The latest house price index published by Statistics Jersey says that the average cost of a home rose by 5% last year, while advertised rental prices were 4% higher than in 2019.
It means that the average house price in Jersey is now £567,000, compared to £249,000 in the UK and £497,000 in London – the most expensive region of the country.
In 2020 all categories of property in the Island saw their average price rise and recorded their highest annual average price to date.
The total number of property transactions was 10% lower, largely due to fewer flat sales.
The report says, however, that three- and four-bedroom houses were more affordable than in 2019, meaning that price levels increased less than average salaries rose. But it adds that a working household with an average income would still not be able to afford a mortgage on a house of any size, with only one- and two-bedroom flats falling within their price range.
Deputy Russell Labey, who was appointed as Housing Minister earlier this month, said that increasing access to affordable homes was one of his priorities.
‘I think everybody recognises, me included, the difficulties that Islanders face with the cost of housing here,’ he said.
‘As I said when I stood for this office, I want to improve that situation and improve access to housing as a matter of priority. What I now discover having been appointed minister, and this is good news, is that action already seems to be happening. The housing policy development board has undertaken an extensive review of the problems with the Jersey housing market. That’s with the Chief Minister and he will publishing the recommendations very soon.
‘We’ve got to improve supply, standards and the affordability of housing and, ultimately, create a sustainable housing market going into the future.’
A 2019 report into projected housing needs in Jersey found that almost 7,000 homes – the equivalent of a small town – would be needed by 2030.
The minister said that new housing schemes at La Collette, the Le Masurier site in Bath Street, Gas Place and the former Ann Street Brewery site would help.
He added that he was not too surprised that house prices had continued to rise during the pandemic.
‘I heard from estate agents that the housing market was still very buoyant,’ he said. ‘The lower interest rates probably also helped the market.’
A spokesman for Andium Homes said that the government-backed social-housing provider was ‘very active’ in developing affordable homes for Islanders.
‘We currently have a number of sites under development,’ he said.
‘Our business plan sets out that we aim to deliver 3,000 new homes by 2030. We have developed a programme to deliver this, which includes a mix of States-owned sites, private sites which we will acquire and intensification of our existing sites.’
He added: ‘All of our rents are set in line with the States’ social-housing rents policy. This currently reflects a policy of 90% of market value but we have not raised rents this year at all and will not do so again until January 2022.’
The median house price of a three-bedroom home in Jersey was £630,000, which means a family on average earnings would need a deposit of £180,000 – three times their annual salary – to afford such a property.
House prices in Jersey increased at a slower rate in 2020 than in the UK, where the average cost increased 7%, and in Guernsey where the rise was 6%.