I've just read a blog of the above title.

It refers to the residential mortgage sector.

Excerpt:

So What Are These New Rules?

From 2013 you will no longer be able to take out a residential mortgage without receiving mortgage advice, therefore ending the practise of either execution only or limited advice services offered by some on line providers and Banks and Building Societies.

Why Has This Been Done?

The main reason why this has been done is to prevent customers over committing themselves to too much debt and to make sure that mortgages are affordable. Pre 2007 we saw an explosion of mortgage products like self-certificated mortgages that did not actually check whether a mortgage was affordable. This often led to a customer falling into mortgage arrears due to becoming over stretched. This was particularly bad not only in this country but in places like Ireland, Spain and indeed the US.

Therefore, these new rules are designed to put greater emphasis on affordability rather than getting a client to overstretch their finances.

What Does This Mean For House Prices?

Well, if there is a greater link to income, this should mean that house prices in the future will be more stable and should only increase by inflation at the most. It is arguable that the boom in house prices between 1997 and 2007 that saw house prices treble in price was mainly due to the availability of easy credit so the opposite could be true in the future as house prices will probably remain stagnant, as mortgage credit is harder to come by, in my personal opinion.

Some will believe that this is bad news but in reality, what the UK has always required is a stable housing market with neither boom nor bust and as already stated these new rules should achieve this end.

What impact, if any at all, do you think this will have on the housing market?

Is it a pre-cursor to regulation of BTL mortgages?

I imagine it is good news for IFA's!

Read the full blog >>> here.

I don't think this makes much difference, it is pre-emptive to stop any "Go Compare" like sites on the internet. Call Centres have exceptions? .. So they can still do execution only apparently.

I'd imagine and hope that most residential mortgages are currently advised and execution only is rarely used.
I really would advise people take advice, but I am biased.

As for Buy to Let regulation they keep trying to regulate shortly followed by a U Turn. Im not even sure why, our mortgage network ensures we comply to most residential compliance - would make little difference to us.

The person writing the blog or the sources they are quoting from do not appear to understand house prices. Advisors are not going to dampen house prices and therefore produce inflation only rises.

The more stable a housing market is the more you will see large deposits and limited feedback based on interest rates. If you can get a fixed term rate for the life of the loan with no charge for early repayment, then the borrowers are isolated from changes in interest rates. Limited forced selling means prices will not react as much to bad economic times. If the owners all have significant equity when they buy, there will be few who end up selling for less than they owe. They might sell at a loss but they will not face repossession.

The original article misses a few important points really.

When the FSA brought out the Mortgage Market Review discussion papers, one of the proposals which sadly won't be implemented at the moment was individual mortgage adviser registration.

It is rumoured that the banks were against this proposal as all of their client facing staff would have to be at least CeMAP qualified - this is where the amendment fell down. As a result, I believe this will still enable High Street banks to still offer some execution only business.

Sadly, many clients I speak to who have gone direct to lenders are unsure after they've returned whether they've been advised or not - that's what needs to change.

On another point, we could well see some movement on house prices if some investors find they cannot gain suitable replacement BTL finance - as the criteria now in place may now mean they can't remortgage - when they choose to.