HIPS re-think needed to boost property market

"Historically, the property market has been fuelled by people who will move ‘if the right thing comes onto the market’.

"When it does, this usually triggers several such interested parties to put their own houses up for sale, but this spontaneity has been thwarted by the HIPS hurdle, which is not only time consuming, but also costs the vendor several hundred pounds.

"Knowing that there is other interest in the property, the spirit of competition is thwarted, the houses don’t come onto the market and so the supply dries up."

Haward added: "HIPs have not produced a single tangible benefit for consumers and the fact remains that the vast majority of potential buyers who approach County Homesearch see them as completely irrelevant to their purchase. Equally, if HIPS were intended to improve the conveyancing process they have failed, failed and failed again.

"They are not even a significant tax raising vehicle. HIPs and housing transactions contribute to Government revenue via VAT and Stamp Duty but it is now clear that revenue has declined in both cases. Stamp Duty revenue from 2007 to 2008 has gone from £5.2billion to £2.4billion – a drop of £2.8billion.

"The market needs to get going again but buyer interest is soaring only to be frustrated by lack of stock. And part of the reason for the lack of homes for sale is that people are put off by having to have a HIP before they market their home. This is clearly an impediment to an improving market – which is why we are calling for the suspension of HIPs. A better system that does not disincentivise homeowners from putting their properties onto the market should be introduced instead."

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0 thoughts on “HIPS re-think needed to boost property market

  1. Paul Hajek

    It’s remarkable that in a survey which effectively asked “you’ve had something for nothing but now you have to pay for it to show committmant” as few as 80% siad they objected. Surely it should have been 100%.

    Most Estate Agents and HIP Providers offer a deferred payment option, so everyone putting their property on the market can still do it without initial cost. was this option included in the Survey questions?

    HIPs are by no means the finished article yet but they still promise the quickest route to an exchange once a sale has been agreed for a property.