RENT PRICES AROUND the country have risen by 5.2% in the past year and the average monthly price of rent is now €1,403, according to a new report from property website Daft.ie.
The rental report from Daft.ie for this quarter said that the price of rent in Dublin has had the slowest period of growth since mid-2012. However, prices remain high in every county around the country.
Rent prices in Dublin have more than doubled since late 2010. Dublin 8 has seen the biggest increase in rent – over 125% – in this period.
Assistant professor in economics at Trinity College Dublin (TCD) Ronan Lyons said the key to improving the housing situation in Ireland is supply. He said policymakers need to figure out why it’s “so expensive” to build in Ireland and tackle the issue head on.
“The market may not suffer another ten years of rising rents, but it will likely suffer another ten years of high rents. And for a country dependent on its attractiveness to workers and businesses that could easily set up somewhere else, that is not good news,” Lyons said in the report.
For almost four years, rents have continuously hit new record highs. The average rent at the moment is €373 higher per month than the previous peak in 2008 and almost €660 higher than the lowest price in late 2011.
In cities across the country, rents have risen by between 5.5% and 6% year on year. Areas in Rent Pressure Zones (RPZs) such as Dublin city, Cork city and Limerick city have rent increases capped at 4% per year.
RPZs were set up in 2016 as part of the Planning and Development (Housing) and Residential Tenancies Act and they apply to the rent of new and existing tenancies.
The zones are located in areas where rents are highest and rising, and where there’s difficulty in finding affordable accommodation.
Average rents
Rent inflation has fallen across the country from over 12% in the middle of 2018 to 5.2% in recent months.
The average rent in Dublin at the moment is €2,044, up 3.9% from this time last year. Cork continues to have the second highest rents in the country at €1,372 per month, which is a 5.5% increase on last year.
CEO of housing charity Threshold John-Mark McCafferty said rents have been at “unaffordable levels” for many people for years and the fact that they continue to rise is “alarming”.
“Relying on the market to eventually produce a levelling-out and a decrease in rents is clearly not an acceptable policy,” said McCafferty in a statement.
“The market alone won’t give our citizens the housing they need, so the state must intervene much more strongly, both in measures for building social housing and actions to enable higher levels of delivery of housing across social, owner occupation and more affordable rental.”
Chairman of landlord lobby group the Irish Property Owners’ Association (IPOA), Stephen Faughnan said rent pressure zones don’t take into account the level of rent being charged or the “indebtedness of a landlord” which makes it “uneconomical” for some landlords to continue renting property.
“The state needs to protect the existing supply of accommodation by introducing a mechanism to increase rent where it is substantially below market rate, as well as incentivise further investment in the sector,” Faughnan said in a statement.
Continuing to rise
Rents in Limerick have increased by 12.1% across the county and by 5.9% in the city. The biggest increase in Dublin was in the North county area which saw prices go up by 5.6% compared to last year.
The monthly price of renting a one-bed apartment in Cork and Galway city has risen by over 10% in the past year. In Galway, this now costs €988 on average while in Cork it will set you back €1,070.
Rents were over 40% higher in Dublin on average in this quarter than the previous peak in late 2007 during the Celtic Tiger. In Meath and Louth, rents are more than double their lowest point earlier this decade.
Munster counties have seen rent price increases of 10.1% while rates in Connacht and Ulster have risen by 8.2% in recent months compared to last year.
There are 3,500 rental homes available around the country, a 10% rise from this time last year. This is the first November in a decade where the supply of homes available to rent has improved.
Ronan Lyons from TCD said the report found improved availability, low inflation and climbing rents that are “already high compared to wages”.
“As has been the case throughout the last ten years, there is no quick-fix regulatory solution for the sector. Rather, fixing it will involve the construction of tens of thousands of new rental homes every year for the foreseeable future,” Lyons said in a statement.
The Daft.ie rental report is published every quarter and its findings are based on the price of properties advertised on the site.
Journal Media Ltd has shareholders in common with Daft.ie publisher Distilled Media Group.
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