Skipton International comments on Guernsey housing market
House prices in Guernsey rose strongly in the first quarter of 2010 by 5.7% compared to the last three months of 2009. Put another way, values were 4.3% up on the equivalent figure last year, according to data released this month by the Guernsey States. Average house prices as at the end of March 2010 stood at £364,088, with the more representative four quarter average figure being £346,369.
Commenting on the latest Guernsey housing data, Nigel Pascoe, Director of Lending for Skipton International, the Guernsey and Jersey mortgage specialists said, “We are now starting to see evidence of a real firming of prices after the volatility of the past few months. House prices in particular have recovered well from the fall recorded at the end of 2009, with values jumping by 11.6% over the year.”
House sale volumes have also risen sharply compared to the same time in 2009, with the number of houses sold standing at 127 compared to 78 this time last year. The proportion of apartment transactions fell back slightly and these now account for 23% of all transactions. The total number of all local market sales was 164 for the quarter.
Nigel Pascoe adds, “The recovery in house sales volume is very important, as it indicates a return of confidence in higher value transactions, although in absolute terms there were actually fewer total transactions compared to the end of 2009, this being due in part to a relatively weak performance from the apartment sector.”
There were 16 Open Market transactions in the three months to March 2010. The value of open market transaction slipped back slightly, although the data needs to be treated with caution, as the sample size is small. Nevertheless, of these 16 transactions, 6 were for over £1 million in value compared to 10 at the end of 2009.
UK data has fluctuated considerably by region over the same quarter, but overall, the average annual growth in prices now stands at 12.9% in the year to the end of April, according to the Financial Times House Price Index. Much of this growth is due to extreme activity at the very top of the London market, which has the effect of skewing the overall average figures, according to the Financial Times House Price Index.
Nigel Pascoe ends, “The Guernsey market has certainly performed well during the last quarter, both in relative and absolute terms. Overall, volumes still have some ground to make up, but we now think the market has entered a new, healthier period. Significant economic turbulence is expected onshore over the next few months as public expenditure and other cuts work through, so we may still see some volatility in prices. With UK Base Rate again being held at its record low of 0.5% for May, this will help underpin confidence in the market, but rises in UK Base Rate cannot be ruled out before the end of 2010.
Now might be a good time for homeowners to consider fixing their mortgage repayments – certainly our two year fixed rate product priced at 3.99% has been extremely popular both with buyers and those looking to remortgage. Our commitment to provide a truly personal service and to ensure our borrowers have the right product for their personal circumstances is as vital as ever in this market.”