Are HIPs Dead?

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Postby Stoday » Thu May 20, 2010 2:39 pm

HIP HIP Hooray!

:lol:
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Postby WILL*REMAIN*STRONG » Thu May 20, 2010 3:51 pm

Are HIPs Dead? They are now! :twisted: :lol: We know someone who has just paid a large amount for one. Perhaps people won't be held to ransom anymore when having problems with neighbours, the HIP was a bad idea to begin with, thanks Cleggy and Camaroony. :lol:
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Postby juliet » Thu May 20, 2010 7:03 pm

Cannot believe it............I ordered one on Monday!
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Postby WILL*REMAIN*STRONG » Thu May 20, 2010 10:51 pm

People will still need the energy certificate for £50. That’s a much smaller price to pay. The HIP was putting too many people off marketing their houses, especially when prices began to fall and fewer houses were selling. I think first time buyers or people buying to let might have been happy with them but mostly they went unread and any sane person would have paid for a proper survey on a house regardless of the HIP.
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Postby deeplyblue » Fri May 21, 2010 1:52 am

WILL*REMAIN*STRONG wrote:Are HIPs Dead? They are now!

Perhaps people won't be held to ransom any more when having problems with neighbours.

We sold our house just before the HIPs came in. Once we had a sale, we had to fill in a form which included nearly all the stuff that turned up in the PIQ inside the HIP later. This included all the detail about planning permission, whether the boiler had been serviced, exactly where the boundaries were - and whether we had any disputes with the neighbours. Presumably our purchasers could have pulled out of the deal if the answers were unsatisfactory.

Perhaps not all solicitors would ask this, but I think that any conscientious solicitor will ask if you have any problems with the physical fabric of the house, or with the neighbours. My understanding is that if you have a serious dispute, for example over rights of way, or high hedges or a shared drive, and you failed to disclose this to the purchaser, then you can still be sued.

Incidentally, if you are buying a house as well as selling it, you will still have to get most of the documents that were in the HIP, such as water searches, local authority searches and property deeds, but now you will have to pay your solicitor to get them for you - unless you fancy DIY conveyancing.

I remain amazed. People will spend £3,000 doing a house up "ready for a sale", spend hours get it into "show house" condition every time a prospective purchaser comes round. Then they pay an estate agent £4,500 (1.5% on £300K) for doing some inferior photography and then putting some inaccurate measurements on RightMove, and field a few phone calls. Then they whinge bitterly about paying out £250 for a HIP. As purchasers themselves, they will then have to pay out for the same information piecemeal.

HIPs were not perfect, and they were unpopular with sellers. They could have been made to work better, and sensible buyers would have started to use them

Still I look forward to all the campaigns to stop labelling on food, safety ratings for cars or poison warnings on garden pesticides. Nobody reads them and they're just another racket to make things more expensive and take away money from people.

Of course, a few years later everyone would be crying out, "Why aren't we told about these things?" "They should have warned us that the next door neighbour threatens to shoot any cat that gets on his land." "They ought to be made to label these things as poisonous."

How long before there's extra legislation brought in - by popular demand - so that people have to declare it when they've had a Japanese knotweed infestation - even if it's been hidden from would-be purchasers?

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Postby Stoday » Fri May 21, 2010 3:24 am

deeplyblue wrote:
I remain amazed. People will spend £3,000 doing a house up "ready for a sale", spend hours get it into "show house" condition every time a prospective purchaser comes round. Then they pay an estate agent £4,500 (1.5% on £300K) for doing some inferior photography and then putting some inaccurate measurements on RightMove, and field a few phone calls. Then they whinge bitterly about paying out £250 for a HIP.

That demonstrates how valueless HIPs were and how right the Coalition is to ditch them.

Generally, the information in a HIP plays no positive part in the sale. Buyers do not take HIP information into account in choosing a house. They may well use it when negotiating the final price downward.

deeplyblue wrote:As purchasers themselves, they will then have to pay out for the same information piecemeal.

