COMMENT
ISSUE 10 SUMMER 2022
Guernsey property prices The recently released figures from the States of Guernsey show that property prices in the island have yet again seen a significant increase. Demand is still outstripping supply in the sales and rental market, but with interest rates rising and the impact of global events somewhat unknown, there is an element of uncertainty for the sector. Guernsey’s most recent quarterly residential property prices bulletin crunches the numbers for house sales and rentals from January to March 2022. It shows that the average local house price has risen to a record high of £575,155. This is an increase of 4% on the previous quarter and 12.4% compared with the same period in 2021. There were 199 local market transactions in the period, which is the highest recorded first quarter number since 2007. There were 36 fewer transactions than in the previous quarter, and 32 more than the same quarter of 2021.
THE OPEN MARKET HAS BEEN LARGELY INSULATED AGAINST PRESSURES THAT INCLUDE THE HIGHER COST OF DEBT, RISING INFLATION, INCREASED ENERGY COSTS AND THE GEOPOLITICAL UNCERTAINTY THAT HAS UNRAVELLED GLOBALLY.
In the open market, there was a total of 26 transactions, eight more than in the first quarter of 2021. The average price for the period was £1,216,313 while the four-quarter average, which reduces the effect of seasonal fluctuations, increased by 7.4% over the past year to come in at £1,343,672. The statistics also show that the average time between a local market property becoming available for purchase and its subsequent sale has been decreasing since the first quarter of 2018. At the same time, the difference in the advertised price of properties and their final sale price has also been decreasing; however, it was larger in the first quarter of 2022 than the previous two quarters. Keith Enevoldsen is the head of residential sales at Savills Guernsey. He believes the market is still looking healthy: “For those looking to sell, it remains a good time to bring your home to the market. The £1m-plus market is buoyant and sensibly priced homes in good locations are attracting plenty of interest. The higher costs of building materials have also meant that new builds and properties not requiring work are attracting something of a premium. Many instructions are selling before they appear on the market.
“Looking ahead, it would be amiss to ignore the threat of economic pressures. However, to date, as can be seen by the number of transactions reported in the States of Guernsey statistics, the open market has been largely insulated against pressures that include the higher cost of debt, rising inflation, increased energy costs and the geopolitical uncertainty that has unravelled globally. As a result, activity has remained ahead of normal levels throughout 2022 so far. However, while we’re not expecting prices to fall, we do expect levels of growth to flatten out given the economic challenges and the uncertainty caused by the war in Ukraine.” Local market director at Swoffers, Andre Austin, agrees that there are factors that could affect the market going forward: “We started the year facing the same challenges as last year, with a shortage of stock across all areas of the market. Although we saw a rise in interest rates, availability of credit is still very good and there are still plenty of buyers around. When you combine those factors, it is no wonder the market was so buoyant in the first quarter. With a recent rise in interest rates it will be interesting to see if there is any impact for the remainder of the year.”
THE Q1 NUMBERS £573,155 average local market property price
199 local market transactions
£1,661 average monthly local market rental price
£1,216,313 average open market property price
26 open market transactions
Guernsey Property and Construction
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