Inside Money: Home is Where the Hip Is
 
Presenter: Lesley Curwen
Listener: Niall Connolly
Producer: Jennifer Clarke

Tx: 	Saturday 22rd July 2006 1204
Rpt: 	Monday 24th July 2006 1502 

THIS IS A TRANSCRIPT OF THE LONGER REPEATED VERSION

CURWEN: 	Hello. Welcome to a very unusual edition of Inside 
Money. It’s all about the Home Information Pack or HIP, the 
government’s big new idea to reform the housing market. The 
programme you’re about to hear was recorded three weeks ago. But on 
Tuesday the government unexpectedly announced that a key part of its 
proposals would not go ahead as planned. I’ll tell you more about that 
AFTER you’ve heard our original programme. Here it is.

Meet Radio Four listener Niall Connolly. 

CONNOLLY: 		Monty, come on, this way.

He’s a Scottish-born photographer living in Somerset, with a long-term 
fascination with property. 

CONNOLLY: 		This is probably the best view of the 
house. The extension that we've built is over on the left and then the 
two thirds…
 
CURWEN: 	Niall  is, in fact, no stranger to Inside Money. After 
being both gazumped and gazundered – having made agreements in 
good faith to buy or sell, only to have the other party go back on their 
word –  he took part in one of our programmes back in 1997, to see how 
the whole process could be made less precarious. And he got the chance 
to ask then-minister Geoff Hoon what the brand-new Labour 
government would be doing about it. 

CONNOLLY: 		Well Mr Hoon, do you think that the 
system in England and Wales needs overhaul?

HOON: 			The new government is very concerned 
that the problems of gazumping and the problems of gazundering need 
urgent attention, and we are now about as a governmentt, to put into 
action proposals to investigate the extent of the problem. 

CURWEN: 	Well that was nearly a decade ago. What the government 
has decided to do next year in response to those widely-acknowledged 
problems - is to bring in a Home Information Pack, or a HIP for short. 
The idea is that even if one sale falls through, key details about the 
house’s condition will be available in the pack for the next buyer, 
saving them time and money. It sounds logical - but this measure is a 
political hot potato; the Conservatives say they would scrap it and other 
critics argue HIPs will be expensive and confusing. Who better than 
Niall Connolly to join us again, to find out whether the packs will be 
effective – and whether they will answer his original concerns?

CONNOLLY: 		I’ve been gazumped and gazundered and 
I know that there are problems in the house-buying market place. I 
hoped that the new Labour government of the time would try and bring 
to the house-transaction market place in England and Wales some 
degree of certainty which would remove the ability of either party to 
make and then break an agreement. What I’d like to find out now is 
what improvements will the Home Information Pack actually make in 
reality?

CURWEN: 	First step – was getting some basic facts about Home 
Information Packs. The idea is to make life easier for the buyer by 
lining up everything you need to know about the property in one folder. 
Already trial packs have been offered on a voluntary basis, ahead of 
more formal dry runs this autumn. So we were able to take a look at one, 
which is being piloted by a trade body AHIPP, the Association of Home 
Information Pack Providers.  Niall and I met its deputy director Paul 
Broadhead. 

CONNOLLY: 		I’ve never seen a Home Information Pack.  
You have one here.  Could you walk me through it?

BROADHEAD: 		Certainly Niall. The Home Information 
Pack’s there to increase transparency in the process, to make it more 
cost-effective and to make it less stressful essentially. As you can see 
it’s quite a glossy brochure.  It looks like essentially a catalogue of the 
information you need to decide whether or not to proceed with the 
purchase. So it talks us through the sales statement; fixtures and fittings 
forms; evidence of title from the Land Registry so that you know the 
person you’re buying the property off has the right to sell it; all of the 
required searches of the property that you would get under the current 
system; a report on the home condition so that you know the condition 
of the property. And that also incorporates an energy-efficiency report. 
And what that details is how energy efficient is the property, how much 
in essence does it cost to run.

CONNOLLY:  		I didn’t hear you say anything about a 
valuation. 

BROADHEAD:		That’s right.  The valuation isn’t in the 
pack.  The reason for that essentially is because of the shelf life. If you 
think about it in a buoyant market within two or three months’ time, the 
valuation can change greatly. So this is purely an objective report on 
condition.

