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Lord Avebury: I looked at the definition of "estate agent" in Clause 132(1) to which the Minister referred. It states:
"A person acts as estate agent for the seller of a residential property if he does anything, in the course of a business in England and Wales, in pursuance of marketing instructions from the seller".
If the owner of a property instructs the webmaster to put it on the website, is that not in pursuance of marketing instructions? I am not quite so certain that the definition has the meaning which the Minister has ascribed to it. I would sooner he took advice on it from those who are familiar with these matters than give me an off-the-cuff answer in Committee.
Lord Bassam of Brighton: I am happy to take further advice. I have had some advice. In that situation, the webmaster is probably operating in the same way as a newspaper or broadsheet. That takes us back to the question of who is the vendor. It is not the webmaster.
Lord Phillips of Sudbury: The Minister mentioned the figure of 5 per cent. I took that to mean 5 per cent of properties marketed. My strong impression is that the majority of people who try to sell their houses themselves are not successful and they eventually end up with estate agents. If the amendment were not accepted, all would-be direct sellers would be driven into the estate agency market. The Government may think that is a good thing; I think that it has an impact on people's choice and freedom.
Baroness Hamwee: The amendment has certainly taken us into unexpected areas. The noble Baroness,
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Lady Hanham, has quite understandably anticipated some amendments that will come later. In identifying that the only novel item in the home information pack is the house condition survey, she rightly reminded us that the survey will not necessarily be adequate for lenders and that not everyone now chooses to have one. I suspect that it is often people whose finances are on a knife edge in making a purchase who take the calculated risk of not having a survey carried out. The Government are seeking uniformity, but what they are proposing contains a strong element of nannying.
The noble Lord, Lord Borrie—the siren, whom I shall now think of as Lorelei—said that when one talks of consumers, one normally thinks of purchasers. I agree with that in a commercial context, where the seller is selling a number of similar or identical items. It is not the case here. I am not sure whether the noble Lord made the same point, but I shall clarify our position. In proposing the amendment, we are not suggesting that one DIY seller in a chain would exempt others in the chain producing home information packs. We shall certainly come back to the issue. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 185C not moved.]
Clause 137, as amended, agreed to.
Clause 138 [Duty to provide copy of home information pack on request]:
The Earl of Caithness moved Amendment No. 185D:
"( ) A seller or responsible person acting on the instructions of the seller may decline to provide a potential buyer with a home information pack until such time as an offer for the purchase of the property has been accepted by the seller."
The noble Earl said: Amendment No. 189A has been grouped with this amendment. I do not think that it bears any relation to Amendment No. 185D so I shall degroup it. I shall come back to it as a separate amendment.
Amendment No. 185D is a simple amendment. When discussing an earlier amendment, the noble Baroness, Lady Maddock, referred to people who come along "shopping for particulars". They look at a vast number of houses before they narrow down their search. If each of them wants a home information pack, a huge amount of extra paperwork and wasted time will be involved in preparing those packs. The packs are not going to be insubstantial documents.
Members of the Committee will know that I pointed out at Second Reading that an Office of Fair Trading report noted that in Denmark, which the Government think offers such a good comparison that it has to be used in their arguments, the home information pack now goes up to 800 pages. There will be a lovely lot of people carrying around 800 pages. But do they have to carry around 800 pages? If somebody comes to me and asks for a home information pack and I know that person is not going to buy the house because he has looked at five other properties and has yet to buy anything, can I say to him, "No, I am not going to give
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you a home information pack. You can look it up on the web". Does that satisfy the requirement for providing a home information pack? Or do I have to give him the 800 pages of material that he is never going to read and then throw away? How many more trees will have to be cut down to satisfy this demand?
As a result of the present Bill, there will be a huge amount of abortive costs. I probed the Minister, the noble Lord, Lord Bassam, earlier, on whether he thought there would be such costs in the future. He backtracked a little from what I believe he said earlier, and said "We're not quite certain. We can't quantify it". I can tell him that there are a great many abortive costs in any housing market; even in the Scottish system, where they are going to have voluntary packs. If I put an offer in for a house in Scotland and it is accepted, that offer—in the vast majority of cases—becomes binding. Therefore, if, say, 20 people all want a house, there will be 20 surveys, only one of which will be part of an accepted bid. That means abortive costs for 19 other people. It does not matter which market we look at: New South Wales, Denmark, Germany or America. To proclaim that there will be no such costs, or that they will be any different from the alleged £350 million at present, is a misrepresentation of the true situation.
This amendment is designed to save abortive costs, and to allow the seller—or the agent acting on behalf of the seller—to say "I've got a home information pack, but you can't have it. You come forward with your offer, and if it's accepted, I'll give you the pack". I beg to move.
Lord Avebury: I think it is a very good idea, as the noble Earl has said, for home information packs to be provided on the web. It is not absolutely clear to me, from the way the Bill is worded, whether that would discharge the duty to make the pack available. If vendors did not wish their HIPs to be generally available to the public at large, they could make the information on the web password-protected, so anyone going to the estate agent and expressing an interest in a property would be given the necessary password, and would then have access to the pack. If the Bill allows information to be provided in that way, I warmly welcome it, because that would cut down unnecessary information and encourage estate agents to be more web-friendly than they are at the moment. I know most of them are already fully alive to the benefits of electronic marketing, but if it were made clear on the Bill, which at the moment it is not, that displaying the pack on the web would discharge the duty to provide the same, it would be extremely welcome.
Lord Bassam of Brighton: Perhaps I could remind your Lordships of what the Bill actually does, before I make my points on why we cannot accept this particular amendment. The Bill places two main duties on those responsible for marketing property. The first duty, in Clause 137, is to have a home information
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pack in their possession while the property is on the market. The second duty, in Clause 138, is to provide a copy of the pack to a potential buyer who asks for it. As most of your Lordships now probably understand, that is a qualified duty, and subsection (4) of Clause 138 sets out circumstances where no copy has to be provided. Essentially this is where there is no prospect of the property being sold to the person making the request.
The effect of the amendment would be, as the noble Earl accurately described it, to convince sellers, although they have a home information pack in their possession, to refuse to provide a copy of it, even to a genuine potential buyer. The noble Earl expressed it very well—in short, the colour of the person's money should be shown before he gets access to the HIP. We cannot accept that. It is, after all, the primary purpose of the pack to enable buyers to reach a well informed decision on the most significant purchase they will make. As far as we are concerned, this amendment would completely undermine that purpose, and for that reason I cannot accept it. I invite Members of the Committee to reject the amendment.
The Earl of Caithness: Could the noble Lord, Lord Bassam, answer my question, which was supported by the noble Lord, Lord Avebury? If somebody comes into my office and says that they wish to have a home information pack, can I refer them to the one on our website, instead of having to give them paper?
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