Mike Ockenden (AHIPP) interview – the future of HIPs

Welcome to Mike Ockenden, Chairman of the Association of Home Information Pack Providers (AHIPP) who has kindly agreed to spread a bit of light on how he sees the past and future of all things HIP related.

Q 1. – What one area has the Home Information Pack positively changed and which area do wish had been different and/or improved?

A. – HIPs have positively changed a number of areas of the homebuying and selling process, but if I had to pick one it would be the improved speed at which transactions get to exchange of contracts because of the pack. Data released by Connells in September 2009 showed that vendors with HIPs exchanged contracts on their property on average seven calendar days faster than those without a Home Information Pack.

Q 2. – It is quite widely read that Grant Shapps has pledged; time and time again to scrap HIPs, if as it appears is likely that the Conservatives win the next election. Do you think the Tories will definitely scrap HIPs or in reality alter and re-brand them?

A. – There is a great opportunity to create a genuinely sustainable alternative to HIPs that will not require the complete unraveling of the existing legislation and industry infrastructure but will rather be built on enabling the British public to have a faster and more efficient house-buying process. AHIPP hopes to work with the Conservatives to re-package HIPs and thus achieve this goal.

Q 3. – AHIPP seems to have softened their stance towards Grant Shapps, is that because he is listening to you now?

A. – AHIPP values the relationship with Grant Shapps and his office which we have always seen as positive and constructive. We wish to continue the dialogue over the coming weeks and months and hope to work with the Conservatives to create a genuinely sustainable alternative to HIPs.

Q 4. – If the Tories carry out their promise to scrap HIPs, what timescale will this involve, are they able to suspend them first with legislation already in place? If so, how long will that take and would suspension need to go through the House of Lords where the Tories would be in the minority?

A. – Whilst the power exists for the Secretary of State to suspend the HIP duties the recast of the EPBD, that will be signed off in December 2009 by the European Council of Ministers, complicates matters. As previously mentioned, AHIPP hopes to work with the Conservatives to create a sustainable alternative to HIPs that will not require a complete unravelling of the existing legislation. To move to a situation where no replacement or alternative is in place would be a retrograde and unacceptable step in efforts to reform the process of buying and selling homes.

Q 5. – With rising un-employment figures, scrapping HIPs would no doubt increase that number, do you have an estimate of the number of people involved in the established Home Information Pack industry?

A. – The UK HIP industry is worth over £300 million and employs over 10,000 people either directly or through the provision of the constituent parts. Clearly a lot of jobs would be at risk.

Q 6. – With Grant Shapps’ pledge to scrap HIPs how many of those at risk of un-employment due to this pledge can you see voting conservative?

A. – I can’t comment on individual cases but it is worth noting that scrapping HIPs will not only affect HIP providers, but all those organisations which currently provide services and products to HIP providers. The destruction of the HIP industry will impact on solicitors, estate agents, printers, IT services suppliers, and marketing companies, in addition to those who directly provide HIP elements such as search agents and energy assessors.

Q 7. – Are HIPs the ‘perfect’ solution to the system prior to HIPs being introduced. What do you see being the best way forward for HIPs, what changes do you see improving the HIP if any?

A. – We must be open and honest about the introduction of Home Information Packs and recognise that they have not achieved everything they set out to do. Their introduction was far from perfect and they have not delivered everything that was hoped. Lessons need to be learned from our experiences, both positive and negative, to inform the next stage of reform.

Going forward, AHIPP would like to work with the Conservatives to develop a viable way forward that is to the benefit of consumers, building on exchange ready HIPs and Energy Performance Certificates, and to ensure providers adhere to the highest standards in providing services to consumers.

Q 8. – Most know about the historic U-turn in regard to the Home Condition Report (HCR), can you ever see a day when this exact product is included in the HIP or is it more likely we will follow Scotland and use a ‘RICS type’ survey if introduced?

A. – The u-turn over HCRs was one of the biggest disappointments about the bungled introduction of HIPs. There might come a time where the issue is revisited but for the moment we are focused on ensuring that the home buying and selling process is a faster and more certain process for consumers and professionals. We believe that the exchange ready HIP provides the framework for this.

Q 9. – It is widely recognised that there is a massive oversupply of Domestic Energy Assessors (DEA) and Home Inspectors (HI). How do you feel about training providers continuing to train people as Domestic Energy Assessors (DEA)s and Home Inspectors (HI) when some Home Inspectors (HI) have never carried out one Home Condition Report (HCR)?

