What are Hips?

AFTER months of debate, Home Information Packs (HIPs) now form a legal part of the home-buying process in England and Wales.

The aim is to spread the costs of the transaction more fairly between the buyer and seller. More importantly, a HIP should avoid the unexpected revelation of any nasty surprises about the property that could delay or scupper the deal at a late stage.

The seller is responsible for arranging the pack and can compile the documents himself or hire an estate agent, solicitor or pack provider to do it. The estimated cost is between £300 and £350 (though some estimates have been as high as £700); sometimes there are no-sale no-fee deals and other offers but read the small print. The packs are provided free to genuine potential buyers though sellers can request reasonable charges for copying and postage.

A pack should contain certain compulsory documents. These are:

• a HIP INDEX listing the exact contents;
• an ENERGY PERFORMANCE CERTIFICATE (EPC) which states how energy efficient the home is on a scale of A to G, with A being the most efficient and having the lowest fuel bills;
• a SALE STATEMENT showing basic information including the property's address, and whether it's freehold, leasehold or commonhold;
• STANDARD SEARCHES results including local searches, drainage and water provision and other local authority records of interest to buyers such as planning decisions and road building proposals;
• EVIDENCE OF TITLE or official record of who owns the property, and extra documents for leasehold and commonhold sales and unregistered land

Other documents are optional, such as a Home Condition Report (HCR), legal summary, and extra useful information such as boundaries and planning permissions, fixtures and fittings included in the sale, electrical certficates and guarantees.

A HIP does not have to include a valuation nor a structural survey, though the latter could be part of the optional HCR.

The HIP must at least be commissioned before marketing can begin. The Energy Performance Certificate must be provided as soon as possible and before exchange of contracts at the latest, but there is no time limit set on when the rest of the HIP should follow. However from June 1, a HIP must be available from the time the property is first placed on the market.

There are some exemptions; the sale of holiday accommodation, for instance, does not need a pick. If your house has been on the market continuously since before HIPS came in, then it doesn't need a pack. You do not need a pack if the property is sold without any marketing or For Sale signs to a family member, for example.

For more information visit www.homeinformationpacks.gov.uk.

Scotland is due to get its own version of HIPs in late 2008 - the Single Survey and Property Sale Questionnaire (PSQ) scheme. Both documents are due to be compulsory.

The Single Survey document will include information on the property type, construction, accommodation, age and neighbourhood; a condition report with necessary repairs rated on a scale of one to three; an energy efficiency report; basic accessibility information and a market valuation.

The PSQ will provide information on useful issues such as council tax banding, car parking, central heating, boundaries, guarantees and residents' associations.