Skipton remains optimistic for the Guernsey property market

Skipton remains optimistic for the Guernsey property market

10th August 2018

The Residential Property Prices Bulletin for the second quarter of 2018, published by the States’ Data and Analysis Team, offers a mixed picture but there are positive signs of recovery.

Jim Coupe, Managing Director of Skipton International, commented: “As always, these quarterly figures should never be taken in isolation; house prices were up on the previous quarter but lower than at the same point last year. Similarly, transactions were up on Q1 but lower than Q2 in 2017.

“However, based on some of the data we’ve been seeing, we expect the next quarter to improve. For example, there were 69 property purchase bonds in July compared to 41 in June. So, while the year-to-date property purchase bonds were down in June on the prior year (273 v 283), this situation had reversed by the end of July (342 v 335), where 2017 was the best year for purchase bonds since 2012.

“The half year mix of lending is better this year: in 2017 Skipton and another lender were responsible for a third of purchase bonds each. This year, however, there are four lenders providing 20-23% of bonds each, reflecting increased competition. Lenders are also extending criteria this year, with Skipton relaunching its 100% LTV Next Generation Mortgage and elsewhere 95% LTV mortgages being reintroduced. Plus, a broker is also advertising the launch of a further new lender in the Guernsey market. All of which should be positive for property transactions and hence prices in the medium term.

“One interesting statistic to note in today’s figures is that the average time for houses and bungalows to complete from first being advertised has dropped by about a third in a year. Does this suggest a tightening of supply and/or increased demand? Apartments have not really changed in this respect. Could more buyers be seeking houses based on the improvements in value offered over the last couple of years? The reduction in time between first advertising and completion is most marketed in the £400-499k range, which has more than halved from over 400 days to less than 200. This could represent a green shoot of recovery, reinforcing Skipton’s view that the market is set to recover.”

Skipton International is one of the largest providers of Guernsey Mortgages, having reached £400 million of mortgage lending last year. The Guernsey-regulated bank also offers a range of Offshore Savings Accounts for Channel Island residents and UK expats in over 100 countries.