Domestic Energy Assessors and Home Inspectors are part of an open and free market and as such it is inevitable that access to the necessary training should remain available. Over time we can expect market forces to take effect, leading to a balance of supply and demand with regards to these roles and their place in the wider market. That said there will always be demand for good people.

Q 10. – Should Domestic Energy Assessors (DEA) carrying out EPCs directly for AHIPP members be worried about future payments as HIP providers could be very quickly be in financial distress if HIPs are scrapped?

The abolition of HIPs would clearly have significant and immediate financial consequences for HIP providers. I am however confident that an alternative sustainable product, building on the benefits of the existing HIP, can be developed and will ensure the future of the industry in the UK. It should also be noted that the EPBD recast will require an EPC to be in place prior to marketing a property for sale or rent. HIPs currently provide the only framework to deliver the EPC.

Q 11. – Can you tell us a little about PEPA; some have said possibly quite cynically that PEPA is a way forward for AHIPP members who are going to lose their main income stream and an exit strategy for AHIPP?

The Federation of Property Information Providers (FPIP) brings together the Association of Home Information Pack Providers (AHIPP) and the Council of Property Search Organisations (CoPSO) under one umbrella, recognising the increasing prominence of the role of these industries in serving consumers. The Property and Energy Professionals Association (PEPA) which has recently been formed is focused on the future of energy and condition reporting in the widest sense across both domestic and commercial properties. Its agenda is distinctly different to that of AHIPP. While the member organisations of FPIP will retain their independence and individual management structures, the Federation’s objective will be to strengthen the constituent bodies’ ability to drive forward positive reform and to act as a compelling, effective voice for the sector with Government.

Q 12. –  Looking back it seems to have been quite a rollercoaster for the life so far of the Home Information Pack, did you imagine at the inception it would have been as it has?

A. There is cross industry recognition that HIPs have not achieved everything they set out to do and clearly this is disappointing. What is important now is how we develop the many benefits contained in a HIP and create a new sustainable product that delivers more fully for the consumer going forward.

Q 13. – Mike as Chairman of AHIPP, you have had some very strong opposition to your Pro-HIP beliefs, thoughts and actions; however, whether others agree with your views or not, most people almost universally recognise the good work you have done towards promoting Home Information Packs. What has your biggest achievement been in this regard so far?

A. – I hope that my biggest achievement is yet to come and that my legacy for AHIPP will be to have worked with the Conservatives to create a genuinely sustainable alternative to HIPs.

Q 14. – This time next year will we still have Home Information Packs and what will they look like?

Yes, I believe we will, in the form of a mandatory legal pack (containing an EPC) to be in place prior to marketing. It just might not be called a HIP!


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8 Responses to “Mike Ockenden (AHIPP) interview – the future of HIPs”

  1. I was disappointed to read Grant Shapps latest comments in the Negotiator magazine in which he actually contradicts himself by saying in one breath he will scrap HIPs but then in the next breath says he will keep them but make them voluntary. He even goes as far as to make reference to the Home Inspectors and the fact that they can still conduct HCR’s as they are available to the public as an option.

    Shapps must surely realise that should he make HIPs optional too then the demand for HIPs will be the same as the demand for HCR’s – practically ZERO.

    An incoming Tory government have a real and unique opportunity to drive forward and influence the buying & selling process in the UK and make positive inroads in achieving a viable low carbon economy. The Institute of Domestic Energy Assessors (IDEA) are keen to work with the Tories to achieve these goals and ensure that the EPC remains an intrinsic element of this process. The current Labour government have made a complete hash of the HIP roll out and have treated both home inspectors and energy assessors abysmally.

    The Tories have a real opportunity here both to do the right thing and redress the balance; let’s hope they don’t waste it!

  2. It’s marvelous how the world of politics works isn’t it? the Home Sellers Pack was the Tory’s idea in the first place but because Labour introduced them as Home Information Packs they are rubbish.
    Nick.

  3. Very disapointed in MO’s responses, he should be a politician the way he never really answered most of the questions put!

  4. Personal Searches should be banned Says:

    Many HIPS are not actually worth the paper they are written on, but this was also the case with personal searches prior to HIPS, so nothing has really changed. Having worked for a company that prepared Personal Searches for HIPS for 3 years, I was horrified to find that they KNOWINGLY provided INCORRECT information on the search reports and the company I was unfortunate enough to work for was far from alone in doing this.If they could not obtain the information required, they would just make it up or lie and say there was no info to obtain!!! Having amassed a huge amount of evidence and reported this company, surprise, surprise, nothing was done about this dreadful company and they continue to get away with dishonesty. I would NEVER trust a personal search and would ALWAYS make sure that the report was made up from OFFICIAL searches carried out by the Local Authorities

  5. Concerned about content Says:

    Please name and shame and give the search companies who do an honest job of work a fair chance.

