House prices rise by six per cent in 12 months
JERSEY house prices have risen by six per cent in the past 12 months and are now more than £100,000 higher than the Guernsey average.
The latest figures from Statistics Jersey indicate that it is becoming harder for first-time buyers to get on the property ladder as prices have grown steadily over the past five years.
And those in the rental sector are finding it just as challenging, with prices up ten per cent in the last three months and seven per cent overall on 2017.
Among the key findings in the house price index are:
*The average property price in Jersey is £480,000.
*Jersey prices are more than double the UK average and on a par with London.
*Rental prices in Jersey increased by ten per cent compared to the previous quarter and increased by seven per cent compared to the same period in 2017.
*A two-bed flat in Jersey costs on average £412,000.
*There were 408 property transactions between April and June – the second-highest number in a single quarter since 2015.
The figures show that the four-quarter rolling average – which aims to iron out fluctuations by averaging the quarterly prices across the whole year – is the highest it has been in a decade, despite prices actually dropping slightly from the previous quarter.
Meanwhile, an online petition to the States calling for rental prices to be capped at a ‘reasonable’ level has passed 1,000 signatures – prompting a response from Children’s and Housing Minister Sam Mézec. If the petition surpasses 5,000 signatures within six months it will be considered for a States debate.
And Gill Hunt, president of the Jersey Estate Agents Association, admitted that it was becoming increasingly difficult for first-time buyers to take the first step on the property ladder and more and more young people were turning to their parents for financial help.
She said that while it was positive to see a market where demand is high, there would ‘come a point where wages simply cannot sustain’ the increasing prices both in the buying and rental markets.
She said: ‘If you look at a one-bedroom flat, even then you are looking at needing two incomes of £30,000 each.
‘Some of those people looking to buy their first property are getting help from family just to get started.’
According to the figures, the average one-bedroom flat would cost £258,000 while a two-bedroom apartment would be in the region of £412,000.
She added that she would like to see the States fund more ‘last-time buyers’ properties for those looking to downsize – potentially freeing up more family homes.
‘It is difficult for people to move out of a three-bedroom home, for example,’ she said. ‘The shift to go up to a four-bedroom is quite big, while if there are people looking to scale down then the supply is not there – not everyone wants to buy an apartment in town.
‘We feel the politicians should re-look at something for last-time buyers in the parishes. It might free up some of the three-beds and allow first- or second-time buyers to move into them.’
Dan Edmunds from Statistics Jersey said the increase in property prices – particularly in flats – had probably stemmed from the number of high-quality new developments coming onto the market in recent times.
The average property price in Jersey is now on par with London while Guernsey’s average – which is measured in a slightly different way to Jersey – is more than £100,000 less.
Mr Edmunds said: ‘The cost of housing in general in Jersey is quite a bit higher.
‘It wasn’t that long ago that Guernsey was slightly higher [than Jersey]. Now we are substantially higher than theirs.
‘We have seen a six per cent rise on this time last year – Guernsey has gone the other way. Jersey is seeing broadly one per cent population growth each year while Guernsey seems to be relatively static. That is reflected in terms of the number of new builds, the demand on houses and the price.’
The House Price Index is released by Statistics Jersey each quarter.
The JEP attempted to contact Senator Mézec but had not received a reply at the time of going to print.