Home Information Packs – a basic guide for developers

A Home Information Pack or HIP is defined under section 148(2) of the Housing Act 2004 as “a collection of documents relating to the property or the terms on which it is or may become available for sale.”

The information required in a HIP for new build homes is very similar to that required for older homes. However, you will need to ensure that you consider whether the property is being sold off-plan and then take this into account with the information contained in the HIP. For example, with properties sold off-plan you will be unable to obtain an Energy Performance Certificate (EPC), as these can only be produced on properties that are available for inspection. Therefore, you will need to provide a Predicted Energy Assessment (PEA). The PEA will be based upon the specifications for the property and should be upgraded to an EPC once the property is build complete and it has still not been sold.

A new home is defined in the Home Information Pack (No. 2) Regulations 2007 as a home that is being designed or constructed, or a home that has been constructed but that has never been occupied. This definition does not include converted properties.

What a new home HIP must contain

 A new home HIP must contain the following:

1. An index;
2. A Property Information Questionnaire (specific to the plot);
3. An EPC or PEA;
4. A Code for Sustainable Homes certificate or interim certificate;
5. A sale statement;
6. Evidence of the title;
7. A copy of the proposed lease (if selling a leasehold property); and
8. Searches – local search and standard water search.

Developers are unable to begin the marketing of a property until all of the required elements of the HIP have been requested and paid for (or at least a commitment to pay for them has been made.) You must also have the basic HIP information available before marketing a property. The basic information required for marketing are the index, Property Information Questionnaire, EPC/PEA, sustainability certificate, sale statement and evidence of title. Once this information has been complied, the HIP is ready to market, albeit not a complete HIP. You then have 28 days in which to ensure that the completed HIP is available.

When is a new home HIP required?

If you sell the plots on a development individually, they will each require a HIP. However, if you are selling completed dwellings to another developer then you will not normally require a HIP, as you have not offered the property for sale on the open market. You will, however, still require an EPC for each plot sold as a completed dwelling.

Sales to a registered social landlord are also generally exempt but the regulations on this are far from straightforward.

Should you sell a portfolio of properties, these are generally exempt from HIP requirements under regulation 30 of the Home Information Pack (No. 2) Regulations 2007. For example, if you sell two or more properties to an investor under a single or multiple contracts, and indicate within the terms of the sale that you would not have accepted their offer on the properties in isolation and make this clear when marketing, then no HIPs are required for the subject properties. There is also no HIP requirement for mixed-sales under these Regulations.

Only homes marketed to the public require a HIP, even if the home is offered on a shared-ownership or shared-equity basis.

Code for Sustainable Homes

From 1^st May 2008, where the local authority has received a building notice, initial notice or full plans application the new homes involved must have a Code rating. The Code uses nine categories for measuring the sustainability of a new home. However, assessing a property against the Code is not compulsory, but you must ensure that the HIP either contains a nil-rated certificate if the home has not been assessed, or if the home has been assessed against the Code then a rating must be included.

Availability of the HIP

Any potential buyers are entitled to a copy of the HIP or any part thereof if they request the same. You have 14 days from the request in which to provide them with the information, and you should make no charge for providing the information to them unless they request the same in paper form. You can then make a reasonable charge for copying and postage.

Whilst you are marketing the property continuously there are no requirements for you to update any of the information contained within the HIP, except that you must replace the PEA with an EPC should the property be completed prior to sale.

The legislation surrounding HIPs can be very complex and this article simply scratches the surface. If you have any questions regarding the legislation relating to a particular development or new home then please do not hesitate to contact me on helen.chaproniere@mablaw.co.uk and I will be happy to help and advise.