Number of rental terminations fell sharply after new tenancy rules came into effect

Actual rents continued to rise upwards despite the new rules effectively capping increases at 2% per year, with the average cost of a new rental in Ireland now €1,839 per month.

The number of rental terminations issued to tenants dropped massively between April and June as new rental rules aimed at bringing stability to the market took hold.

Notices of termination dropped by 43% from the first three months of the year after the new rental rules granting security of tenure for six years took hold on March 31.

The drop in terminations compares to a 51% increase quarter-on-quarter noted when the Residential Tenancies Board provided its previous quarterly rental update last May.

Separately, actual rents continued to rise upwards despite the new rules effectively capping increases at 2% per year, with the average cost of a new rental in Ireland now €1,839 per month.

For existing tenancies, meanwhile, the average rental figure is now €1,513 per month, up 4.2% year-on-year.

At a media briefing announcing the findings, RTB director Rosemary Steen acknowledged the pace of rental inflation despite the new rules remained a "concern".

By way of example, the rate of increase in nine separate counties was over 10%, despite the supposed calming nature of the new standards, with Limerick, Cork, and Galway cities particularly heavily affected by increases.

However, the RTB said it was important to take the new figures in the round, given so much of Ireland had previously been subject to rent pressure zone (RPZ) rules for the majority of the past decade, meaning rents had been capped at 2% per year.

That means a large number of landlords will have been resetting rents to market rates since the new rules were introduced, though this is an effect that should only materialise on this occasion.

Ms Steen said it appeared the country was "entering a period of stabilisation" with regard to rents.

"We have much more visibility on how landlords are setting rents now," she said.

Researcher with the Economic and Social Research Institute Dr Rachel Slaymaker said the inflationary increases were necessary to allow new rents to reset to market value "in order to encourage supply into the market, which is needed".