The average monthly local market rent hit £2,162 in the final quarter of last year – up 6.1% on 2024 and a whopping 57.2% higher than in 2021.
Figures from the latest residential property price bulletin showed that the average rent was up by almost £1,000 in the last 10 years.
Guernsey Private Residential Landlords Association chairman Jeff Guilbert accepted that the continued rise was unsustainable, but said it was basic supply and demand that was pushing up prices.
‘We have an influx of workers who are here on short terms of up to three years, coupled with the key worker subsidy at 20% for four years,’ he said.
‘The landlord doesn’t get that directly but it does mean they can start a bidding war.
‘At the end of the day landlords are a business and it’s human nature to maximise whatever you can. If you were selling a loaf of bread for a pound, and someone came and said, I’ll give you £2 for it, which one are you going to sell to?’
House prices in the same period have risen by 20.8%, which Mr Guilbert said had put about £120,000 on the average purchase price.
‘People can afford the extra monthly mortgage and satisfy the lending criteria,’ he said.
‘If you then turn it back to the rent over the same five-year period, rents have just over doubled. While it’s not comfortable, and it’s not sustainable, it has been achievable in the short term – single people are going to struggle whereas couples are more able to afford that.
‘It all comes from pressure on the same housing demands, and the only way to relieve that is to build more houses or to diminish the demand.’
Andre Austin, director at estate agent Swoffers, agreed that it all came down to a lack of house building.
‘We are still struggling with the stock. Thankfully at the beginning of the year, the States finally got rid of the idiotic extra stamp duty they put on second properties and investment properties, which achieved precisely nothing apart from stopping investors coming into the market. I don’t think it’s the panacea, but the market is stable and the returns are solid.’
Mr Austin said he understood that current rents were challenging for many, but he could see no quick fix to the situation.
‘We have a situation where people are coming in to the island and in many cases have rental subsidies as well. With that kind of level of demand, prices are to remain high. Until you’ve got more stock and more competition, that isn’t going to change.’
Emily Rowe from Savills said the introduction of the minimum housing standards legislation last year had caused a level of caution from both landlords and tenants.
‘However, there remains a lack of supply in both the open and local markets,’ she said.
‘Demand continues to be strong and two-bedroom properties in St Peter Port are particularly sought-after.
‘The removal of the additional duty levied on the purchase of second properties should help bring more properties to the rental market, but that may take some time to filter through.’
You need to be logged in to comment. If you had an account on our previous site, you can migrate your old account and comment profile to this site by visiting this page and entering the email address for your old account. We'll then send you an email with a link to follow to complete the process.