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Increase in available rental properties in Dublin 'likely related to collapse of tourism'

Half of the Dublin increase is concentrated in the most in-demand property type and area for the short-term market.

Image: Shutterstock

PROPERTY WEBSITE DAFT.IE has seen an increase in advertisements for rental property in Dublin since the coronavirus outbreak hit the tourism sector.

Ronan Lyons, Daft.ie economist said there has been a general increase in the number of available rentals across the country over the last 18 months, but there is a particular trend he has noticed in the data from the start of March in the capital.

The number of rental ads is up in March so far, by about 13% nationally.

He said almost all of that increase is concentrated in Dublin (303 of the 353 extra listings) and half of the Dublin increase is concentrated in what might be termed the most in-demand property type and area for the short-term rental market – one and two-bed properties in Dublin city centre.

This segment has seen a 64% increase in listings since the start of the month – with 396 ads so far, compared to 242 in the same period last year.

“The increase in the number of properties advertised for rent so far in March is likely to be related to the collapse in tourism and thus the fall in demand for short-term rentals,” Lyons said.

Most of the country has seen almost no change in properties advertised to rent, compared to a year ago. But the number of smaller properties in central Dublin – where demand for short-term lets is concentrated – has grown by almost two-thirds. Close to 400 one- and two-bed properties were advertised in under three weeks, up 150 from the same period last year.

Speaking to TheJournal.ie, Lyons said the drop in tourism as a result of the coronavirus measures in Ireland and around the world may have been a “trigger” for property owners who were using their apartments for short-term lettings on a fulltime basis to get out of that market.

Last year new short-term letting regulations came into effect around Ireland.

Under these new laws, home-sharing on platforms such as Airbnb are only allowed where a house is a person’s primary residence inside designated ‘rent pressure zones’.

Home-sharing – people renting out a part or all of their home for a period of time, usually to tourists who are visiting the country – operates under strict limits and is monitored by local authorities.

This is difficult to enforce, however, Lyons said, and the recent increase in listings may indicate some property owners were continuing to flout the regulations until the current situation took away the tourism option for them.

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“I suspect that’s probably the case, they don’t know when this will be resolved and they’re thinking there’s no point relying on sparse tourism demand for six months, and maybe a crackdown is coming anyway because of the new regulations so they’re thinking they might as well [change].”

While there has been a noticeable increase in available properties, Lyons said the scale is still small compared to overall need.

He said the Dublin rental market typically needs 1,000 homes a week to keep rents affordable.

“Thus, while a one-off shift from the short-term to long-term rental market may be welcome news for many, it does not change the huge underlying need to build new rental homes.”

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

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