New housing data 'blows apart' claim Ireland is in step with Europe

House price increases are slowing across Europe. File Picture

Rents and house prices in the EU increased again in the third quarter of 2022, with respective hikes of 2.1% and 7.4% on the same period in 2021, new figures show.

However, price increases are slowing across Europe. In the third quarter of 2022, house price increases slowed with a 0.9% decrease on the previous quarter and a 2.4% decrease on the previous year.

The latest data from the EU “blows apart” the claim that Ireland is not out of step with Europe, and housing advocates have pushed for “a significant increase in social, affordable and cost-rental housing”.

In November, the then Tánaiste Leo Varadkar suggested that while “the grass looks greener” abroad, young people will not find lower rents. However, Ireland saw the highest rent increase relative to house prices over the last 12 years in the EU and is one of just three member states where rents increased more than house prices.

From 2010 until the third quarter of 2022, rents increased by 18% and house prices by 49%, according to data compiled by Eurostat, the European Commission’s statistics branch.

Substantial house price increases were seen in some countries, such as Estonia, Hungary, Luxembourg, Lithuania, Latvia, Czechia and Austria where costs more than doubled, the highest being Estonia.

🏘️When comparing Q3 2022 to 2010, EU house prices increased most in:
🇪🇪Estonia (+199%)
🇭🇺Hungary (+174%)
Highest decreases:
🇬🇷Greece (-22%, see methodological notes)
🇮🇹Italy (-9%)

Rent prices increased most:
🇪🇪Estonia (+233%)
Decreases:
🇬🇷Greece (-24%)

👉https://t.co/EelWyoAYy2 pic.twitter.com/sZRpXZn4VE

— EU_Eurostat (@EU_Eurostat) January 10, 2023

Greece (-24%), Italy (-9%) and Cyprus (-0.3%) were the only countries to witness a drop in house prices over the 12-year period. Denmark was the only EU country to reduce average house prices on the third quarter of 2021, with a 2.4% reduction.

Rory Hearne, Assistant Professor in Social Policy at Maynooth University said the price increases “worsen the cost-of-living crisis faced by those having to pay these higher rents and higher house prices”.

“We have heard a lot from the Taoiseach about how Ireland’s rents are not out of step with other countries, but this data blows apart that claim. 

It shows that since 2015, rents in Ireland are up a phenomenal 51%. The average increase across the EU in that same period was just 9%.

Mr Hearne said the data demonstrated that the housing crisis is not felt everywhere, and suggested Ireland’s issues are the results of “policies pursued by governments over the last decade”.

“The increase in rents has a major impact on Generation Rent – those in their 20s, 30s and 40s who are locked out of owning a home and are stuck renting.” 

Housing charity Threshold’s national advocacy manager, Ann-Marie O’Reilly, said the data “shows that rents in the Irish private rental sector are out of step with most of our European neighbours. 

"While the Rent Pressure Zone regulation has had a moderating impact on increases more is required to bring about long-term affordability in the private rental sector. Such affordability can only be achieved by a significant increase in social, affordable and cost-rental housing.”