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Regulators concern over prices

Buy-to-let landlords face tighter borrowing

To letBuy-to-let landlords face restrictions on their borrowing ability amid concerns that they may be destabilising the economy.

The Bank of England’s powerful finance policy committee said it is concerned about the rapid growth of the sector which may force borrowers to over-stretch themselves.

If landlords see their loan repayments starting to exceed their rental income, many would respond by selling their property – potentially accelerating a downturn in the property market.

Buy-to-let lending has grown by 40% since 2008 — 20 times faster than lending to owner-occupiers – fuelled by individuals switching out of other poor-returning investments and concerns over pensions.

 

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