The Bank of England seems set to be given greater powers
over the buy-to-let market, after the Chancellor expressed concern about the
housing "bubble". A consultation was launched late last year after
the Financial Policy Committee, which is part of the Bank of England,
recommended it should be granted the power to direct regulators to require
lenders to restrict buy-to-let loans. The powers included allowing the FPC to
cap the maximum loan-to-value ratio (the size of the loan relative to the value
of the property), as well as the costs of debt servicing relative to rents. The
FPC, whose role is to identify and head-off possible risks to the financial
system, has had similar powers over residential mortgages since April last
year. Read more on the Sky News website.
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