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New property price calculations in Guernsey introduced

The Guernsey States said it will use a method referred to as the ‘mix adjusted’ method and include fixtures and fittings sold with a property. The net effect has been to increase the new mix adjusted price description by a little over 10%.

Using the older method average property prices eased back slightly from their position at the end of December 2010, but compared to their position 12 months ago at the end of March 2010 prices now stand some £6,500, or approximately 3% higher at £370,500, according to data.

Using the new measure, average prices at the end of the first quarter of 2011 stood at £424,714, up around £13,500 or 5.7% on their position at the end of 2010.

Local market transaction volumes declined slightly from their position at the end of December but stood marginally higher than at the same time last year at 165 for the quarter.

Within this, demand for the critically important two and three bed house moved ahead to represent 15% and 14% of transactions respectively, up from 6% and 13% of the total at the end of December 2010.

‘This quarter, the change in methodology introduced by The States of Guernsey for the calculation of prices has muddied the picture slightly, but overall, the market remains solid and on any measure, is ahead in both value and volume terms compared to the position at the end of March 2010,’ said Nigel Pascoe, director of lending for Skipton International, the Guernsey and Jersey mortgage specialists.

There were seven open market transactions during the period, down from 18 at the end of December.
In the UK as a whole, according to the UK Land Registry, over the year to March 2010, prices fell back 2.3% and 1.1% in March alone. Over the year, the London region was the only one to show any gain, with a modest 0.8% recorded, whilst all other regions fell back in value, the worst hit being the North East where values fell by 9.3% during the 12 month period.

‘We believe the market is now entering a period of consolidation. Demand is firm, but the absolute level of demand will be influenced by wider questions of confidence. As inflation in the UK rises, so we can expect to see some volatility in the market, but overall, Guernsey property continues to represent a good long term investment,’ added Pascoe.