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Lord Rooker: The noble Earl has given an interesting and wholly practical example, and I shall be more than happy to take advice. He would be in trouble only if he had rung me after receiving the phone call to take instructions. Once he had taken instructions, that was it; he would then have been responsible for the marketing of the property. Tipping me off beforehand is not marketing because he had not been told by the vendor that he was the estate agent and I would not know anything about the vendor.
However, situations will arise where three or four estate agents could be seen in the street taking photographs of the same house and walking in and out. It would be obvious to the neighbours that something was afoot. I have said that we want to cover this 100 per cent, but the world is such that you do not cover 100 per cent for the very reasons given by the noble Earl. However, he has asked an interesting question that in due course will receive an answer.
The Earl of Caithness: I am again grateful to the noble Lord for his further full response. This is certainly one of the areas that we will come back to on Report. We considered it yesterday and have done so again today, so I know that it is a matter of concern to many noble Lords. In the mean time, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 194B to 195ZB not moved.]
Clause 141, as amended, agreed to.
Baroness Hamwee moved Amendment No. 195A:
"INCOMPLETE PACKS
A property may be marketed with an incomplete pack in circumstances where reasonable efforts have been made to obtain the missing information."
The noble Baroness said: This amendment provides that a property can be marketed with a pack that is not complete where reasonable efforts have been made to obtain the missing information that would make it complete. By and large, we have not moved again from these Benches amendments that are identical to those moved by our colleagues in another place. This amendment is a duplication, and we have tabled it because the Minister stated in another place that he fully
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appreciated the sentiments behind the amendment and that it would be unreasonable not to take them into account. He ended by saying:
"further, in consultation with industry and consumer stakeholders".—[Official Report, Commons Standing Committee E; 10/2/04; col. 573.]
We are moving the amendment in order to hear the results of the Government's consideration. I beg to move.
Lord Rooker: Amendment No. 195A would provide that marketing could go ahead with an incomplete pack in cases where reasonable efforts had been made to obtain the information. We share the noble Baroness's concern on the issue. I can assure her that regulations to be made under Clause 144(9)(a) will achieve this effect without further amendment to the Bill.
Baroness Hamwee: I am grateful for that. When we see the draft regulations such amendments will not be necessary. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Hamwee moved Amendment No. 195B:
"Residential properties in disadvantaged areas
The duties under sections 137 to 140 do not apply in relation to residential property in disadvantaged areas."
The noble Baroness said: This amendment excludes from the duties under Sections 137 to 140 residential property in disadvantaged areas. It is commended to us by the Law Society, which says that the term "disadvantaged areas" is found elsewhere in legislation. It has been defined for the purposes of special stamp duty exemption. Noble Lords who live in certain areas south of the river but close to Westminster will be aware of the special stamp duty exemptions.
The Secretary of State may seek to make regulations in respect of low value properties in areas of low demand where the cost of the pack preparation is a disproportionately high value of the property. At the other end of the scale it is suggested that standard home information packs will be wholly inadequate for large or unusual properties. In this case I am seeking to draw the Minister's attention to the lack of proportionality where the property is of low value. Rather than pointing to the individual property, this is a similar blanket exemption drawing on the analogy of the stamp duty provision. I beg to move.
Lord Rooker: I understand the reasons why the amendment has been moved. I cannot accept it, but I believe that I have a reasonably positive answer. If it is considered necessary, it has always been our intention to make special arrangements for sales of low value properties in low demand areas in regulation and not on the face of the Bill. This could be done under
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regulations made under Clause 143, which enables the Secretary of State to provide for other exceptions from the home information pack duties.
Alternatively, we believe that the regulation-making power in Clause 144 enables the Secretary of State to tailor the contents of the home information pack. This power could be used to make different provisions for different areas and different descriptions of property. The noble Baroness spoke very briefly, but it is important to put this on the record.
