Treasury to review proposed changes to buy-to-let regulation
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The Treasury says it will review some of the proposed changes to buy-to-let regulation to ensure it is proportionate.
In a report, Mortgage Regulation: Summary of Responses, the Treasury says it will consider how best to protect the customer from detriment caused by poor investment choices and unaffordable borrowing.
The Government also says it aims to introduce proposals which are proportionate for individual professional landlords.
The report says: “The Government remains convinced that it is right to introduce regulation of buy-to-let, to better protect consumers from the harmful practices seen in recent years and society from the potential wider impact of those practices on the financial markets.
It adds: “The Government will examine how to ensure the impact of regulation on the buy-to-let market is proportionate, particularly for individual professional landlords. It will also consider how best to protect consumers from the range of possible causes of detriment that may result from buy-to-let including, if appropriate, the consequences of poor investment decisions as well as unaffordable borrowing.”
The current proposals were initially due to be formed by the FSA but the Treasury is now in consultation as to what parts of the market need regulating.
Last month the Council of Mortgage Lenders warned the Treasury against extending the scope of buy-to-let regulation,arguing that it would not result in increased consumer protection and would capture an inappropriate range of commercial transactions.
Further consultations on buy-to-let regulation will be looked at after the Government has reflected on its responses to a consultation on investment in the private rented sector, which closes on April 28.
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