I read somewhere that the avoided cost was only ~20% of the HIP cost.

deeplyblue wrote:Still I look forward to all the campaigns to stop labelling on food, safety ratings for cars or poison warnings on garden pesticides.

That suggestion is ridiculous as well as being invalid.

The woman who bakes cakes for the local fête is not required to produce a label nor does someone selling his car have to produce a safty certificate. An appropriate comparison is the Building Regulations. The seller has to provide answers to the buyers solicitor in relation to these.

deeplyblue wrote:Of course, a few years later everyone would be crying out, "Why aren't we told about these things?" "They should have warned us that the next door neighbour threatens to shoot any cat that gets on his land." "They ought to be made to label these things as poisonous." How long before there's extra legislation brought in - by popular demand - so that people have to declare it when they've had a Japanese knotweed infestation - even if it's been hidden from would-be purchasers?


A very long time indeed. The discontinuation of HIPs does not mean that conveyancers will no longer ask questions.
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Postby WILL*REMAIN*STRONG » Fri May 21, 2010 9:14 am

We would always disclose that we have had problems with a neighbour but we still wouldn’t have liked purchasing a HIP.

As for wasting money on estate agents, don’t people do that anyway? Everyone knows they can try to sell their house privately cutting out the estate agent and his fees, but most feel it is worth the money to have it all taken out of their hands and to be on Rightmove.

Anyway the option to save a bit of money is always there, now people can save that £200-£400 they would have spent on a HIP and put it towards the inevitable conveyancing fees and the removal van...or cheap rental van. :wink:
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Postby Conveyancer » Tue Jul 13, 2010 10:39 am

An article in the Legal Executive Journal suggests that the abolition of HIPs will mean a loss of 100 million pounds in VAT receipts. Consultation was promised, but none took place. Several thousand people are without a job with no warning. The baby was thrown out with the bath water.
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Postby WILL*REMAIN*STRONG » Tue Jul 13, 2010 10:52 am

I must say I really do feel sorry for those who are out of work now, but I think the H.I.P was such a bad idea. I’m not against having to have an energy certificate, but paying for what is going to be paid for again by a buyer in most cases who will have their own survey, well I thought it was madness. It might have benefitted those who buy to let for example, because it speeded things up a bit. But for many it wasn’t money well spent, some couldn’t sell and ended up with an expensive H.I.P for nothing.

Perhaps those who are now out of a job can become estate agents, we always need more of them. :wink:
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Postby Conveyancer » Tue Jul 13, 2010 11:50 am

WILL*REMAIN*STRONG wrote:I think the H.I.P was such a bad idea.


Do you want a long or short answer to that?
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Postby WILL*REMAIN*STRONG » Tue Jul 13, 2010 2:17 pm

Conveyancer wrote:
WILL*REMAIN*STRONG wrote:I think the H.I.P was such a bad idea.


Do you want a long or short answer to that?


Surprise me. :) Lets not make this about my new bionic hip though. :lol:
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Postby Stoday » Wed Jul 14, 2010 2:19 am

Conveyancer wrote: Several thousand people are without a job with no warning.


That statement is a bit ignorant (in an economic sense).

Suppose the government gave 6 months' notice. The housing market would fall down a cliff face for six months. That would hit estate agents too, so you could expect the overall adverse effect on employment to be even greater.
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Postby Conveyancer » Thu Jul 15, 2010 12:52 pm

What mischief were HIPs intended to remedy? It was the generally perceived view that the conveyancing process took too long. People pointed to the systems operating in other countries where the process was far less painful. "Something must be done!" was the cry. The government promised to do something. Regrettably the government set about the task rather naively and failed to foresee the opposition from vested interests; it made the mistake of leading the way, when it ought instead have invited suggestions. The legal profession objected because it did not think government should tell it how to conduct legal business. Estate agents objected because they saw that they would not be able to put houses on the market as soon as instructed. Lenders objected and said they would not accept the home reports and still commission their own valuations. Most comments were negative and few positive suggestions were made; there was no proper dialogue as the professions essentially refused to have one. The government then found itself in a tricky position. It had promised it would do something and if it did not would be accused of breaking its promise. It therefore went ahead with its proposals, though they were watered down.

