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George Osborne has announced that he wanted to give the Bank of England more powers to regulate buy-to-let mortgages.
The announcement which came out of the blue is in response to Mark Carney the head of the Bank of Englands repeated warnings that a buy-to-let bubble could represent a threat to the stability of the economy.
Changing Housing Market
The changing housing and mortgage market now means that the proportion of Britons owning their own home has fallen to a 26 year low. Many house buyers are unable to obtain a large enough mortgage to enable them to buy there own home and the Chancellor responded to an overheating London housing market by restricting banks to be able to lend no more than 15% of mortgages to people borrowing over 4.5 times their income. Despite the worries over an overheating buy-to-let market lending still remains below the amount borrowed in the boom just before the financial crash.Up until recently the Chancellor had resisted calls by the Bank of England for greater controls over buy-to-let mortgages. However, he has now responded to MPs questions by stating:
"The Governor of the bank and the FPC (Financial Policy Committee) have asked for additional powers over buy-to-let mortgages, which weren’t included. We have granted those powers so that they have that tool as well.”
Previously in 2014 the Bank of England had asked the Chancellor for additional powers to cap the size of landlords mortgages based on their expected rental income. The Chancellor decided against this instead putting the matter out for further consultation and thereby 'kicking it into the long grass'.
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5 comments:
Clueless Carney and the cretinous Osborne don't know what they're doing.
Utter morons.
Before using words like 'clueless','cretinous' and 'morons' you should at least find out what they actually mean; and check that they are applicable in the context they are to be used. This reputable forum is not the place for ranting. A more useful comment would have included constructive descriptions of what would benefit all the interested parties.
If you have a good idea then please share it with us. Your posted personal opinion and comments have not benefited anyone nor enhanced any argument that you might have.
Unless Carney was actually expressing concern over the latest tax relief cuts on BTL mortgage interest which will lead to many portfolios being unviable without the shedding of considerable debt leading to a dumping of property and a possible collapse of prices what's the point? BTL mortgages as a business model in the old sense are all but dead and will be in three years for private individuals.
It should be "their own home" not "there own home".
Sorry to point this out but I was a professional journalist for 20 years and seeing this kind of mistake in a published text really HURTS.
Blame spellcheck, which can't distinguish the purpose of a word to correct the spelling (and you must be a lover of "Eats, shoots and leaves" even though it isn't aimed at spelling).
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