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Rents fall for first time in seven years as urban-rural divide widens

 

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Warning: Ronan Lyons cautioned against a rent freeze. Photo: Damien Eagers

Warning: Ronan Lyons cautioned against a rent freeze. Photo: Damien Eagers

Warning: Ronan Lyons cautioned against a rent freeze. Photo: Damien Eagers

Rents have fallen for the first time in seven years nationwide - but continue to rise in Dublin.

Figures from Daft.ie show there is now a clear urban-rural divide.

Rents rose in Dublin, Cork and Galway cities between September and December, but fell outside major cities.

Nationally, there was a marginal fall in the last three months of last year.

This was the first time since the middle of 2012 that rents nationally have not risen in a quarter when compared with the previous quarter.

The report shows there are now 10pc more homes for rent than a year earlier.

Dublin rents are up 3.5pc, the slowest rate of increase since 2008. The Daft.ie report shows average rents in Dublin rose to €2,052 at the end of last year. This is a rise of around €70 a month when compared with a year earlier.

The average monthly rent nationwide stood at €1,402 a month in the final quarter of 2019. This is €659 a month higher than the low seen in late 2011.

National rental inflation for all of last year was calculated at 4.1pc, which was the lowest rate of increase since 2012.

The number of homes available to rent nationwide continues to rise but is coming off a very low base.

There were 3,543 properties available to rent across the country on February 1, up 10pc from the 3,216 available on the same date a year ago, according to Daft.ie.

This marks the 17th time in the last 19 months that availability has improved year-on-year.

But Daft.ie said the number of rental homes on the market was still down 80pc from its peak in 2009.

Report author Ronan Lyons, an economist at Trinity College Dublin, said housing and rents were likely to be a key part of the next government's priorities.

And he warned the next government against introducing a rent freeze.

"Despite the desire for a quick fix, such as rent freezes, no such quick fix exists. By worsening insider-outsider dynamics, rent freezes are likely to further harm those most affected by the shortage of accommodation," he said.

Prof Lyons said if rental controls are applied to newly built homes, they "could prove calamitous for a country".

Irish Independent