Treasury consults on Bank powers of direction over buy-to-let market
Week in Westminster
Published: 18 December 2015 | Author: Michelle Vosper
The Treasury has published its long awaited consultation on new powers of direction for the Bank of England over the buy-to-let market in the UK. If granted the new powers the Bank will be able to direct the Prudential Regulation Authority and the Financial Conduct Authority to require lenders to place limits on buy-to-let mortgage lending in respect of loan-to-value ratios and interest coverage ratios. We issued a statement commenting on the consultation.
In advance of the Housing and Planning Bill’s report stage in the House of Commons on 5 January, the government has tabled a raft of amendments many of which are aimed at reducing the regulation of social housing.
The Commons CLG committee continued taking evidence on its inquiry into the housing association sector and right to buy. On Monday the committee considered what lessons can be learned from elsewhere in the UK with witnesses from Scotland and Northern Ireland giving evidence. The committee also examined the role of the social housing regulator as well as the impact of the government’s proposals on the availability of finance in the housing sector.
On Tuesday the CLG committee heard from the housing minister Brandon Lewis on what he sees the role of housing associations being in the future. There was some discussion around the deregulation of housing associations and how this might affect lender confidence. The minister was also asked about the government’s new proposals for Help to Buy: Share Ownership and possible challenges in securing mortgages. Mr Lewis commented: “One of the challenges around shared ownership has been the secondary market as well, making it easier for somebody to move on and up the ladder, to sell their shared ownership property and their part of that shared ownership, so we will be talking to lenders around that. Also, it is a product that has been so heavily regulated that it is quite difficult for the sector to move forward, so we are looking at that at the moment, working with housing associations, the private sector and the lenders to put together a package that means that we can get that streamlined a bit, to really give it a turbo-charge and see more come through.”
The CLG committee has also this week announced a new inquiry on the government’s National Planning Policy consultation, including looking at the delivery of Starter Homes.
There was an opposition day debate on housing introduced by shadow housing minister John Healey. He moved a motion attacking the government’s “five years of failure” and its proposals within the Autumn Statement which he argued would not lead to the construction of homes needed by young people and those on ordinary incomes. He said that the Housing and Planning Bill would reduce the availability of affordable homes. And he suggested that extending the Right to Buy to housing associations would benefit “speculators, second home owners and buy-to-let landlords”.
The House of Commons is now in recess and is next expected to sit on Tuesday 5 January. The House of Lords will rise on Tuesday 22 December and return on Monday 11 January.
Scotland’s deputy first minister and finance secretary John Swinney unveiled the Scottish Government’s Draft Budget for 2016-17. The main announcements included:
- No change to the Land and Buildings Transaction Tax(LBTT) rates, but an additional 3% surcharge for those purchasing a second home costing more than £40,000.
- Commitment to build 50,000 affordable houses in the lifetime of the next Parliament and will increase the budget for affordable housing by £90 million in 2016/17 to invest £690 million in housing supply.
- Continue to provide £35 million to eradicate the impact of the “bedroom tax”.
The Scottish Parliament debated the general principles and approved the Rural Affairs, Climate Change and Environment Committee’s stage 1 report on the Land Reform (Scotland) Bill.