Cork rents continue on upward spiral
Daft.ie rental report shows it is now more expensive to rent than buy a property in Cork
The cost of renting accommodation in Cork has continued on its upwards spiral over the first quarter of 2019 - with the average rent charged in the county rising above the €1,000 mark.
The latest Daft.ie Rental Report has revealed that average rent in the county rose by 4.5 per cent over the first three months of the year to €1,006 - representing a year-on-year increase of 12.7 per cent. The figure represents a 72.6 per cent increase from its lowest point, or trough, in 2011.
The picture for Cork city was even more stark, with the average rent now standing at €1,331, a 10 per cent year-on-year increase and a staggering 86.4 per cent above the trough.
The report for the first quarter of the year, which provides a review of rental market trends across the country, showed that Cork remains the most expensive county in which to rent outside of the capital and the so called 'commuter counties; of Wicklow, Kildare, Meath and Louth.
Under the heading 'To But or To Rent?', Daft.ie analysed data from its House Price and Rentals reports to calculate the average mortgage payments and rents for properties around the country.
Using the base, a 3.5per cent variable mortgage over a 30-year term with 85 per cent loan to value (LTV) and a 2 per cent increase in interest rates, the report found that it was actually cheaper in all of the 54 markets across the country covered by the report to pay a mortgage than to rent.
It found that in Cork county, for example, mortgage repayments on a three-bed house can vary between €572 and €723 - while the average rent for the same property now stands and €923.
In Cork city the mortgage repayments on a similar property are between €899 and €1,133, with the average rent standing at €1,231.
The report's author, Trinity College economics professor Ronan Lyons, said the report "did little to assuage the worries of policy makers, renters and others interested in a healthy rental market".
He said that while the 8.3 per cent national rate of inflation was at its lowest level for five years, this was "small consolation" at best saying that nobody could argue an inflation rate of 7 or 8 per cent was "anything like a health outcome".
He said a key problem was the fact that Ireland's rental market remained "starved of supply", with just 2,700 properties available to rent nationwide as of May 1 - the lowest number since the first Rental Report in 2006.
The lack of available properties was reflected across province of Munster, where there are just 700 home on the rental market in April - 20 per cent lower that the same period in 2017.
Professor Lyons the rental market "remained plagued by weak supply at a time of string demand" and although the number of rental homes available did improve slightly earlier this year, "the figures for May have undone all that progress".
"With the sale market showing greater balance between supply and demand, policymakers must maintain their focus on boosting rental supply," he said.
While all of the counties in Munster recorded rental increases over the 12-month period to May, Cork remained the most expensive in which to rent a property followed by Waterford (€986), Limerick (€864), Clare (€862), Kerry (€848) and Tipperary (€832).
The report showed the average national monthly rent as the month of April drew to a close was €1,366.