From Harry Walsh.
UPON reading the JEP on Good Friday, I was struck by the discontent displayed in the letters section about Jersey – most of it at least partially unjustified. There is a tendency in Jersey to think that the government can do everything. Well, it can’t, at least not without bankrupting the country.
We all know that Jersey is an expensive place to buy or rent property, but so are Sandbanks or Salcombe, both of which are fairly analogous to Jersey despite not being self-governing islands. Obviously, Liverpool, say, is cheaper, but most of Kensington and Belgravia are doubtlessly much more expensive still.
The article in the same issue of the JEP on the definition of affordable housing was a bit misleading. It concentrated on the income of one earner alone in defining affordability, whereas the hypothetical young couple will perhaps more usually, in this day and age, have two incomes from which to meet mortgage payments.
There remains the down-payment and stamp-duty problem. As grandparents die, and leave house inheritances, the increase in house prices during their lives crystallises and may provide a source of house purchase support for the grandchildren. So, the parents may be the bank of mum and dad, but it could well be that the grandparents are the ones who put the assets in the bank through bequests to their children.
For the system to work, parents must on-gift or soft lend to their children for them to meet purchase expenses. All this assumes that the grandparents were owner-occupiers and that all the money does not disappear in elderly care expenses, family breakdown, gambling or alcohol addiction, etc. This system is all rather shaky and depends on family size and stability and timing, but so does life. The alternative is private or social renting, separate subjects in themselves. Policy issues include whether stamp duty should be reformed to help first-timers and downsizers more.
So, we build, presumably for the next generation. But we build masses of small flats and not family homes. Perhaps the real question for Jersey is where are the bigger follow-on family houses going to go? Not to mention the wisdom of despoiling the Island with inappropriate high architecture.
With the fertility rate in Jersey well below the replacement rate that provides a constant population, this in theory should not be necessary – though we need some immigration to help service an ageing population. I suspect that a lot of Jersey housing is simply profit motivated, with even Jersey beans happy to grab the profits from land appreciation. We need a development tax whenever the increase in the price of land stems from development permission and the present arrangements may need review.
On non-housing costs, the price of food has risen sharply in the UK as well as here, although there are always extra shipping and processing costs in providing food to an island.
I would share the view of anyone, however, who would wish to increase support for our farmers here in Jersey. This is partly to improve food security and continuity, but mainly for the perhaps selfish and obvious reason that fresh local produce is generally healthier and tastes better.
Energy-cost increases are a reminder that the market for hydrocarbons is volatile at the best of times and not to give Putin an excuse to restrict supplies by applying mistaken sanctions on his energy revenues. OPEC has already recently announced a limit on oil production.
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