As shortages in the rental market reach a ‘frightening’ level, buyers are becoming more cautious
For 20 years Paul Reddy has been selling and letting properties in Fingal, the fastest growing council area in Ireland, where Housing Minister Darragh O’Brien is a local TD. Back in Celtic Tiger times, he met 18-year-olds with 100pc mortgage approvals. They even had extra cash factored into their loans for a new car. “It was a frenzy,” he said. And now?
“I get people coming into my office every day begging for rentals. I’ve never seen anything like it. People are frightened.”
Reddy grabs a bag of keys. He has agreed to allow the Sunday Independent to accompany him throughout his day. He works six days a week, from 9am until after 8pm sometimes. His new electric BMW i4 M50 suggests business has been good — and he also had the good fortune to buy his own home during the last downturn.
He’s not complaining, but commissions on the sale of homes would be arriving more frequently if he could get more of them on his books: “I used to have 20-30 houses for sale at a time, now I only have seven or eight because stock is so low,” he says.
Of the 70 or so properties he has sold in the last year, “the most popular is a three-bed semi-detached house close to schools, shops and facilities. They are the homes that lead to bidding wars”. He has watched couples stuck in a cycle of being repeatedly outbid for two years.
Things are far worse, he says, in the rental market. “If I put a rental up online, I’ll get 100 applications within two days. I feel really sorry for the couples where both are working — they don’t qualify for any of these housing assistant payments and they are competing with people who do qualify who are getting a lot of their rent paid by Fingal County Council.”
At the first viewing, there are four couples. At the next, there are just two. Reddy reminds me that most people are at work, but there is still a sense the market is cooling.
“When people came out of lockdown there was fierce competition for properties — I would have had six to nine groups at each viewing,” he says. Properties are still selling, but “people are taking longer to decide, they’re asking for a second viewing”. There was a time when they were making offers on the driveway “before they even saw the house”.
We walk around a 75sq m semi in Donnycarney on sale for €420,000. It needs a lot of work and everyone who views it talks about building costs. “People are more clued into that now,” says Reddy. “After getting a mortgage they mightn’t have the extra money to put into the house. One woman told me the lowest quote she got for a single-storey extension was €100,000.”
After taking a look around, Nick, an actuary, tells me he has been actively looking for three weeks. “I’ve heard the nightmare stories but it’s not as bad as I thought it would be,” he says. “It’s certainly a lot easier to get a viewing to buy than one to rent. If you send 20 emails about a rental place, you get one response — and then you’re viewing it with 20 others.”
An hour later, we’re in a housing estate in Swords. Vinny is looking at the property with his young daughter. “Rent is the real problem,” he says. “It’s making people desperate but I can afford to wait. I think there’s a big bubble. It will explode.”
It’s almost 8pm by the time Reddy is showing prospective buyers around in his final viewing of the day. Laoise and Ciaran are partners who have been living separately with their parents until they can save enough buy their own home. “We’re both in good jobs — why are we struggling so much?” Laoise asks.
She’s not expecting the market to soften any time soon: “They say there’s a recession on the way, but I can’t see it affecting house prices.”
A little earlier, on the news, she had heard President Michael D Higgins describing a housing “disaster” and lamenting the nation’s “great, great, great failure”.
“It’s nice to know someone high up is speaking the truth for once,” she says.