Rents in main cities spiral despite decline elsewhere
Published 13/06/2015 | 02:30
The cost of renting a home in our main cities is more expensive today than five years ago, despite rents falling across the rest of the country.
The Irish Independent 'Rent Report' today reveals that costs have soared by as much as 30pc in parts of our main cities, but plummeted by 65pc in the regions where there is little or no demand. Only in the three cities of Dublin, Galway and Cork is it more expensive to rent today than in 2010.
It also shows that large homes in upmarket parts of the capital now command monthly rents of more than €2,300, while a similarly sized property can be rented for just €450 in other counties.
The 'Rent Report' shows that the most expensive 'average' rent across all property types is at Grand Canal Square in Dublin 2, at €1,945 per month.
That compares with the lowest average rent of €290 at Waterford city's Inner Ring Road.
The report also shows that Dublin is the most expensive place in which to rent a home, whether a one-bed apartment or four-bed detached house.
Tenants living in Dublin 4 in a four-bed semi-detached house, redbrick buildings typically found on more established streets, fetch an average of €2,355 per month, or €28,260 per year. This compares with an annual rent of €446 for a similar property in Leitrim.
The price rises in our larger urban areas are being fuelled by a lack of properties coming on to the market as the construction sector struggles to deliver the required number of new homes to help meet demand.
This lack of financing not only fuels property price increases, but also results in soaring rental prices. This is at a time when one in five households rely on the private rented sector for their accommodation.
High prices means that families and single people will find it increasingly difficult to save the deposit in order to secure a mortgage.
Meanwhile, the flight of young people from the regions to the cities and abroad in search of work is keeping prices in some counties stubbornly low.
The 'Rent Report' reveals that in Dublin, the largest price hikes are seen in apartment developments. It shows:
The average cost of a three-bed semi-detached home in the capital now stands at €1,148, up 3pc.
A two-bedroom apartment costs €1,147 (up 11pc), and a one-bed unit some €930 (up 9pc).
In Cork city, a three-bed house costs €851 (up 2pc). A two-bed apartment is more expensive at €864 (up 5pc), and one-bed unit is €653, up 1pc.
In Galway city, a three-bed house is €823, up 5pc; a two-bed apartment rises by 4pc to €802 while a four-bed semi-detached house cost €1,029, up 4pc.
The only county in which the cost of a three-bedroom house has increased is Galway. This is because some towns are home to commuters, who make the trip into the city every day.
Outside Dublin, the highest 'average' rents are found in Wicklow, Kildare and Galway.
The cheapest are found in Longford, Leitrim and Cavan.
Read more: A generation trapped by spiralling rents
The 'Rent Report' is based on real market data collated by the Economic and Social Research Institute (ESRI) on behalf of the Private Residential Tenancies Board (PRTB).
The PRTB records the monthly rent per registered tenancy, and the type and location of the property. This is different from other rent reviews which only cover asking prices.
Records of more than 400 locations are held, and published today. The report shows that average rents for all property types are down 1.6pc nationally - they stood at €800 per month at the beginning of 2010, but the most recent data shows this has since fallen to €787.
That scenario is completely reversed in the capital, where prices have soared by as much as 30pc in some areas.
It shows that across all property types, the highest increase has been recorded at Islandbridge in Dublin 8, where increases of 26pc and 30pc have been recorded. A one-bed apartment is 30pc more expensive today, at €1,097 per month.
However, a two-bedroom apartment on Dublin's South Circular Road has dropped by 33pc to €974. Monthly rent on three-bedroom semi-detached homes in Dún Laoghaire, Balbriggan, Swords and Finglas have also fallen
The highest increase outside Dublin is for a two-bedroom apartment in Ratoath, Co Meath. This costs €811 per month, up 15pc. Prices for a four-bedroom semi-detached home at Newcastle in Galway city, which is close to NUI Galway, have also risen 15pc to €1,260.
The sharpest falls outside of Dublin are in Waterford city, followed by Ballaghaderreen in Roscommon (down 29pc), Castlebar in Mayo (down 19pc) and Edgeworthstown in Longford (down 18pc).
The 'Rent Report' also reveals that the booming IT sector - including Google, Twitter, Facebook and Airbnb, which are based in the Dublin Docklands - is helping fuel the increases along the east coast, but that the influence is not confined to the capital.
Outside Dublin, the next most expensive place in which to rent is Leixlip in Kildare, home to tech giants Intel and Hewlett Packard, where a home costs €1,041 per month.
The information published today is for the two most commonly rented property types - a three-bedroom semi-detached home, and a two-bedroom apartment. In the cities of Dublin, Galway, Cork, Limerick and Waterford, the third most popular property type is detailed.
While prices have risen in the last year, the overall trend across most counties is that it is cheaper to rent a home today than five years ago.
The data shows that rents rose in 338 locations between the end of 2013 and December 2014. However, they fell in 28 locations in Carlow, Cavan, Clare, Cork, Donegal and Dublin.
What's the real cost of renting in your area?