THE AVERAGE RENT of a home in Ireland is now €1,243, according to the latest quarterly index from the Residential Tenancies Board.
That’s an 8.2% increase in the average cost of rent compared to the same time last year. This is also the highest year-on-year rise in the average cost of rent since the second quarter of 2016.
In Dublin, the average rent is €1,762 which is a 6.6% increase. The RTB said that “affordability still remains an issue” in the capital.
Last week, the Dáil passed a bill put forward by Sinn Féin’s housing spokesperson Eoin Ó Broin to freeze rents. He told the Dáil that legislation was needed as it was clear “rents are completely out of control”.
Ó Broin also said that the current system of Rent Pressure Zones (RPZs) is “not working”.
‘Pace of increase’
Outside of Dublin, growth in rents is faster which has contributed to a rise of 3.3% nationally in the last quarter alone. In Galway city, rents have risen 11.6% in the last quarter, alone. And, in Waterford city, rents are 16.4% more expensive than this time last year.
There are now seven counties where the standard rent exceeds €1,000 a month – Cork, Dublin, Galway, Kildare, Louth, Meath and Wicklow.
However, growth in Dublin city and Cork city is lower than elsewhere in the country and the RTB said that this “is a sign that the pace of increase has fallen and may be stabilising in the areas which have been Rent Pressure Zones the longest”.
A Rent Pressure Zone is a designated area where rents cannot rise by more than 4% per annum.
There are dozens of areas that have been given this designation with a full list available here. The RTB said today that four new areas have now been designated rent pressure zones.
They are Baltinglass in Wicklow, Cobh in Cork, Piltown in Kilkenny and the Sligo-Strandhill area. In the case of Baltinglass and Sligo-Strandhill, rents have risen by over a fifth since this time last year.
In the report, the RTB said a “significant increase in the number of properties available for both sale and rent will be required in order to temper the rapid growth in rent prices”.
It said that despite the number of housing completions increasing recently, the level of supply remains “significantly below the level” of structural demand.
However, despite the fact that supply remains an issue, RTB director Rosalind Carroll said that the lower growth in Dublin city and Cork city shows that rent pressure zones are “having a dampening effect on rents”.
“We also expect to see some stabilisation in future quarterly reports particularly outside Dublin, as this sample reflects recent legislative changes which now require landlords of student specific accommodation to register their tenancies with the RTB,” she said.
We recognise that affordability continues to be an issue in the rental sector with rents peaking over €1,700 in Dublin despite the increase in housing completions.
It is also important to be aware that since 1 July the RTB has increased powers to investigate and sanction breaches of rental law. To date, the RTB currently has 38 investigations in progress.
Reacting to the latest index, Minister for Housing Eoghan Murphy said that while “rental prices are still too high”, he welcomed the “signs of stabilisation” in cities.
“To further support the RTB in its work, and to ensure that all institutions of state are working together to protect tenants, I will instruct Local Authorities to inspect rents being paid by tenants as part of the tenancy inspection process,” he said.
This means that the rents being paid in more than 3000 tenancies will be verified every month and this information will be passed on to the RTB to enable them to assess whether the rents being paid are in compliance with Rent Pressure Zone restrictions, and to initiate enforcement investigations where non-compliance is identified.
The RTB’s index is based on actual rents paid on 21,236 tenancies registered with the board this quarter, encompassing new tenancies and renewals of existing tenancies.
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