Home-buyers and industry beware!
Interesting debate in the House of Commons yesterday (16/07/08) spanning several topics including:
- How homebuyers know Home Information Packs (HIPs) are unreliable - Remarkable insights!
- Why homebuyers insist on paying for their own HIP using independent lawyers - Revealed!
- Discover how 'a substantial number of conveyancers' could not be ignored by the Carsberg Review - Exposed!
- Unveiled! How one man convinced NHER to write secret EPC message that endangers thousands of EPC ratings!
Plus, Iain Wright, Parliamentary Under-Secretary for the DCLG (Department for Communities and Local Government), officially announces RdSAP update from September 2008 to "allow additional data input where it is considered appropriate by the energy assessor".
Before we get to that, though, a run-through from the top.
Home Information Packs (HIPs) "unreliable"
Lead protagonist in this debate is Angela Browning, Tory MP, whose opening salvo, to my mind, appears to backfire upon further examination, but that's for you to decide.
She begins by rolling out a curious piece of artillery in the form of a report published by Leeds Legal, professional lawyers in Leeds, which claims 57% of lawyers surveyed nationally, want rid of the HIP.
OK, everyone is used to reading that by now but here's where the grenade seems to bounce straight back off the wall.
Quoting Mr. Stephen Pickard of law firm Lupton Fawcett, and spokesman for Leeds Legal, she said:
...most of the buyers I've acted for since Hips were introduced have regarded the content of the packs as so unreliable they've commissioned providers like me to supply the information independently.
So buyers are judging HIPs to be unreliable.
Why on earth, then, commission another?! Or do two unreliable packs equal a reliable one?
Of course, those questions assume homebuyers know what they are judging.
A point picked-up by Simon Thomas, interim executive board member of IPPA (Independent Pack Providers Association), who said: "We would be interested to discover how these buyers came to regard their HIP contents as unreliable. I assume it is the various searches that are being referred to, in which case, it's worth noting that most buyers will previously have not paid much attention to these documents, and therefore would have little experience on which to base this opinion."
"Is it, in fact, Mr Pickard who has convinced his clients of the need to purchase additional documents? I don’t understand how else his clients would have reached this conclusion."
Hold that thought because it does beg another question.
Angela Browning goes on to state, as fact, that: "...we now know that despite the fact that sellers must by statute pay to have HIPs produced, a lot of buyers do not value them at all - do not even look at them"
(Yet, nevertheless, buyers insist they are unreliable so ask to pay for another!)
She makes that assertion based on submissions made by conveyancers to the Carsberg Review - which, from my cursory reading (and that is all that's required) is itself largely premised upon sentiment and assumptions.
She continues by quoting from the review:
...a substantial number of conveyancers ignore its existence and recommission searches on receiving instructions from their buyer client, suggesting a lack of confidence in the limited content.
Mis-selling Home Information Packs
In whose best interest is it for a conveyancer to "ignore its existence and recommission searches on receiving instructions"?
A point not lost on Mr Thomas: "The only new document in the HIP is the EPC; the remaining contents are exactly those that conveyancers have been using for years. Why have they now become unreliable?"
Leaving aside the valid issue of "expired" searches, is there not a case for mis-selling here? Otherwise, why aren't "substantial" numbers of HIP providers taken to court under the Trade Descriptions Act, at minimum?
I wonder when consumer groups will latch onto this.
And how serious can we take the Carsberg Review when it even considers 'evidence' from practitioners who "ignore its existence"?
Make your mind up!
Before we move on to Energy Performance Certificate matters, Simon points out how prior to her Carsberg Review citation, Angela Browning drew attention to the angst of buyers being charged for hard copies of the HIP.
"Ms Browning quotes the Carsberg Review as saying, 'few buyers have shown an interest in the HIP'. She then immediately claims that 'a lot of buyers do not value them at all—do not even look at them', yet earlier she complained that buyers are having to pay to see them!"
"It all seems rather contradictory", he notes.
Domestic Energy Assessors with sore necks
The Right Honourable Lady moves on to recite the tale of one constituent of hers who discovered - sigh - that a DEA had failed to notice three solar panels on the roof!
A cause for concern which we will return to below.
