Jersey’s property predicament. Is there anything we can learn from London? As Featured in Business Brief Magazine
By Carrie Harding, Change Architect, Marbral Advisory
Walking through the market in St Aubin earlier this year and the familiar sight and sounds of a musician welcomed shoppers, nothing untoward there then. But when I listened more closely, something profound became apparent. This wasn’t a song about an old flame, a summer in the late sixties or even a sea shanty but instead a song about how the singer – a man perhaps in his late thirties – couldn’t get on the property ladder. His lyrics articulated a melodic disappointment and frustration with Jersey and the state of its property market. He wanted a house so that he could provide his daughter with the Jersey upbringing that he was evidently so grateful for.
It's little surprise he feels this way. Statistics Jersey recently reported that a median-priced 3-bedroom house was affordable only to households with gross annual income of at least £199,000. Put another way the gross earnings of 4.2 full time employees are required to pay the mortgage of an average three bed.
What’s London got to do with Jersey?
The root cause of this predicament is the limited supply of land. Jersey, being an island, and London, constrained by the Green Belt, both face severe land availability issues, driving up property prices.
The average price of a house in Jersey is around 25% higher than London with a 2022 report indicating that the house price to earnings ratio in Jersey was 14.8 versus 13.9 in London. The recent cooling of house prices means that Jersey’s figure is now closer to 13 times, but you get the picture – the Jersey property affordability predicament is very similar to the London one.
Before moving to Jersey, I spent nearly a decade working in London for Transport for London’s (TfL) Property Development team. You’ll be surprised to learn that TfL is one of London’s largest landowners with holdings of 5,700 acres – about the same area as St Brelade and St Lawrence combined. Admittedly much of this land is part of the train network, and my team was tasked with identifying viable sites for the building of 20,000 homes, Half of these will be affordable contributing to the Mayor of London’s housing objectives.
So what did TfL do and how can Jersey learn from it? Part of the programme was reviewing TfL’s entire land holdings to identify viable sites for development. Sites like car parks, depots and above stations were opportunities. Working in partnership with private sector developers enabled thousands of homes to be brought to market. All sites had an operational interface – and by working with TfL’s operational business we unlocked these sites for development. Without TfL’s involvement these sites – despite their excellent locations - would never have come to market. TfL has completed 1,000 homes, with a further 3,450 under construction
Is there an opportunity for the Government of Jersey here? Jersey's government could adopt a similar approach. The Island Public Estate Strategy aims to generate land for affordable housing, but does not comprehensively assess all government-owned sites and more importantly housing provision isn’t the principle purpose.
How TfL deliver homes? TfL has brought to market a number of schemes through various mechanisms, including; joint ventures, small sites (for smaller developers), 100% affordable sites (Housing Associations) and Build to Rent blending overall to a 50% affordable rate.
More recently, in partnership with Grainger- a leading residential landlord, TfL has focused on the delivery of 1,500+ 'Build to Rent' (BTR) homes. BTR is beneficial to TfL as it delivers purpose-built rental homes, while also generating significant ongoing revenue to reinvest in the Transport network. 40% of the BTR homes will be termed affordable via discounted rents. Financing from institutional investors means decisions are made with a long term horizon, which is good for sustainability, renters and the environment.
Could this be an answer for Jersey?
A third of Jersey’s residential property is privately rented, by comparison one in five English households rent privately suggesting a strong demand for rental housing. Indicative of these pressures, in the UK just last month (19th June), the housebuilder Berkley announced that it is going back into the private rental market for the first time in a decade.
Developing BTR projects on state-owned land could provide safe, secure homes and create a sustainable revenue stream for supporting infrastructure. Thinking here shouldn’t be limited to state owned development opportunities. In the UK John Lewis is looking to build rental flats above its Waitrose supermarkets, could they consider doing the same thing here. Red Houses and La Vallee Des Vaux would be ideal candidates for such development. This could increase housing stock and stabilise rental prices.
Density? To improve supply, density needs to be increased. Not everyone wants high density in their back yard, but NIMBYism is waning as those previously opposed to development soften their stance as they appreciate the struggles their own children and grandchildren are facing - which in Jersey’s case often means moving to the UK. Do you want your grandkids in your back yard? If so, you’ll probably need to acquiesce to sensible development with sympathetic density there too.
Comprehensive consultation can help alleviate concern and certain intransigent individuals will maintain a staunchly anti-development stance, the media often refers to this cohort has BANANAs (build absolutely nothing anywhere near anyone), which I quite like.
The Bridging Island plan calls for at least 800 homes to be built annually, but the current the average build rate is only 400. Doubling this output requires clear leadership, setting targets for both developers and GoJ, and confidence and conviction in prioritizing this issue. All eyes are on the Crisis Emergency Taskforce recently set up to tackle this property emergency.
As for our musician in St Aubin, without the right accommodation we lose the right people. Musicians of course, but also teachers, nurses, artists, chefs and early care providers.
We won’t want to be here when the music stops.
If you’d like to get in touch with Carrie, she’d love to hear from you. Please send her an email.
