Rents up by a third since 2011 low point, report shows

Rents nationwide rose by an average of 9% last year and by an average of 1.5% between September and December, it has emerged.

Towards the end of last year the national average rent was €979, according to the latest quarterly rental report by the property website Daft.ie.

However, the average rent nationwide has risen by almost one third (32%) since bottoming out in late 2011 and is just 5% below the early 2008 peak.

While rents in Dublin have risen by 43% since their lowest point in 2010 and rents in Cork have increased by 37%, there has been an increase of just 6% in Donegal and 7% in Mayo.

The availability of rental homes is at a record low — there were just under 3,600 in February, compared to 5,200 a year ago and almost 16,000 five years ago.

The report warns that the capital is effectively starved of rental properties, with fewer than 1,400 rental homes on the market at the start of February — less than two weeks’ supply.

The 9% increase in rents nationwide last year compares to an increase of 10.7% in 2014 and 6.7% in 2013.

The report points out that there have been three years of quarterly rent rises.

For the third quarter in a row, rent inflation outside Dublin, at 9.8%, was greater than the 8.2% increase for the capital.

Highest inflation rates were recorded in the cities outside Dublin — rents are 15.4% higher than a year ago in Cork and 13.3% higher in Galway.

Annual rent inflation in Limerick is 12.4% higher than a year ago, while a 10.3% rise was recorded for Waterford.

Year-on-year changes in rental rates:

• Dublin — €1,435 +8.2%.
• Cork — €978 +15.4%.
• Galway — €887 +13.3%.
• Limerick — €778 +12.45.
• Waterford — €673 +10.3%.

Economist at Trinity College Dublin and report author, Prof Ronan Lyons, said there was no sign of an improvement in the availability of rental accommodation, particularly in Dublin.

Prof Lyons said the shortage of rental accommodation was first identified in a Daft.ie report in late 2010, ahead of the last election when the political focus was on legacy issues related to ghost estates and negative equity.

“Hopefully, the new government will focus on taking the necessary steps to increase availability of homes to rent early in its term of office,” he said.

The shortage of homes to rent has not been limited to Dublin or even to the cities — properties available to rent in Cork, Galway, Limerick and Waterford, fell from an average of 2,000 since 2012 to just over 300.

Outside the cities, the number of available homes to rent has fallen from 10,600 to 1,900, according to the property analysis.