29
Jan
2008
Hips reduce speculative marketing
The government’s home information pack scheme (Hip) scheme has begun to make an impact on the property market, with a fall in the number of speculative sellers in decline.
According to AA Legal Services the Hip scheme has “undoubtedly reduced speculative marketing” – potentially to the benefit of the market.
“Hips naturally focus the mind of the seller before marketing their property,” said James Molloy, product manager for AA Legal Services.
“We hope that now only those who have a genuine, considered desire to sell their property enter the market at the front end, and Hips have undoubtedly reduced speculative marketing.”
Hips were made compulsory for all properties from December 14th, completing a three-stage rollout process.
And their impact is likely to be positive in the long term, according to the AA.
“There are many commentators who will argue that speculative rather than deliberate marketing provides for fluidity of supply in the market that ‘oils the wheels’ of the property market, and that view undoubtedly has some merit.
“But it is also true such lack of commitment has contributed to, in my view, an unacceptable level of aborted transactions in the pre-Hips era,” explained Mr Molloy.
Before the scheme was introduced as many as one in three property sale chains were broken, according to the Financial Times.
This may, now, be about to change.
“It will ultimately be for economists to provide the fullest answer, but my view is that where we see a reduction in broken chains, a large contributing factor is the introduction of Hips,” concluded Mr Molloy.