Are you ready for HIPS?
Pretty much every single home put onto the market needs a Home Information Pack. The Pack includes an Energy Performance Certificate containing advice on how to cut carbon emissions and fuel bills. Also included are documents such as a sale statement, searches and evidence of title. Weve been doing our homework and want to help you through the process every step of the way. Read below for some frequently asked questions.
Why do we need HIPs?
To improve the buying and selling process by giving buyers more information from the outset, so they can make informed decisions early on and will, therefore, help reduce the number of aborted transactions that take place
Your sale is much less likely to fall through as the buyer will have a lot of information about your property before even putting in an offer
You can proceed with the sale, confident that there is less likely to be any last minute legal problems, delaying completion
Whats in a HIP?
Compulsory Documents for registered freehold, leasehold and commonhold properties
Home Information Pack Index listing all the documents with a checklist for sellers, buyers, estate agents and enforcement authorities. If a document is unavailable, the index must say so, giving the reason for being missing and what steps are being made to obtain it
Energy Performance certificate indicates how energy efficient your home is, including recommendations on how to improve your energy efficiency to save money and help the environment
The sale statement provides basic
information including:
The address of the property being sold
Whether the property is freehold, leasehold or commonhold
Whether the property is registered or unregistered
Whether or not the property is being sold with vacant possession
Standard searches, including:
Local land charges register
Other records held by the local authority on matters of interest to buyers, such as planning decisions and road building proposals
The provision of drainage and water services to the property
Evidence of title documents to prove the seller owns the property and has the right to sell. Where the property is being sold is registered, certain documents that are available on request from the Land Registry must be included in the pack.
These provide up to date official record of who owns the land and consist of:
Official copies of the individual register
An official copy of the title plan
Compulsory Documents for leasehold properties only
A copy of the lease
You should also include, whenever available:
Any regulations or rules that apply to the property that aren't mentioned in the lease and any proposed amendments to same
Statements or summaries of service charges covering the previous 36 months
Where appropriate, the most recent requests for payment of service charges, ground rent, insurance against damage for the building in which the property is situated, and insurance in respect of personal injury caused by or within the building during the 12 month period before marketing began
The name and address of the current or proposed lessor, and details of any managing agent that has been appointed or proposed by the lessor to manage the property
A summary of any works being undertaken or proposed that will affect the property or the building in which it's situated.
Compulsory Documents for commonhold properties
An official copy of the individual register and title plan for the common parts
Where they are reasonably obtainable, or sellers can reasonably be expected to be aware of them, the following documents and information are also required:
Copies of any regulations or rules not described in the commonhold community statement and any amendments proposed to those regulations or to the commonhold community statement
Copies of any requests for payments made in the previous 12 months in respect of commonhold assessment, reserve fund levy and insurance (if not covered by a request for commonhold assessment)
The name and address of any managing agent or other person appointed or proposed to be appointed by the commonhold association to manage the commonhold
A summary of current or proposed works affecting the commonhold.
Optional Documents
Home condition report contains information about the physical condition of a property
A legal summary
Home use / contents forms include information on boundaries, notices, services, sharing with neighbours, planning permissions and other matters of interest. It is usual for sellers to declare which fixtures and fittings and other contents of the property are included in the sale, are excluded from the sale, or are subject to negotiation
Other documents including searches such as rights of way, ground stability and actual or potential environmental hazards such as flooding and contaminated land. Sellers will also want to include guarantees and warranties for work already carried out on their homes.
Can I market the property without a HIP?
The ability to market without a pack is a temporary arrangement and will only last until 1st June 2008. From 1 June 2008, there must be a Pack available when marketing starts and certain documents must be in the Pack. Marketing with an incomplete Pack may take place if documents have been requested and it is expected that they will become available within 28 days of the start of marketing.
How soon after commissioning a HIP will it be ready for buyers to view?
We can commence as soon as a HIP has been ordered and we have received written confirmation from the HIP provider / solicitor to say so. It is estimated that it will take under 14 days to put together but the Government expect all HIPs to be issued within 28 days.
How do I get a HIP?
We recommend that you ask your solicitor to arrange your HIP. Many solicitors will produce this free of charge if you are having your conveyencing work carried out through them. It will also give you complete authority over which agents you wish to instruct and use in the sale of your property. Another good reason for asking your solicitor to arrange this is that if your estate agent arranges through a provider, they will usually be on a commission or will add a handling fee to the cost of the HIP. If you do require some assistance in choosing a provider and you do not wish to go through your solicitors, we can recommend a list of good suppliers we have dealt with recently (and we can assure you we do not take any commission or change any handling fee to help you). Alternatively you can arrange this for yourself. Click here for a list of recommended suppliers.
How much is the HIP?
The cost to sellers of Home Information Packs will be set by the market. This can depend upon the size of the property, whether it is leasehold or freehold or whether you choose to include any of the optional documents. The costs will range from approximately £300 £600, depending on the size and type of property. A Home Condition Report, if you choose to have one, will be an additional cost of approximately £200. As mentioned, a number of solicitors are preparing the HIP free of change based on the instruction for conveyencing of the property.
When is a HIP not required?
Private sales or properties not marketed to the public
Residential properties sold without full vacant possession
Properties where the most recent use was non-residential and there will be no conversion to residential use prior to the sale
Properties where the primary use is not residential
Properties where conversion to non-residential use is expected prior to sale
Properties where the use is restricted by planning conditions to seasonal or holiday accommodation
Mixed-use property
Dwelling with dual use (if primary use is not residential)
Sales of portfolios of properties
Unsafe properties
Property due to be demolished
Residential properties which are sold with 5 hectares or more of land and the most recent use of the land was primarily for cultivation, keeping of livestock or woodlands.
What is the shelf life of a HIP?
If all regulations have been complied with, none of the components of a HIP has a prescribed shelf life whilst the property remains on the market. The contents may, however, be reviewed at any time.
If a sales is agreed on my property before the HIP is ready, will it delay the sale?
No. You can proceed with the conveyance irrespective of whether the HIP has been produced or not. However, a HIP needs to be commissioned and given to the buyer, or their legal representative, as soon as the information is received.
Download your sellers guide to Home Information Packs here
