HIP Roll-out May Be Delayed

The Government’s Home Information Packs (HIPs) have come under criticism for their cost, complexity and the time they take to produce. They were introduced for houses with four bedrooms and more on 1 August, and then for homes with three bedrooms on 10 September. The Government had said that it will introduce HIPs for smaller properties as soon as it can, but the stance has changed.

Last week housing minister Iain Wright said the Government would assess the success of HIPs to date before completing the roll-out, especially in the light of the credit crunch and its potential impact on the economy. He said: “We are monitoring the impact of HIPs in the marketplace before we complete the roll-out. We are at a time of unusual market conditions. Most serious commentators are clear that interest-rate changes, house prices, the end to fixed-rate mortgages for some consumers, stock market uncertainty, concerns about sub-prime lending across the Atlantic and the Northern Rock issue have determined the housing market over the summer. Against that background, it is to be expected that property owners might think twice about putting their property on the market.”

The Department for Communities and Local Government said nothing had changed, but there was little doubting the content of Mr Wright’s comments, and a delay beyond the end of 2007 is expected to HIPs for smaller properties. Mr Wright said a timetable for further implementation would be set out in due course.

The National Association of Estate Agents said it would be a farce if HIPs were in place for larger properties, yet not for smaller, and said that the whole things had been very badly managed.

There is, however, a concern that HIPs will have a greater adverse effect on the lower end of the market with the cost of each pack at around £400. The smaller property market has already suffered most in current conditions, and the implementation of HIPs could only make it worse. Houses under £300,000 have seen most pressure on prices.