Tuesday 25 October 2016

Renting a home in capital now costs more than at peak of property boom

RTB director Rosalind Carroll
RTB director Rosalind Carroll

The cost of renting an 'average' home is Dublin is now more expensive than at the peak of the boom.

A new report says it costs on average €1,314 per month to rent a property in the capital - €3 more expensive than in 2007 when prices reached a record high.

The Residential Tenancies Board (RTB) say rents have risen 8.6pc in the past year, adding almost €900 to housing costs, but the increases are slowing.

The average monthly rent paid across the country in the first quarter of this year is €922 - up from €849 a year ago.

The RTB Rent Index shows that rents have risen for the 12th quarter in a row as the shortage of new homes coming on stream fuels price increases.

The problem is particularly acute in Dublin, where prices are now above the peak.

It shows there was a modest increase in the first three months of this year compared with the last quarter of 2015.

Nationally, rents rose 0.5pc during this period, with houses marginally lower by 0.3pc, but with rents for apartments up 1.8pc.

The data is compiled by the Economic and Social Research Institute for the RTB. It is considered the most accurate and authoritative report of its types because it is based on actual rents paid as registered with the board, as distinct from the asking or advertised rent.

The report shows that some 22,753 new tenancies were registered in January, February and March this year. It also shows:

•Across the country as a whole, rents for houses rose 7.8pc year-on-year to €900, an increase of €65 per month. Apartments are up 9.8pc to €972, up €87 per month.

•Annual growth in the Dublin market was also strong, up by 8.7pc overall, with Dublin house rents up 8.4pc and apartments up 8.1pc. A house costs an average of €1,454 and an apartment €1,306.

•Comparing the figures quarter-on-quarter, Dublin rents grew by 0.2pc in Q1 compared with Q4, 2015. Outside Dublin, rents are up 0.9pc.

Rents reached a peak in the last quarter of 2007 when the national average stood at €1,013. They fell to their lowest level at the beginning of 2012, down to €758.

"While the peak-to-trough in the Dublin market was similar to that experienced nationally, the strength of the recovery in Dublin means that rents are now 0.2pc higher than their previous peak in Q4, 2007," it says.

Outside of Dublin, rental levels are 13.9pc off the peak.

Director of the RTB, Rosalind Carroll, said it appeared that the rate of growth was slowing, but that hikes were being fuelled by a lack of new housing supply. Some 324,000 tenancies are registered with the RTB.

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