Guernsey: Guernsey Housing Market – Calls For The States To Intervene

Last Updated: 21 April 2016
Article by Martyn Baudains

With the price of houses in Guernsey expected to continue to fall, and the number of conveyancing transactions at its lowest for years, now is the time for the island's government to intervene, says Ogier's Guernsey property partner Martyn Baudains.

Intervention could help stimulate the market, help first time buyers get on the ladder and increase the amount of duty received by the Guernsey coffers on property sales.

After a States of Guernsey meeting last September to consider a joint report by two committees - Treasury and Resources and Housing - on various schemes to assist first time buyers, government agreed it would support the Guernsey Housing Association's (GHA) partial ownership scheme rather than intervene in the housing market. In the longer term it was agreed to review document duty and consider ways of encouraging new lenders to operate on the island.

"Since then the most recent figures available show States Local Market Residential Property Prices reflecting a fall in the mixed adjusted average house price between Quarter 2 of 2012 and Quarter 4 of 2015 of about 9%," said Martyn.

"These figures are interesting because those involved in the property market (estate agents, surveyors, developers and lawyers) actually believe the fall in house prices is greater than that reflected in the States quarterly bulletin – and some believe that house prices may continue to fall. In addition, the number of property transactions has fallen to such a degree that the States are possibly losing out on about £4 million of income each year."

It was announced recently that the ratio of earnings to house prices in Guernsey is high, in fact as high as London. 

Martyn poses the question: "So a fall in house prices would be good, wouldn't it?"

However he adds: "Not necessarily. A fall in house prices will result in negative equity, which upsets the housing market and disrupts the economy in general. If we need a price adjustment it has to be a gradual process whereby earnings are allowed to increase faster than house prices. No economy will benefit from a crash in house prices."

High property prices and a smaller number of lenders is bad news for individuals and couples trying to purchase their own home but cannot because they are unable to raise the deposit required by a bank.

"At the moment banks in Guernsey will lend a maximum of 90% of purchase price, meaning a couple buying a house at the lower quartile (£295,688) will have to raise approximately £40,000 towards their deposit and the costs of buying the property (of which some £7,500 will be duty and court fees). Ironically, saving such a sum is made more difficult by the fact the couple are paying rent.

"It was acknowledged by the States last September that the island could benefit from having more lenders. There are fewer active lenders on the island than there has been for a long time. The loss of the Co-Operative Bank and Guernsey Home Loans left a gap in the market, and the introduction by some banks of stricter lending criteria mean that there is a lack of available credit in Guernsey." 

Although the focus has been on the Guernsey Housing Association's scheme, it has limitations, says Martyn.

"Unfortunately, the GHA have no partial ownership units available. The good news is that there are some GHA developments in the pipeline, but even when those units become available the GHA believe there will be a waiting list of some 200 applicants. The States could, through a change in policies, release land for development of further partial ownership units, but that will take time. Also, whilst acknowledging that the GHA has an important role to play, why put money into development of that number of partial ownership sites when there are homes available but inaccessible in the private sector?"

So what's the solution? Martyn has some suggestions:

"If the States were to fund a first time buyers deposit loan scheme for a trial period of say 6 months, using £3 million of funds, up to 100 first time buyers could be helped into the private sector, so increasing the number of sales and raising about £750,000 by way of document duty in the process. The ripple effect could mean that the States receive much more than that in the way of document duty. Such an amount of funds, and the relatively small number of people who are likely to benefit from such a scheme, is unlikely to over-stimulate the market to bring about inflation. Evidence of the success of such a scheme can be found at our sister isle, Jersey, which ran a similar scheme two years ago; their housing market is now experiencing a very acceptable 2% a year increase in value.

"Can the States continue to do nothing for the private sector?," he asks.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions