I bought my first house in Jersey in 1974, it was a three bedroom linked detached in Trinity with a garage and a reasonable sized garden and it cost me the grand amount of £17,000. A fair sum in those days but it was only just over 4 times the joint salary of myself and my wife. I worked for a bank who provided the mortgage at well under market rates and required no deposit. Over the years we have moved three times and now live in a nice old granite house that we renovated from a shell 20 years ago, this is now probably worth £900,000 or so. This is a fairly typical example of how many people who bought properties years ago are now living in homes worth many times what they paid for them.
Great for some but clearly not good for those starting out on the housing ladder, my first property today would probably cost in the region of £500,000, to afford this property now you would need a sizable deposit and probably need a joint salary in excess of £100,000pa to be granted a mortgage.
The question that concerns many people is whether Jersey property is now in a long term downwards cycle. Some of the negatives include:
• General impact of economic downturn
• Redundancies and lack of growth in the finance industry
• More stringent lending rules from the Banks
• Over supply, after years of building by developers have we now reached the point where too many properties are chasing not enough buyers?
• Increasing taxation, reducing spending power of potential buyers
According to the statistics unit Jersey property values fell by 5% in the second quarter of the year compared with 2009 with the price of three bedroom houses falling below half a million pounds for the first time in two years.
The price of one bedroom flats fell 6% to £220,000, while two bedroom apartments dropped 8% to £295,000. Two, three and four bedroom house prices all dropped. But it is three bedroom properties that have suffered the most, falling below £500,000 in what is a key category for the island’s real estate market as they represent half of all residential real estate in Jersey.
What’s your feeling on property prices, is this just a short term blip or are we in for a prolonged period of falling prices?
Are you trying to sell a property but not having any luck in doing so, has your Estate Agent suggested that you should reduce your asking price?
Negative equity is now a real possibility for some, are you stuck in this difficult situation?
Please let us have your views on the Jersey property market in general
Member since: 9th July 2012
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