House prices: ‘We’re better off than in UK’
Thursday 16th September 2010, 2:59PM BST.
Jersey's property market is said to be better off than the UK's
JERSEY’S housing market has withstood the effects of the recession far better than the UK’s, a conference was told last night.
Speaking at a property and research seminar at the Radisson Hotel, Michael Dean of Savills said that Jersey had been ‘lucky to escape the worst of it’.
However, he said that world events did affect the local market and that the start of the year was ‘considerably poorer’ than expected.
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The Jersey housing market is static and has been for some time. The only houses selling are those belonging to owners willing to take a substantial drop in their asking price. I know of 2 houses that sold recently, one dropped £40K off the £500K asking price and the other £125K off it’s £650K asking price. My friend in the business says he’s got houses stuck up his ar*e sideways which I think eloquently illustrates the true state of the Jersey housing market.
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I have never in all my life seen so many houses and flats for sale in Jersey. Nothing seems to be selling from multi million properties to small flats.
Why are Dandara building more?
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still grossly overpriced i m h o .
still the sign makers doing ok .
offer less.
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Its simply down to two things, unemployment/lack of jobs and a permanent tightening on lending.
I still see two bedroom houses for sale at over £300,000 and they do not even have parking. The buying public are not stupid and money is tighter now, so if people still think they can ask for pre-recession prices then they will not sell their places for sometime yet.
I actually think this static period will be here for sometime yet.
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Yeah, a quick search reveals I can get a one bedroom flat in Jersey for £115,000 or a two bedroom house in Bishop Auckland for £50,000.
Real lucky. I know where I’m buying my first house.
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‘We’re better off than in UK’
How does it go?
If you say something enough times you start to believe it.
Anybody ever wonder if Jersey is social experiment along the lines of The Truman Show?
Can’t help thinking it’ll be messy when the brown stuff hits the whirly thing and people realise.
BTW, if you are reading this off-Island, well done; you have passed the test.
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This should actually read -
“House prices, you are better off in the U.K.”
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Why is it seen as good to have expensive housing? Would we look at anywhere else in the world and think they were doing well if houses were expensive. Surely we’re doing worse than the UK as houses remain expensive.
We’re better off if housing, like fuel, food and clothes are cheap.
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What this article is really meant to say is – if you want to buy property in Jersey you haven’t got a hope in hell because we have managed to keep the prices over-inflated! ! !
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Prices well over inflated and it is difficult to raise a deposit to something. £40000 needed for a £200000 property. I’m leaving Jersey as it has become far too expensive here.
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Until house prices drop and uncertainty in the job market improves,this will continue for some time.
It will have a knock-on effect of course.
furniture shops, blind and curtain makers,painters,plumbers,carpet fitters,solicitors staff, to name a few will all be under threat of being redundant-and all for what?
And they continue building regardless in any available space they can get their hands on-doe,st make sense.
Maybe they know something we don,t
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The bubble has finally burst. I know of three people trying to sell their houses. They lowered the price and still no takers. Last year many put up the sale sign to test the market and perhaps get the highest price before the drop. Now I believe many are selling because they need to sell due to redundancy or simply because they can not afford the mortgage Sell now at a low price or next year at an even lower one ! Because that’s when the economic troubles will really start to hit the island….Negative equity is on the doorstep !
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Well we must blame the Estate Agents for not advising their clients to drop the asking prices to a more decent price – obviously the guy from Savilles is thinking of his take rather than what is worth anything. I have just been scouring properties up for sale and the prices for a hut are ridiculous way, way out of proportion. Just greedy people trying to make an extra buck!
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Why is Jersey always compared to the UK market. In no way can anything related to money be comparable. The cost of living is higher, salaries are supposedly higher, the mortgage/housing market is different ie housing qualifications, the way fees are paid, guarantor mortgages. Taxation, GST where shall I end………..
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House prices are now falling in Jersey for a number of reasons. Unemployment/lack of jobs/pay freezes/reductions in bonuses/uncertainty in labour market/removal of tax allowances/tightening of lending.
Prices have not fallen by much more because most people choose not to sell rather than realise a loss. (some houses have been for sale for over 3 years)
This trend will continue for the forseeable future and will accelerate when interest rates eventually rise.
