£634,000: Average price of a home hits a record high

THE average price of a home in Jersey has reached an all-time high of £634,000.

Picture: ROB CURRIE. (32090811)
Picture: ROB CURRIE. (32090811)

It rose by more than £100,000 over the past year, a new report has revealed. The figures were released in the wake of comments by a senior minister who denied there was a housing ‘crisis’ in the Island.

During the third quarter of 2021, the average cost of a house reached £634,000, climbing by more than £1,900 a week since the same time last year (£533,000).

The latest House Price Index was released yesterday, a day after Treasury Minister Susie Pinel said that she would not use the word ‘crisis’ to describe the soaring cost of homes in the Island. Speaking at a Chamber of Commerce lunch event, she described housing problems as a ‘challenge’ and added that the situation in the Island was not as bad as in India and Africa.

Her comments have prompted a senior business figure, Kevin Keen, to label her remarks as ‘out of touch’.

For the first time the average cost of a three-bedroom family house has climbed above £800,000, meaning a couple on average earnings in Jersey would have to borrow nine times their combined salary if they put down a £40,000 mortgage.

Mr Keen said that he was ‘very disappointed’ by Deputy Pinel’s remarks.

‘There is a housing crisis in Jersey and we need to address it. It’s the biggest problem the Island faces and I will not be voting for anyone at the next election who doesn’t take this issue seriously,’ he said.

‘We need to make housing affordable to attract people here, to keep people here and to get people to come back here. It wouldn’t surprise me if there are a lot of people who have cashed out of the property market and left now.

‘It wouldn’t surprise me if our population has probably actually gone down – but we don’t have up-to-date population figures.’

He added: ‘I would like to see the government take more control in the housing market. Because interest rates have been so low for a long period, property has increasingly become an investment, but homes should be homes before they are investments.

‘At the moment, we have tax incentives for people to buy property as an investment but not for people to buy a home.’

Mr Keen added that a couple each earning the average wage – £820 per week – would now need a deposit of £400,000 to buy a three-bedroom house.

Children’s commissioner Deborah McMillan said the price of housing was increasing child poverty in Jersey and was not matched by wage levels, which had not increased in real terms over the past decade.

‘The term “housing crisis” is, for far too many families in this island, exactly correct,’ she said.

‘We know that there are children growing up in poverty here. We also know – and my team is reminded on a weekly basis through their casework – that the housing situation in Jersey is at the heart of some families’ inability to make ends meet.

‘The average wage in Jersey does not tally with the average price of buying or renting a house. Children have a fundamental right to be housed safely and securely. This should be the very minimum standard that our government is looking to set – and yet, far too many children are still telling us that housing is a huge obstacle in their lives.’

And Senator Kristina Moore, who chairs the Corporate Services Scrutiny Panel, said that she felt the situation was a ‘crisis’ to which immediate solutions needed to be found.

‘Whenever the government talk about this, they talk about medium-to-long-term solutions, such as building more homes on the site of the hospital once it has moved,’ she said.

‘But the crisis is now and short-term solutions need to be found.’

The Senator said that a possible short-term answer could be building low-cost but high-quality temporary housing before longer-term projects are completed.

Housing Minister Russell Labey said: ‘The latest House Price Index reveals that the situation is largely similar to the previous quarter, which may indicate a slight slowing in the increase in house prices.

‘That being said, the price of one-bedroom flats and three-bedroom houses are at their highest, which makes it even more important to press on with the objectives in the housing action plan.

‘I am working with my officials to tackle the issues head on with a number of short- and longer-term measures to help take the heat out of the market and help to deliver much-needed access to housing.’

In 2011, the average cost of a three-bedroom house in Jersey was just over £500,000. Statistics Jersey’s last average-earnings report, published in August, indicated that, taking into account inflation, the average wage in the Island had not increased at all in the past ten years.

House prices in the UK have risen by 10% in the past year, with the average cost of a home now £262,000. The most expensive region was London, with an average cost of £510,000.

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