Dublin still most expensive rental area

THE cost of renting an apartment in Dublin is nearly 40% more expensive than in Cork City, a new survey has shown.

Although renting accommodation across the country is getting cheaper, Dublin continues to be more expensive with the average one-bedroom apartment in the city costing €845 a month to rent.

This compared to a price of €607 per month in Cork, the survey by the Institute of Professional Auctioneers and Valuers (IPAV) found. But rental incomes are falling, with a 3% decline in Dublin in the year to the end of June 2004.

Prices dropped by 4% in Munster. In Leinster, rents fell by 2%.

However, the IPAV said property remains a good investment with homeowners across the country seeing the value of their property rise by 8% on average.

IPAV chief executive Liam O’Donnell said: “This year, property is expected to give a minimum return of 8% in capital growth, which is excellent compared with other investment.”

The survey also found that the price of a three-bed semi-detached house nationally was €233,000 at the end of June, while second-hand houses were selling for slightly higher at €238,000.

There was a wide disparity between house prices across the country. In Cork the average price was €251,000 compared to €380,000 in the greater Dublin area.

In Connaught the average semi will set you back €234,000 and €239,000 in Leinster. For the rest of Munster the average house sold for €217,000 compared to just €181,000 in Northern Ireland.

Members of the IPAV, which is comprised of estate agents and auctioneers, expect house prices to rise by about 8% this year in line with other market data, though around half of IPAV members in Dublin expect prices in the capital to be lower in the coming year.

A third of the survey respondents said house prices in estates with social housing expect prices in these areas to reduce, although the same number expected them to grow.

At the upper end of the housing market, which has lagged somewhat in the past couple of years, both sales and rentals are more buoyant than at the lower end.

Labour Party spokesperson on Environment and Local Government Eamon Gilmore said that the figures show that the average price of a new house has increased by €20,000 nationally and €30,000 in Dublin in the last 12 months. He said the new houses are increasing in value year-on-year at a rate equivalent to an average annual salary.

“The figures from IPAV indicate that the cost of a new houses has increased by 8% in the past 12 months. The stark reality of that increase in financial terms is €20,000 of an increase outside of Dublin and €30,000 in the capital - or between €50 and €80 each day.

“It is time for the debate on house prices to focus on monetary increases, not just meaningless percentages. The real expression of today’s figures is that the cost of a new home in this country has increased by the equivalent of a person’s annual salary. This increase puts home ownership far beyond the vast majority of the population.

“The single biggest socio-economic issue facing the country at present is the fact that ordinary working families cannot afford to buy a house from their own resources. The problem is now very acute in Dublin, where the average price of a new house is over €350,000”, he added.