Those who say that tough times are ahead say that there is no reason why we should be isolated from events which, around the globe, are crippling business and stifling spending.
There is, however, one aspect of the Jersey economy which distinguishes it from a great many others, including the UK’s. Whereas house prices are declining alarmingly on the other side of the Channel, they continue to rise here – and by substantial margins.
This, unfortunately, leads to as many problems as advantages, not least for those desperate to enter a marketplace where the average price of a three-bedroom house is now a shade over £541,000. Although Economic Development Minister Philip Ozouf says that strenuous efforts are being made to do everything possible to help first-time buyers, the basic arithmetic of the present situation indicates just how difficult it is going to be to devise policies that make a real difference.
Meanwhile, other figures in the latest house price survey, which has just been published, show that other problems are beginning to emerge. These relate to the number of property transactions processed by the Royal Court, which in the three-month period to the end of September were the lowest in six years. This, in turn, suggests that the credit crunch and the diminishing propensity for lenders to finance mortgages are already having an impact here.
If, on the other hand, the state of the housing market offers reasons for optimism, they come most obviously in the shape of the increase in the value of assets held by Islanders who are privileged to own their own homes.
It can, of course, be argued that home owners should realise that capitalising on the increase in the value of a house involves selling it and either downsizing to more modest accommodation or moving to a location where property is cheaper.
This is a realistic assessment, but there is far more to economics than logic. The mere perception that they are better off is likely to mean that those with property will be less inclined to pull in their financial horns than people in the UK seeing the value of their homes sliding downwards , with consequential benefits for Island commerce.
