Rents are now rising at the fastest rate on record as social campaigners warn that “spiralling” costs are forcing people into homelessness, writes Conall Ó Fátharta of the Irish Examiner.
According to the Daft.ie rental price report for the last quarter of 2016, rents rose nationally by 13.5% in the year to December — the largest annual increase in rents ever recorded by Daft, which extends back to 2002.
In the final three months of 2016, the average monthly national rent stood at a record €1,111 — the third quarter in a row that this figure has increased.
In Dublin, the annual rate of rent inflation last year was 14.5% — the second highest rate on record since 2002. Rents in the capital are now at an average of €1,643, 13.7% higher than their previous peak in early 2008 — or an average of almost €200 a month.
In Cork, rents rose by 12% during 2016 and now stand at an average of €1,096.
Rents in Galway are 10% higher than a year previously at €975, while rents in Limerick have risen 12.5% to €875 in the last year.
In Waterford City, rents have risen by 10.7% in the 12-month period to €745. This is the same percentage rise as the rest of the country where the average rent outside major cities now stands at €783.
The Daft.ie report shows that housing supply remains low. There were just under 4,000 properties available to rent nationwide at the start of February. This is a slight improvement on the same date the previous year when there were just under 3,600 properties available.
However, it remains just one-quarter of the level seen in 2012, when there were almost 12,000 properties available to rent nationwide.
Ronan Lyons, an economist at Trinity College, Dublin, and author of the report, said the figures are “very concerning”.
“Not only do rents continue to reach new peaks, rental inflation continues to increase in both Dublin and nationwide. The increase in rents in the final three months of the year in Dublin was 4%, the second fastest three-month increase on record,” he said.
“While measures to control rental inflation may help sitting tenants, they do little to address the underlying issue of a lack of supply.
“Indeed, they may hinder supply by encouraging the exit of existing landlords who had not substantially increased rents in recent years. Addressing construction costs remains the best way of addressing supply shortages and the audit of build costs remains the single most important next step for policymakers, for that reason.”
Niamh Randall, a spokeswoman for the Simon Communities, said that spiralling rents and the lack of housing supply needed to be tackled as a priority, as people were being forced into homelessness.
“Increasingly, these issues are preventing people from finding and sustaining affordable homes within the rental market,” she said.
“Many people entering into homelessness are coming from the private rental sector where they have been unable to maintain their tenancy.
“Keeping people in the homes that they already have is key to stopping the flow of people into homelessness.”