HIP: Should You Use a Third Party or Go Direct?
When selling a property it can seem like there are a hundred and one things to do. Aside from organising finance for your new home, moving your belongings and making sure everything is in order in your new house you now have to also take the time to put together a Home Information Pack.
The HIPs toll out began on August 1st 2007 will all properties with four or more bedrooms requiring a HIP. Now that rule applies to all homes, regardless of size. The Home Information Pack must be completed before the property is even put on the market.
But with so much to do you might be inclined to pass the buck when it comes to organising the HIP.
HIP ProvidersThere are many companies who exist solely to provide Home Information Packs. These firms will compile all the necessary documents for you – including optional extras such as the Home Condition Report – and make sure the HIP is in order before you market your property.
These firms, of course, have to make a profit and so they will charge a fee for putting together your HIP.
You may find that your estate agent offers to arrange for the HIP to be compiled. The estate agent will source a provider and instruct them of what you require without you having to do any work whatsoever. However, be warned that this may end up costing you.
Hidden ChargesHaving an estate agent take the pressure off you and sort out the Home Information Pack may seem like the easiest option and in some cases can be beneficial. However consumers should bear in mine the issue of commission.
When you go direct to a HIP provider you will pay the price of the HIP plus the fee the provider charges. When you use a third party such as an estate agent he or she will also want to take a cut.
Obviously the HIP provider is not going to want to surrender any of his fee in order to give the estate agent payment. Therefore the price of the HIP can increase dramatically. In some cases consumers can end up paying almost twice the cost of the HIP in order to cover the estate agents commission.
Why Do Estate Agents Get Commission?It may seem odd that a HIP provider would be willing to increase the price of his product in order to give the estate agent a big commission but due to the nature of their job, estate agents can mean big business for HIP providers.
Estate agents deal with home sellers every day of their working life. If a HIP provider strikes up a good relationship with an agent he can establish a regular flow of new business. By giving the estate agent a decent commission he can ensure that the business continues to flow his way.
With a number of HIP providers in the market, having access to regular new business is invaluable.
Consumers should be aware though that the provider the agent has a working relationship with may not necessarily be the cheapest or more cost effective.