The amendment concerns the effect that home information packs could have on the sale of low-value properties, particularly properties suffering from low demand. People based in the south-east, the London-centric people, have difficulty getting to grips with the idea of low demand and falling prices. I can assure them that in parts of the north-east and north-west that is indeed the situation. It was a matter of some concern in the Homes Bill, which was before Parliament before the last general election. We promised to consult further on that important issue.
Since then, we have commissioned further and more detailed research and consulted on a range of options for addressing any problems that these proposals might cause for sellers in low-value, low-demand areas. The consultation paper and an independent report on the outcome of that consultation have been made available to the Committee.
This is a difficult issue. I know I shall be asked on what date and when it was deposited, but no doubt I shall find out before I sit down. I can assure the Committee that it is not a secret document. We need to strike a balance between, on the one hand, any disproportionate effect of introducing compulsory home information packs for very low-value properties—I am talking about properties that are sometimes bought and sold in pubs for less than £5,000 in the north-east—and, on the other hand, the need to avoid stigmatising the properties or the area even more than they are now. We also want to avoid creating anomalies and denying the benefits of the pack to buyers who may be particularly vulnerable in the absence of good information about the home that they are buying.
It was certainly the view of the researchers that the Government should not make special arrangements for sales of low-value properties. That was also the view of the majority of those who responded to the consultation exercise. If the Government were to intervene, the best option was felt to be a cash limit, so that those sales below a prescribed amount would be exempted from some or all of the home information duties.
Interestingly enough, the option that found no favour whatever was one that would have attempted to define areas in which different arrangements for low-value sales would apply. That would rule out, for example, the housing market in all Pathfinder areas, the nine areas of the country that are well defined on maps. People who live in those areas know that not all
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properties are low-value and low-demand properties, but they are the most difficult places in the country. If anyone thought of doing that it would be ruled out.
In view of the outcome of our research and consultations it would not be appropriate to put an exclusion on the face of the Bill. We want to do the right thing for those who live in areas where the housing market is not functioning properly. We shall consider all views before deciding whether it is appropriate to make special arrangements in regulations for those properties.
We have heard the speech of the noble Baroness—I do not criticise it—but she did not address some of these issues. The next sentence in my brief, which I am almost reluctant to read out bearing in mind the constraints that we are under, says that I shall report back to my right honourable friend the views expressed in the debate on this amendment. It is no good if the noble Baroness expresses no views and I am the only one to do so. In other words, we have addressed the issue.
There has been some research and consultation on the matter which has steered us away from what would be a seductive solution for people with whom we do not want to be disproportionate and heavy-handed, but we do not want to make matters worse than they already are by stigmatising a particular area. If we come to some arrangements, there is capacity in the Bill to do that in regulations. The probable way through would be to put a cash limit on it, so that homes marketed at less than a certain value would have a different set of rules.
This is a very difficult issue. We are talking about people's homes. People do not like being told that they live in low-value, low-demand areas, but they know when they do. When there is large-scale abandonment of properties, street by street, it is a very serious situation. The Pathfinder programme is beginning and, as I say, it really only started full operation this year. We have announced the early funds to eight of the nine areas—the final one will probably be settled before the end of the year. They were levering much more money than we are allowing them, but it is not a five-minute programme. It is not even a five-year programme in some cases. We have to deal with that. But people are buying and selling homes in these areas and we have to take account of that fact.
The unusual thing about the market renewal pathfinder programme is that it is the first time that I can recall any housing renewal programme having as a policy objective the aim of raising the value of properties in the area. Nor did that happen with any schemes that I dealt with for my former constituents—whether it was housing renewal areas, housing action areas or urban regeneration areas—although that may have been a spin-off of those schemes. But one of the avowed policy objectives of the housing market renewal programme is to raise values in the area, restoring the equity and giving people the confidence to invest in those areas and to recreate those communities.
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Obviously there is a massively complex programme of work to be undertaken. While that is happening, we do not want to cause any stigmatisation by putting a red line around those areas. Therefore we will look at this matter as it is a serious issue. As I said, I welcome any comments on the matter.
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