Inspiration

HIPS – The Opportunity is Greater than the Debate

Stop faffing about over the detail – there’s profit to be had today

I recently presented what was billed as a “motivational address” to a group of about 130 NAEA members about “Branding and the HIP Opportunity”. Other speakers included key industry figures such as NAEA CEO Peter Bolton-King, former NAEA CEO Hugh Dunsmore-Hardy and Cathy Cant, the then HIP Programme Manager at the Office of the Deputy Prime Minister.

As you might expect, discussions over the rights and wrongs of HIPs, confusion over policy and detail, and disagreement over implementation were expressed passionately by speakers and audience alike, and I had to bite my lip on occasion. My role was not to express an opinion about HIPs, but to help agents spot the commercial opportunities that HIPs presents.

However, what struck me was the surprisingly narrow and defensive view taken by a number of estate agents. Agents usually have a keenly entrepreneurial spirit and tend to be good at spotting, creating and harnessing potential business opportunities.

Yet so many agents appear intent on finding fault with what is admittedly a hasty and largely ill-thought-out piece of legislation, that they run the risk of severely cutting off their nose to spite their face.

One of the possible causes of the dissent is that estate agents have a differing view of how the public will react in reality when HIPs are introduced. I suggest the divide is actually not as great as it appears but has been distorted by the way the public’s response is gauged. For example, the Government says it has undertaken extensive research into public opinion and has overwhelmingly found the public to be in favour of the introduction of HIPs. So how come agents feel the public will be so anti-HIP?

I suspect the Government’s research survey posed a question such as “Would you be in favour of legislation that speeds up the antiquated home buying process in the UK, reduces fall-throughs and provides a simpler home-inspection system?”. You can guess what the answer is likely to be because it is autosuggestive in favour of HIPs.

The question could be just as autosuggestive when asked by someone who disagrees with HIPs; “Would you be in favour of legislation that would cost you up to £1000 just to put your house on the market, and prevent you from marketing your house immediately”. See what I mean?

As estate agents we wield tremendous influence over how the home-buying and selling public regards the process, and we can choose to use this to our own, and our clients’ advantage. Or not!

Having been an estate agent in South Africa where on one occasion I actually received my (7%) commission cheque on the same day as agreeing the sale, which was the same day as listing the property, I would be among the first to embrace an overhaul. However, whilst I think it is absolutely right that key players in the industry, such as those heading up SPLINTA (Sellers' Pack Law is Not the Answer) should lobby for the most intelligent solution to some of the frustrations of the English and Welsh system of property transfer, we should also take the opportunity to harness some of the benefits of HIPs that have undisputedly been identified, irrespective of what form HIPs may or may not take.

Whilst it is of course wise, responsible, professional and duly diligent to keep fully abreast of any legislation that does go ahead, up-beat agents will be adopting elements of HIPs today! Why wait for implementation day (1st June 2007) when you can take advantage of impressing your clients today! I used a version of HIPs for years and my agency clients are now milking the opportunity and consequently finding a substantial increase in their conversion ratios, saleability of stock and fee levels.

I understand there are at least 145 HIP providers in the UK, most of whom will be wanting to secure your business. But few appear to provide the flexibility required for you to be able to deliver powerful easily-implemented solutions where you take the credit! Oh yes – and the commission! HIPs are a tremendously powerful way of not only raising your commission levels, but you can also make money on each HIP provided! And they are really easy to sell as well, especially when they form part of a strategic pre-instruction pack.

When you choose a HIP provider do make sure that you choose one (let me know if you would like contact details) who will support your current practices by allowing you to nominate your known solicitors and home inspectors, as you will have built up relationships with these over the years. Likewise, the process needs to be as close to “hands-off” as possible so you can get on with what you do best - marketing and selling property.

By demonstrating that you are a pro-active agent who is helping you clients take advantage of the benefits of a HIP, you are creating real distinction for your agency and positioning yourself way ahead of those who just sit there moaning about the various devils there may be in the detail (although all credit to those who are lobbying to smooth out the issues anyway).

Indeed, you could even promote the fact that you are part of the Government’s early adopters by registering as one of their trialing agents (contact dionne.campbell@odpm.gsi.gov.uk for more details).

If you search the phrase “embracers and…” on Google, you get embracers and resistors, embracers and detractors, embracers and hangers-back, embracers and opposers, embracers and rejecters and embracers and dissenters. I generally find that successful people tend to be those who embrace the broad-brush opportunity, despite the risks associated with the detail.

For example, until the 1970s, Switzerland was known for its watches. The Swiss spurned quartz movements as they believed people would always prefer traditional watch movements. Japan now has over 90% of the global watch movement market! ‘Nuff said.

Are you a resistor, detractor, hanger-back, opposer, rejecter or dissenter, or one who embraces opportunity and uses it to your advantage, today?

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© Richard Rawlings 2012
Richard Rawlings is the founding director of Estate Agency Insight, which specialises in helping estate agencies harness opportunity through innovative method, marketing, publicity, and training. He can be contacted at or on 0845 838 1354.

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