Usually I am floating about in a sea of ambiguity - always seeing both sides to a story - so I do love it when something definite comes up.
Listening to BBC Radio Jersey yesterday, I heard Matthew Price say something that I thought was not right, and this prompted me to do a little research and write again.
Matthew was talking about the year 1965 in Jersey - what sort of music was played, what was going on, for example Fort Regent was being discussed, and house prices.
My feeling is that house prices are way too high in Jersey leading to many social problems. Matthew gave examples of houses for sale in 1965, including a two bedroom modernised cottage in First Tower with an asking price of £3,500. Matthew then joked that it seemed very cheap but that incomes were probably "pro rata". I thought back to my own childhood (which was a bit later than 1965) and remembered that people in those days did have ambitions to own a house which usually seemed to be fulfilled, so I decided to find out if incomes were "pro rata"
In 1965, the average wage in the UK was £1,250. I cannot find the statistics for Jersey but expect it was similar. That means the house at First Tower's asking price was 2.8 times the average income.
Presently there are many two bedroom houses for sale, with asking prices mostly around £400,000. The average median household income in Jersey (for a couple with at least one child) is £37,180. That is a multiple of 10.75.
The Median Multiple
The median multiple is used as a measure of housing affordability. Generally, housing is thought to be affordable if the multiple is 3 or less and severely unaffordable is the multiple is above 5.1. For example, the multiple is 7 in New York and 8 in San Francisco - the highest multiples in the United States. (Annual Demographia International Housing Affordability Survey) The most recent and accurate figures I could find for the UK (with just a few minutes to search) show a multiple of 2.3 for the North-East and 4.8 for London ( the lowest and highest for the UK) Other sources show the multiple for England overall as being 5.1.
This is a rough guide - household income used in this equation should be the figure after tax. There are other factors involved in the affordability of housing, for example, high interest rates in the late 1980s made many mortgage repayments out of people's reach.
However, the fact remains that since the 1960s, Jersey's housing has become severely unaffordable, and quite possibly the most unaffordable in the world
