Home Reports 'will ruin market'

CONTROVERSIAL new Home Reports which will add hundreds of pounds to the cost of selling homes in Scotland should be postponed until the current turmoil in the housing market subsides, according to property experts.

The three-tier reports – including a seller's survey, an energy performance report and a property questionnaire – are being introduced as a legal requirement by the Scottish Government in all house sales from December 1.

But hundreds of property agents in Scotland are now calling for the launch of the reports, which will cost sellers £600 on average, to be abandoned until the housing market shows signs of recovery.

Agents predict that although house values in Scotland are currently stable, they could fall later this year, as they have in England, because of the general squeeze on mortgage lending caused by the credit crunch.

They argue that the speed of transactions has already slowed and the planned introduction of Home Reports will lead to even longer delays and fewer homes being put on the market.

The Glasgow Solicitors Property Centre, which represents more than 300 member firms in the west of Scotland, has written to Communities Minister Stuart Maxwell, saying: "The unprecedented change in the property market over recent weeks makes this a particularly bad time to launch such a fundamental change in the way residential property is bought and sold in Scotland.

"Given the recent turmoil in the financial markets and the reduction in funds available for mortgage lending, it will come as no surprise to you that selling residential property has become increasingly difficult."

The GSPC adds that the recent slowdown in the market

means a significant number of homeowners could be left with a substantial bill for a Home Report without ever selling their home, while the number of homes coming onto the market could fall significantly.

The Highland Solicitors Property Centre, which represents property agents in the north of Scotland, said it supported a postponement.

Spokeswoman Sarah Woodcock said: "December is traditionally a quiet time of year in the housing market and I would hate people not to put their property on because they say they can't afford to because of the Home Report."

Tayside Solicitors Property Centre said the housing market in its area was "flat" and the December launch date was the "wrong time".

"It couldn't be a worse time really," said spokeswoman Helen Wyllie. "Properties are taking longer to sell than they were a year ago and introduction of Home Reports at this time will only slow procedures further. We would prefer them to be held back until the market is more buoyant."

Home Reports were conceived by the former Labour-Lib Dem administration at Holyrood to end the problem of multiple surveys in a booming housing market, in which would-be buyers were each paying hundreds of pounds for home surveys on one property.

But although that problem was largely solved by the adoption of the "sale subject to survey" system, Home Reports survived the change to the SNP Government last year. With the addition of energy and property questionnaires, the package became the means to improving Scotland's housing stock and meeting new Brussels requirements on environmental standards.

Despite the endorsement of the Scottish Consumer Council, which believes they will raise housing standards, they have proved unpopular with homeowners. A voluntary pilot scheme launched in Edinburgh, Glasgow, Dundee and Inverness in July 2004 had to be scrapped after seven months, when only 74 sellers commissioned surveys compared with a planned 1,200.