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'People are basically fleeing the city now': What sky-high rents are doing to Dublin

Economist Ronan Lyons tells us why the government needs to cut the cost of building new homes.

BOOMING DUBLIN RENTS may finally be starting to peak as the asking price for city accommodation outstrips peoples’ wages and ability to pay.

In an interview with TheJournal.ie, TCD economist Ronan Lyons said rents in the capital had now “more or less” returned to their 2007 highs, but peoples’ incomes had decreased over the same period which meant they had less means to afford those costs.

The latest Daft.ie rental report showed the average Dublin rent was now €1,350 – 11.5% higher than the same time last year and more than double the average price in Waterford.

Lyons said one of the effects of several years of rent rises in the capital was that people were “basically fleeing the city now”. Here’s some more of what he said about the impact of those rental price pressures:

Source: Video TheJournal.ie/YouTube

The main driver of the rapid increases in both house prices and rents has been chronic undersupply, and Lyons said part of the solution to that problem was to cut the costs of building new homes.

He said the price of construction need to come down up to 40% for it to reach “a healthy level”, although there was more the government could do to make housing affordable:

Source: Video TheJournal.ie/YouTube

Note: Journal Media Ltd has shareholders in common with Distilled Media Group.

Video by Michelle Hennessy.

READ: Buying or renting? Which should you be doing? >

READ: The figures are in: Are you paying above average for your rented property? >

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About the author:

Peter Bodkin  / Editor, Fora

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