Last week, Housing Minister Sam Mézec issued a response to a petition calling for Jersey to introduce rent controls, in which he outlined a number of measures his department is considering to combat high rents and house prices in the Island.
While the response played down the possibility of rent controls, it said that the department would review the introduction of ‘rent stabilisation’, preventing rent increases above the rate of inflation, and a moratorium on individuals without housing qualifications purchasing buy-to-let properties in new developments.
Roger Trower, the managing director of Broadlands estate agents, said, however, that previous government interference in the property market had always failed.
‘Every time they try to interfere in the free market and over-regulate or over-control it, it does not work. It’s what they tried in the early 1990s,’ he said.
‘What happens is that you end up causing a recession. What they need to do is increase supply. The States need to look into where they can build and then they can fund building themselves with the large amount of money they have set aside for that purpose.’
He added: ‘It has always been difficult to buy property in Jersey. It was hard when I bought my first property in 1979 and it is just as hard in 2018. The reason is we are one of the best places [in the British Isles] to live and that makes it difficult to buy property here.’
Mr Trower said that there was also a misconception that buy-to-let investors were always large corporations or super-wealthy individuals.
‘Bricks and mortar is a safe investment. If you have had historically low interest rates like we have for a long time now, if someone has £300,000 they want to invest they can only get one per cent interest if they put it in a bank account,’ he said.
‘Stock and shares are a risk – you are always hearing about people promising the earth only for their investments to turn out to be Ponzi schemes.
‘And it’s not all big investors buying these schemes, like you always hear about. Usually it’s just someone who has got their savings together.’
Meanwhile, Lee Henry, the managing director of the States-owned Jersey Development Company, said that they would support the proposed moratorium on buy-to-let properties as long as it was applied equally.
‘JDC would support a moratorium on off-Island investors purchasing buy-to-let residential properties in new developments provided this was applied across the board to all new residential developments,’ he said.
‘If JDC’s residential developments are a gauge, we had no off-Island purchasers at College Gardens and to date on Horizon we have secured 116 pre-sales and only five have been acquired by off-Island purchasers.’
