Press Office

WHERE NOW FOR HOUSE PRICES ON GUERNSEY AND JERSEY?

Good news for Jersey and Guernsey house buyers, who can rest assured that the value of one of their main assets – their house - has weathered the storms of recent market swings well, with values holding up through 2005 and certainly more effectively than in many regions in the UK .

Over the course of 2005, average local market house prices on Guernsey rose by around 5% to reach just over £300,000, from their level of £287,000 at the end of March 2005. In terms of transactions, the volume of houses bought did not change on a quarterly average basis from 2004 to 2005, so there is no evidence of more buyers entering the market over these periods.

Average prices on Jersey remained stable during the course of 2005, rising from £331,000 at the end of March to £335,000 at the end of December 2005. In volume terms, the average quarterly number of purchases dropped slightly from 250 per quarter in 2004 to 235 per quarter in 2005.

When compared against certain key areas in the mainland during 2005, it is clear that Guernsey and Jersey held their own, with the annual average rise in the South East and South West of England only a little over 1%, with London rising by only 2.1%. Over 2005 as a whole, data issued by the Halifax House Price Index showed an annual average increase of just over 5% in the UK .

With new data expected soon from both the Guernsey and Jersey governments on the volume of house purchases in the first quarter of 2006 and the average prices paid, Skipton Guernsey's Director of Lending, Nigel Pascoe offers some views as to likely house price movements over the coming months, “With mortgage rates as low as 4.75%, we are expecting 2006 to be a good year for both Guernsey and Jersey house buyers. We would expect to see average local market house prices rising by at least 6% on both Jersey and Guernsey in the £180,000-£350,000 bracket, although the position for smaller flats may be less optimistic. In essence, what we are seeing now is confidence returning to the market after a period of stagnation, as there is real pent up demand.”

For further information on Skipton Guernsey please contact:

Guy Stephenson/Deborah Kent Nacelle Limited

Tel: +44 (0)20 8333 9125

E-mail: info@nacelle.co.uk

Editor's Notes

Skipton Guernsey Limited (SGL) is a wholly owned subsidiary of Skipton Building Society. Deposits made with SGL are not covered by the Financial Services Compensation Scheme established under the Financial Services and Markets Act 2000. Skipton Building Society, established since 1853, has given an undertaking agreeing to discharge the liabilities of SGL in so far as SGL is unable to discharge them out of its own assets and whilst SGL remains a subsidiary of Skipton Building Society. SGL is licensed under the Banking Supervision (Bailiwick of Guernsey) Law 1994, as amended and conducts business only in Guernsey ; it is not authorised to accept deposits elsewhere. Copies of the latest audited accounts are available on request.

If resident in the European Union for tax purposes, under the EUSTD, which was introduced on 1 July 2005, the interest earned on capital invested will either be taxed at 15%, or, on receipt of a specific customer written request, SGL will exchange information regarding the interest earned on the account on the customer's behalf to the Guernsey tax authorities, who will inform the tax authorities in the country the customer is resident in for tax purposes.