CONNOLLY: 		What is it likely to cost the vendor? How 
will they find a Home Information Pack Provider for a start?

BROADHEAD: 		For an average house, a three-bedroomed 
semi in a provincial town, we think in the region of £750. We think 
what will happen is that you will pay the £750, not up front, but on 
completion of the sale, so no initial outlay. To commission a Home 
Information Pack. Initially it’s likely to come through an estate agent or 
your solicitor or your lender or whoever you normally go to at that first 
point in the process. 

CONNOLLY: 		We all know that property sales don’t 
happen in two weeks.  They can take an extended period of time. How 
long will the vendor be able to depend on this document?

BROADHEAD: 		The elements of the pack, the Home 
Condition Report, the searches etc. must be no more than three months 
old at the point that the property is marketed.  The only two items 
you’re really talking about going out of date are the searches and the 
Home Condition Report.  Currently these are accepted for around six 
months.

CONNOLLY: 		Now the Home Information Pack is quite 
extensive. I’m quite amazed at the amount of information that’s 
gathered together here. How do you think this document is going to 
address issues like gazumping, gazundering, failure to complete etc?

BROADHEAD: 		The Home Information Pack will not 
solve gazumping per se.  It doesn’t make people more committed sort 
of financially to the process or penalise them if they drop out.  But what 
is does is actually provide all of the information for you as a vendor or 
as a purchaser to enable you to make an informed decision. I don’t see 
this Home Information Pack being the be-all and end-all of home 
buying and selling reform at all 

CURWEN: 	That was something of a surprise  – that Paul Broadhead, 
a cheer-leader for HIPs, conceded they’re only a starting-point for 
reform.  Even so, they will change the way we sell and buy our homes, 
and the key innovation is the Home Condition Report which is really a 
new kind of survey. At the moment a very basic valuation survey is 
done when the buyer of the property wants a mortgage, because their 
mortgage lender needs to get the house valued. A quarter of buyers then 
choose to pay extra for a more detailed inspection known as a 
Homebuyers survey. But from next June, it’s the seller who’s 
responsible for the physical inspection, as part of the HIP. That means 
there’ll be a whole new army of property inspectors needed – around 
five thousand of them are being recruited and trained to pass a brand-
new qualification. We went to Watford, home of training group BRE, a 
building consultancy and centre of excellence. BRE’s Chris Broadbent 
gave Niall a quick tour of the site

BROADBENT:		It was built as a state of the art 
environmental building. And so those chimneys you see on the top just 
allow natural circulation of air through the building
 
CONNOLLY: 		So the hot air rises up the chimneys and 
ventilates 

BROADBENT: 		So rather than forcing it round with 
chillers using loads of energy….

CURWEN: 	He is the director of BRE’s Home Inspector business, 
one of many training centres teaching the new inspectors. 

CONNOLLY: 		Who are the candidates who are coming 
forward to become home condition inspectors? 

BROADBENT  		We’ve got two types of candidates.  
Initially, there are experienced practitioners who have a background in 
construction industry. They may need some additional training just to 
supplement their background. We also have separately what we call a 
“new entrants programme” and these are people who are looking to 
change career.  But that programme takes much longer, it takes them 12 
to 18 months, rather than 3 or 4 months as would be the case for an 
experienced person. 

CONNOLLY: 		Will there be enough people available 
when the programme is officially launched in June of next year?

BROADBENT: 		We think so.  It’s looking good so far. 
There are about 4,400 currently in training, but all the time there are 
more people coming forward, so there’ll be a constant throughput in 
addition to that.  

CONNOLLY: 		How will this new breed of surveyor 
compare to those already existing? 

BROADBENT: 		They’ll be different.  The home inspectors 
will be trained to deliver a very prescriptive and very particular report 
on the condition of a house, whereas a chartered surveyor would have 
over the years developed much wider based skills than that, be able to 
deal with more widely ranging building problems which the home 
inspector wouldn’t have had the requisite training for. 

CONNOLLY: 		Who would a buyer or seller seek redress 
from if they felt that something had gone wrong because of a report? 

