Homes Bill

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Mr. Don Foster: Does the Minister recall the fact that the last time the right hon. Member for Skipton and Ripon raised the matter, his complaint was that the Minister appeared to have a halo?

Mr. Raynsford: I hope that the right hon. Member for Skipton and Ripon will have cause to see that same phenomenon during the passage of this Bill.

Amendment No. 31 is intended to exclude derelict properties from the definition of a dwelling-house, but would not do so, as I shall explain. Amendment No. 32 is intended to omit new homes, or those that are due to be constructed. Our intention is that the marketing of single dwellings for sale with vacant possession should be subject to the seller's pack obligations. There are good reasons for that, which I will come to in a moment.

The definition of a dwelling-house is crucial, and I will jump ahead to deal with the points raised by the almost perspicacious hon. Member for Carshalton and Wallington, who said that he could see only one reference to ``dwelling-house''—in its definition—and wondered, therefore, why it was included in the definitions. Had he looked back to clause 1(2) he would have seen, under the definition of residential property, that a residential property consists of a ``single dwelling-house''—so there is another reference. The term ``residential property'' occurs frequently in part I, and the term ``dwelling-house'' is fundamental to the definition of ``residential property''. I give him full marks for observation and hope that he is satisfied that the one appearance of the phrase that he had not spotted is crucial to that definition.

Mr. Brake: I spotted the look of relief on the Minister's face when the appropriate note was passed.

Mr. Raynsford: I try to be frank on such matters. I hope that the hon. Gentleman will accept that there was an exchange of notes between myself and the officials to check that my interpretation was correct, and they confirmed that it was. I always ensure that my understanding is correct before I give advice to a Committee on such an important matter.

Mr. Clifton-Brown: Will the Minister clarify what is considered to be a dwelling-house in relation to shared use with commercial accommodation? There can be dwelling-houses with common stairwells, common passages, a shop or an office. How, under such circumstances, is the dwelling-house defined, and are the passage and the stairwell and so on defined with it?

Mr. Raynsford: That is a fair point. There are two different sets of circumstances. One he did not mention, but of which he will be well aware, is where residential properties such as mansion flats have some shared facilities. The definition covers the single dwelling within that, but there will be arrangements for leasehold properties. We will discuss those when we deal with the contents of the seller's pack for leasehold properties, for which specific documentation relating to the management of the common parts will be required.

The hon. Gentleman raised the issue of mixed commercial and residential properties. I will have more to say about that in terms of some of the exemptions from the provisions of the seller's pack, because we accept that in some cases involving mixed properties, it may be appropriate for there to be an exemption. That is a complex and difficult subject, which is not germane to the amendments, so I hope that the hon. Gentleman will accept that I will deal with that when we reach the relevant point in the Bill.

The hon. Member for Eastbourne explained that the amendment was intended to exclude derelict properties. However, leaving out

    or intended to be occupied

from clause 1(3) would exempt from the seller's pack obligations the marketing of homes that at the time of marketing are unoccupied, which is a far wider category than that of derelict properties. For example, the category would include properties where the previous occupant had died and his or her executors were disposing of the property. It would also include properties where the owner had moved or was temporarily abroad. I cannot see why any distinction should be made between a property that is currently empty, and being marketed, and one that is currently occupied by the vendor. I do not believe that the amendment is sensible in that respect.

There is a parallel with low-value properties. I understand the concern that in some cases the requirement of a seller's pack might inhibit the sale of a derelict property. However, just as with low-value properties, it is precisely where there is a worry about the structural condition of the property, where there may be serious costs involved in bringing a derelict property back into use, that a seller's pack becomes particularly useful, and we would be reluctant to exempt derelict properties from the requirement to have one.

Mr. Waterson rose—

Mr. Tim Loughton (East Worthing and Shoreham) rose—

Mr. Raynsford: I hope that hon. Members can decide which of them is seeking to intervene. I shall then happily give way.

