Why you've got to get HIP
The Government believes that HIPs are necessary as a staggering £1 million a day is wasted on failed transactions with buyers often spending hundreds of pounds on valuations, legal advice and searches on transactions that ultimately breakdown. 1
By the middle of this year a certification scheme will be established which will provide quality assurance and manage the Home Condition Report (HCR) and Home Inspector registers.
The HRC contains searches and other information currently paid for by the buyer. If several buyers pursue the same home these costs currently are paid for several times rather than once with HIP, which is why so much money is being wasted.
Rather than see HIPs as a threat, you should realise the benefits for you and your customers - such as reducing gazumping and speeding up the house buying process.
HIPs are designed to alleviate the administration burden of buying a house for your customers, which should mean less chasing of paperwork.
First-time buyers will be big winners as vendors will have to pay for the pack up-front. This should bring much needed new mortgage borrowers into the market.
It is estimated each HIP will cost about £6001 - money that first-time buyers will not have to pay.
You should try to keep abreast of the developments on HIPs and could look to form partnerships with estate agents to ensure you are part of the house buying and selling chain.
With HIPs, there will be less chance of a sale falling through so it's vital for your customers to have a mortgage in place at the start of the house buying process. Having a mortgage in place could be the key to your customer getting the property they want so they can move quickly.
- Office of the Deputy Prime Minister press release 17/11/2005