Buy-to-let sector 'does not need extra regulation'

The government should think again over plans to regulate buy-to-let mortgages, it has been suggested.

According to the Building Societies Association BSA, any such move would be to the detriment of investment in the private rental sector.

Extending regulation to such mortgages would fail to address the underlying issues in the buy-to-let sector, the BSA has argued, and potentially lead to the withdrawal of lenders.

Paul Broadhead, head of mortgage policy at the BSA, said including buy-to-let mortgages in the same regime as owner occupied mortgages would "not be practical".

Subjecting investors to affordability and suitability assessments is not appropriate, and would result in a further constraint in the supply of quality housing to the private rental sector, he added.

Last week, Paragon Mortgages reported that UK buy-to-let remortgaging activity continued to decline during the final quarter of 2009.

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2010-02-15 12:48:20 © Moneyextra.com