Frequently asked questions
Q: A Home Information Pack is required when marketing starts, but how is this defined in relation to new homes?
A: The question of whether marketing has begun will depend on the individual case. In cases where a ‘land acquired for building’ sign is erected, there is no single residential property identifiable, and the developer does not know what specifically is for sale; this is unlikely to be considered ‘marketing’. However, if the developer is at a point at which reservations can be taken for individual properties, then it’s likely that the developer is marketing individual properties. The important point is that the information in a Pack is designed to help buyers to make decisions about properties. If the developer is at a point where people can start doing this, then a Pack is likely to be needed.
Q: As developers sometimes sell homes directly, sometimes instruct an estate agent and sometimes act jointly, how is the ‘responsible person’ defined under the legislation?
A: HIP obligations (and the penalties for breaching them) apply to the person who is responsible for marketing the property. This is either the seller himself or someone who is acting as the seller’s estate agent. The responsibility of a seller ceases when there is at least one person acting as an estate agent and the seller is no longer marketing the property himself. Where the developer and estate agent are both actively engaged in marketing, they will both be responsible persons.
Q: Is a HIP needed for each individual property if you are selling more than one home to an investor, and does it make a difference if selling on one contract for a number of units or on separate contracts?
A: HIPs are not required for sales of ‘portfolios’ of properties. For this to apply, a number of conditions must be satisfied. First, the sale must involve two or more properties that would otherwise be subject to HIP obligations (whether under a single contract of sale for all, or under separate contracts for each property included in the sale). Second all the properties must be available for sale with vacant possession (unless there is partial occupancy in dwellings in a sub-divided building marketed as a single property e.g. a “granny-flat”). Third, the terms of the sale should indicate that the seller would not accept an offer to buy any one of the properties in isolation, and that this is made clear in the marketing material.
Q: Is a buyer of a new home required to provide a HIP for a home being taken in part exchange?
A: No. In this example, there would be no marketing ‘to the public or a section of the public’, and therefore no duty to provide a HIP.
Q: Will a new build sold off plan only need a predicted energy assessment?
A: In cases where a HIP is required (see above) it should include a predicted energy assessment (PEA) if the property is being marketed off-plan. However, this should be replaced by a full EPC if the home is completed whilst still on the market. If the property is sold whilst still incomplete, there is no requirement for an EPC to be produced.
Q: How are EPC requirements applied to the sale of a converted property?
If the property is incomplete when marketing begins, the HIP should include a Predicted Energy Assessment (PEA) rather than a full EPC (which can only be produced following a physical inspection of a completed building. Conversions that are complete when marketed starts need a full EPC.
Q: If multiple units are being marketed on the same development by the same developer is it necessary to produce a separate HIP for each individual plot or can one HIP cover the whole of the development and be passed to the prospective purchaser of any of the plots.
A: Each property should have its own individual pack. Documents that apply to more than one property can simply be copied across (e.g. searches and evidence of title) but some items, the sale statement for example, can only relate to one property.
Q: Where a new build sold off plan is then resold after completion will it need a new HIP, even though no one has lived in it?
A: Sales of new homes between developers, do not trigger the requirement for a HIP, although an EPC is needed for each of the homes being sold. A sale to someone for owner occupation would require a HIP (if none of the exceptions apply). If that person then sold it on, a further HIP would be required even if the seller had never actually lived in the property. Where a new home is purchased and immediately put back on the market by someone who bought it as an investment a HIP with a new sale statement is needed as there is a different seller. Other documents could be recycled provided that they are in date and comply with the regulations. For example, the searches could be reused if they are no more than three months old when marketing begins and confer third party contractual rights on the next buyer and their mortgage lender.
Q: Can a sale be completed and contracts exchanged in cases where a full HIP does not exist (e.g. a property sold off plan where the buyer is happy with what they see and do not want to wait for a partial HIP)?
A: If the property is marketed it will need a HIP. If the HIP is incomplete at this stage for some reason, the HIP duties would cease when marketing stops so the buyer could agree not to proceed with it. However an EPC will still need to be given to the buyer if the building is completed before exchange of contracts, even though marketing has stopped.