The States will soon try and boost the housing market by allowing more outsiders to buy. (cloaked as a new immigration policy)
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Michael Dean of Savills is bound to keep upbeat but his comment is actually bad news for his business. House prices may be better off than the UK but this will only lead to a slow down in Jersey of buyers paying these high prices. Until the estate agents ‘Get Real’ we could see some of them close.
5 DragonLady: Where did you find a 1 bedroom for £115,000, either this is a studio(bedsit) or its a chicken pen in Gorey.
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The States are planning on substantial cuts in public expenditure, falling staff rolls, etc over the next few years.
Unless the finance industry discovers a huge pot of gold at the end of the rainbow we are likely to see retrenchment as they seek to rebuild core capital, margins and profitability as well.
At best property prices look like going sideways for the next few years. What is there to drive them up?
Maybe one of our estate agents would care to offer a reason?
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House prices are still way over the maximum borrowing capacity of the average wage so whats better off about that? States cuts, higher taxes, recession, tighter borrowing, minimum deposits, unemployment, these property prices are only just beginning to fall.
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13. Geraldine – You must also remember that many people are having to sell because of current pay freezes and job losses – I would not imagine that they can afford to sell for less than they paid in the first place.
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So Dragon Lady – you can buy a flat for £50k in Bishop Aukland – well you can buy one for £45k in Middlesbourough, and probably less than that in Pakistan – but get real – compare the job market when you compare house prices !
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Total Bank Deposits down the last two quarters,the islands one trick pony that is finance is no longer guaranteed to perform,we should all be worried and not just about the roof over our heads! if the funds continue to flow out so to will the jobs and their spending in the wider economy will be shrink,in the last quarter deposits fell 6% if this trend continues the only way house prices are heading is down.
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A house is only worth the amount someone is prepared to pay for it.
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16 Mark G: http://housefinder.thisisjersey.com/home/property-for-sale/searchResults/searchResults.htm?action=locationList
Advertised as a one bedroom flat for £115,000.
20 Richard: I can assure you I am very “real.” Comparing the housing prices, the cost of food, the monthly electricity, water and gas bills, the state of the job market, both the average and range of saleries in the area, and I can happily stick by what I said before- I know where I’m buying my first house, and here’s a hint, it won’t be in Jersey.
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WOW! This must be the only thread ever where all posters are right!
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They should have been more specific than “we”. By “we” they mean house owners, NOT those looking for a house. Those looking for a house are most definitely worse off.
#4 Jon, remember that the majority of people are being ‘guided’ (i.e. completely led) by the estate agents, if you think the prices are wrong maybe you should take it up with them.
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Its not just the prices of houses for sale. What about the astronomical costs of rental properties? Try looking on Jersey Insight, very rarely are there any under £700 per month, most of them are £1000 upwards – who on earth can afford that? Even if you are lucky enough to be able to pay that amount you still aren’t allowed to have children or pets in it!!Some people are even charging £500+ to rent a room out. Far too many greedy landlords, too many non-quals places, and why are so many of them furnished? Thats not a proper home life.
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Only from a commission-paid estate agent’s viewpoint are we better off than the UK. For the people and economy as a whole, severely inflated real-terms housing prices are a massive problem. If prices could be kept stable (that is “stagnant” in estate agent-speak) for a whole generation of gentle wage inflation, we could, in theory, escape from the trap painlessly. More likely, though, is a property crash like the UK in 1989-90, with negative equity and repossessions left, right and centre.
And a few dozen redundant Civil Servants unable to keep up the mortgages they took out on the strength of their supposedly secure salaries will probably be just the pinprick it takes to burst the property bubble.
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This thread seems to just be drawing out those that for whatever reason feel hard done buy, e.g. unable to afford a morgage or pull together a deposit.
Whilst i am realtively young i believe house ownership for the masses is a concept of the Thatcher years prior to that renatl was more common.
I do not understand why people act like they have some god given right to be able to afford to buy a house.