It seems the DEA couldn't even manage to look down either:
Furthermore, they assumed that there was a solid floor when in fact there was not.
Which touches upon the conversation I had with Neil Bleakley of Stroma on the podcast discussing how the EPC could explain the assumptions made.
RdSAP deficiencies
Sensing she's on a roll, she turns to the RdSAP next, firing mortars into the exposed flanks of its methodology. She shares the story of an architect, Mr Dyke, who had self-declared his home to have a SAP of 60 back in 1998. Recently, however, it was blessed with a 44 under the RdSAP conventions of the domestic Energy Performance Certificate (EPC).
Not content, the architect wrote to the then Housing Minister, Yvette Cooper, and demanded to know why.
Whilst awaiting her response, he tackled NHER which, in turn, provided background information to the assessment of his home, which recorded that:
- "Wall insulation is not accurately reflected.
- Roof insulation assumed in respect of the age of the building...
- RDSAP cannot reflect retro fitted, under-floor insulation."
Plus other (undisclosed) details besides.
Ignore this EPC
OK, this is the Reduced SAP. It's never going to be as comprehensive as the full version; the profession knows this (and this blog has already revealed how one homeowner removed his property from sale after receiving a poor EPC rating on his carbon neutral home), however...
Apparently, thanks to his persistence, the architect managed to secure his own 'exemption notice' [my spin] from NHER which would appear to effectively over-rule the unsettling results of his EPC. Over to Tory MP, Angela Browning:
"He managed to negotiate with the national home energy rating (NHER) scheme an agreement that he could write, with its approval, on his official energy performance certificate and on the estate agent's documentation [the following]:
Since the introduction of the HIP legislation, the assessment procedure used for producing the energy performance certificate (EPC) has been monitored.
The EPC is a comparison tool and there are limitations in the model that may lead to a property like this being rated lower than is actually the case. Further information can be obtained from the Agents and detailed literature is included within the Home Information Pack appertaining to this property."
I did try to contact Brian Scannell of NHER for his take on this but, to be fair, it was late in the day so no one was available.
But it would seem, on face value at least, that Angela Browning may be leading to a valid point: "The point that I want to make strongly to the Under-Secretary is that what applies to Mr. Dyke's property surely must apply to thousands of other older homes throughout the country."
Indeed, why stop at older homes?
Trading Standards
Having traced-out the silhouette of Mr Wright's frame from the wood-panelled wall with gunfire, she does the gentle-lady thing and suggestively threatens war-by-proxy on effectively all active battalions in the field of EPC implementation, not forgetting our uni-directional DEA:
The lady with the solar panels that were not noticed asked whether I could bring the matter to the attention of the relevant authorities, because trading standards should have an interest in it. That is a pertinent point.
If the Government are forcing people to pay money not only for a flawed process but for the unsatisfactory standards applied by those who undertake it, and those people consequently suffer material loss, I hope that every trading standards department in the country will take an interest.
She is also demanding a written response from Mr Wright on NHERs' "damning report".
She raised a number of other points and even declared more weaponry tucked away in her backpack. But instead of unleashing them she stood-down to allow room for surrender.
Govt to write to estate agents
In response to the disinterest in HIPs amongst buyers and sellers, Iain Wright revealed that CLG was drafting "correspondance" to estate agents reminding them of their "statutory duties" and commanding them to proactively make buyers aware of the HIP.
RdSAP to allow additional data
Responding to the limitations of RdSAP, Mr Wright admits it to be the cheap, fast, broad-brushed solution that could never deliver accurate results for all, but reclaimed some ground by announcing software amendments, to be introduced in September, that allows for additional data about the property to be recorded by Domestic Energy Assessors (to include things like cob construction, for example):
We will therefore update the software in September to allow additional data input where it is considered appropriate by the energy assessor.
Housing market and further improvements
Lastly, Mr Wright hinted further improvements would be dictated by market conditions:
She mentioned that she is unhappy with the performance of HIPs and EPCs. In the light of current economic difficulties and particularly the drying up of mortgage finance, I would suggest that the last thing required in the housing market is needless tinkering.
Home Information Packs: 16 Jul 2008: House of Commons debates (TheyWorkForYou.com)
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