Rightmove, the property services company whose share price was hit by the Government's U-turn on Home Information Packs (Hips), scrapped plans yesterday to invest any more cash in the scheme.
The company had originally planned to spend £22m developing its own Hip product and had spent about £7m to date.
Rightmove said it would cost another £1.2m to exit from its strategy but reiterated the upbeat message of its 6 July trading statement, when the company said pre-tax profits would exceed the top end of analysts' forecasts.
However the company, which says that more than half of Britain's estate agents are registered on its site, said the change of policy meant that potential sales and earnings of its own Hip offering were likely to be significantly lower than expected.
Rightmove's shares plunged more than 20 per cent last week after ministers watered down plans to make sellers pay for a pack that would have included a property survey.
The move came after sustained pressure from mortgage lenders, surveyors and estate agents who claimed that the industry would never have been ready for the planned implementation next June, and that Hips could endanger the stability of the housing market.
A Rightmove spokeswoman said yesterday: "We don't feel now that Hips will create much business growth for Rightmove so this is the right time for Rightmove to stop this."
Hips were to include all local and environmental searches, details of leases and planning permission applications, as well as a home condition report (HCR), which would have comprised a basic structural survey and details of the energy efficiency of the property.
The Government estimated they would have cost sellers about £650, although some experts in the industry experts claimed the figure would have been nearer £1,000.
Under the new legislation, the inclusion of HCRs - which would have accounted for most of the cost of a Hip - would no longer be mandatory. They would now have to include only details of local searches and the property's energy efficiency.Reuse content