BROADBENT: 		There will be the home inspector 
certification scheme which is becoming established at the moment. And 
that will be a scheme which licenses home inspectors, monitors their 
work to make sure they’re delivering to the right standard, and also then 
registers their reports with the database from which the pack providers 
would take them.  

CONNOLLY: 		Is there just going to be the one 
certification scheme for all home inspectors?

BROADBENT: 		No, there’ll be a number of certification 
schemes all operating to a set of standards that are being prepared by 
government. I believe there are seven different bodies considering it 
although none have come forward to formalise their application yet.

CURWEN: 	So let’s get this right.  We’d have seven different 
accreditation bodies in charge but none of them have actually been set 
up yet?

BROADBENT: 		They’re in the process of being set up and 
would be ready in time.

CURWEN: 	But it’s less than a year to go, the clock’s ticking.

BROADBENT: 		Yes it is, yea.  
 
CURWEN:	By now, Niall was feeling perplexed.

CONNOLLY: 		All I can understand is we’ve got a new 
breed of people who aren’t really surveyors doing things that aren’t 
really surveys, and they’re regulated by I’m not really sure who, frankly

CURWEN: 	Clearly regulation was an issue. If a Home Condition 
Report proves to be wrong or misleading, what then? Imagine that the 
new owner of a house finds a damp problem which was never picked up 
in the report; who will be held responsible and who will provide 
compensation? Our listener Niall was trying to piece together the 
jigsaw in his own mind. To be honest, it’s a messy picture and the 
potential for confusion is at the heart of many concerns voiced about 
HIPs, even from one of the scheme’s most enthusiastic backers - the 
consumer watchdog, Which?.  I took Niall  Connolly to meet Emma 
Harrison at Which?.
 
CONNOLLY: 	I’ve been told that there could be as many as 
seven licensing bodies.  That seems a tremendously complicated 
structure to put in place? 

HARRISON: 		These certification schemes are all about 
generating competition in the market. But our biggest priority at Which? 
is making sure that if you if you have a problem with a home inspector, 
you don’t have to ring up seven different people to get redress.  There’s 
a one-stop shop, and we’ve told the government there’s no negotiation 
on that. 

CURWEN: 	But surely what you want is a statutory independent 
government-backed system like an Ombudsman Scheme?

HARRISON: 		Absolutely.  That’s been our 100%....

CURWEN: 	Is that going to happen by June next year?

HARRISON: 		No, unfortunately there will not be an 
independent statutory regulatory body set up by next year. 

CONNOLLY:		Doesn’t that worry you? 

HARRISON: 		We’ve been talking about redress for six years in 
this area. We have asked the government to introduce Home 
Information Packs with a statutory redress scheme underpinning it and 
yes, it’s too little, too late, that they’ve now said they will do it but not 
in time for June 2007.But we firmly believe that the industry will 
deliver a solution which will work because we firmly believe Home 
Information Packs will benefit all consumers and that is good for 
business too.

CONNOLLY: 	I’m heartened by Which?’s clear, positive view 
of the HIP scheme, but I just think it’s tinkering at the edges, and it’s 
certainly not going to require house sellers and buyers to be as good as 
their word. 

HARRISON:		HIPs will go a long way to giving you the right 
information as a buyer to make the decisions if you really want that 
property. And that ultimately is a really good thing for both seller and 
buyer, I think, but it’s not the panacea, it doesn’t solve all the 
problems.This is just a first stage as far as Which? is concerned. 

CURWEN: 	Despite admitting more needs to be done, Which? has 
been very supportive of the HIPS project. Property professionals, on the 
other hand, have been less enthusiastic. Surveyors, lawyers and estate 
agents have all voiced concerns but in some cases, pragmatism has won 
the day. Many former opponents are now preparing to provide HIPS. 
But there are difficult issues. Solicitors, for example, still have a duty to 
their clients to check information, especially if it doesn’t come from 
another solicitor. Niall  wondered whether they might end up repeating 
some of the legal work in packs. So we went to see Kevin Martin the 
president of the solicitors’ professional body, the Law Society. Niall 
asked him – how far will lawyers trust the information in a HIP?