Mr. Waterson: I hear what the Minister says, but does he not accept that the seller's pack is no more than a report on the home's condition, which is a different kettle of fish from a proper survey? We shall come to the detail later, but it is simply a matter of ticking boxes and setting out in skeletal form the condition of the property. I cannot see—I am open to persuasion—what a home condition report will add that a potential buyer of a derelict property cannot see with his own eyes.

Mr. Raynsford: I am sure that, in his research, the hon. Gentleman has read the format for the home condition report that was proposed by the Royal Institution of Chartered Surveyors. He will know, therefore, that it is extensive and that it covers a large range of issues. He will also be aware that the term ``derelict property'' covers a range of circumstances. I accept that, at one extreme, a property with no roof would be completely open to the elements and totally uninhabitable, that bringing it back into use would involve massive costs, and that a home condition report would be superfluous. That is why I was cautious in what I said about low-value properties.

On Second Reading, I gave a clear undertaking that we would look at the case for making exemptions if they could be justified, but, as the right hon. Member for Skipton and Ripon knows, I was guarded about giving that undertaking because of the importance of the information in the home condition report to people buying low-value properties where the cost of unforeseen repairs could be disproportionate, given the low value of the property.

Mr. Loughton rose—

Mr. Raynsford: I shall give way to the hon. Gentleman when I have finished answering the hon. Member for Eastbourne.

Although I do not rule out the possibility of the exemptions that we have already undertaken to make for certain low-value properties applying also to some derelict properties in certain circumstances, I would be reluctant to extend them more widely. For instance, a derelict property may have suffered a certain amount of superficial damage, but the bulk of the property may otherwise be in good order. Information, for example, about the condition of the electrics or of other elements in its fabric could be important to a potential buyer seeking to decide whether it was appropriate to make an offer and, if so what offer to make, given the potential repair costs.

Mr. Curry rose—

Mr. Raynsford: I shall give way in a moment—first to the hon. Member for East Worthing and Shoreham and then to the right hon. Gentleman.

It is precisely because of the need to be cautious and the wish not to deny the benefits of the seller's pack to people buying properties, especially those properties where the information could be particularly useful, that I am wary of making blanket exemptions. That is why I invite the Committee to reject the amendment should it be pressed to a Division.

Mr. Loughton: The Minister appears to have started making concessions that were not clear. One of the major reasons why three quarters of a million empty homes, which are mostly privately owned, are not brought back into occupation is the cost of the repairs. Ideally, we would like those houses brought back into use to help put people on the housing ladder. It would be a specific disincentive to add yet another cost to selling those properties. It would help his affordable homes policy, with which we all agree, to bring those derelict homes back into circulation by exempting them from that additional stealth tax. It would help bring derelict property back into circulation by acting as a specific incentive.

Mr. Raynsford: The hon. Gentleman is completely wrong. The Government have taken action on a number of fronts to try to reduce the cost of bringing empty property back into use. He will be aware of the VAT exemption announced by my right hon. Friend the Chancellor and of the capital allowances for bringing flats above shops back into use. Those important measures will act as a real financial incentive. As I stressed in response to the hon. Member for Eastbourne, I believe that the availability of a seller's pack will, in many cases, make purchase a more realistic option to those thinking of buying an empty property as it will give them a greater handle on the condition of the property and the potential costs that they may have to incur.

It seems entirely fallacious to suggest that the seller's pack could be an impediment to bringing such properties back into use. In many cases, it could make it easier to attract buyers, to secure successful sales and to reassure buyers who, without the information, would be nervous about buying empty property.

Mr. Curry: We may end up imposing seller's packs on houses worth £500,000, for which the purchasers ought to be competent enough to know what they are doing. However, the Minister is contemplating exemptions on low-value property, which may be subject to first-time purchase. Perhaps it is purchasers of such property who need assistance. Does he agree that there is a real danger that those houses will be labelled as being unable to get a licence, and that they will therefore be described as ghetto properties? Is it not precisely the low-value end of the market—the grotty end, to put it colloquially—that needs help? The idea of imposing the packs on people who are perfectly capable of spending £750,000 on a house seems dotty. A lot of pressure is from those in his party.

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