Rents across the country are continuing to rise. They increased nationwide by an average of 11.3% in the year to last September, according to the property website, Daft.ie.
It is the tenth consecutive quarter that a new, all-time high for rents has been reached, with annual rent inflation exceeding 10%.
The average monthly rent countrywide was €1,334 between July and September this year.
The rental cost is €304 higher than the previous peak, in 2008, when the financial crisis hit, and €590 higher than when rents were at their lowest, in 2011.
In Dublin, rents were, on average, 10.9% higher over the third-quarter of 2018 than a year previously.
The average advertised rent in the capital has now reached €1,968, almost double what it was in 2011.
Rental costs in other cities continue to rise rapidly, too:
- Cork: €1,301, +13.7%
- Limerick: €1,151, +20.3%
- Waterford: €955, +19.7%
- Galway: €1,226, +16.1%
While the average inflation rate for other cities is 15.9%, the inflation rate elsewhere in the country is 10.6% and the average rent is €937.
The cost of renting a room increased by 10% in Cork City, to €467 for a single bed; it was €358 in Limerick (+8.2%), and €335 in Waterford (+13.2%).
For a double bed, the average rent was €545 in Cork City (+11%); €455 in Limerick (+15.2%), and €368 in Waterford (+13.9%).
According to Daft.ie, there were 3,214 properties available to rent countrywide on November 1, which is a 4.5% decrease on the same figure a year ago and the lowest total for the month, on record, since 2006.
While there was a small rise (6.4%) in availability in Dublin, it was more than offset by falls elsewhere, particularly in Leinster (-15%) and Munster (-13%).
Economist and author of the report, Ronan Lyons, said the latest figures, while not surprising, were worrying.
“The condition of the private rental market remains a cause for huge concern, with very strong demand not being met by supply,” he said.
In particular, there was an acute shortage of apartments, not family homes.
Prof Lyons said that the recent increase in residential construction was being driven by estate houses, not apartment schemes.
“Dramatically increasing the construction of urban apartments, for both market and social housing sectors, must become the priority for policymakers in 2019,” he said.
The Daft.ie report, now in its 99th edition, is based on an analysis of the full database of properties posted on its website up to November 2018.
Prof Lyons said that, with people staying in their tenancies longer, the churn of rental homes had become far less than what it was a few years ago.
“Even as things stand, the number of people in rental accommodation is roughly 50% larger than ten years ago,” he said.
“This means that if 4,000 homes were needed to be listed every month for Dublin’s rental market to be in equilibrium a decade ago, then 6,000 are needed now. Dublin is currently seeing only 2,200 per month, at the moment.”
While many people could have guessed the headline findings for this report, based on the last two or three rental reports, the outcome was more than just statistical persistence, said Prof Lyons.
“Ultimately, the reason rents are rising country-wide is because demand far outstrips supply,” he said.
Up to 2014, the rental market outside of Dublin typically had more properties on November 1 than it had processed during the previous month.
Unsurprisingly, with more availability than the market could process, rents fell during this period.
For Dublin, the picture was slightly different. Any surplus availability was much smaller — less than 20% — and was gone by 2010.
Prof Lyons said that he wrote an article in 2010, entitled ‘Spotting the Swallows – Ireland’s rental market in 2010’.
Prof Lyons highlighted the fact that by 2009, any surplus seemed to have disappeared from the Dublin market.
Since then, availability in Dublin had typically been about 40% below a month’s worth of listings.
The market outside of Dublin is now as bad, “so, now, a problem that started to emerge nine years ago in Dublin has not only not been resolved, it has spread to the rest of the country”, said Prof Lyons.