Sam Dunn: What hope for HIPs after another backflip?

'A cop out', 'a shambles' and 'a useless, expensive waste of time'
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The Independent Online

The Government pulled one of the main provisions of its proposed Home Information Packs last week (see news, page 22).

Its decision that a Home Condition Report (HCR) - akin to a traditional survey - would not be compulsory leaves the planned pack rather light on vital information for buyers.

As it stands, the newer, slimmer HIP will simply include an energy report saying how green a property is; deeds; notes of any planning applications; and details of fixtures and fittings.

The consumer body Which? has branded it a "half-HIP" and, in anger at what it sees as a betrayal of consumers, warned that what eventually emerges on 1 June 2007 will be "a useless, expensive waste of time".

That was one of the milder reactions to the announcement by the housing minister, Yvette Cooper: "a cop-out", said national estate agent Spicerhaart; "a shambles", according to shadow housing minister Michael Gove; and "half-baked", added Which?.

This last objection was made in a letter to Ruth Kelly, the Secretary of State for Communities and Local Government, informing her that Which? was withdrawing its support for HIPs.

Not everyone was pulling their hair out, though. The Law Society, a body that has never swerved in its opposition to the packs, pointed out that buyers "could not sensibly rely on an [HCR] commissioned and paid for by the seller".

Officers at the Council of Mortgage Lenders declared themselves "pleased" since they had harboured concerns that next summer's deadline was too early for a smooth introduction.

The HIP may be down but it's not out. Rather gamely, Ms Cooper wants to plough on. She says the HCR will - for now at least - be left to market forces.

So lenders and estate agents will still be encouraged to include them in next year's packs but only off their own backs and as a voluntary addition.

Intriguingly, Ms Kelly's department stressed that "mandatory introduction of the HCR remains on the table". However, no timetable was given or even hinted at. At best - and for now, at least - the HIP looks severely dislocated.

A U-turn like this will have left most consumers scratching their heads.

Many will also recall a similar screeching of the brakes earlier this year when Chancellor Gordon Brown decided to abandon plans to allow savers to put vintage wine, art and second homes in self-invested personal pensions (Sipps).

In both cases, the Government put its head down from the start and blithely ignored specialist advice from professional industry bodies, companies, charities and consumer groups until late in the day, and then it bowed to common sense and went into reverse.

To be fair, the change to HIPs comes earlier than for Sipps, but the same question is left hanging: how did such skewed policies gather momentum in the first place?

With pensions, the cost to the Treasury and impact on the UK housing market - let alone low-income Labour voters - of encouraging wealthy savers to exploit tax relief to pay for extra homes simply hadn't been thought through.

It's the same with HIPs and more's the pity since the concept has great merit.

A pack that lets homebuyers see what they're really getting for their money seems the fairest way to do business.

But the ham-fisted execution - lenders unwilling to rely on the HCR, so forcing buyers to pay for separate valuation; delays in home-inspector training; omission of details on subsidence risk - could end up with the dismantling of a great idea.

And, ultimately, the sellers' packs themselves.

s.dunn@independent.co.uk

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