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daft rent report

Record high rent increases amid ongoing 'extreme' supply shortage

The latest report found that market rents have risen by 14.1% in the last 12 months.

LAST UPDATE | Nov 22nd 2022, 12:16 PM

THE IRISH RENTAL market has seen record levels of rent inflation in the last 12 months, as there continues to be an “extreme” shortage of properties available to rent according to the latest report

Their latest report found that market rents have jumped by 14.1% in the third quarter of 2022, compared with the same period last year.

This is the highest year-on-year price hike since Daft began its reports in 2006 and is higher than the previous record of 12.6% recorded last quarter.

The average market rent during the Q3 was €1,688 per month, which is a 4.3% rise compared to Q2. This is also the highest quarter-on-quarter rise ever recorded in a rent report.

The average market rent in Q3 is also 120% higher than the average market rent seen in late 2011, which was €765 a month.

However, rents may be higher or lower depending where in the country you live.

Dublin has continued to trend higher than the national average in rent inflation, with it rising 14.3% year-on-year.

Cork city has seen a slightly smaller jump, but rent inflation has still risen by 12.1% compared to Q3 2021.

While both Dublin and Cork are seeing large jumps in rent inflation, larger hikes in rent are being seen in cities like Galway (16.4%), Limerick (17.1%) and Waterford (17.1%).

Here’s the overall picture:

  • Dublin: €2,258, up 14.3% year-on-year
  • Cork city: €1,708, up 12.1% year-on-year
  • Galway city: €1,713, up 16.4% year-on-year
  • Limerick city: €1,604, up 17.1% year-on-year
  • Waterford city: €1,357, up 17.4% year-on-year
  • Rest of the country: €1,318, up 13.8%

Lack of properties

Alongside rising prices, the Daft report also highlights the ongoing shortage of properties available to rent throughout the country.

As of 1 November, there were 1,087 homes available to rent nationwide.

While this is an increase compared to figures recorded on 1 August, when only 716 homes were available, it is down a quarter compared to the same period in 2021.

It is also only a quarter of the average number of homes which were available to rent between 2015 and 2019.

Availability - Rental Price Report Q3 2022

In Dublin, there were just 345 rental properties available as of 1 November, which is up slightly from the 292 which were available on 1 August.

The latest report also includes an analysis of rent paid by sitting tenants.

According to this survey, rents for sitting tenants has risen by 3.4% each year over the last decade. Sitting tenants in Dublin have a higher than average rise year-on-year at 4.9%.

Under current Rent Pressure Zone (RPZ) legislation, rents can only be raised either by the rate of inflation or 2%, whichever is lower.

Due to the current rate of inflation running at 8.2%, rents in RPZ’s cannot be hiked more than 2%.

Collapse in availability

Report author Ronan Lyons, an Associate Professor of Economics at Trinity College Dublin, said that the continued rise in rents is due to a collapse in availability.

“Over the past 20 years, the best predictor of future changes in rents is the number of homes available at any particular point in time. As that has collapsed over the past 18 months, it was apparent that there would be significant upward pressure on rents all across the country,” Lyons said.

“This has been confirmed in these latest figures, which show record quarterly and annual increases in market rents, despite rents already being at very high levels.”

Sinn Féin’s Housing Spokesperson, Eoin Ó Broin has also reacted to the report, calling on Housing Minister Darragh O’Brien to take “emergency action” to tackle the rising rents.

“The Minister for Housing, Darragh O’Brien, must take emergency action to tackle runaway rents. This means a three-year ban on rent increases. It means a properly designed refundable tax credit to put a month’s rent back into every private renter’s pocket,” Ó Broin said

“It also means increasing and accelerating the delivery of genuinely affordable cost rental homes.”

He also criticised the Government for placing too much bureaucracy on both Local Authorities and Approved Housing Bodies, saying that this is preventing the development of affordable cost rental homes.

Ó Broin called on the Government to support a Sinn Féin private members motion, which would declare a housing emergency.

Social Democrats Housing Spokesperson Cian O’Callaghan also criticised the Government, calling the continued rent increases proof of the “abject failure” of the Housing for All plan.

“The Government is busy patting themselves on the back and congratulating themselves as 28,000 homes are predicted to be delivered this year, despite a general consensus that at least 40,000 new build homes are needed each and every year,” O’Callaghan said.

“We need an end to the constant Government spin on housing and a relentless focus instead on delivering homes that are affordable to rent and buy.”

Speaking outside Leinster House this morning, People Before Profit TD Richard Boyd Barrett, calling the Government’s Housing for All plan “an absolute shambles”.

“I mean, there are so many aspects to the Government’s failure on this housing disaster that we are facing, it’s difficult to count them but we now have, with rents going up to over €2,200 on average in Dublin, €2,400 in South Dublin.”

“That means a whole generation of young and working people on average and below-average incomes have no chance at all of being able to afford the rents out there or have even the remotest chance of being able to buy a house at the house prices, if they could even find places to rent or to buy.”

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