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Dublin struggling to cope with demand for rental properties

DUBLIN is experiencing a drought in rental properties as stocks have dropped to their lowest levels in seven years.

Many young couples who would traditionally have bought are renting, even though in some cases the rent is higher than they would have to pay if they could secure a mortgage.

And others who can get a mortgage, cannot find a house to meet their needs and are in rental accommodation while their search continues.

Economist Ronan Lyons said that there were fewer than 1,500 units available to rent in Dublin at the time of the recent report by property website DAFT.

"To put that in context, there would have been five times as many in 2009. You would have had basically 8,000 units to choose from," he said.

"Even in 2011, there would have been 4,000 or 5,000 to choose from. So it is unbelievably tight in the rental market at the moment.

"The last time time, it was this bad was early 2007 and that was when rents were also rising at double digit rates," Mr Lyons said.

"But even then, there were maybe 1,700 or 1,800 units so it wasn't quite as bad as it is at the moment."

According to the economist, there are a number of contributory factors in relation to this issue.

"They are the symptoms, that people are staying in rented accommodation longer, but the ultimate cause really is the lack of building in Dublin," Mr Lyons said.

More people need to live in Dublin than there are dwellings for them to live in and that "is why we are seeing rents and prices rise so rapidly in Dublin at the moment," he said.

Rents have risen in the city by around 10 to 11pc over the past 12 months and, unlike in the sales market, most parts of Dublin are pretty much the same, ranging from 9.5pc in north county Dublin to 12pc in the south city area, he said.

AVERAGE

The figures show the average for a four-bedroom house per month in the south city area is €1,600 and it is quite similar in the south county area at €1,650. Dublin's city centre is also at €1,650, while it is €1,375 in the north city area and €1,200 in west Dublin, the economist said.

For a three-bedroom house, people will pay an average of between €1,300 and €1,350 in the south city, south county and Dublin city centre per month. In the north city area it is about €1,150. Elsewhere in west Dublin, and the north county areas, it is about €1,000 per month, Mr Lyons said.

"Both rental and sales markets, they are screaming out for more properties to be built in Dublin," the expert added.

Meanwhile Fionnughla McLoughlin, of Threshold, the national housing charity said that it is "bordering on the impossible" for many people to find somewhere to rent at the moment, because of the lack of supply.

She said that she has heard of numbers going on viewings having to be curtailed because of the demand.

In addition, there are biddings now for rental properties to try and get the place.

ACCOMMODATION

"If the house is €1,000, and there might be five people that want it after a viewing, they could go up €50 until they get to the limit where the landlord accepts or someone else can go higher."

Ms McLoughlin said that there is a shortage of property across the board, not just for families, but for those in search of single accommodation too.

"If people want to move, there is nowhere for them to move to, so they are staying put," she said.

In addition, rents have gone up. A survey of 249 one-bedroom apartments across Dublin this month showed the average rent was €935 a month.

"For two-bedrooms, we surveyed 639 properties, and the average for a two-bed was €1,266 a month," said Ms McLoughlin.

FDILLON@HERALD.IE


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