RENTS CONTINUED TO rise in the year to March, despite government attempts to address spiralling costs.
According to the latest rent report from Daft.ie, the average rents rose by an average of 13.4% in the first quarter of the year. That means the average monthly rent across Ireland was €1,131, the fourth quarter in a row that a new all-time high has been set.
In Dublin, rents are up 13.9%, with the average property in the capital costing €1,668 a month.
The rest of the country’s cities have seen rises with the average rent in Cork now €1,107 (up 10.4%). In Galway it is €996 (up 10.6%), Limerick €892, (up 12.6%) and Waterford €757 (up 10.2%).
The rise in prices is exacerbated by a severe lack of supply, the report shows.
There were just 3,084 properties available to rent nationwide on 1 May. This is the second lowest number on record, in a series that starts in January 2006. The availability of rental accommodation has not improved on the all-time low recorded in May 2016, when 3,082 properties were available nationwide.
Ronan Lyons, economist at Trinity College Dublin and author of the Daft Report, said the report shows “extreme distress” and said the government’s rent control measures were not helping.
“While the headline rate of inflation in rents has eased slightly, the market continues to exhibit signs of extreme distress. Rents are at a new all-time high, while the number of homes available to rent remains at the lowest levels on record.
Regulatory measures designed to limit rent increases could only ever have a very limited effectiveness in a market with such a scarcity of supply. Indeed, there is evidence to suggest that rent increases for sitting tenants have been only half the size of increases faced by new tenants.
“The more appropriate solution remains to increase supply. This includes both making better use of the existing stock of housing and building substantially more, in particular more apartments.”
The report has led to widespread reaction, with Pat Doyle of Peter McVerry Trust saying it was “deeply worrying”.
“The report paints a deeply worrying picture and shows the current situation is unsustainable. Tenants are under huge pressure, and those people who are dependent on the rental system for their housing needs are looking at rents that are up to 15% higher than the Celtic Tiger peak with the lowest number of properties to rent since 2006. Our concern is that rapidly rising rents will lead to more tenants becoming homeless.”
Niamh Randall, National Spokesperson for the Simon Communities said:
“The soaring rents and plummeting supply within the private rented sector must be constantly monitored and addressed. These issues are preventing people from finding and sustaining affordable homes within the rental market.”
Focus Ireland Director of Advocacy Mike Allen said:
“Good honest law abiding landlords who restrict rent increases to 4% between tenancies are being made fools of by the fact that there are other unscrupulous landlords clearly ignoring the rules and charging what they want with no risk of being called to account. We need action on this matter.”
The Irish Property Owners’ Association chairman said the report showed landlords were rewarding “good tenants” by keeping rates below market levels.
“This has always been the norm in the market with landlords valuing their good tenants and showing that value by not increasing to market rent. Rent control introduced in over half the tenancies in the country now restrict these fair landlords when their tenants leave to 4%, it also affects rental properties that are being sold discouraging new investors to purchase rent controlled properties.
“The State has punished landlords that kept their rents low.”