Only luxury rents are falling, says Threshold

WHILE rent prices for luxury apartments are falling, rents for lower-income properties are rising.

In a study of over 600 Dublin rents, housing organisation Threshold found increases of up to 20% between December and April.

The weekly price of a one-bedroom flat increased from €150 in December to €182 in April. Weekly rents for two-bedroom houses rose from €219 in January to €246 in March, before falling to €238 in April.

According to Threshold, the situation may be even worse in other parts of the country, such as Galway. It has received reports of people moving from Galway to Dublin because they cannot afford to pay rent there.

The latest Central Statistics Office (CSO) figures show a slight drop in the cost of rented accommodation, but it now appears this is all at the higher end of the market.

"There's been constant talk over the last couple of months that rents have dropped, particularly from landlords. But, quite clearly, at the lower end of the market that isn't true," Threshold Housing Access manager Russell Chapman said.

Since last November, tenants who depend on rent allowance from the health boards have had their rent capped. Threshold said it was now obvious the rent capping strategy had failed.

"The government thought that rent allowances were fuelling rent increases, and that capping them would control the increases. But from our research, that is not the case. People are colluding with their landlord and paying the rent out of their own pocket," Threshold chairwoman Aideen Hayden said.

"You are talking about a serious volume of people around 100,000 who are long-term renters at the bottom end of the housing market," she added.

The Department of Social, Community and Family Affairs defended the rent capping scheme, saying that it now caters for 57,000 people, compared to 54,000 in 2000.

"The health boards tell us the scheme is operating effectively," a spokesman said.