The cost of renting or buying somewhere to live is increasing faster than wages can keep up with, the latest States of Guernsey statistics show.
The latest quarterly residential property bulletin breaks down the most recent rent-to-income ratios.
A price-to-income ratio is used as an indicator of how affordable buying a property is, compared to the median earnings in that area.
The higher a ratio, the less affordable an area is to live in. Guernsey has seen a spike in its PTI ratio since 2020, as shown below:
Pictured: Both metrics saw a consistent downward trend for nearly five years, but it’s now back on the rise.
Median earnings in Guernsey have been rising over the past two years, but much slower than house prices and rent. As of the beginning of 2021, the median average salary - which the PTI is based on - was £35,497.
An average house cost £500,000, and a rise of 10% has been recorded in house prices in the last 12 months.
The PTI ratio in Guernsey sits at 13.9, which is higher than almost the entire UK. The only comparable areas sit around London, with Hackney, for example, having an affordability ratio of 14.8.
It must be noted that there is no international standard for calculating PTIs, so the States of Guernsey has warned about putting too much weight on direct comparisons.
Pictured: Percentage rises in median earnings have been relatively stable.
The median earnings figures in 2020 and 2021 should also be seen within the context of covid, as there was a loss in lower paid jobs, which may have contributed to the increase in the island's median earnings figure.
The rent-to-earnings ratio rose faster in the second quarter of 2021 than at any point in the past two years.
The average monthly rent paid out in Guernsey is now £1,593, compared to £1,376 in the same quarter last year.
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