Stafford issues HIPS warning
The packs, due to be introduced on 1 June 2007, will be compulsory and are designed to provide people with all the information they need to buy and sell a home. They will cost homeowners up to £1,000 per pack, which concerns Stafford Railway Building Society.
Mike Heenan, chief executive at the building society, said: “The packs could trigger a real imbalance in the number of homes on the market. For example, people with lower incomes may be unable to afford the cost of the pack, delaying the listing of properties. Alternatively, people may rush to sell their properties before the change in policy on 1 June 2007.
“On the other hand, cautious and inexperienced buyers, such as first-time buyers, may hold back on purchasing houses until the packs are introduced. Either of these scenarios would seriously affect the supply and demand ratio, and resulting house prices.”
The Council of Mortgage Lenders has voiced its concerns over HIPs and predicts that around 400,000 homes may remain off the UK market because of the system. Heenan added: “There is real uncertainty amongst consumers and the industry about whether HIPs will add any real tangible benefits. It seems absurd that increasing costs and paperwork during the sale of a property will effectively provide peace of mind or efficiency.
“There is already plenty of legislation in place to protect buyers, which coupled with the widespread availability and professional recommendation of structural surveys during purchase, seems to rule HIPs as excessive.”