The report reasons that this measure will help first-time buyers (FTBs) onto the housing ladder.
Councils would be allowed to designate some locations as 'housing growth areas' which would give priority to FTBs and restrict sales to buy-to-let investors.
The report does not make it clear if this measure would be a permanent ban on letting the new properties affected, or whether this restriction would lapse over time.
The market restricting measure it appears would be an attempt to control property prices by restricting demand from UK based and foreign in investors, particularly in London boroughs where many properties have been snapped up by investors from far-eastern countries such as China.
This comes on top of new Labour Party policy announced by Ed Milliband in the summer which sent shock waves through the landlord community: the introduction of rent controls, compulsory long-term tenancies, restrictions on landlord evictions and a compulsory national register of landlords.
Alan Ward, Chairman of the Residential Landlords Association has today said:
?We welcome the report?s objectives to beef up the role of housing in Government, but the reality is that to secure the homes it needs, greater support has to be given to the provision of homes to rent.
?This report will choke off investment in the only housing tenure that has been growing and risks taking the country backwards. Perhaps little surprise as the reports' commissioners didn?t include a representative of the private rented sector.
?Today?s report falls into the trap of being too focused on the Capital to the determinant of the rest of the country. We need a one-nation housing policy, not a one London one.?
The private rented sector (PRS) now represents 18 per cent of all homes in the country, a big increase from the 9% it represented immediately following the deregulation of the rental market brought in by the Tories in 1988.
The Royal Institution of Chartered Surveyors (RICS) an organisation which contributed to the review has welcomed the report?s findings saying 'It makes a number of recommendations that will make a real difference to meeting housing need across the UK.'
?We particularly welcome proposals for housing growth areas, mandatory local plans and Olympic-style new homes corporations. We held roundtables for the Lyons Housing Review and provided member insight into many topics. Chartered surveyors and RICS member firms have demonstrated their influence in providing real solutions in order to drive economic growth and build better communities.?
Article courtesy of LandlordZONE