Research has shown that over half of homeowners surveyed would pay for a Home Information Pack (HIP) to avoid their property transaction falling-through, with 40% willing to pay for one if it would speed up the transaction time.
This finding comes off the back of a study by Moverly, who provide digital property packs. The study indicates that by providing a consumer friendly report at the point of listing a property, which includes information such as the boundary plan, flood risk, whether the property is in a conservation area, if there are any TPOs or flagging if the property is listed, homeowners could see as much as a 13.31% reduction in residential sales that fail to complete.
Of course the inclusion of up front information in a HIPS style format won’t totally negate the fall through of every sale, and the information provided within can’t be expected to cover every situation for every property at the point of listing. However, there does appear to be a clear correlation between the provision of more detailed home information packs and successfully completed transactions.
This does lead to question what should be contained within a modern HIP, and as it stands there is currently no precedent or clear guidance on the requirement of any or all of the information that could be included.
Home Information Packs and transaction speed
Timing and delay with transactions has been a constant criticism of the UK’s approach to property sales, and this is mirrored by 39% of consumers who cited the frustration of having to provide information about their property throughout the transaction, and its impact on the time taken to complete. This is supported by 63% of home sellers stating that they had experienced delays in the transaction, 20% seeing their transaction fall through and 10% having a transaction collapse multiple times.
The report by Moverly suggested that by including a HIP at the point of listing a property, homeowners could see a time saving of up to 70%, so clearly there could be an appetite for the reinstatement of them if only for the purposes of speeding up the transaction.
Are Home Information Packs worth the extra cost?
The assumed acceptable pricing ranges for a HIP varies from £100 up to £1,000, albeit with almost 50% of consumers sitting at the lower end of the cost curve.
By including a HIP at the time of listing your property the buyer has all the information before they make an offer, which in theory means offers will only be coming from high-quality serious buyers.
With this in mind it could be argued that investing in a HIP, with its potential to reduce transaction time and lower the chances of a sale falling through, is worth the cost.
Unfortunately, it looks as though sellers are set to endure an even greater degree of market turbulence over the coming months as interest rates continue to climb and the market tries to find its feet. The introduction of a HIP by proactive sellers however may make the process as simple and painless as possible, and with the average cost of a transaction failing being above £3,000 to sellers, the investment in a HIP may be a very cost effective alternative.
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