The growth in number and impact of ‘j’ category housing consents

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WRITTEN QUESTION TO THE MINISTER FOR HOUSING BY DEPUTY G.P. SOUTHERN OF ST. HELIER

ANSWER TO BE TABLED ON TUESDAY, 5th DECEMBER 2006

Question

1. Further to the answers givenbythe Chief Minister on 21st November2006 concerning theimpactof j' category persons on the housing market,and in lightofthegrowth in private sector j' categories in the last 3 years, would the Minister inform members what estimates, if any, have been madeforgrowth in thenumber of j' categories in next 3 years, particularly if the 2% economicgrowth target is metorexceeded? If no estimates currently exist, will heundertake to make them and, if not, whynot?
2. What pressure, if  any, is  expected on the local  housing market,  and  especially  family  homes, as a consequence of economic growthand,inparticular,new j' category persons to meet the skills shortage in the finance sector?

Answer

1. j ' consents are very strictly controlled bytheHousing Minister inthe best interests of the community.To this end, j' category essential employeesmakeup just 3%ofthetotalwork force, and statistically therefore haveminimal overall impactondemandfor housing.

j' consents are issued within the overall context of ensuring a balance between economic growth and demand on the resources of the Island, including the housing stock. In achieving this balance, statistical data is monitored on an ongoing basis, in conjunction with the Migration Advisory Group, and reference is made to the 2% economic growth target and 1% working population growth target, as set out in the Economic Growth Plan approved by the States.

A work programme is taking place at this time, involving officers from a range of departments, on the population and migration implications of achieving 2% economic growth. This piece of work, due to report to the Council of Ministers early in the New Year, should provide more information on the parameters involved.

2. It isvital in a climate ofeconomic growth that policyshould develop to meet the challenges presented. Policy developments suchasareongoingnowaroundsharedequityandfirst time buyerschemes are important in maintaining,indeedimproving,house price affordability,andensuring a balance between economic growthanddemandon resources, including the housingstock. It isimportant,however, to place this issuein the perspective of average house price growth over the last four yearsof3%perannum.

The issuing of j' consents will continue to be strictly controlled, so as to continue to minimise any impact on the housing market. As noted by the Chief Minister on 21st November 2006, in relation to the Quarter 3 2006 House Price Index and j' category essential employee purchases –

"There has been some increase in the number of (j) Category house purchases but it should also be emphasised that the great majority of purchases - 92 per cent - have been made by locally qualified people with at least 10 years' residence in the Island.

The impact of (j) Category purchases is considered minimal.  It is simply not plausible, in the context of large increases in local employment and real economic growth for the first time in 5 years,  to  ascribe  the  increase  in  house  prices  to  a  small  number  of  essential  employees purchasing 8 per cent or 30 out of 400 properties.

It is important to add, however, that house prices are a supply and demand equation and that positive initiatives are being developed around shared equity and first-time buyer schemes to seek to address issues of affordability for local people as a matter of priority."