Coalition Government scraps HIPs but keeps Energy Performance Certificate
By Rob Hull on June 1, 2010
The new Lib-Con Coalition Government may have scrapped the requirement for homeowners to provide a Home Information Pack (HIP) when selling their property recently, but it has shown commitment to a greener housing market by retaining and looking to develop Energy Performance Certificates (EPC) which need to be commissioned before putting a house on the market.
Communities Secretary Eric Pickles and Housing Minister Grant Shapps announced on 24 May that HIPs were being suspended with immediate effect, rendering the packs as ‘pointless’, ‘expensive’ and ‘unnecessary’.
The packs, launched in December 2007, meant homeowners looking to sell had to pay an average of £500 for a HIP with around 2.7 million property owners forking out for the packs during their duration. They included information about the property, such as local authority searches and the EPC, but were rarely utilised by potential buyers and blamed for restricting an already difficult market. But despite HIPs being axed by the new government, EPCs have remained as a necessity under EU law.
On announcing the suspension of the HIPs scheme, Pickles said: “The expensive and unnecessary Home Information Pack has increased the cost and hassle of selling homes and is stifling a fragile housing market. That’s why I’m taking emergency action to suspend the HIP, bringing down the cost of selling a home and removing unnecessary regulation from the home buying process.
“This swift and decisive action will send a strong message to the fragile housing market and prevent uncertainty for both home sellers and buyers.
“HIPs are history. This action will encourage sellers back into the market, and help the market as a whole and the economy recover.”
Shapps added: “This is a great example of how this new Government is getting straight down to work by cutting away pointless red-tape that is strangling the market. Rather than shelling out hundreds of pounds for nothing in return we’re stripping away bureaucracy and letting home owners sell their property.
“But we’re also showing our commitment to a greener housing market by keeping Energy Performance Certificates and making them more relevant in helping buyers make informed decisions on the energy costs of their new home.”
An Energy Performance Certificate is required for all homes when built, sold or rented. The certificate details how energy efficient a property is and provides A-G ratings. These are similar to the labels now provided on boilers.
They are produced using standard methods and assumptions about energy usage so that the energy efficiency of one building can easily be compared with other building of the same type. This means potential buyers can now consider energy efficiency and fuel costs as part of their investment.
An EPC also comes with a Recommendation Report (RR) that lists cost effective and other measures to improve the energy rating of the property including renewable energy options and replacement of poorly-rated out-dated boiler systems.