This leads me to ask: What are the potential solutions to solving the leasehold conundrum?
It’s a big question. The answer may be found in a blast from the past, in the form of the late, and arguably not so great, Home Information Pack (HIP).
For those who have been in the industry as long as me, I’m sure you will remember HIPs, and also recall how much of a headline writer’s dream they were for those working in the press at the time.
‘HIP to be square,’ anyone? I could go on. But I won’t.
Features of HIPs
HIPs were introduced in England and Wales in 2007. The aim was to speed up the house selling process by obliging sellers to provide much of the required conveyancing information when properties were first put up for sale.
The packs were paid for by sellers. They contained property information, title deeds, local searches and other necessary information. However, they were dogged by criticism across the industry due to the additional red tape generated and increased costs attached to the selling process.
So much so, that they were scrapped 11 years ago, although one lasting legacy did emerge and that was the continued requirement of an energy performance certificate (EPC).
But are HIPs really the answer to this problem?
In my previous article, I alluded to the idea that transparency is key when it comes to homebuyers getting to grips with the property they are looking to purchase. After all, the more information which is available at the outset of any decision-making process, the stronger the likelihood that better decisions will be made.
Call for clarity
HIPs in their old form didn’t work. That is clear. However, we have to ask ourselves whether wholesale reform of leasehold is needed or if we should concentrate more on ensuring that homebuyers have all the relevant information available to them from the onset of their search.
By this I mean a survey, a valuation and all pertinent legal documentation.
I will always welcome any responsible move to improve the homebuying journey. However, I do question if leasehold reform will do this, or will it simply lead to more questions than answers? As always, the devil will be in the detail.
We as an industry need government to implement changes sensitively and clearly, with some flexibility available for unforeseen consequences.
Improved transparency at the front end of the homebuying process needs to be at the forefront of any decision making. I’m not saying that we need to dust off the home information pack just yet, but as Shakira once sang – HIPs don’t lie.