Bank may limit risky buy-to-let loans

GEORGE Osborne is to consider further measures to curb Britain’s buy-to-let boom, it emerged yesterday.

Ministers will look into giving the Bank of England powers to limit risky lending to landlords, amid fears of a housing bubble.

Currently, landlords are not subjected to the same tough lending criteria as ordinary homeowners.

But it is understood the Bank could be given new controls to restrict everything from the proportion of buy-to-let mortgages handed out, to the size of loans in relation to borrowers’ income and deposit.

Quizzed by the Treasury Select Committee yesterday, the Chancellor suggested handing the Bank radical powers in the future. Pushed on a time frame for a consultation, he said: ‘I think the next couple of months. I have just written a letter to the Bank’s governor Mark Carney. It’s all imminent. It’s happening this year.’

Mr Osborne told the committee the Bank was supposed to ‘identify bubbles and risks in the financial system’ and had recently named the buy-to-let sector as one of them.

But he said he did not want to stop small-time landlords from investing in property, adding: ‘There are many people who have saved hard throughout their lives to buy a little property and rent it out.

‘Those are people we absolutely want to support and help.’

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