Guernsey Prices Lower but Sale Volumes up
House prices in Guernsey slipped back 3.9% on an annual basis at the end of 2009, having appeared to have weathered much of the storm that has affected the mainland, according to data released this month by the Guernsey States. Average house prices at the end of December 2009 stood at £330,500, down from £342,000 at the end of December 2008.
Commenting on the latest Guernsey housing data, Nigel Pascoe, Director of Lending for Skipton International, the Guernsey and Jersey mortgage specialists said, "Apartments, have held their value well, reducing by just 1.9% on average over the year, whilst much of the change in average prices seems to be due to a fall in the value of houses."
House sale volumes have however risen sharply during the quarter to reach 187, a figure not seen since the beginning of 2008, whilst the number of apartment sales dropped back slightly to 40. The total number of sales was up over 10% at 227 for the quarter.
Nigel Pascoe adds, "The recovery in sales volume is very important, particularly at the higher end of the market, as it indicates confidence is returning to the marker, as buyers feel the worst of the turmoil is now past us. The figures for the last quarter at 187 house sales are now in line with broad average volumes seen before the latest markets fluctuant in 2006 and 2007."
There were 227 Local Market and 16 Open Market transactions in the three months to December 2009. The value of local market transaction jumped considerably, although the data needs to be treated with caution, as the sample size is small. Nevertheless, of these 16 transactions, 10 were for over £1 million in value.
UK data still presents a more mixed picture, with, according to the Financial Times House Price Index, a price recovery in the year to December of 4.2%. However, much of this can be explained by the strong performance of Greater London, where, according to the same survey, prices rose by 4.9% in the year to end December, which would have boosted the national average rise by up to 0.8%. In the South West, by comparison, prices fell back by 0.2% over the year.
Nigel Pascoe ends, "The data from Guernsey seems on the face of it to be disappointing, but the strong recovery in volume will underpin market stability moving forward. Overall, prices on Guernsey have suffered far less than the UK, so some volatility is to be expected. However, we now feel more confident that the low point of the market has passed and with UK Base Rate again been held at its record low of 0.5% for February, this will help rebuild confidence in the housing market.
Our new Next Generation mortgage product has been very popular with buyers too. With this type of mortgage, Skipton International will fund up to 100% of the value of the property being purchased if the buyer can enlist the support of a family member who will guarantee up to 15% of the purchase price of the property. This new approach to getting on or moving up the housing ladder is part of our commitment to provide a truly personal service and to ensure our borrowers have the right product for their personal circumstances."