Monday 23 July 2018

Record-high rents and growing urban-rural divide: Seven things we learned from the latest rent report

Rents are still rising at double-digit rates around the country, according to the Daft.ie rental report Photo: Stock
Rents are still rising at double-digit rates around the country, according to the Daft.ie rental report Photo: Stock
Kathy Armstrong

Kathy Armstrong

Rents soared to a record high last year, with people paying 10.4 per cent more in 2017 compared with 2016, a new report has revealed.

Daft.ie released their Irish Rental Price Report today, which highlighted how rents are continuing to swell and gave us an indicator of what we can expect from the housing market  in the coming years.

Here are the key things that we learned from the study:

1. The average rent is now 65pc more expensive than when prices bottomed out

The average rent is now €1,227, which is 19.2pc higher than the previous 2008 peak.

On average, renting nationwide is now 65pc more expensive than when prices bottomed out in 2011.

2. Dublin rents are now €4,500 more expensive annually than during the boom

Rent in the capital grew for the 26th consecutive quarter, at an average of 81pc more expensive than at their lowest point in 2010.

This upswing is twice as long as the previous market upswing, which lasted from early 2005 until mid-2008 and it's also twice as long as the downturn, which lasted for four years.

3. Commuter counties have seen some of the biggest increases in rental prices

As more people are priced out of living in Dublin, rents have soared in bordering counties.

Housing supply is failing to keep up with demand Stock image
Housing supply is failing to keep up with demand Stock image

Outside of Dublin, rents rose by almost 11pc last year, the 14th consecutive double-digit increase.

While rental prices grew by less than 40pc in Carlow and Westmeath since 2011, they soared by over 80pc in Meath during the same period.

The cost of renting a single room in a commuter county grew by 10.8pc during the first quarter of last year to €412, for a double room it increased by 8.4pc to an average of €484.

In Wicklow the average rent is €1,256, in Kildare it is €1,212, in Meath you can expect to pay around €1,171 and in Louth €1,086.

4. The most expensive places to rent are...

Perhaps unsurprisingly, the most expensive places to rent are all in the capital.

South County Dublin is the priciest, at €1,995, South Dublin city comes in second at €1939.

Central Dublin City is the third dearest place to rent in Ireland, €1869, and in North Dublin city it's €1,709.

5. And the least expensive places to rent...

Outside of urban areas, the average rent is 10.4pc more expensive than it's previous peak.

Leitrim is the least expensive place to rent in Ireland, with the average letting at €542, following this is Co Donegal, €599.

In Co Longford the average cost of rent is €605 and in Roscommon it will set you back €625.

The cost of rent rose by 3.9pc in Donegal, by far the smallest increase nationwide.

Stock Image
Stock Image

6. Urban populations are continuing to increase - but it's not bad news for rural areas

At the moment two-thirds of people live in urban areas in Ireland, compared to the Organisation for Economic Co-operation and Development average of 80pc.

Using the forthcoming National Planning Framework, the report predicts that by 2040 our population will reach six million people and 4.8 million (80pc) of us will live in cities.

Author of the report and economist at Trinity College Dublin Ronan Lyons expects that this will benefit rural Ireland.

"Somewhat paradoxically, the best hope for rural Ireland lies in the success of the cities. The bigger Dublin and Ireland's other cities grow, the bigger the population that can be sustained in rural areas.

"Or to put it another way, if rural Ireland appears consigned to 20pc of the total, then it is in the interest of rural Ireland for the total to be as large as possible," he explained.

7. 40,000 new homes are needed each year to keep up with demand

There were 3,143 properties available to rent nationwide on February 1 2017, this is the lowest number recorded for that time of year since the report series began in 2006, this is a 20pc decrease year-on-year.

In Dublin less than 1,350 houses were available to rent, compared with almost 6,700 on the same date in 2009.

Mr Lyons said that 40,000 new homes are needed to keep up with demand but less than 20,000 were built last year.

If you pay above-average rents anywhere in the country, be sure to contact us with your story at contact@independent.ie or on our Facebook page

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