And of course we have been somewhat protected from the reductions in UK house prices, because our ecomomy is buffered from the recession to some extent. When the recession eases probably not too far off our house prices will recover ang gain quicker than elswhere…..and thank be to the god mammon on that.
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Q: Why do you not see so many Dandara flats on the market?
A: Because they are all sold as INVESTMENTS not habitable properties.
Only the estate agents think the current property market is good – have a look in the back of last months jerseynow or property free rag – the number of royal court transactions was less than half a page… worried about their commission.
P.S Go on a recruitment website and phone up about one of the jobs.. 9 times out of 10 they have just been filled or we haven’t recently updated our website… another commission based industry sweating…
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26 – high rents – where do you suppose the £72 million per year income support paid for out of our taxes goes – straight into the pockets of multi millionaire property owners!
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Dragon lady
You are welcome to Bishop Auckland, raging unemployment, boarded up shops and high crime rate hence cheap price of property….
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To PJ (comment 31) Whilst some parts of the UK are probably hellish to live in I can assure you that there are some very nice places to be found which will provide a much cheaper alternative if you are wishing to leave Jersey.For example,where I live, 4 bedroom detached house /large garden not overlooked/double garage for under £250,000 and the crime rate?Well in four years there has been one incidence of graffiti on our bus shelter-a smiley face to be precise.
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If half on the people on here actually left the island,they would know that Jersey isnt an expensive price to buy at all.
Try looking at the property market in the south of France or northern Italy then you may realise its not so bad.
Some of the individuals on here probably cant even afford a bag of chips let alone a house!
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Yes (No 32), I know the UK well, spent 30 odd years there and wouldn’t go back unless dragged. Jersey is expensive but wages are higher and tax still considerably lower despite threats to raise it. Every time I go back to visit family it looks tattier and more crowded and my family live in a perceived nice area in the South West where property isn’t far off Jersey prices.
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The value of property in Jersey depends on if you think the states can control expenditure and limit taxes and if the employment prospects start to look brighter.
When the economy starts to look better volume and prices will pick up.
If you express prices as a multiple of the average annual income then prices are high.
Comparisons with the South of Frannce or Northern Italy are a bit disingenous as the markets there are partly driven by wealthy individulas moving in to these areas, this is only partly true for Jersey.
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Now now everyone you really must listen to the estate agents because they are the profesionals who got their degrees and doctorates from the university of mmmm mmm, wait a minute you dont need any qualifications to sell property. Its got to be the easiest and best paid JOB (Definately not a profesion) It’s supply and demand that controls the market.
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PJ (comment 34) Strange how we have differing opinions- to me it is Jersey that is tatty and crowded as I am now used to so much space in my part of the UK (and I am Jersey born and left through choice not necessity!)I think I was fortunate to grow up in Jersey when it was less crowded and more friendly but it sure has changed over the last 10-20 years. Each to their own as I always say!
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#28 Possibly because the alternative is renting and that leaves you completely open to someone else’s greed! Were there laws in place keeping a tight leash on landlords then fair enough more people would probably be happy to rent, but since that isn’t the case most people will want their own home. Had I been born 30 years earlier I may well have happily rented, but given how much more greedy and materialistic the world has become I’m not going to allow an individual (that I probably won’t even know) to have such a big say in my life.
Frankly, I don’t trust anyone else enough to rent off them. Fair enough in this day and age really. And no, I don’t think I’m entitled to own a house, I just think it’s a darn sight better than renting one.
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The sense of self entitlement on this thread sums up why the benefits system needs a serious overhaul … benefits are not a lifestyle choice and house ownership isn’t a right .. Bill Gates speech below (who btw is not giving his money to his children)
Rule 1: Life is not fair – get used to it!
Rule 2 : The world won’t care about your self-esteem. The world will expect you to accomplish something BEFORE you feel good about yourself.
Rule 3 : You will NOT make $60,000 a year right out of high school. You won’t be a vice-president with a car phone until you earn both.
Rule 4 : If you think your teacher is tough, wait till you get a boss.
Rule 5 : Flipping burgers is not beneath your dignity. Your Grandparents had a different word for burger flipping: they called it opportunity.
Rule 6: If you mess up, it’s not your parents’ fault, so don’t whine about your mistakes, learn from them.
