AMI, the Council of Mortgage Lenders, the Building Societies Association, the British Bankers’ Association and the Treasury have all worked together to oppose the incorporation of buy-to-let under EU regulation since the first draft of the European directive.
But at a Mortgage Introducer roundtable this week Sinclair said that in the past couple of weeks the trade bodies have had to move on from fighting against regulation.
He said: “We’re probably not going to win that debate therefore we have to work out how to structure what we would want out of this.
“If we go into a standard mortgage affordability model then buy-to-let isn’t going to work.
“We’ve got to change European thinking how that buy-to-let model structure works because it’s already been identified that this is going to be a fundamental part of what forms the fabric of the UK going through the next decade.”
Sinclair also discussed the time scales for the EU Mortgage Directive saying a revised draft would probably be published in November followed by further debate and then its first vote through the European parliamentary body around February next year.
He said: “The likelihood is that it could hit law at earliest point June next year, therefore two years after that to implement.”
Paul Broadhead, head of mortgage policy at the BSA, added: “It remains our belief that buy-to-let regulation should remain outside of the EU directive as it is inappropriate to treat it in the same way as residential owner occupied lending.
“It is clear that the Commission would like to regulate buy-to-let lending and that there is some support for this amongst some MEPs.
“In the course of our analysis of any regulatory proposal it is common for us to fully assess the impact on both industry and consumers.”
Broadhead said that as part of the analysis, discussions with other industry bodies were common to ensure that new regulation didn’t have any unintended consequences on the market.
He added: “It is still early days in terms of progress of the directive so we will continue to assess developments with other industry partners over the coming months.”
