George Osborne is to consider further measures to curb Britain’s buy-to-let boom, it emerged yesterday.
Ministers will look into whether to hand the Bank of England wide-ranging powers to limit risky lending to landlords, amid fears it is fuelling a risky housing bubble.
The Chancellor revealed he is looking into giving the Bank controls over the rapidly expanding market and admitted he had already written to governor Mark Carney about an ‘imminent’ consultation.
Currently, landlords are not subjected to the same tough lending criteria as ordinary homeowners and it is easier for them to access interest-only mortgages.
But it is understood the Bank could be given new controls to restrict everything from the proportion of buy-to-let mortgages handed out, to the size of loans in relation to borrowers’ income and deposit.
Such restrictions would mark a radical tightening of the relatively unregulated buy-to-let market.
A fifth of all new home loans are now for buy-to-let properties after Britain’s army of landlords grew from 1.5million to more than 2million in just six years.
But the Bank has expressed concerns this could threaten the financial stability of the country, particularly when interest rates begin to rise because landlords could find their loans unaffordable and be forced to sell up, flooding the property market and sending house prices plummeting.
The Chancellor revealed he is looking into giving the Bank controls over the rapidly expanding buy-to-let market
Quizzed by the Treasury select committee yesterday, the Chancellor suggested handing the Bank radical powers in the future.
Pushed on a time frame for a consultation, he said: ‘I think the next couple of months. I have just written a letter to