Jersey is difficult but rewarding investment

Tuesday, 19 February 2008 12:00 AM

Investment on the Channel Island of Jersey, while difficult, can prove to be extremely rewarding for overseas property buyers, according to Jersey Properties.

Short supply of property on the island - which is a British Crown Dependency, but not part of the UK or European Union - ensures prices remain high, with potential for further gains in the future.

According to official statistics from the island, the average property in Jersey cost £435,000 in 2007 - a 20 per cent increase on the previous year.

However, it must be noted, concerns have been raised the figure has been distorted by the sale of several out-of-town superprime properties.

"Basically we have seen very big rises here, very big increases," said June Stead, owner of Jersey Properties.

"We have a very strong economy here, with a very strong finance industry and prices are getting driven upwards," she added.

Yet, investment is far from straightforward.

To occupy a property on the island as a domestic residence an investor must have lived in Jersey for 12 years.

"So for anybody wanting to purchase here, they can purchase certain properties but they won't be allowed to occupy them," said Ms Stead.

Restrictions have been tightened in recent years as concerns the attractive price increases have drawn too many overseas investors - to the detriment of domestic first-time buyers.

Yet, some properties are still available to investors.

"It is apartment blocks that are being put up on what little space we have down on the waterfront," continued Ms Stead.

"At the moment, as things stand, they are available. They're a good investment because everybody will be looking to rent, as they won't be able to afford to buy! It's a bit of a strange scenario."

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