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Shapps keeps up the heat on MMR

Housing minister Grant Shapps has once again joined in the debate on the Mortgage Market Review saying the regulator’s measures must be “proportionate” and “avoid unnecessary prescription.”

In a written response to a question posed by Robert Syms, the Conservative MP for Poole, Shapps says the government shares the underlying objective of the MMR but wants to see regulation that supports access to homeownership.

Syms asked Shapps what discussions he has had with the Financial Services Authority on the MMR and whether he has assessed what impact the measures will have on house prices.

Shapps says: “The new government are committed to supporting aspiration to homeownership and shares the underlying objective of the Mortgage Market Review to create a stable, sustainable market for all participants. We must avoid the boom and bust that the property market has experienced in the last decade.

“We want to see a regulatory framework that supports access to homeownership and new housing supply while preventing repossessions.

The government believe the Financial Service’s Authority’s changes must be proportionate and avoid unnecessary prescription on the mortgage industry.”

He says his officials are working closely with the FSA and the Council of Mortgage Lenders on these proposals and will continue to do so.



Dish of the day

As the mainstream market remains constrained, there’s growing appetite for bridging loans to plug the gap, which bodes well for the sector in 2011

Why prevention is better than cure

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  • Lee Chester 8th December 2010 at 5:21 pm

    Any idiot can see Paul should be working for the Bank of England.

  • Paul 8th December 2010 at 4:25 pm

    “but wants to see regulation that supports access to homeownership.

    Any idiot can see that the biggest hurdle for access to home-ownership now is not credit availability, but house prices.

    Any idiot can see that a short-term squeeze in credit availability will result in lower prices, allowing for greater access to homeownership as
    deposits as % of house prices increase, making more people eligible under the LTV cap, and price/wage ratio decreases, making servicing the debt easier.

    And before people start bleating about how high house prices are good for the economy, they are not. HIgh house prices feed into everything and make the economy ultimately uncompetitive, as evidenced by a recent OECD report. Our economy needs rebalancing away from the last decade of malinvestment into unproductive assets and into wealth-generating business activity.