Partner Article

Home Information Packs - The Reform of the Home Buying Process

With Watson Burton LLP Law Firm

Under the present home buying process, certain information required by buyers only becomes available after an offer has been made and accepted. This can mean that any potential problems with the property only come to light after both parties have incurred significant expense in legal fees, searches, surveys etc.

Provisions under the Housing Act 2004 will require sellers to make a Home Information Pack (HIP) available before marketing residential properties for sale. The Office of the Deputy Prime Minister has suggested that providing key information up front in the HIP will make the process more efficient and user friendly, and it is hoped that this in turn will deter speculative marketing of properties which leads to transactions collapsing at an advanced stage.

It is anticipated that the pack will include documents such as the terms of sale, evidence of title and other information that is currently made available later in the transaction. In addition, the HIP will contain a Home Condition Report based on a professional survey of the property. This will require each home to be inspected before being marketed for sale.

There is no need to provide a HIP when marketing a property that has primarily been used for business purposes, or where one or more properties are being sold together as a package, e.g. when selling a block of residential flats or a housing estate as a portfolio of properties.

The exact rules have not yet been finalised and new proposals for HIPs are still in consultation. HIPs are expected to be made compulsory in Spring 2007 and it remains to be seen just how effective they will be in resolving the problems with the current process.

If you have any queries in relation to this article or any other property matter, please contact Stephen McLellan (Stephen.mclellan@watsonburton.com).

This was posted in Bdaily's Members' News section by Ruth Mitchell .