Hips loophole may not benefit seller

Posted: 11 Sep 2007 12:39:46 GMT


            Property News - Hips loophole may not benefit seller

Many homeowners may choose to start advertising their properties in different ways as Home information packs (Hips) begin to affect the market.

Many homeowners may choose to start advertising their properties in different ways as Home information packs (Hips) begin to affect the market.

According to Abbey, there is likely to be an increase in the number of two-bedroom properties with a ‘large study’ entering the market as sellers look to avoid the cost of Hips.

The company has published research which shows that 8.5 million homeowners are now prepared to advertise their property as having fewer rooms in order to avoid paying for a pack.

Hips were introduced to properties with three or more bedrooms on September 10th and the seller is required to pay for them.

However, the average Hip is estimated to cost around £400 and Abbey warns that sellers may find themselves worse off by making their home appear smaller and, therefore, bringing down its value.

"While Hips might seem a hassle we think it would pay in the long run to play it a straight rather than going through this loophole. By remarketing your home as a two-bedroom house with a study, you'll become invisible to thousands of potential buyers that are searching online, specifically, for three or four bedrooms and above," said Nici Audhlam-Gardiner from Abbey.

"You might also make your property seem over-valued as potential buyers will be comparing the price of your bigger abode against someone else's, which is likely to appear to offer better value due to the reduced number of bedrooms in your property," she added.

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