Once the proposals were launched the public realised there would be a cost. Now the public takes the view that when a service is improved it should be at no cost. As deeplyblue suggests property owners can be frightfully penny-pinching (and in fact the penny-pinching of the property-owning classes goes a long way to explain much of what is wrong with the conveyancing system). Those who had called for improvement now deplored it.

Did HIPs achieve anything? The answer is not a lot but something. The main thing they did was to enable a conveyancing transaction get off to a flying start once a deal had been done. There was however nothing to maintain the impetus. The seller's conveyancer might get the contract and supporting documents out quickly, but there was nothing to make the buyer's conveyancer look at them quickly.

In answer to Stoday, I think the suggestion that prospective sellers would postpone selling rather confirms the idea that property owners are a penny-pinching lot. What the government could have done was to announce it was undertaking consultations with the relevant professional bodies with a view to making significant changes. That would have fired a good warning shot over the bows of those who make a living from providing HIPs. Instead, for a quick political fix, HIPs were suspended without warning. It has to be accepted that government action which government perceives to be for the common good may lead to the loss of jobs, but here the government pulled the rug from under people's feet and deprived them of a source of income overnight. I cannot think of a case where that has happened before.

The previous government kept its word and tried to do something. It did the best it could in the teeth of opposition from vested interests and without a complete overhaul of the system.

The present government broke its word as it promised consultation, but went ahead without it.

The real problem though is not so much the conveyancing system as such, but rather the way people go about buying and selling houses and the way house purchases are financed. There may be any number of reasons why any particular transaction is not progressing, but over all the reason for delay is because people dither. In part they dither anyway, but in part the dithering is enforced on them while they wait for lenders to make up their minds and, if they are in a chain, for everyone else to stop dithering. In countries where the conveyancing process is quicker there are no chains because the way property purchases are financed is different and the convention tends to be that you do not make an offer unless you intend to be bound immediately. Whilst improvements can undoubtedly be made to the conveyancing system, until there is a huge change in the way people approach buying property and the way it is financed there is little that any government can do to speed up the process.
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Postby Stoday » Fri Jul 16, 2010 3:55 am

These "penny-pinching" property owners probably choose an expensive car such as a BMW rather than a 2CV. Why? Because they perceive value for the extra cost. What extra value can a conveyancer add? I know of nothing, so I have an incentive to seek the least expensive conveyancer. That's not penny-pinching.

Other than that I rather agree with Conveyancer's comments.
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Postby SYLVA » Fri Jul 16, 2010 6:48 am

A relative of mine is always boasting that Scottish Conveyancing has an edge over England.
Whilst this maybe so, it does remind me of a recent cosmetic surgery documentary where it was demonstrated that a qualified surgeon had made a complete hash of a woman’s breast surgical procedure.
At a later date the program makers ‘employed’ another surgeon to re-dress the situation with success.
My point being is that it is sometimes difficult to find a qualified professional, be it Solicitor, Doctor, Dentist etc that fulfils the public’s general expectation that all qualified persons are of an equal status of integrity and capability, where in reality a conveyancing procedure can be slowed down by a complacent solicitor who simply goes along with the rate of flow.

I am not saying that each Individual/Practice should be given a published star rating but generally speaking we (public) are at the mercy of a professional without really knowing the person’s capabilities.
It is common between ‘local solicitors’ practices to privately rate each other on a scale of one to ten, but the public does not have that choice.

Solicitors can be a bit like ‘ladies hairdressers’, put them both in inner city high rateable valued business premises, and charge an exorbitant pricing structure thus immediately creating an aura of ‘we are the best’ which instantly attracts people with money to burn.
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