    The Councils make it hard enough for personal search companies trying to make an honest living so lets work together to drive out the cowboys and give the rest of us a chance

    If you have been in the industry you will know that the Councils often get it wrong and that a responsible personal search agent is not only quicker and more accurate but often cheaper than the council, which has to be good for the consumer

    Please help us and name this Company so that we can help and add pressure on the regulators to sort out this company

  6. Debbie Gillett Says:

    Very disappointing to read the responses to the questions. not enough consumer focus.

    Regardless of whom comes into power and what they state they are going to do does not address the now situation, lets not assume the conservatives will automatically become the next government. I can recall Labour staing it would abolish Buy to Let, we all know their tactics to win voters. We as an industry need to provide a product which does what it says on the tin.

    Consumers are the people who make the decisions, the main Industry responsible for Lending e.g CML need to be at the forefront for any re-modelling of the product “hips”.

    I worked closely within this industry at the start and it was clear very early on that a HCR with Valuation was needed, this area has not been addressed in any of the responses. With the lending criteria, affordablility being a major focus area the HCR report is crucial for lenders in making lending decisions. A HCR will also contain the EPC and will go along way to justify the cost of the report and make it meaningful.

    The process cannot be speeded up and be truly a ready to go property at exchange without a HCR with Valuation. Too much focus has been on the cost of the Hips as being an additional burden, I have seen nothing to help explain this in layman terms to consumers. If this had been done they would be able to see that comparing costs prior to hips and reviewing their conveyancing costs now that they are actually saving time and money.

    Consumers want two things, they want to move house and want information that they can understand at a reasonable cost to make informed decisions.

    Lenders are going back to their roots and will not make quick decisons driven by computers and basic credit scoring, the property and its repair and running costs will be needed before giving an approval in principle.

    The industry has had sufficient time to improve upon the product over the last few years.The failing has been in managing the project and losing focus of the objective.As usual too many political egos has resulted in the consumer left being confused.

    Too many estate agents anti hips have made too much money out of hips and full disclosure should be made when taking instructions from clients as to how much they are earning from the product.

    I would like to ask for this information being made available within the pack disclosure.

    I am disgusted from working with agents, working for a reputable agent and mystery shopping them as to their lack of understanding of the whole issue, consumers deserve better.

    I would like the HIP industry improved with a new set of values and objectives set to take into consideration the fundamental changes that have happened within the finance industry which surely has to be addressed by any party in power.

  7. Conveyancing has experienced a lot of reform over the last few years, all of it with the intention of making buying and selling property easier but the most controversial reform has had to be the introduction of Home Information Packs (the successor to the sellers packs which were scrapped by the Conservatives). They were part of the governments’ manifesto pledge to reform the conveyancing process because the market was losing around £350m a year from 1 in 4 transactions failing.

    Before HIPs officially came to the market it was thought that most sellers would obtain their HIPs from a HIPs provider accredited by AHIPP. The HIP Code was introduced to deliver quality standards across HIPs providers (sponsored and maintained by AHIPP) and the Search Code was introduced and sponsored by the Council of Property Search Organisations. The information contained within the HIP would be provided up front at the pre-offer stage instead of both parties getting it in bits and pieces between offer and exchange and the information it contained would be relied upon. The Codes would provide protection to the homebuyers. The Property Codes of Compliance Board contained a list of HIP providers that complied with both Codes and all companies that wanted to subscribe to AHIPP were required to have professional indemnity in place.

    If you take this as a base from which HIPs was working on I’m sure that not many would find fault. It continues to be consumer led in that Christopher Hamer, the Property Ombudsman has had his remit extended to include HIP and search providers registered with the PCCB.

    Consumers have a clear choice in that they can continue to buy from others supplying HIPs packages, they can choose to purchase cheaper packages online, or they can choose to purchase from sites that have more consumer-friendly safeguards built within them.

    HIPs is still not perfect because it still needs to make the HCR compulsory (structural defects was another reason for 1 in 4 transactions failing), and build on information provision for leaseholders but I personally feel that it is heading in the right direction.

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