MARTIN:		It’s very difficult to forecast precisely how 
people are going to react. I believe that there will be a natural 
comparative reluctance on the part of solicitors to deal with packs 
prepared by other people. There will be some aspects of the pack where 
most solicitors will accept most of the information that’s provided, but 
there are going to be some difficult areas, local searches, for instance - 
and this applies whoever they’re provided by - they have a shelf life. 
And if a local search goes out of date it’s got to be done again. 

CONNOLLY: 	So clearly there is a possibility that information 
is going to have to be refreshed?

MARTIN: 		Yes. Searches are one and the Home Condition 
Report is another, that what it says about a property today, may not be 
applicable in three or six months’ time. So again, duplication.

CURWEN: 	Is there any hope do you think that actually the costs of 
the buyer, the legal costs of the buyer will be reduced because of Home 
Information Packs?

MARTIN: 		I think that’s unrealistic.  Essentially I think the 
same amount of work broadly will have to be done, as has been done in 
the past. The fact that a lot of the information is being provided at the 
same time without having to ask questions about it, is offset by the need 
to make sure that everything is legitimate, it does come from a proper 
source, that the Home Information Pack is a good and reliable one and 
that the information is not out of date.

CURWEN: 	Because the buyer’s solicitor has a duty to make sure 
that they are protecting their client.

MARTIN: 		Yes, absolutely

CONNOLLY:  	Will the Home Information Pack deliver any 
greater certainty in the buying market?

MARTIN: 		It has the potential to produce certain benefits, so 
that the seller is going to have to be much more informative and frank 
at a much earlier stage. We thought that during the course of the 
legislation it was right to oppose it because we didn’t believe that it was 
addressing other factors that affect the home buying process. I’m if I 
may say so, a very experienced conveyancer and people drop out of 
property transactions for a whole range of reasons that you could think 
about and quite a few that you couldn’t even imagine. It’s money, it’s 
the chain and it’s human nature. Now human nature you can’t do 
anything about but I think it’s regrettable that the first two were not 
addressed.

CURWEN: 	The Law Society interview did nothing to cheer Niall. 
 
CONNOLLY: 	Everybody that we’ve spoken to has their own 
view of the shortcomings of the HIPS programme and these are really 
experienced people who know the thing back to front. It’s perfectly 
clear that this project is incredibly complicated, ill-thought out and is 
being rushed.

CURWEN: 	And there’s a risk of another form of duplication too, 
involving mortgage lenders.  Remember Paul Broadhead had told us the 
packs will not contain a valuation of a house or flat. But the mortgage 
lender still needs to get the place valued before it’s willing to lend 
money, and it’s the buyer who pays for that survey.  The government’s 
theory is - all that will become old hat. It reckons that lenders will be 
able to view the Home Condition Report on a central computer database 
to help calculate a value. It sounds great – will it happen? We took Niall  
to the Council of Mortgage Lenders to see its director general, Michael 
Coogan. 

CONNOLLY:  	How are the lenders going to use the HIP when it 
is launched?

COOGAN: 		Well one of the difficulties is that we don’t yet 
know.  Lenders are looking at it very carefully, but the HIP will not 
include a valuation, and we don’t yet know the extent to which there 
will still need to be physical inspections of many properties, some 
properties or very few properties.  The government hopes more lenders 
will use automated valuation models, computer systems with house 
price details so that you don’t need to go to a property and visit which 
costs more money. But for many properties which are higher risk for 
lenders we expect the physical inspections will still be needed and 
customers will be expected to pay for them. So our view at the moment 
is it’s likely that costs will go up.

CURWEN:	Hang on a minute – the government’s idea is that what 
we spend on moving house will fall as a result of HIPs, but Michael 
Coogan reckons costs will go up. There was another issue too, about 
those computer databanks where information will be stored.  

CONNOLLY: 	You touched on Automated Valuation Process. 
As I understand it, the Home Condition Report is going to be lodged in 
some central database and lenders are going to have to get access to that. 
Are the systems in place to make that possible?
 
COOGAN: 		At the moment no one yet has built the systems 
and one of the problems is it’s a very tight timeframe to have IT 
systems which links every lender through the portal, the database, to 
collect that information about Home Condition Reports.  We don’t yet 
know whether lenders will want to invest in that system because at the 
moment they don’t yet know how much work they will need to do 
separate from the HCR, how many physical inspections they will need 
in any event, and therefore if they’re not going to use the Home 
Condition Report in the majority of their cases, it may not be worth 
investing for electronic links

CURWEN: 	So some lenders may in fact decide not to link up to the 
database because it’s not worth their while?

