Hip scheme extension will frustrate flat dwellers

The Government’s decision to extend the requirement for Home Information Packs (Hips) to all private dwellings for sale in the UK is particularly bad news for flat owners and first-time buyers.

First-time buyers are already facing a shortage of small properties on the market and the introduction of Hips is likely to reduce the stock because speculative vendors will be put off by the cost of a Hip.

The scheme will be introduced for properties of two bedrooms or under from the 14th December and the Government has admitted that some flat owners will be experiencing a level of frustration.

Most flats and apartments in the UK are leasehold and while Hips will shortly be required, they will not include vital information, such as service charges, building insurance details and repair costs.

Information of this nature can only be provided by the freeholder and their managing agents and Duncan Samuel of Convex.net, the online conveyancers, has called the situation “ridiculous”.

He believes there no point in a vendor going to the time and expense of getting a Hip if such important details are missing, because sourcing these exact details is a common cause of delays in conveyancing.

Obtaining information on a lease can take between two and six weeks.

According to Mr Samuel, the Government is committed to reviewing the situation in the next six months.

Discuss this in the Finance Markets forums

Story link: Hip scheme extension will frustrate flat dwellers