Return of the £200,000 home is ‘unrealistic’ – Deputy Trott

Independent consultants Arc4 found that housing was less affordable in Guernsey than anywhere else in western Europe.

The average local market home now costs more than 16 times the average person’s earnings, three to four times greater than the ideal figure suggested by Arc4.

‘It is conventionally accepted that affordability should not exceed five times median earnings. It is, therefore, impractical for us ever to aspire to see average house prices at £200,000 in the local market,’ said Lyndon Trott.

He was responding to a statement made to the States by Peter Ferbrache in which the Policy & Resources committee president bemoaned the cost of housing locally.

‘I breathe a sigh of despair almost when I say that the average purchase price of a local market property is now over £650,000,’ said Deputy Ferbrache.

‘It’s unsurprising that home ownership is out of reach for an increasing number of islanders. That is simply not acceptable in Guernsey.

‘The cost of living in Guernsey and interest rate increases have compounded these challenges further. The effects are being felt across our community. Not only in individual homes but in businesses due to the fact that it impacts on recruitment and retention.’

Deputy Ferbrache said that dealing with housing supply and affordability was critically important to P&R.

He told the States that his committee’s actions included allocating a significant sum for new social housing in a financial plan to be published early next week, backing the purchase and development of more sites for housing and negotiating over the possible involvement of the States in plans to develop Leale’s Yard.

But Deputy Trott wanted reassurances that P&R had realistic objectives on housing.

He asked whether politicians should be more careful about the language they used on housing and instead ‘focus on what we are in effect doing, which is an improvement to the extremes in affordability, but at the same time casting aside any pipe dream or aspirations that we will ever get to anything close to conventional affordability levels’.

‘I think that’s a fair point. I say more affordable and more realistic,’ said Deputy Ferbrache in reply.

‘We’re unlikely to get back to the multiples of five or six, but I hope we can reduce it from 16.

‘It’s the old adage – the only way you are going to satisfy demand is by increasing supply, or you suppress demand and I think that is unlikely in relation to where we are in our economic cycle.’