COOGAN: 		Well they have to take a view from the point of 
view of their business, are the cost of investment in the systems worth 
the benefits they may get?.   And at this stage, there isn’t going to be a 
blanket approach by lenders because we just simply don’t have enough 
information about HIPs to know how it will work.

CONNOLLY: 	I don’t get the picture that you’re wildly 
confident about this project. 

COOGAN: 		The CML’s perspective has always been to try 
and help the government deliver a policy it’s had for 9 years so far. 
They have created a process which involves inspectors’ certification, 
which requires compensation schemes and they’ve got behind that a 
database of Home Condition Reports. It is a significant structure that 
they’re putting in place. None of it has been built yet, so we don’t yet 
know whether it will work.  What we do know is there is a risk that 
there aren’t enough inspectors, there’s a risk that the database won’t be 
accessed by lenders, it won’t necessarily speed up the process, and we 
do know it won’t necessarily reduce aborted transactions. There is an 
awful lot still to be found out, and the timeframe is ticking away.
   
CURWEN:	Right from the start, our listener Niall  had been 
worrying about whether HIPs would address his central concern – how 
to make buyers and sellers more likely to stick to an agreement. But 
along the way, he had heard substantial concerns voiced about 
something more basic - the practical implementation of HIPs. Nine 
years after his last interview with a minister, Niall  re-traced his steps to 
Westminster to talk to the current Housing minister Yvette Cooper. 
There was a lot of ground to cover – and he started with whether the 
packs will, as intended, cut out duplication in house-buying. 

CONNOLLY:  	Lenders say that there will still have to be a 
separate valuation survey;   the Law Society has said that its members 
may not be able to rely on the contents of the HIP and they may have to 
do all of the work again. That sounds like a bit of duplication still in the 
system. 

COOPER: 		Well I think you’ve got quite a lot of vested 
interests at the moment, whether it’s through mortgage companies, 
whether it’s through lawyers and conveyancers wanting to defend their 
current system and also wanting to maintain their role in the process 
and claim that they’re going to have to do additional work and so on. 
But I just think the reality is you will have a Home Condition Report 
that you can legally rely on.

CURWEN: 	In fact the Law Society said to us that they don’t think 
that conveyancing will become any cheaper for buyers.  So once again, 
if there’s still going to be a valuation survey in most cases, where are 
the savings?

COOPER: 		Well you’re right that you do have, as I said, a lot 
of vested saying that, you know, they still want you to pay loads of 
money for their services. But actually if their services are not going to 
be needed because some of these searches and things have been done as 
part of the Home Information Pack, then I think this is going to 
fundamentally change the way in which all of the existing organisations 
operate in the house buying and selling process.        

CURWEN:	The minister staunchly rejected concerns about 
duplication. Would she be as bullish when Niall tackled her over the 
complaints system for Home Condition Reports?
 
CONNOLLY: 	Having heard the new structure that you’ve set 
up explained to me, I see it as being hugely complicated and the issue 
of redress is not at all straightforward.

COOPER:		I do agree with you that we do need to do more 
to simplify the redress process.  That’s going to need additional 
legislation and we are working on that at the moment.  But I think we 
can make substantial progress and you know give people redress in a 
way that they’ve not had it before as a result of bringing this in. 

CURWEN: 	Will there be a single point of contact for those maybe 
up to seven accreditation bodies that will be involved?  Will there be 
the equivalent of an independent Ombudsman? 

COOPER:  		Well that’s what we want to look at as part of the 
new legislation. Now we need to get the certification schemes up and 
running first.  We don’t know yet how many there are going to be. 
What we want to do is as part of the dry run in the autumn, really look 
in some detail about how you make sure this is consumer friendly, how 
you make sure it’s simple for people if things go wrong, they’ve got 
follow-up and they know where to find it and how to do it.  We are 
sympathetic to the need for further legislation here but you know we 
need to go one step at a time and get the system up and running. 

CURWEN: 	Why not wait until that legislation is in place before you 
launch HIPs?

