News

16 May 2011 - House prices in Guernsey have increased and volumes broadly stable

On the historic measure of Guernsey property prices the average price eased back slightly from their position at the end of December 2010, but compared to their position 12 months ago at the end of March 2010 now stand some £6500 or approximately 3% higher at £370,500, according to data released this month by the Guernsey States. Going forward, The States have announced a change in the method of calculating average prices which will in future will be known as "mix adjusted" and include fixtures and fittings sold with a property. At the same time, the basic method of calculating the average property price has been amended to reflect more accurately the mix of housing sold. The net effect of these two changes has been to increase the new mix adjusted price description by a little over 10%. Using this new measure, average prices at the end of Quarter 1 stood at £424,714, up around £13,500 or 5.7% on their position at the end of 2010, using the new methodology.

Local market transaction volumes declined slightly from their position at the end of December but stood marginally higher than at the same time last year at 165 for the quarter.

Within this, demand for the critically important two and three bed house moved ahead to represent 15% and 14% of transactions respectively, up from 6% and 13% of the total at the end of December 2010.

Commenting on the latest Guernsey housing data, Nigel Pascoe, Director of Lending for Skipton International, the Guernsey and Jersey mortgage specialists said, "This quarter, the change in methodology introduced by The States of Guernsey for the calculation of prices has muddied the picture slightly, but overall, the market remains solid and on any measure, is ahead in both value and volume terms compared to the position at the end of March 2010."

There were 7 open market transactions during the period, down from 18 at the end of December.

In the UK as a whole, according to the UK Land Registry, over the year to March 2010, prices fell back 2.3% and 1.1% in March alone. Over the year, the London region was the only one to show any gain, with a modest 0.8% recorded, whilst all other regions fell back in value, the worst hit being the North East where values fell by 9.3% during the 12 month period.

Nigel Pascoe ends, "We believe the market is now entering a period of consolidation. Demand is firm, but the absolute level of demand will be influenced by wider questions of confidence. As inflation in the UK rises, so we can expect to see some volatility in the market, but overall, Guernsey property continues to represent a good long term investment."

For further information regarding Skipton call 01481 730 730.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

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European Union Savings Tax Directive
Information for all EU Residents (including the UK)

This communication outlines the changes implemented, by the Government of Guernsey, on 1 January 2011, to the EU Savings Tax Directive ("The Directive").

Automatic Exchange of Information

If you are resident in the EU (including the UK) gross interest will be paid to you and be subject to an automatic exchange of information with The Guernsey Income Tax Authority.  This report will detail your full name, postal address, account number/s,  date of birth, place of birth, tax identification number (if known) and the amount of interest added to your account/s.  Thereafter this will be forwarded to the tax authorities in your country of residence.

If you are deemed to be "non-domiciled" for tax purposes in your country of residence, we may be able to pay you gross interest without the need to submit an exchange of information report.  To arrange this we require confirmation of your tax status, e.g.  a letter issued by the tax authorities in your country of residence or accountants.

Non EU residents will continue to receive gross interest and it remains the responsibility of individual investors to disclose the interest earned on their accounts to the relevant tax authorities.

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