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Commercial Property News and Comment

Home Inspectors and the Home Information Pack

Overview of the Reforms
Only 1 in 5 of home buyers currently has any form of survey. From 2007 that number will be 5 in 5.

Under sweeping changes contained in the new Housing Act 2004, from mid 2006, sellers will be encouraged to obtain, voluntarily, a Home Condition Report (HCR) when they place their properties on the market in England and Wales. From early 2007, HCRs will become mandatory, as part of a Home Information Pack (HIP).

Only officially licensed Home Inspectors (HIs), a new body of professionals independently certified by an industry-run scheme to be approved by government, will be allowed to carry out HCRs.

From early 2006, sellers will be encouraged to obtain, voluntarily, a Home Condition Report (HCR) when they place their properties on the market. New legislation will mean that from early 2007, HCRs will become mandatory, as part of a Home Information Pack (HIP).

Home Condition Reports will only be able to be prepared by licensed Home Inspectors (HIs), of whom it is estimated that about 7500 will be needed to cover England and Wales.

Home Inspectors will be independently certified by an industry-run scheme to be approved by government. The HI will be required to demonstrate competence against National Occupational Standards (NOS) at Level 4, for which the Awarding Body of the Built Environment (ABBE) have developed a Vocationally Related Qualification (VRQ) at level 4, which is currently awaiting approval by the Qualifications and Curriculum Authority (QCA). In the longer term when the new HI role becomes live this will become a National Vocational Qualification (NVQ).

What is wrong with the current home buying and selling system?
Research carried out in 1998 by the then Department of the Environment, Transport and the Regions showed that:

  • The house buying and selling process is the slowest in Europe, with transactions typically taking eight weeks from offer to exchange of contracts;
  • Wastage is high - 28% of house sale/purchase transactions fail after an offer has been agreed, at significant cost to the consumer and the industry;
  • Of these 28%, about 42% of failures resulted from the disclosure of defects within the property, emerging either as a result of a mortgage valuation inspection, or a pre-purchase survey. (12% of all sales therefore fail for this reason). The research also showed that these defects were frequently reported to the buyer very late in the transaction process;
  • Wastage is very high - The estimated wastage cost to consumers averages 1 million per day;
  • It leads to frustration and misery - Two in five home buyers and sellers are dissatisfied with the current process, but the research also showed a high level of satisfaction with the professionals involved in the industry generally.

Since 1998, the Office of the Deputy Prime Minister has, together with representatives of the property industry, undertaken:

  • A major study of home buying and selling in the UK;
  • Research into international comparisons, including Australia, USA and Denmark;
  • A pilot scheme in Bristol to test the practical operation of Home Information Packs;
  • Pilot schemes to test the robustness of the Home Condition Report;
  • Consultations on the contents of the HIP and its application in low demand areas


- Christo & Co -
Commercial and Residential property specialists, estate agents, valuers and surveyors
in Kentish Town, Camden Town and throughout North & North West London

66-70 Parkway, London, NW1 7AH - Tel: 020 7482 1203 - Fax: 020 7482 4441
- Web: www.Christo.co.uk