Prescott plans a new disaster for house sales
John Prescott, the man who doesn't pay his council tax, will soon face another major embarrassment. This is the chaos he will unleash by introducing a serious new complication to homebuying, due to cost homeowners £1 billion a year - all because he wishes to disguise his need to obey a Brussels directive.
From June 2007, it will be illegal for anyone to offer a house or flat for sale without paying up to £2,000 for a 100-page "Home Information Pack", prepared by a certified inspector. This "HIP" will contain details of legal and council searches, and a "Home Condition Report", checklisting the kind of details obvious to a fairly rudimentary visual inspection. (Buyers will still need to commission a full structural survey and valuation.)
This is a flimsy cover, however, for the real motive behind Mr Prescott's HIP scheme - his obligation to comply with EC directive
2002/91 requiring every home put on the market to have an "Energy Performance Certificate", based on a formula which measures the size of a property against recent fuel bills.The more closely surveyors, estate agents and lawyers look into Mr Prescott's scheme, the more horrified they become, not just by its pointlessness, but by the damage it is likely to inflict on the property market. According to his officials, it will require up to
7,500 inspectors, each needing 18 months' training. The latest figure for inspectors in the pipeline is only 1,800, so when the scheme comes into force in 18 months, less than a quarter of the required number will be available.Nevertheless, anyone caught by trading standards officials selling a home without an HIP will be liable to a summary penalty up to £500. The shortage of inspectors means that, unless Mr Prescott is allowed a postponement from Brussels, delays of months, even years, will be inevitable, creating havoc across the domestic property market. The initial cost of commissioning an HIP will be incurred by the estate agent, to be added to the bill when the property is sold. Although the Government's estimated cost for an "average" property is only £700 including VAT (quite onerous enough for sellers on low incomes), in many cases the cost will be as high as £2,000, and perhaps even more. Few vendors will wish to pay such sums more than once, particularly when the cost of copying a 100-page report for each prospective buyer could be £15 or more. Gone will be the days of offering a home through more than one agent.
One horrified observer of this "disaster waiting to happen" is Philip Collings, formerly the IT director for Railtrack, who has just launched a website
But Mr Collings also believes he has spotted a loophole in the scheme, by which homeowners could avoid having to pay for HIPs. Although he is not revealing the details yet, for fear of counter-action by Mr Prescott, he is inviting property owners who are likely to sell within two years to register their interest on his website, so that in due course he can sign them up, for a modest fee, to an arrangement which he believes could save them thousands of pounds and months of hassle