HM Treasury

Consultations & legislation

Regulating the sale and rent back market: a consultation

02 June 2009

The sale and rent back market offers homeowners the option of selling their properties at discounted rates in exchange for tenancy arrangements. A range of stakeholders, including the mortgage industry and consumer groups, has expressed concerns regarding this market. In light of these concerns, at Budget 2008, the Government asked the Office of Fair Trading (OFT) and the Financial Services Authority (FSA) to investigate the sale and rent back market, focusing on consumers’ experience of these arrangements, and consider options where appropriate to strengthen consumer protections. On 14 May 2008 the OFT announced that it would conduct a formal market study, working to an expedited timetable in light of stakeholder concerns.

The OFT published its report on 15 October 2008. The OFT’s report identified a number of risks to homeowners entering into these arrangements and made three recommendations to Government, including compulsory regulation, increasing consumer awareness and improving information about housing benefits.

The Government accepted these recommendations, and published a consultation on regulating the sale and rent back market on 6 February 2009. The consultation lasted 12 weeks and closed on 1 May 2009.

The consultation is available below in Adobe Acrobat Portable Document Format (PDF). If you do not have Adobe Acrobat installed on your computer you can download the software free of charge from the Adobe website. For alternative ways to read PDF documents and further information on website accessibility visit the HM Treasury accessibility page.   

The Government published a summary of responses to legislation on 1 June 2009. The Government also laid before Parliament secondary legislation to bring sale and rent back agreements within the scope of Financial Services Authority (FSA) regulation.


Alongside the Government’s consultation, the FSA published its consultation on a potential interim regulatory regime.  The FSA’s consultation closed on 30 April 2009. The FSA will publish shortly details of its regulatory regime, which will take effect on 1 July 2009 subject to Parliamentary approval.

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