Jersey Prices Hold on to Gains During 2009
House prices on Jersey ended 2009 2% higher than at the end of 2008, meaning values have now risen steadily over the last three years. Average home values finished 2007 at £405,000, then rose to £486,000 at the end of 2008 and rose again to £497,000 in 2009, according to data released by the States of Jersey this week. This compares to data for the UK issued by the Financial Times House Price Index showing a decline of over 10% during 2008, with values recovering by 4.2% in 2009.
Commenting on the latest Jersey housing data, Nigel Pascoe, Director of Lending for Skipton International, the Guernsey and Jersey mortgage specialists said, "This is a good performance from the market against the backdrop of a global banking crisis and significant falls in average property prices in all the major global economies, particularly the UK. Whilst the market has undoubtedly cooled, it is reassuring to see values essentially remaining flat, rather than going into reverse."
House sale volumes have also shown evidence of a recovery, with the number of sales rising to 191 for the quarter, up from 150 at the end of September, giving an annual quarterly average of 175 sales. Whilst this still some way below volumes seen in 2007 and early 2008, it is nevertheless nearly double the low figure seen in the third quarter of 2008.
Nigel Pascoe adds, "A recovery in sales volume is very important, as it often indicates confidence is returning to the marker, as buyers feel the worst of the turmoil is now past us."
Whilst the prices of one, two and three bedroom dwellings have remained stable over the last year, the price of four bedroom houses has risen steeply, growing by 7% over 2009 to now stand at £723,000.
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 Jersey is reassuring and indeed slightly stronger than that from Guernsey over the same period where prices edged downwards, but a strong recovery in volume was evident. 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."