Home Information Packs will become mandatory in June

Some suggest that it will add an unnecessary layer of expense and bureaucracy to the house selling process - others that it brings much-needed transparency.

BBC News explains what the packs will mean for homeowners and the housing market.

I want to sell my house and have been told that I will need a Home Information Pack (Hip). What are they?

The packs contain information that will be useful to any potential buyer.

Copies of title deeds, any recent planning permission or building consent given on the property, a local area search and an energy performance certificate will all be in the pack.

From 1 June, everyone who puts their property up for sale will be legally obliged to produce a HIP. Failure to produce a HIP can lead to a substantial fine.

This will initially apply to England and Wales only - but Scotland is set to get its own version of Hips in 2008.

PACKS WILL INCLUDE Evidence of title Copies of planning, listed building or building regulations consents A local search Guarantees for any work on the property An energy performance certificate.

What are energy performance certificates?

The idea of the certificate is that, at a glance, would-be buyers will be able to see the properties energy efficiency - a bit like when buying a fridge.

The homeowner will also be presented with some tips on how the energy efficiency of their home can be improved.

Energy performance certificates kill two birds with one stone - providing information for homebuyers and ensuring the UK complies with an EU directive which comes into force in 2009.

Under the directive all homes have to be energy rated once every 10 years.

However, the cost of having a property's energy performance assessed has been estimated at anything from £100to £150.

An army of assessors have been trained up to inspect properties new to the market and issue certificates.

Why are the packs being introduced?

Hips have been in the offing for a decade.

The Labour government went into the 1997 general election promising to introduce Hips, with the express intention of reducing the number of property sales which fall through.

The idea is simple: the more information that is presented to the buyer upfront, the slimmer the chance of a nasty surprise scuppering the sale further down the line.

I remember that originally Hips were meant to contain a structural survey - has that plan been dropped?

Yes.

Last year the government announced that Hips would, for the time being, not have to include a structural survey.

Many thought that dropping the requirement to have a survey would mean that the whole Hip project would be shelved.

However, the government has pressed on with Hips and told the legal and estate agency industry - which have both objected to the introduction of the packs - that they had better prepare for 1 June.

How will I organise getting a pack?

That is unclear at present. However, estate agents are expected to offer to act as go-between for pack providers.

Alternatively, homeowners maybe able to approach pack providers direct.

I have read that these packs could cost up to £1,000 - is this true?

This is probably a bit of an overestimate - but you can probably expect to pay £400-£700 for a Hip.

Potential buyers will not have to contribute to the cost of a Hip.

Will the packs make the buying and selling process easier?

However, they may want to get their own local authority searches done and mortgage companies will still insist on a proper valuation.

My estate agent has advised to sell my house before the packs are introduced, is this a good idea?

Anyone who gets their property on the market before 1 June will not need a Hip until January 2008.

However, if lots of homeowners rush to get their properties on the market before 1 June it could cause a glut which in turn could depress prices.

I am buying a property. How much store should I set on the information in the pack?

The information will be useful but it may soon be out of date. Your solicitor may well advise that you get your own searches done.

Your mortgage provider may also want fresh property searches.

In other words, they may well disregard Hips.

Will the packs speed up buying and selling?

That is the big hope - but also the big unknown.

Some solicitors and estate agents have suggested that the introduction of Hips will actually slow down the buying and selling process.

They say that a shortage of energy assessors means there may well be delays in putting Hips together.

However, the Association of Home Information Pack Providers, which is overseeing the launch of the scheme, states that there will be plenty of assessors ready for 1 June.

BBC News website 16.5.07