A GROUP of Islanders representing different sectors have written to the Chief Minister calling on the government to review its housing ‘interventions’, claiming they are an ‘attack’ on the market.
Authored by Broadlands director Harry Trower, the letter expresses the group’s ‘severe concern regarding the recent interference in the market by the government’, referencing increased stamp duty, changes to landlord and tenant legislation, and a proposed landlord licensing scheme.
The government’s current strategy, the signatories said, ‘belies a detachment from what is actually happening on the Island’.
The letter warns of a ‘knock-on effect on the Island as a whole’.
Other signatories include Paul Scally, a partner at Le Gallais and Luce; the chair of the Jersey Landlords Association, Guy Morris; the vice-president of the Jersey Estate Agents’ Association, Catherine Buckley, and Jersey Farmers Union member Doug Richardson, as well as Ben Cairney, director of Ashbe Construction, and Rob Morton, director of Hawk Group Ltd.
The letter raises concerns about the recent increase in stamp duty for second homes and investment properties at a time when they said indicators suggest the ‘market is slowing’.
In January, the government agreed to increase the stamp duty payable on the purchase of a second home by 3%.
The letter said: ‘You provided no hard data and stats that would have backed up the decision and it has come across to the industry that it has been implemented without consideration for the broader impact to Islanders.’
It continued: ‘This decision has stifled the investment market, which historically props up the market and more importantly chains that then allow people to move.’
The letter stated that the decision had ‘effectively killed the apartment market’.
The Environment Minister’s proposal for a landlord licensing scheme, which is due to be debated in July, is also cited as raising ‘serious concerns’.
The letter said: ‘While the intention to ensure the safety and quality of rental properties is commendable, there is little evidence to back up the need for such changes and the implementation of such schemes will prove burdensome and will place additional financial strain on landlords.’
Under the proposed scheme, it would be an offence, punishable with a fine of up to £10,000, to allow a property to be used as a rented dwelling unless it had a valid licence.
The letter added that estate agents were receiving inquiries from landlords seeking to exit the market, which they said would shorten housing supply and increase the burden on social housing providers – tenants would ‘turn up at Andium’s door’.
The letter ends by listing a series of recommendations which would ‘enable the population and the market’ instead of ‘targeting buyers and landlords’, including fixing planning delays by recruiting more officers, opening up supply, changing stamp duty thresholds, beginning work on States-owned sites such as St Saviour’s Hospital, and ‘ignoring media hype about HNW [high-net-worth] individuals impacting the market’.
It stated: ‘While the government’s objective may be to regulate and protect consumers, excessive regulations can stifle innovation and discourage entrepreneurship.
‘It seems to industry as if there is a deliberate approach from the government to attack the property business with limited consultation from politicians.
‘We respectfully urge the Council of Ministers to review these interventions and consider alternative approaches that foster a market-friendly environment while addressing the legitimate concerns that led to these measures in the first place,’ the letter added.
Economic Development Minister Kirsten Morel said: ‘Ministers are committed to relentlessly supporting Islanders and businesses through the current difficult economic times, including working with lenders to support homeowners, appropriate protections for tenants, investment in our construction and property market, and targeted support as we tackle the cost-of-living crisis.
‘We will be responding shortly to the letter we have just received and continue to welcome engagement.’
