House sellers not at risk with HIP scheme

By Victoria Richards
Posted: 2009/04/06

THE Department for Communities and Local Government accused a property law firm of "scaremongering."

House sellers could be prosecuted under new laws governing controversial .

Property law firm Fridays warned that a revamped version of the Home Information Packs scheme, which comes into force next week, could lead to owners being sued by potential buyers.

It includes a questionnaire which - according to the firm - would enable potential purchasers to claim for any out-of-pocket costs, if answered incorrectly.

The test puts questions such as, "Is your property a listed building or contained in a listed building?" and "Are you aware of any flooding since you have owned it or before?"

Legal experts say that falsely answering any of the 30 questions - even in error - could result in a "property misdescription" lawsuit.

Simon Seaton, co-founder of Fridays, said the questionnaire would act as an erosion of "caveat emptor" - "let the buyer beware" - whereby a buyer cannot recover money from the seller for defects on a property after a sale is completed.

Claiming it could also cause gazundering where buyers force down the price of a property at the last minute.

Mr Seaton said: "It arms the buyer with ammunition to gazunder which in the current market is the last thing we need."

But the Department for Communities and Local Government accused Mr Seaton of "scaremongering" and that sellers could fill in "don't know" to any of the questions.