COOPER: 		Because I think you would then miss out on a 
huge opportunity to start improving services for consumers and you 
can’t make the perfect the enemy of the good 
 
CURWEN: 	Given the number of outstanding issues, is this going to 
go ahead next June?

COOPER: 		Well we set out the 1st of June as the 
implementation date and we think that all of the bits and pieces should 
be in place by then. Of course we’ve got to have proper trials before 
that and so we’ve got to make sure we learn the lessons for that.  But I 
think we need to get on with this. 

CURWEN	So according to Yvette Cooper, the practical problems 
could and would be solved. But what about Niall’s abiding concern 
which much more fundamental. It was about introducing more certainty, 
by getting buyers and sellers to stick to their agreements. Niall put that 
to the Minister.

CONNOLLY: 	No-one has been able to look me in the eye and 
say that the market will be any more certain after the introduction of 
HIPs than it is today. Property sales are still going to fall through 
because of basic fundamental instability and lack of commitment in the 
market.  Gazumping, gazundering, people walking away from deals 
because they’re simply not committed and there’s nothing in the HIP 
that will deal with that 

COOPER: 		Well we think the first step is to actually 
introduce HIPs and to make sure that people have full information 
because this is a classic case of people doing a deal without information 
and that can cause all sorts of problems, whether it’s about homes, 
whether it’s about cars, whatever it is, not having the information is 
critical. That I think is the opportunity for HIPs. Yeah we’re going to 
have to go further after that, but that’s what the discussions about the 
further legislation are about.

CURWEN: 	And that’s where this programme should have ended. 
But then on Tuesday, came the government’s surprising announcement. 
Despite those assurances the Minister gave Niall three weeks ago, the 
government has now decided it is no longer working towards what it 
calls a “big bang launch” because of “risks to consumers”.  So although 
HIPs will still be introduced next June, and will have to contain the 
searches and the new energy efficiency reports, the heart of the HIP, the 
Home Condition Report, will not be there. The cornerstone of the new 
policy – the part which required the training of thousands of new 
inspectors, a brand new regulatory framework, and a new IT 
infrastructure to allow lenders access to the information – will not now 
be mandatory. And the government can’t currently say when – or even 
if – it ever will be. What prompted the change of policy? On the day of 
the announcement, Housing Minister Yvette Cooper spoke to Eddie 
Mair on Radio 4’s PM programme 

MAIR: 		As you’ll know you spoke to Lesley Curwen just 
a couple of weeks ago. She put to you the concerns that the mortgage 
lenders might not be set up with any IT systems. You brushed those 
aside as vested interests. You did the same when the lawyers’ problems 
were put to you. And now suddenly an about turn.

COOPER: 		Well we do think there have been a lot of vested 
interests throughout this, of people who simply don’t want change and 
we have got to make sure that we have changes that are in the interests 
of consumers. But you know we have been looking in some detail at the 
progress of the automated valuation models, that’s the technology that 
the lenders want to use We’ve also been having a series of consultation 
meetings and discussions. I’ve personally talked to some of the main 
HIP providers, the people intending to provide Home Information 
Packs, and some of the main lenders myself within the last two weeks 
to catch up on where they are. And it’s as a result of listening to various 
people who are going to be involved in delivering this, that we think 
that we need to phase the introduction in order to benefit consumers.

CURWEN:	What did our listener Niall Connolly make of it all? He 
went into his local studio to give us his reaction 

CONNOLLY:		When I look back to the interview we did with 
the Minister three weeks ago she defended absolutely robustly and with 
great commitment the HIPs project. And I am completely baffled to 
face a situation now where three weeks later they’ve entirely 
eviscerated the project. I’d love to think that meeting with the Minister 
and discussing the wide range of uncertainties and concerns about HIPs 
had been influential in causing her to look more closely at the whole 
package.  But I feel terribly let down because I was looking to the 
government to do something real and meaningful. I wasn’t particularly 
convinced by what they were proposing, but they at least did seem 
committed to doing it. Now they’re not even doing that. And the 
elephant that was in the room in 1997 - the issue of uncertainty - 
remains unaddressed,  and I’m left wondering what have we got for our 
9 years of waiting? Precious little.



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