24-09-07, UpMyStreet ©
The most controversial element of Home Information Packs - the home condition report - was scrapped as a compulsory part of HIPs in July 2006 amid complaints from the property industry that the report was toothless and expensive.
Home condition reports are still a voluntary element of HIPs, and could become mandatory in the future. We explain what they mean for buyers and sellers.
What is a home condition report?
The report is a 30-page document outlining the general physical condition of a property for sale. The report is similar to a homebuyer's survey, and is carried out by a trained inspector.
How do they benefit sellers?
The report will show up the areas of your home that need attention, which gives you the opportunity to rectify problems before you market the property.
It's up to sellers to pay for the home condition report, but the Government believe that they will reduce the number of sales that fall through, as buyers will have information up front.
How do they benefit buyers?
A home condition report gives buyers and mortgage lenders access to detailed information on a property before they make an offer. Under the current system, buyers often only uncover problems with a property after they've made a formal offer and spent money on a survey.
Why the controversy?
Many professionals in the property industry believe that the report creates unnecessary paperwork. According to the Council of Mortgage Lenders: "Our estimate is that the majority of transactions will still need a valuation report that will be charged for separately by the lender." Because the reports do not include a valuation and other information, buyers still need to pay for a mortgage valuation or full survey. Reports cost up to £1,000.
Will I need a home condition report?
No, not unless you want to provide one to buyers. The Government announced in July 2006 that home condition reports would be introduced on a voluntary basis only. Energy performance certificates, which were originally contained in home condition reports, remain compulsory if you're selling a home of three or more bedrooms.
More HIPs news
› HIPs extended to three-bedroom homes
› Energy performance certificates explained
› How to get to grips with HIPs
› The real cost of buying property
A home condition report contains:
- Information relating to the construction and condition of the property
- Details of whether more investigation is required
- Details of major defects
- Inspection of inside and outside of building
- Inspection of gas, electricity, water and drainage services
- An energy performance certificate
- A condition rating between 1 and 3 for all aspects of the property
- 1 = no repair needed
- 2 = non-serious repairs needed
- 3 = Serious or urgent repairs needed
Trefor (Telford and Wrekin), on 04/12/2007 at 18:43
Roll on compulsary HCR's.
As one who has been stung in the past I believe all homes for sale should have one. After all would you buy a second hand car with no MOT. I not then why trust the seller of a house any more than a car seller?
What the seller spends on the HCR will easily be re couped by not having to pay the inflated surveyor fees for their next home. Most Home inspectors will probably also be qualified to give a valuation report as well which shoud be sufficient for the mortgage lender.
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