After years of planning and debating, Home Information Packs (or HIPs for short) became the law on 1 June 2007. Now, anyone who walks into an estate agent's and puts their house up for sale, by law has to compile a HIP before they can market their home

HIPS cost between £700 - £1,000, and it takes roughly two weeks to get all the information together. There are several companies out there who are specialising in compiling HIPs, including My Sale Pack (www.mysalepack.com, 0870 285 1474).

The packs include a Home Condition Report (HCR), the survey element of the pack. The HCR looks out for defects (subsidence, for example), but falls short of a full structural survey. The HCR does not include a valuation of the property - this means that, in some cases, mortgage lenders will still need to carry out their own valuations. A spokesperson for the Council of Mortgage Lenders says on the matter: 'Lenders need a robust valuation of the property. That information may or may not be contained by the HCR. We believe more than half of the mortgages applied for still require a traditional valuation.'

There will also be an energy efficiency report: this will show how much money a buyer will need to spend to make the property as efficient as possible, and how many years it would take for you to recoup any money spent. Searches, proof of title and planning consents will all be included in the pack.

HIPs transfer much of the costs from the buyer to the seller. Up until HIPs became obligatory, the buyer paid for the valuation and local searches before exchanging contracts, and if anything bad cropped up in the survey the buyer lost out. Now it is the seller who has to pay (although some agents argue that buyers may want to commission a full structural survey for themselves to supplement the HCR). While it might be a hard pill to swallow for sellers, if they then go on to buy another property, they are able to recoup this money.

The idea of HIPS - or sellers' packs, as they are sometimes referred to - is to make the house buying process more transparent so a buyer is armed with the full facts about a property before they commit to a purchase. This, the government feels, will cut down on sales falling through: at the moment, without the packs, one in three sales do fall through, costing the consumer £1m a day, according to the office of the Deputy Prime Minister.

'We think it will make a huge difference to both buyers and sellers,' promises Yvette Cooper, Housing Minister. 'It will save money and make for a smoother process.' She adds that she thinks HIPS will best benefit first time buyers, for they have the least experience of the home buying process. In an interview with The Observer newspaper, she spoke of her experience as a first time buyer, paying for a survey that revealed £10,000 of building work that needed to be done. 'If you've got that information up front - as will happen with the introduction with HIPS - you will know straight away whether you can afford £10,000.'

Not everyone agrees. There has been fierce debate in the run up to the implementation of HIPs as to whether they will solve the problems that the government says they will. By and large, estate agents are broadly against them; David Cameron, has also stated he will scrap HIPs if the Conservatives come into power. Location, Location, Location presenters Kirstie Allsopp and Phil Spencer have also backed a campaign to get them scrapped.

In an open letter to SPLINTA (sellers packs law is not the answer), the presenters state: 'Gazumping, gazundering, chains and the fact that sales fall through because people simply change their minds will, sadly, all still be facts of property life after HIPs come into force. We would like to see cost-effective changes made that would really improve the home buying process, but the Home Information Pack is just not it.' They add: 'The only people who will benefit from these packs are the companies that will make a fortune out of compiling them - and the government, who will get hundreds of millions of pounds each year in extra VAT revenue.' The Jury's still out.