What is a Home Information Pack (HIP)
From June 2007 the law will require anyone selling their home in England & Wales to put together a Home Information Pack for potential home buyers. The Pack will bring together the key information required when buying and selling a home, plus an Energy Performance Certificate (EPC) and a voluntary Home Condition Report (HCR). For more details please visit the official government website at www.homeinformationpacks.gov.uk

What is a Home Condition Report (HCR)
The Home Condition Report is an objective report on the condition of the property on the date it was inspected. The report will be in a standard format using plain English and will give 'condition ratings’ to the major parts of the main building. The HCR is a voluntary document and can be relied upon by buyers, sellers and lenders alike. Click here to download a sample HCR in pdf format.

What is an Energy Performance Certificate (EPC)
The information contained within the Energy Performance Certificate will enable buyers and sellers to get A-G ratings on their homes similar to fridge ratings as well as a list of practical measures to cut their fuel bills and carbon emissions at the same time. The EPC is mandatory and must be the first document in the HIP after the index. Click here to download a sample EPC in pdf format.

What will the HCR contain
The main purpose of the report will be to assess the property’s overall condition and functionality and to highlight any defects in the property that would be considered desirable or prudent to rectify or that may be hazardous to health and safety. It will identify any matters that require further investigation but minor defects that would not normally affect the sale of a property will not be highlighted. A valuation of the property will not be included, but a buildings reinstatement cost for insurance purposes will be.

Why should I bother having an HCR when it's voluntary
Sellers who commission an HCR on their property will be in a much better position to sell quickly. Potential buyers will look more favourably on a property that has an HCR and in time, will come to expect one before making an offer. Anyone who has had their chain collapse several weeks or months after a 'bad' survey will know the frustration it causes. Having an HCR at the point of marketing will help to eliminate this problem by allowing buyers to see the report before committing to the transaction. Many owners are unaware of defects in their homes and the HCR will also give them the opportunity to make repairs and to include any guarantees as part of the HIP.

As a seller, why should I commission an HCR?

An HCR is a very detailed but easy to understand inspection report on the condition of your property. If your property is in good condition the HCR will confirm this fact to all prospective buyers. Many buyers will not know that insignificant cracks in plasterwork are caused by the plaster shrinking as it dries and not because of subsidence. Prospective buyers can take on board the comments in the HCR before viewing your property and thus allay any fears they may have when they view the property.

This should result in more viewings of your property which should lead to a quicker sale, less negotiation over the asking price and less stress for you to endure.

The Energy Performance Certificate is an integral part of the HCR. It is very cost effective to commission an HCR in lieu of the mandatory EPC at little additional cost.

As a buyer, why should HCRs be of interest to me?

Buying a house is one of the largest single investments most of us will ever make but many home buyers rely only on a mortgage valuation report. A mortgage valuation inspection is not a survey it is merely a valuation carried out on behalf of the mortgage company to ensure the property offers sufficient security. Thus a mortgage valuation will only list items that materially affect the value of the property, leaving other defects that are of greater importance to purchasers unmentioned.

If the property you are considering buying does not have an HCR it would be advisable to insist on the property having an HCR as a condition of sale. After all, if you are selling a home as well you could face two sets of survey costs but it's not fair for you to carry double the financial burden just for being sensible.

To ensure the investment you are considering will be sound either insist on the seller having an HCR carried out or, alternatively, we can prepare an HCR on your behalf (and for your sole use) and provide you with up-to-date information to enable you to make an informed decision.

Who can produce the HCR and EPC
Home Inspectors who are registered with a government approved Home Inspections Certification Scheme and who hold the ABBE Diploma in Home Inspection are allowed to produce both the HCR and EPC. Domestic Energy Assessors (DEA) who are accredited to a similar scheme are also able to produce the EPC, but not the HCR. At Hinow, we are able to offer both products.

What’s wrong with the current home buying and selling process?
Research shows that the current home buying and selling process:
• is slow by international standards. Currently, in England and Wales, it takes an average of eight weeks to sell a home. In other countries it takes an average of four weeks.
• is wasteful and inefficient resulting in high rates of failed transactions. More than one in four transactions currently fails between offer acceptance and exchange of contracts.
• is particularly prone to delays and other problems during the period between offer acceptance and exchange of contracts.
• causes considerable frustration and stress. Almost nine out ten consumers are dissatisfied with it.
Currently buyers and sellers do not have access to key information to inform their initial decisions. This means that buyers and sellers are negotiating and agreeing terms without the benefit of all the facts, which often causes problems later in the transaction, or causes it to fail altogether.

How will the Home Information Pack help?
The Pack will bring together at the very start of the process important information which at present is collected piecemeal in the days and weeks after the offer has been accepted. This will:
• ensure that buyers and sellers are better prepared and have as much information as possible right from the start
• secure faster mortgage offers and search replies
• reduce delays and uncertainties
• help address a number of problems caused by delays, including gazumping and problems in chains.
How much will a Home Information Pack, including a Home Condition Report cost, and who will pay?
We estimate that the cost of preparing a pack for an average home will be of the order of £600-£700. But:
• these are not additional costs, as most of the changes involve doing the same things as in the current home buying process but more efficiently and at an earlier stage.
• The Home Information Pack will transfer responsibility for obtaining local searches and a home condition report from the buyer to the seller. But, since the vast majority of sellers are also buyers these costs would usually be balanced by corresponding savings and benefits.
• We expect that most sellers will not have to pay up front for the pack, so Home Information Packs should not act as a brake on properties coming to the market.
• Market forces will keep prices low for consumers and those who are pricing Home Condition Reports and Home Information Packs at a premium will lose out to those who don’t.
• Another factor is that at least £350 million is wasted each year by consumers on aborted transactions under the current process. The Home Information Pack will reduce substantially the number of failed transactions and hence these wasted costs.
When will sellers be required to pay for the preparation of a Home Information Pack?
Industry expectations are that the seller will not have to pay the full costs up front - in most cases these will be deferred until completion of the sale, like estate agents fees are now.

Won’t the packs be open to fraud or misrepresentation by sellers?
Caveat emptor will apply as now. A buyer’s conveyancer will be responsible for checking relevant documents. These will mostly contain much the same information as those used in the process now, with the exception of the home condition report. Home Condition Reports will be provided by a qualified person who is a member of an approved Certification Scheme. Their reports will be stored on a central databank and buyers will be able to obtain copies from that source. Buyers and their advisers may obtain copies from a Certification Scheme Home Condition Report register to ensure that the copies they have been provided with by the seller are correct.

How can I get hold of a Home Information Pack?
Home Information Pack providers can be found through high street traders such as lenders and estate agents, through national, local and online advertising or via a public register of Home Inspectors, which will become available towards the end of 2006.

Can sellers assemble their own pack?
Yes.