The Home Inspector Calls
If you are planning to sell your house after the 1 June 2007, you will need a Home Information Pack (HIP), read on and you will not be in for a big surprise. The HIP is the bringing together of all of the elements required for a seller and buyer to negotiate the sale of a house based on information about the condition of the house, prior to it going on the market. The jigsaw consists of 8 parts; The seller, the estate agent, the home inspector, the solicitor, the home information pack provider and the buyer, with the final 2 pieces being the valuer and the mortgage company. In July the government announced that it was delaying the mandatory requirement for the Home Condition Report (HCR) that will be prepared by a licensed home inspector. This is now optional for the time being and will be available for those sellers that want to prepare this information in advance for a buyer. The Energy Report part of the HCR will still be required for every house going on the market and every house being rented. Specialist building surveyors will continue to provide more detailed surveys. I understand that a compulsory HCR will be implemented in the future.
An article for Thatched Living, Winter issue, 2006.
The Home Information Pack Provider (HIPP) is the collator of the
information about your house. Different HIPP's may operate
in slightly different ways but essentially the Estate Agent will
be registered with a HIPP, he will have a list of preferred home
inspectors and solicitors on his panel. The Seller chooses
an estate agent to market his house; the agent contacts the home
information pack provider, the solicitor and the home inspector.
The solicitor prepares the conveyance, authorises local searches
just as he will do now. The home inspector will undertake
a survey of the house for the preparation of the Energy Report.
If the seller requests a full Home Condition Report (HCR) then he
will assess the condition of a wide range of parts of the house,
i.e , the roof covering, chimneys, walls, damp, drains, electrics
etc. For each section the condition is assessed into one of
N I; Not Inspected
1 ; No repair is presently required.
Normal maintenance must be undertaken.
2 ; Repairs are required but the home inspector
does not consider these to be either serious or urgent.
3 ; Defects or a serious nature or defects
requiring urgent repair.
Then he has to justify his decision in a few
words. The final HCR will show if the house is sound, where
routine maintenance in required or if there is major work to be
done on the property. This provides the prospective buyer
with a survey superior to the current Home Buyers Report and much
more detailed than a valuation survey that will only confirm that
there is enough equity in the building to cover the borrowings.
The Energy Report and where requested the HCR and the solicitors
report are then collected and registered by the HIPP. The
completed report is the Home Information Pack, this information
is attached to the Land Registry Title Deeds of the house and will
be available on the internet. Prospective Buyers will be able
to access all of the details at the estate agent's office and online.
The home inspector does not do a market valuation but he does do
a replacement valuation.
Currently there are about 1.5 million house sales in the UK every year, 28% of which will fail nearing the exchange of contracts stage due to last minute information. Quite a bit of this information will arise from the results of a valuation survey that highlights a particular problem unnoticed by a prospective buyer, or the solicitor may unearth a disputed boundary or a bad title that could take weeks to sort out. Many purchasers choose to rely on a valuation survey only and will not pay for a Home Buyers Report or Full Building Survey. The intention of the HIP is to reduce the rate of house sale failures to 8% or less.
The HIP has been in the pipeline since the Housing Act of 2004 and it is estimated that there will need to be about 7500 trained Home Inspectors. It is quite a daunting task to find enough available people that have sufficient experience in the building, surveying and construction industries to train a totally different way to survey houses. ABBE is a part of the University of Central England is the award body for the Diploma of Home Inspection and they have set the standards and supervise the examinations. A number of Assessment centres are training home inspectors now, some are only taking on experienced practitioners and others are training new entrants. All will be taking the same exam and will have to pass an exacting 70% pass level as well as undertaking several assessed condition reports. Training covers a wide selection of terraced, detached and semi detached houses, bungalows and flats that have been built from a mid Victorian time. As I write this I understand that only specialist home inspectors who are competent with older and non standard buildings can compile an HCR on older buildings.
There is considerable hype in the press about the introduction of Home Information Packs (HIPs) on that date. Experts on both sides of the argument are raising awareness and some are predicting doom to the housing market. When a similar method was introduced in Denmark, the market dipped for a couple of months and then it overtook recorded levels as confidence in the new system improved. Consumer groups are generally in favour of this scheme, my own thoughts are that it should have gone further to include that an accepted offer should be a binding contract. This would bring about the demise of the gazumpers, gazunders and those buyers who have accepted offers on several houses at the same time and then dump sellers at the last minute.
My recommendations for selling older houses and Listed buildings where the seller chooses to have a Home Condition Report.
The Estate agent is the first link in the chain. Choose a local Agent who knows the area and he will recommend a local Home Inspector.
For example if you have an old house made of cob with a Thatched Roof then insist that the Home Inspector has specialist knowledge of cob and thatch, or a timber framed house and thatch. There will be houses of non standard construction in localised areas where local specialised knowledge is essential. If you live in a mining district then there may be a local history of subsidence. A Home Inspector coming from away should spot this but may not be aware of local specific conditions. The Home Inspector must decline the preparation of an HCR if he feels not competent to make the report.
Ask if the Home Inspector will supply a Pre Survey. This is an informal and non recorded Home Condition Report that should highlight any defects in the house so that they can be rectified several months before you decide to put your house on the market. The Home Inspector will charge for this but will probably refund a part of this when the official Home Condition Report is prepared.
Further information from: