One third of Estate Agents provide unsatisfactory HIPs

By on 10/03/2010 in News

Trading Standards at Birmingham City Council, in conjunction with the Property Codes Compliance Board (PCCB), have undertaken the most comprehensive estate agent and Home Information Pack (HIP) enforcement exercise yet by any Trading Standards authority nationally. The survey results provide a revealing insight into the estate agency, HIP and personal search markets. Results revealed that 70% (26 HIPs in total) were rated satisfactory or reasonably satisfactory with 30% (11 HIPs in total) rated unsatisfactory when measured against the HIP regulations, often leaving buyers with no idea who to contact if they have any cause for complaint relating to the content of the HIP.

A HIP, often called a Sellers Pack, has to be provided before a property in England and Wales can be put on the open market for sale. They have been compulsory since late 2007. In the vast majority of cases, it is the estate agent who is responsible for ensuring that a HIP is produced, but individual private sellers must also comply. The HIP is designed to help potential home buyers make a decision on the sale, by making important property information available at an early stage, including; an Energy Performance Certificate, local authority searches, title documents, guarantees, etc.

The Birmingham survey aimed to identify if estate agents; had HIPs in place for the properties being marketed, were making packs available at the appropriate time, were ensuring packs contained all the required documents and were being provided in the format prescribed by the regulations, and whether the contents were accurate. Particular attention was paid to the accuracy of local search information.

The survey set out to test approximately 25% of the estate agent market within the Birmingham boundary. Teams of Trading Standards staff went to previously identified estate agents, selecting properties being marketed and requesting HIPs to be sent to Trading Standards.  As a result, 40 HIPs were requested from as many agents across the city.  

Only 37 packs were received and examined, as one property selected was found not to require a HIP since it had been marketed prior to the regulations coming into force. A further two agents were unable to provide HIPs on request and were subsequently issued with penalty charge notices and referred to the OFT for failing to comply with the regulations. The HIPs were then forwarded to the Property Codes Compliance Board (PCCB) for inspection and checking.

Given the complexity of the information, a grading system was developed so that each HIP would be scrutinised using the same criteria and a compliance grading assigned accordingly. Of particular note was the markedly better performance of HIP and Search Code of Practice subscriber firms against unregistered firms, with 87% of HIP Code subscribers ranking satisfactory or reasonably satisfactory and personal searches being found to be on a par with those sourced from local authorities.

The most common faults included:

•        no information on complaint / redress procedure

•        no consumer information

•        no company contact details

•        technical Issues with the search

•        HIP Index related issues

Chris Neville, Head of Trading Standards at Birmingham City Council, comments:

“The exercise shows that the market is generally compliant, but buyers should be aware that not all HIPs can be taken at face value as being accurate. Birmingham Trading Standards will keep a watchful eye on the estate agent and HIP provider market, and we urge buyers to contact us if HIPs are not made available by estate agents at the time of marketing. To avoid any confusion over the accuracy of information provided in a HIP, we recommend that both buyers and estate agents should choose a HIP Code registered firm, as our survey has found these to be the most trustworthy”.

Richard Footitt, Chairman of the Property Codes Compliance Board, adds:

“This exercise gives a timely and reliable insight into the current level of compliance within the industry, and should serve as a warning to both estate agents and HIP providers that they must comply with the law and regulations. That said, it was encouraging to note that 95% of agents were complying with the requirement to have a HIP available when marketing a property and also that 90% of HIPs from PCCB registered HIP Code subscribers met or exceeded levels of good practice. We urge other Trading Standards offices to follow Birmingham's lead to ensure high standards of compliance and consumer protection are maintained”.

Birmingham Trading Standards will now formally contact the estate agents, HIP providers and search firms involved in the survey to inform them of their individual results.  Any non-compliant companies will be asked to take corrective action as a matter of urgency.

 

ENDS

For more information please contact Hayley Meachin on 0121 303 1271/ 07920 750007  hayley.meachin@birmingham.gov.uk

Notes to Editors

 

1. Full survey results:

HIPs enforcement report1 PDF
 
Appendix 2 – Weighted scores checklist PDF
 
APPENDIX 3 – Final Gradings PDF

2. If Trading Standards do take action against estate agents for not having a HIP in place at the time of marketing and subsequently issue penalty charge notices, they are obliged to inform the Office of Fair Trading (OFT). This could lead to the estate agent being banned by the OFT from continuing to act as an estate agent.

3. The Property Codes Compliance Board is the independent regulatory body responsible for maintaining a register of firms that subscribe to the HIP and Search Codes and for monitoring their compliance with the Codes - the self-regulatory standards of best practice (www.propertycodes.org.uk). Consumers should look for the HIP Code logo on packs and check whether a firm is registered by searching the “Register of Firms” on the PCCB website.

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  1. Roger Lawrie says:

    It’s good to see HIP compliance being taken seriously. With commercial property being responsible for 40% of CO2 emmissions and over two thirds being marketed without an EPC in contravention of the directive, it would be good to see a similar investigation in this area.

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