Monday, 28 April 2008

Calls for more regulation

There are some that call for more regulation and taxes to control the housing market.

We do not need more laws or taxes, the market needs to operate in a free market way.

But the regulator and government need to regulate and govern. Everything is now spun that there is no bad news but spinning does not work when things start to happen.

When lenders adjusted their lending criteria from the 2.5 joint income which has been around for decades, the regulator should have stepped in and queried their reasons.

When lenders stopped requiring sight of a mortgage repayment plan the lender should have stepped in.

When lenders stopped checking incomes the lender should have stepped in.

You see the regulator is hopeless and HPI suited the government as every crticism could be met with a rebuttal that the homeowing population were feeling wealthier.

There was only one reason for this boom and it was the uncontrolled relaxation of credit which allowed buy to let to go mainstream and lending levels to go from 2.5 joint to at least 4.25 joint.

Now lenders are restricting access to capital back to what it used to be and the government cry foul.

Sorry Gordon it does not work that way.

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