The FSA says regulating the buy-to-let market alongside the residential mortgage market would be beneficial.
FSA director of conduct policy Sheila Nicoll told delegates: “It is a matter for the Government to decide whether we should regulate buy-to-let, but we certainly see benefit in having the buy-to-let market regulated alongside the residential mortgage market.
“We are very alive to the issue of buy to let and the European mortgage directive. One of the problems is that the buy-to-let market is far larger in other member states, such as Germany, so it is difficult for them to see why it should not be regulated but the FSA is very aware of the industry’s concerns on this.”
Paragon Group chief executive Nigel Terrington said: “My fear is that there is apathy among other European countries on the UK’s fears about regulating buy to let under the directive. There will be a horse trade between the various EU countries, which will all come to the directive discussions with a number of issues they want to be included or excluded.
“Whether buy to let is excluded will depend on whether we can get enough support from other countries to get this pushed through.”