buying. By abolishing HIPs packs costs have immediately increased for homebuyers.
Now that the HIPs pack have gone, I believe it is important that something is done to fill the gap and come up with a better version of the HIP as Buyers have gone back to being at a distinct disadvantage in the property market.