‘Unsustainable’ buy-to-let market ‘must be regulated’




The Financial Services Authority (FSA) has called the buy-to-let market ‘unsustainable‘, with high incidences of mortgage fraud and arrears a major reason for them to act as regulators.


If buy-to-let remained outside its remit, borrowers who were turned down for residential mortgages – which are already regulated and will be subject to tougher rules under the FSA’s proposals – may try to obtain unregulated buy-to-let loans instead; a process it called ‘gaming’.


The FSA said: ‘Bringing buy-to-let within regulation…would address an identified risk to market sustainability, strengthen oversight arrangements and offer the potential for protecting consumers making investment decisions on property’.






Extending the FSA’s scope to include buy-to-let mortgages would require approval from the Government.