Rule 7: Before you were born, your parents weren’t as boring as they are now. They got that way from paying your bills, cleaning your clothes and listening to you talk about how cool you thought you were. So before you save the rain forest from the parasites of your parent’s generation, try delousing the closet in your own room.
Rule 8: Your school may have done away with winners and losers, but life HAS NOT. In some schools, they have abolished failing grades and they’ll give you as MANY TIMES as you want to get the right answer. This doesn’t bear the slightest resemblance to ANYTHING in real life.
Rule 9: Life is not divided into semesters. You don’t get summers off and very few employers are interested in helping you FIND YOURSELF. Do that on your own time..
Rule 10: Television is NOT real life. In real life people actually have to leave the coffee shop and go to jobs.
Rule 11: Be nice to nerds. Chances are you’ll end up working for one.
If you agree, pass it on.
If you can read this – Thank a teacher!
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#39 Why should I thank a teacher if I can read that? Look at point 8 for example – good reason why NOT to thank a teacher. Teachers really ought to get over themselves. Most importantly, a teacher is paid to do a job, it is not a vocation IT IS A PAID JOB!
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“Bill Gates speech below (who btw is not giving his money to his children)”
I think it is fair to point out that Bill Gates had a trust fund established by his father that was worth several million dollars by the time he left Harvard to establish Microsoft.
This paid for the premises, computers that were mindblowingly expensive at the time, salaries for the first employees, etc.
I doubt he would have got the money from a bank and it had the advantage of leaving him and Paul Allen, his business partner, in control of 100% of the stock in what was going to become an extremely valuable company.
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How the hell can we be compared with The Uk,
90,000 + people in Jersey, and 51 + million people in the UK.
No only that but they’re scared to say the recession is about to hit harder than we thought over the winter months, If the States kept an eye on the global stock markets they would know this. Remember Jersey isn’t monaco,
39, i enjoyed reading the comment.
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Helen Back: It is easy and fair to compare to the UK. In everything it is (housing etc.). Therefore to compare lifestyle give the historical and cultural connection it is perfectly reasonable.
The reason I have referred to ‘averages’ is for th every fact to remove population as a difference. The quality of life, crime rates ON AVERAGE are much higher in Jersey, and in fact much closer to Monaco.
I suspect you are a teacher with your comments.
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JERSEY RENTAL PRICES…..we,re far worse off than the rest of the world!
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The reason why everyone wants a house or morgage is because we are all fed up with ridiculous high rents with all the usual nonsence thrown in i.e no, pets, no smoking, no children, no life. I would quite happily live in rented places all my life but this is no longer affordable and its no longer affordable to buy either so both ways its bloody hard. Oh well at least i,ll only be 75 before i get my deposit together and meanwhile shall stay in my heavily overpriced run down squat with no children, no pets, and no smoking and no lfe for a little longer!! Hee hee
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This is one of the first articles where a vast majority of you agree!
I live in London (born in Jersey) and work as a property analyst in the City and see the problems of the world’s economy every day. The facts are this – no banks will ever lend to the same degree in our lifetimes that they did during the boom years because they got so badly burnt! This obviously means potential house buyers simply won’t be able to afford houses unless they have huge deposits of around £100k for say a £500k property (and that’s if you earn a huge wage for the bank to lend you £400k.
So, in the case of Jersey the estate agents have to realise this and so do sellers! They have to become more REALISTIC. Jersey’s house prices were artificially driven up as mortgages were so easily obtained (up to 125% of the value of the house with no mortgage!!) Now, things have changed, people are leaving the island as the going gets tougher – I see no change for at least 3-4 years in the housing market. Sure there’ll be some ups and downs but it will continue to head south. I would say you’ll see a potential 20-30% reduction in Jersey house prices over this period simply because Jersey’s prices were driven up so ridiculously high during the boom.
ESTATE AGENTS AND SELLERS TAKE NOTE!
PS – As for Dandara – oops!!!!
