Buy-to-let ‘woes’ for landlords mounting, as analyst warns that BoE ‘will be watching you’

| Rosalind Renshaw
City analyst Jefferies has warned that more buy-to-let lending controls could endanger the housing market – but that the Bank of England will stay on the case of property investors.

The Bank of England has said it will crack down on buy-to-let lending. The Bank yesterday said that “it remains alert to the rapid growth of the UK buy-to-let market” and said it “could pose a risk to broader financial stability”.

Investment bank Jefferies said that yesterday’s Financial Stability Report from the Bank of England added to the woes of the rental sector as all political parties now appear to be pro ownership of homes.

Jefferies yesterday said “an elephant on the pitch remains” in the form of buy-to-let lending.

Jefferies added: “Buy-to-let demand may reduce, but the real issues in our view are that housing supply remains too low and that aspirational home buyers do not have sufficient deposits to secure a home.

“Unless these issues are addressed, tinkering on the side will not, in our view, do much to address the current supply / demand imbalance and continued house price growth looks likely.

“If ever there was ‘code’ for the Bank of England to say ‘look out, I’m watching you’ it is that your activity ‘may have implications for financial stability’.”
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5 Comments

  1. AgencyInsider
    December 2, 2015 at 08:26

    The Bank yesterday said that “it remains alert to the rapid growth of the UK buy-to-let market”

    Where the heck has the Bank of England been for the last 20 years? If they have only just woken up to the ‘rapid growth’ in BTL they are incompetent.

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    1. mrharvey
      December 2, 2015 at 08:52

      I have to agree. I’m wondering what their prediction is for the ultimate implosion of the market. If it has taken them that long to realise that buy-to-let is legitimately popular, I think we should take their words with a pinch of salt.

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  2. seenitall
    December 2, 2015 at 09:27

    “but the real issues in our view are that housing supply remains too low and that aspirational home buyers do not have sufficient deposits to secure a home.

    “Unless these issues are addressed, tinkering on the side will not, in our view, do much to address the current supply / demand imbalance and continued house price growth looks likely.”

    Errrrr  stop feking around with the agents/rates/blamegame  start building more houses.   Already been told 1000 times before.

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  3. surreyagent
    December 2, 2015 at 09:35

    aren’t we forgetting the younger population won’t be able to buy unless a major correction which isn’t in anyone’s best interest and also aren’t we moving more to the European model where everyone rents longer??? the younger lot are more transient with jobs and where they live and therefore there is a market for quality rental accommodation and if the PRS are slow on the uptake then someone has to take up the slack…….

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    1. mat109
      December 2, 2015 at 19:30

      I’m young. How is a major correction not in my interest?

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