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"Cautious optimism" for housing market

Wednesday 10 June 2020

"Cautious optimism" for housing market


Analysing the statistics relating to property sales during the first quarter of 2020 gives some reason for "cautious optimism" according to the head of Carey Olsen's property group in Guernsey.

Jason Morgan has said, before the Bailiwick entered lockdown, sales activity in Guernsey's Local Market, during the first quarter of this year, was on course to top the levels seen in the same period last year.

Conveyancing transactions were largely halted towards the end of March with just three deemed 'essential' and allowed to proceed on 31 March, a week after the lockdown started.

Those restrictions were relaxed as part of the 'Exit from Lockdown' framework but Mr Morgan believes it is also highly likely that there will be a larger fall in activity levels at the end of the second quarter. 

"The slight fall in activity levels in Guernsey's Local Market for the beginning of this year was to be expected in light of the first set of COVID-19 restrictions put in place towards the end of March and there will likely be a larger drop in the second quarter as it was only at the very end of April when restrictions were relaxed for the Contracts Court. 

"Whilst there is obviously an element of clearing the backlog of conveyances that were delayed or rescheduled pre-lockdown, it is still the case that the housing market largely ground to a halt for much of April. House viewings, mortgage applications, surveys and all of the other elements that go into the process of selling and buying properties were placed pretty much on hold for the whole month."

shutterstock house sale

Conveyancing statistics compiled by Unusualities of Guernsey reveal that there were 189 Local Market houses and flats sold in the first quarter of 2020, slightly down from the 193 for the same period last year. Of those 189 Local Market transactions so far this year, the median price (realty only) for the 147 houses sold, currently stands at £496,275, up from the £477,750 for the same period last year. The median price (realty only) of the 42 Local Market flats is £254,970, which is also up on the £234,488 recorded in the first quarter of 2018. 

For the Guernsey Open Market, the 17 transactions recorded by Unusualities of Guernsey in the first three months of 2020 was two fewer than during the same period last year. Of those 17 sales, the median price (realty only) of the 15 Open Market houses sold this year is £1,706,250, which is up from the £1,218,750 for the same period last year. The two Open Market flats sold had a median price (realty only) of £725,625.

None of the sales figures includes inter-family or inter-company sales or transactions which are typically completed for a nominal consideration.

Mr Morgan added: "Notwithstanding the inevitable short term impact of the lockdown on conveyancing activity, there are some early signs of a fairly rapid post-lockdown recovery. Whilst a range of factors will determine how sustained such a recovery is – in particular, where the Open Market is concerned, around how long the island's quarantine requirements remain in place – the initial indications of a bounce back, in terms of renewed interest and activity levels, should be a cause for some cautious optimism." 

Pictured top: Jason Morgan of Carey Olsen's Guernsey office.

 

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