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Groan! Enough with the rents being high gripe.. phone any estate agent and ask what properties prices are then ask what potential rental you would likely to receive for them…you will be lucky to find anything returning around 5% per annum and remember you have upkeep and owners rates to pay…now go to alomst any Bank and you will see that most have 5 year guaranteed savings products around the 4.5% – 5% level…so given the capital appreciation doubts surrounding property now and you had money to invest where would you put it?
Summary
Property at current percentage rental to value is currently unattrative for most landlords and has been for some time…like anywhere if you do not want to rent then buy, if you cannot afford either than I do feel sad for you but if you cannot afford to live here then leave this cold hard financial truth is the same the world over .. sad but true
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#45 – do what I did, married a rich local.
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#34 “tattier and more crowded” there are huge areas of the UK where such adjectives just don’t apply. There are also some areas in Jersey where they don’t apply but only a few can afford to live there, and for how long they will remain uncrowded is a pertinent question.
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Is it because we have high rental / purchase, houses / flats, and high food costs that we have high average wages?
If we reduce the former will not the latter also reduce ?
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PJG – From an economics perspective certainly closely linked. But usually my understanding from many years ago studyign economics that wage inflation predates cost inflation. To push up prices (be that rent or cpi) it woudl first be as a result of demand driving from increased wages.
Jersey had some horrendous ages inflation over the years before the financial crisis, and as a result wages are now softening, and in some cases reducing. Accordingly we can expect to see housing being affected (which I believ we are), and ultimately so will other areas, though it takes considerable time.
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46 – thank you for a very sensible comment. There are currently a huge number of properties for sale, all at really stupid prices. Unfortunately there are going to be some people having to face up to losses on property in the near future.
I passed one house today where work seems to have stopped, I wonder if the builder has run out of cash?
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I bought a house in Jersey in 1991 for 123.000 and sold it in 1998 for 160.000 today its listed for 430.000,whats wrong with this picture?
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Leah Holmes – I was just wondering if you own your own house – if you don’t mind me asking? You say you won’t give money to anyone you don’t know (which I happen to agree with completely!) I was just wondering if there was any way around it?
I don’t want to have to throw money away, but I don’t as yet have my quallies.
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Ebenezr Page: What is the point you are making? Seems fair enough to me. So you made 19% growth on average per annum, and the people who bought it off you made approximately 22% per annum. If you are bothered by that you really should see someone!
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I doubt that the house price statistics in Jersey mean very much at all at the moment.
There are so few properties being sold that the sample size makes any comparison almost meaningless. A few properties sold for an above or below average price for their type will skew the numbers.
But heigh ho the estate agents are still in their usual permanent state of public optimism.
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Truthseeker you really need to invest in a calculator re post 55
123k for 7 years to 160k represents approx. 4% p.a. however 160k to for 12 years to 430k is approx 8.5% p.a.
God I hope you don’t work in Finance….
E Le Page you did not mention whether you subsequently bought another property and therefore also enjoyed the 8.5% growth in property to date or whether you squandered your gain leading to bitterness ever since that does not show one bit?
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#54 DundeeDella, unfortunately if you don’t have your quallies or have a partner with quallies there I don’t think there is any way around it other than to get out of that situation as soon as you can. Of course people could campaign for the Government to step in and give tenants more rights (especially in the unqualified category) to make renting a better option.
My partner has his quallies and owns a home otherwise I would still be in the UK (I owned a place there). No criticism of your decision to come here without a non-rental place to live in, but I just couldn’t have done it. Good luck finding a better scenario.
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#58 – Leah, I never said I didn’t have a non-rental place to live in, and purely saying ‘no criticism’ and ‘i just couldn’t have done it’ you were clearly judging. Thanks for making me feel so good about myself there.
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Wake Up People @ 57.
Yes, I did mess that one up… though we are both wrong, as yours doesn’t take into account the compounding nature of it – HOWEVER, yours is a considerable amount more accurate than mine.
Secondly, I knew my pseudonym would come in handy, as did work in finance before I retired… ooops!
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Real truthseeker 55.
Re: “But usually my understanding from many years ago studying economics…”
Good job you studied economics and not Brain Surgery with results like that! However, I suppose the mathematical operation in question was a rather challenging exercise for you after all these years…even though it was somewhat self-explanatory.
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