Rents rise at fastest rate on record

A new report from Daft.ie shows monthly rents are continuing to increase

Rents rose by an average of 13.5% in the year to December 2016, according to the latest quarterly Rental Report by Daft.ie.

This is the largest annual increase in rents ever recorded in the Daft.ie Report, which extends back to 2002. In addition, at €1,111 in the final three months of the year, the average monthly rent nationwide is at a new high, for the third quarter in a row.

In Dublin, the annual rate of inflation in rents during 2016 was 14.5%, the second highest rate on record since 2002. Rents in the capital are now 13.7% higher than their previous peak in early 2008 – or an average of almost €200 a month.

In Cork, rents rose by 12% during 2016, down from 18% earlier in the year.

Rents in Galway are 10% higher than a year previously, while rents in Limerick have risen 12.5% in the last year.

In Waterford city, rents have risen by 10.7% in twelve months, the same as outside the major cities.

There were just under 4,000 properties available to rent nationwide on February 1st. This marks a slight improvement on the same date the previous year, when there were just under 3,600 properties available.

However, it remains just one quarter of the level seen five years previously, when there were almost 12,000 properties available to rent nationwide.

Reaction

Commenting on the report, Ronan Lyons, economist at TCD and author of the Daft Report, said: "The latest figures from the rental market remain very concerning. Not only do rents continue to reach new peaks, rental inflation continues to increase in both Dublin and nationwide. 

"While measures to control rental inflation may help sitting tenants, they do little to address the underlying issue of a lack of supply. Indeed, they may hinder supply, by encouraging the exit of existing landlords who had not substantially increased rents in recent years. Addressing construction costs remains the best way of addressing supply shortages and the audit of build costs remains the single most important next step for policymakers, for that reason."

"Rent certainty and security of tenure go hand in hand". said Mick Byrne of the Dublin Tenants Association.

"Without adequate security of tenure tenants will always struggle to hold their landlords to account and the current culture of non-compliance with regulations on the part of many landlords will continue".

Meanwhile, the Simon Community called the figures "extremely worrying".

"Keeping people in the homes that they already have is key to stopping the flow of people into homelessness," said Niamh Randall, National Spokesperson for the Simon Communities.

"People renting their homes must have the security of knowing that their rents are in line with real market rates and index linked for example to the Consumer Price Index (CPI). People cannot plan for the future or become integrated into their Community if they do not have the security of knowing that they can stay in their home for as long as they may wish to."