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Rics: Hips rollout will hurt first-time buyers

Tuesday, 13 November 2007 12:00 AM

The government's home information pack (Hip) scheme will push property further out of reach of first-time buyers if they are rolled out to include one and two-bedroom properties.

That is according to the Royal Institution of Chartered Surveyors (Rics), which claims Hips have resulted in a reduction in the number of properties coming onto the UK housing market since they were introduced in on August 1st.

Up to 67 per cent of surveyors questioned by Rics stated there had been a fall in the number of three-bedroom or larger houses coming onto the market during September when compared with the same month in 2006.

"With prospective buyers and sellers currently taking a 'wait and see' approach to moving, activity in the housing market is grinding to a halt," said RICS spokesperson, Jeremy Leaf.

"The housing minister needs to understand rolling Hips out to one and two-bed properties could find first-time buyers caught between a rock and a hard place as accessibility to the market would go off the scale."

The Rics survey found while there had been a 26 per cent fall in the number of properties coming onto the market, the fall was only six per cent among properties not requiring a Hip.

"Lack of smaller properties for purchase will force first-time buyers to remain in the lettings market where rents are already climbing at the fastest pace in over eight years," continued Mr Leaf.

"If the Housing minister genuinely wants to improve the plight of first-time buyers, she should not continue with this flawed policy."

However, Hips were unsurprisingly strongly defended by the Association of the Home Information Pack Providers (AHIPP).

"What Rics appear to have forgotten is first-time buyers stand to benefit the most from the introduction of Hips. With the vendor responsible for acquiring the Hip, costs will be eliminated and buyers will be able to make a more informed decision from the offset," said Paul Broadhead at AHIPP.

"Research among our own estate agency members suggests while the supply of property on the market is lower than usual at this time of year, the actual stock on estate agents books is not.

"This would suggest a lack of buyers in the market place, and as most buyers are sellers they are unlikely to put their home on the market if they are not thinking of moving."

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