Chancellor George Osborne has decided to give the Financial Policy Committee powers to place controls on the buy-to-let market.
The Treasury had been due to consult on whether to give the FPC powers over the buy-to-let market after giving it the power to cap LTIs and LTVs in the owner-occupied.
Speaking in front of the Treasury select committee yesterday, Osborne confirmed he had taken the decision to grant the committee powers over the sector but go into specifics about the devices available to it.
He said: “The governor of the Bank of England and the FPC have asked for the additional powers and we are in the process of granting those.”
Asked how his comments relate to the Treasury’s plans for a consultation on the changes, the Chancellor responded that the exchequer would chiefly be considering “how they have those powers”.
He added that he hopes the FPC will be able to exercise its new abilities “as soon as possible” after they are formally granted.
However, just last month the FPC said it had no “no immediate cause” to take action in the buy-to-let market. But it did say it is “alert” to the sector’s rapid growth and “potential developments in underwriting standards”.