Thursday 22 August 2019

Revealed: How much renters need to earn to afford one-bed flat in Dublin

Ellie Donnelly

Ellie Donnelly

Renters would need a salary of around €42,000 a year to afford a one-bed flat in Dublin - among the highest rates in Europe, according to a new survey.

The data, from a survey complied by global housing website Nestpick, bears out an earlier report from The Expat City Ranking 2017 which classed the capital as the second-worst major city in Europe in terms of quality of life - including high living costs.

The Expat City Ranking survey found nine out of 10 foreign workers in Dublin regard accommodation as unaffordable - double the global average.

In Dublin, the Nestpick survey found that the average monthly rent for a furnished apartment is €1,035, and that the monthly minimum salary required to rent a single-person furnished apartment was €3,568.

International comparisons are increasingly important to the city, where multinational firms now say they compete for talented recruits with rivals from across the EU, not just across Ireland.

The IDA has warned that quality-of-life concerns are becoming make or break issues in terms of winning and keeping foreign direct investment.

Top employers' groups including the American Chamber of Commerce Ireland, whose members employ 150,000 people here, recently warned about the lack of available housing for workers in Ireland - a crisis that is most acute in Dublin.

Despite those high-level interventions, junior housing minister Damien English this week blamed what he described as "a negative narrative" around the housing situation for potentially damaging Ireland's reputation as a place to do business.

"Some of this narrative has seeped into international coverage of our housing system and is damaging to Ireland's international reputation, that our social response to this issue is being portrayed as dysfunctional," he said in the Dáil on Tuesday.

While Ireland is expensive by European standards, US rents topped the ranking.

Nestpick found that four out of the five worst cities to rent a furnished apartment are in the US, with Hong Kong rounding out the group. High rents for workers are an issue for many businesses, but investors have been quick to cotton on to the trend.

The number of Irish Build-To-Rent (BRT) properties is growing rapidly. While BTR is a long-established sector of property markets internationally, it is a relatively new phenomenon here.

It is popular with institutional investors, such as pension funds targeting long-term rental incomes derived from letting residential units in large numbers. These provide steady returns over many years, and through the peaks and troughs of economic cycles.

A recent analysis by commercial property and real estate services adviser CBRE suggested that around €33.3bn of equity is targeting the UK's BTR sector currently.

In Dublin, developer Pat Crean's Marlet Property Group is seeking forward-funding for 1,170 apartments across four 'Dublin Living' schemes being marketed to investors at €425m, which promise to deliver annual rents of €20.5m.

US real estate giant Kennedy Wilson has 2,100 units either built or under construction here and plans to acquire more. In September, in a planning application, US real estate giant Hines signalled its intention to use BTR as a model to deliver homes in South Dublin, including plans for 1,269 apartments.

Irish Independent

Also in Business