herald

Wednesday 21 November 2018

House shortages and surge in rents hitting firms' bid to woo staff

Ciara Morley outlined report
Ciara Morley outlined report

Dublin rents are rising at their fastest annual rate since 2007 as the city approaches over- capacity, a report from the four Dublin local authorities has warned.

The lack of available housing and the high prices being dem- anded could be limiting the ability of employers to attract talent from overseas, it says.

The Dublin Economic Monitor also notes that house prices have doubled since 2012, average monthly rents have been more than €1,500 for the past year and Brexit fears have weakened consumer confidence.

Problems

While Dublin remains a hive of economic activity, with unemployment falling and consumer spending continuing to grow year-on-year, the 15th edition of the report warns of possible problems ahead.

It finds that the city is showing symptoms of over-capacity, with the cost of housing at an all-time high.

Brexit concerns are also beginning to weigh on consumers' confidence in the economy.

"Without doubt the overall outlook for Dublin remains broadly positive, though housing continues to present the greatest challenge for the city," said Ciara Morley from EY-DKM Economic Advisory, which compiled the report.

"Average rents and house prices are in excess of levels recorded 10 years ago, and with both housing completions and commencements coming off such a low base, it will be some time before we see these pressures alleviated.

"This, coupled with the fact that the unemployment rate in the city is at its lowest level since 2008 and edging towards full employment, means firms may find talent attraction a challenge in the years ahead."

The report looks at a range of economic indicators driving the city's growth.

These include employment, property and rental prices, house building, hotel rates and public transport use, which measure economic performance from the height of the boom to the crash and recovery.

Key findings include average monthly residential rents in Dublin now stand at €1,587, €128 higher than 12 months ago and the greatest annual increase since late 2007.

House prices are now at their highest level since the end of 2008 and are close to 95pc higher than their trough in early 2012.

The unemployment rate in Dublin is now 5.2pc, the lowest level since early 2008.

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