The lowdown on Hips

BREAKING NEWS.........HIPS UPDATE

Government Announcement - Friday 17th August at 11.59am

The government has just announced that Home Information Packs (HIPs) will become compulsory for THREE bedroom houses from 10th September 2007.

So if you want to avoid paying the extra or delaying your house sale
GET YOUR THREE BED HOUSE ON THE MARKET BEFORE THE DEADLINE.

Does everyone who plans to sell their home need a Hip? No. The Government announced in May that it was postponing the introduction of Hips, which had been set for June 1, until August 1. However, it also said that Hips would initially be mandatory only for those selling houses with four bedrooms or more. There will then be a second phase, covering three-bedroom properties, and a third, covering the rest of the market.

We are planning to sell a house with four bedrooms. Can we market it as a three-bedroom house with a study? You could, but it might well be self-defeating because you could end up getting less for the property than you would by marketing it as a four bed. “The way most people shop for houses these days is through internet portals, and about the second or third question you are asked is how many bedrooms you want,” says Mike Ockenden, director-general of the Association of Home Information Pack Providers (Ahipp). “If you list your home as a three-bed-room house, then you will lose all the potential purchasers looking for four bedrooms or more.” However, agents already have a name for the study – “the Hip replacement room”.

I want to sell a smaller property. When will I need to obtain a Hip? You may have to act soon. There is no firm time-line for the introduction of the second and third phases of the introduction of Hips. The Government has said that it will wait until there are enough domestic energy assessors (DEAs) to cope with the job, and until those DEAs are in the right parts of the country to make the system work smoothly. Two weeks ago Ahipp announced that just one more DEA was needed for the second phase to start. “The likelihood is that the Government will lay down the commencement order for Hips on three-bedroom properties very soon,” Mr Ockenden says. They should go live from September 1, with the rest following not long after. All properties will need a Hip by the end of the year. However, the National Association of Estate Agents says that there are not enough DEAs in the right places even to cope with four-bedroom houses.

What happens if I put my property up for sale before Hips are introduced? If so, you are likely to have until next spring to sell your home without a Hip. Originally the Government had stated that, if your property was already on the market at the time Hips were introduced, you would not need to get a Hip until March 31, 2008. There is no longer any firm cut-off point but, if the second and third phases do happen soon, that deadline could well be revived.

What documents must a Hip contain? Most of the information within a Hip is that which would usually be gathered by a prospective purchaser’s solicitor: the terms of sale, evidence of title, a property information form, a fixtures and fittings form, planning consents and replies to standard searches. The notable addition is the energy performance certificate (EPC), which will give details of the property’s size, its average energy use per square metre, its carbon dioxide emissions, and an estimate of how much it costs to provide heat, light and water for the property. Hips for leasehold properties will also need to include a copy of the lease, details of service charges and regulations made by the landlord or management company.

How long will it take to obtain my Hip? That depends on how efficient your Hip provider is, but also on the type of property you are selling. For most freehold properties, gathering the information needed for a Hip should take no more than a week. For leaseholders, compiling a Hip could be problematic because the seller has to rely on the managing agent or freeholder to come up with information on service charges promptly – something the agent or freeholder is under no legal obligation to do. Thankfully, until the end of the year you can market your property as soon as you have commissioned (rather than produced) your Hip.

How much will a Hip cost me?

Prices in Sheffield will vary depending on who you use, don’t be mislead by agents offering a FREE HIP,there is no such thing, the fee will merely be added to a tie in or higher commission rate.

We will offer two companies ,one is Norrie ,Waite and Slater solicitors, who will take care of everything, the other is Hip specialist HOME-IN. We can arrange for them to contact you directly so you can decide what suits you, instead of us forcing you .Both will offer a deferred payment ,so you should not have to pay up front.

Please also note if you use an estate agent then change to another you will still have to pay them, with us your hip is yours to keep.