CFI: NACFB
Buy-to-let regulation in store may be unnecessary by Chris Ferguson, NACFB
the FSa has taken steps closer to regulation of the buy-to-let market but is this really necessary and what would this potentially achieve? adam tyler, ceo of the
nacFB, recently commented: “many lenders have been treating the buy-to-let sector as a regulated sector for some time and this certainly hasn’t led to them or their clients getting into trouble.” the growth in the buy-to-
let market has led to a raft of amateur investors getting into financial difficulties and the range of tV programmes and plethora of millionaire landlord tales has led to the sector often being viewed as a “get rich quick” scheme. But it is vital that investors see the market for what it is - a commercial investment that also has the potential for investors to make losses.
adam tyler
went on to say: “With a buy-to- let investment, the investor will be expected to do the research to see that their chosen investment veh- icle -
the
property itself - is suitable, is in the
right
location, and complies with all the necessary l e g i s l a t i o n . Basically that it is a good investment. “the invest-ment vehicle
for a buy-to-let is a property not itself a financial product, so the FSa will be unable to protect consumers here.” Whilst the nacFB is not
anti-regulation, adam tyler underlined the potentially expensive issue of regulating the buy-to-let market and cast
doubt on what regulation would achieve. “We are happy to work with
the FSa to discuss potential solutions,” he said. “But the current market seems to have enough problems right now and it seems a shame to spend millions on a magic bullet that we doubt will hit its in
tended target.” With house building at its
lowest since 1923 and the demand for
ineffective rental
accommodation growing in the uK, it would seem that introducing costly and potentially
regulation would only add to the woes of the housing crisis.
CBI growth predicted at gloomy lower level of 0.9%
the cBi has announced some rather gloomy news with a forecast for growth in the uK at 0.9% this year, claiming that the uK will narrowly avoid recession. the 0.9% predicted by the cBi is well below the
government’s previous
predictions of 1.7% this year. it also said that despite the
downturn in expected growth, the austerity measures should be maintained to ensure that the uK’s aaa rating stays in place. John cridland cBi director
general said: “the government must stick to its plans to bring down the deficit to maintain confidence in the uK’s public finances and keep the cost of borrowing down.” a number of factors have
been blamed for the reduced expectation of growth with
the eurozone crisis being cited as a likely problem for the reduction in uK exports. However, the report was
not all gloom - it did predict that inflation would reduce over the coming year with the government target rate of 2% likely to be met by 2013.
50 mortgage introducer DECEMBER 2011
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