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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 16th SEPTEMBER 2008
Question
Further to his response on 15th July 2008 relating to j' category consents to purchase, will the Minister detail for members the types of accommodation purchased by the 287 j' category residents in 2006 and 2007 along with the prices paid in appropriate bands? Does he consider that the 50 per cent increase in 'j' category purchases in 2006/7 over the equivalent rate in 2005 corresponds with a five-fold increase in house price inflation over the same period?
Answer
"j" category employees purchased the following properties in 2007, which illustrates the prices ranges within which activity takes place:
Number of properties Number of properties
purchased by private purchased by public sector
sector "j" "j" % of total "j" category employees category employees purchases
Price Band
Less than 300,000 1 2 2% 300,000 - 400,000 24 10 25% 400,000 - 500,000 14 9 17% 500,000 - 600,000 17 9 19% 600,000 - 700,000 10 2 9% 700,000 - 1,000,000 24 3 20% 1,000,000 + 13 - 9% 103 35 100%
The following table illustrates that while "j" category purchase have increased, so has activity across the whole market:
2005 Q1 | Total Purchase Consents 365 | "j" Purchase Consents 20 | "j" as a % of Total Consents 5.5% | Average "j" Purchase Price |
Q2 | 427 | 16 | 3.7% |
|
Q3 | 457 | 20 | 4.4% |
|
Q4 | 422 | 28 | 6.6% |
|
|
|
|
|
|
2005 Total | 1671 | 84 | 5.0% |
|
|
|
|
|
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2006 Q1 | 423 | 37 | 8.7% |
|
Q2 | 540 | 32 | 5.9% |
|
Q3 | 533 | 35 | 6.6% |
|
Q4 | 543 | 45 | 8.3% |
|
2006 Total | 2039 | 149 | 7.3% |
|
2007 Q1 411 30 7.3% 619,000 Q2 536 47 8.8% 628,000
Q3 490 35 7.1% 613,000 Q4 444 26 5.9% 840,000
2007 Total 1881 138 7.3% 670,000
2008 Q1 454 27 5.9% 587,000
Q2 489 38 7.8% 642,000 Q3
Q4
It is evident that "j" purchases as a percentage of the total number of properties purchased in Jersey has increased, from 5% in 2005, to 7% in 2006 and 2007. However, while all activity contributes to changes in property prices, house prices in Jersey are affected by a whole host of factors including:
The cheapness and availability of credit;
Overall economic conditions including trends in earnings and employment;
Natural population growth and demographic changes;
Household formation rates
Net migration; and
Confidence in the housing market.
This would suggest that the total number of j category licences in the Island are one of only a wide range of factors that influence house prices in Jersey and by themselves can have only a marginal impact on house prices.