HIPS – Facts & Fiction
Some questions and answers, with thanks to Alyson Cadd who researched these points below. Correct as of March 2008.
My home has been on the market before the regulations ?
An EPC is required for the sale of all homes from October 1 2008, including those properties that do not need a HIP. The seller is the ' relevant person ' under EPC legislation and is responsible for making the EPC avaliable. Contact a local DEA to carry out the inspection as soon as possible.
Isn’t it just larger houses that need a HIP?
On 14th December 2007 HIPS rolled out to the whole market, not just larger houses – even bedsits for sale need a HIP. If you were marketing your 2 bed or smaller property prior to 14th December you have avoided the regulations. See my update regarding EPCs.
But the holiday house I am selling is exempt isn’t it?
Only if its use is restricted under local planning regulations to holiday or seasonal occupancy. If it is a normal house or flat which just happens to have been used as a holiday home for years, it will still need a HIP. Static caravan homes are exempt.
What are the other exemptions?
Exceptions to the HIP regulations (most only until 01 October 2008).
Mixed commercial use such a house sold with a petrol station, the farmhouse on a working farm or a house incorporating a shop or consulting rooms.
Restricted use or occupancy such as holiday homes that by law can only occupied for 11 months per annum, or properties that are deemed unfit or dangerous.
Homes marketed and sold with a sitting tenant or portfolios/groups of houses (occupied or not).
Private sales, with no public marketing at all (see below).
The rules are fairly complex so get in touch if you need help.
I am marketing my house privately so I don’t come under the HIP regulations?
Marketing a house yourself is not a private sale – under the HIP regulations a private sale is where no marketing takes place at all and an individual, friend or relative approaches you with an offer. Even a notice in your window or a card on a shop notice board is marketing and you will need a HIP.
If I build a house myself and sell it do I need a HIP?
New builds (self build or otherwise) – need a full HIP from April 6th 2008.
I am renting out my mother's house, do I need a HIP?
Rented properties do not need a HIP – however from October 2008 they will need an Energy Performance Certificate (EPC). This document will last for 10 years and only needs to be shown to new tenants, not replaced. To find a local DEA contact us.
What happens if I then decide to sell my mother’s house?
If it is sold with a sitting tenant, it does not need a HIP. If it is sold privately to the tenant, without any other form of marketing, it does not need a HIP. If the property becomes empty and you market it for sale it will need a HIP.
HIPs are complicated so do I need a legal expert to put it together?
Not generally. In fact with a little time and research most individuals could prepare their own as most of the information is about your property. Some of the template documents are available on http://www.homeinformationpacks.gov.uk/ and the other documents can all be obtained from the Land Registry, Local Council and United Utilities. The main report is the Energy Performance Certificate (EPC) and that can be ordered directly from us.
There are of course exceptions such as properties with unregistered titles but these are rare and you will know with one simple enquiry early in the process if that is the case. Any HIP provider would normally refer these cases to a solicitor.
Do I have any say in where the HIP is ordered from?
Yes, you are the client! A HIP does not have to be ordered through your estate agent. In fact many of them would prefer to have very little to do with the process as their area of expertise is selling houses not collating documents and reports.
Here in Whitefield, Manchester, at Inspect your Energy we can offer a very personal service and supply the whole HIP, including the EPC. We are small enough to be under the VAT threshold so can offer a very cost effective HIP solution. You don’t need to order online or deal with any call centres, just give us a call on 0161 7679470.
But one estate agent implied that I could only use their HIP.
The Government says "Any estate agent has a duty to ensure that they are complying with HIP duties. There is no reason why an agent cannot rely on a HIP provided by the seller, a different estate agent or a HIP provider other than the one they would normally use, as long as they are content that it is compliant. Further information can be found on our website: www.homeinformationpacks.gov.uk". Some estate agents prefer to offer their own in-house HIP, or they are have a financial agreement with a national HIP provider to offer theirs, which can make life simpler for the agent but any HIP that meets the regulations is perfectly legal and acceptable.
My agent has offered me a free HIP
Some agents are genuinely trying to offer free or very cheap HIPs. If it really is a free offer then that is a good deal, however the devil is in the detail! Most cut price or 'free' hips are tied in to either you using a specific conveyancing firm, higher sales commission on your property or if you move to another agent you may then be asked to pay a 'disbursement' that covers the cost the agent has incurred - i.e. the HIP.
If I order a HIP directly will I have forms or online orders to deal with?
Some HIP providers only provide an online order option but we will contact you by phone or even come round to see you. There will be about 10 questions about the age, type and size of your property and if it is freehold or leasehold – but even that we can research fairly quickly if you don’t know. You will need to confirm your contact details, method of payment and that you want the order to proceed. In fact most of this is actually going to be asked of you by anyone who orders the HIP on your behalf anyway.
Why won’t I actually get any documents for the money I am paying?
The HIP does not have to be a paper document. In fact they can be the size of a small telephone directory and very expensive to print and post out. Most agents would need a small library in which to store the HIPs for all the properties on their books! Most HIP companies are producing a HIP on a CD or as a purely online database HIP where all the component documents are downloadable. Sometimes for an extra charge the HIP provider or agent will print you off a copy if you wish. I will provide you with a hard copy, in fact the Government have stated that you should be given one free of charge. If you just want to see a copy of the EPC you can ask for the 'Report Registration Number (RRN)' and download it from the Government site http://www.hcrregister.com/.
My house has been on the market before HIPs came in. If I change Estate Agents now, do I have to get a HIP?
If your house has not been taken off the market i.e. continuous marketing has occurred, then no, you will not need to commission a HIP. If, however, there was a break in marketing you will need to supply a HIP.
My house was taken off the market as it was under offer but the sale has fallen through, do I now need a HIP to remarket it?
If your house is remarketed within 28 days of the sale falling through you do not need a HIP.
Will the buyer's solicitor accept the search documents in my HIP?
To some extent that depends on the solicitor and the type/age of searches included in the HIP. Most HIP companies are using the cheaper version of local searches done by Personal Search Agents. Many solicitors prefer the full official searches done directly by the local council. Unfortunately full official searches cost more, this can be arranged. It is your choice.
The Energy Performance Certificate
What is an EPC?
The Energy Performance Certificate (EPC), is part of the Government's commitment to reducing carbon emissions. It looks at how efficiently your home is heated and how it retains that heat. It also assesses the carbon emissions of the property. The EPC assessment, which can take up to an hour depending on the size of the property, can only be conducted by a qualified and licensed Energy Assessor or Home Inspector. The assessor mainly collects data which they then enter into a computer programme back in the office, which works out the rating (A-G) for your property. This is shown on a graph like the ones for fridges.
Look at this guide about EPCs, click here for the PDF file.
The EPC also makes some recommendations on improvements that can be made (some cheaply) to improve your rating and save you money on fuel bills.
Information about improving the energy efficiency of your home can be found at http://www.energysavingtrust.org.uk/. Have a look on my Saving Energy page or my links.
Do I need the heating on and have all my old bills at the ready?
The assessor does not test your heating system or fires (no draft tests). The EPC does not require any past bills as it uses 'standard occupancy' rules regardless of how you use the heating. This gives a standardised result across properties of a similar age, size and construction to enable comparisons to be made.
What will they need to see?
The assessors will need to see the heating system, any hot water tanks, meters and insulation, so you will need to be able to give them access to lofts, cellars or garages. Technically if they can’t see or measure insulation or see good physical evidence it is there then they should disregard it. This is important when it comes to a sealed loft or cavity wall insulation. Documents such as the double glazing FENSA certificates would be useful to see, or planning approval/invoices for extensions or improvements.