Rents across the country continue to rise to record levels, driven by a chronic shortage of houses.
In the final quarter of 2022, average rents hit €1,733 per month, up 13.7% on the same period a year ago. In some parts of Munster, the rise was even higher — with Limerick up 18.9% and Waterford up 20%, according to the latest report from Daft.ie.
The worrying trend comes as the Government grapples with an escalating housing crisis, with a record 11,600 people now homeless, including almost 3,500 children.
The State is also scrambling to house more than 70,000 Ukrainian refugees and 19,000 international protection applicants who have arrived since last year.
Taoiseach Leo Varadkar admitted that while 30,000 new homes were built last year, it was simply not enough.
The Daft.ie figures show the following average market rents:
- Dublin: €2,324, up 13.1% year-on-year;
- Cork City: €1,768, up 14.9%;
- Galway City: €1,796, up 19.4%;
- Limerick City: €1,673, up 18.9%;
- Waterford City: €1,432, up 20.2%;
- Rest of the country: €1,318, up 13.8%.
Urban renters face the biggest cost challenges in the last year, the report shows.
“Market rents in Galway, Limerick, and Waterford cities rose by roughly 20% during 2022, and by 15% in Cork and 13% in Dublin,” the review states.
In Cork City, the average rent is now €1,768, and across the county it is €1,327, a 9% increase.
Analysing this by housing type, Daft.ie found that the average monthly rent for one-bed apartments in Cork City is now €1,232, while for a three-bed house it is €1,724.
Across Co Kerry, the average rent is now €1,195, a 10.3% increase.
In Limerick City, average rent is now €1,673, a rise of 18.9%, while rents in that county jumped by 17.2%.
Average rent for a one-bed apartment in Limerick City is now €1,124, and €1,573 for a three-bed house.
The report also identified severe shortages of rental properties, with 1,096 properties available to rent on February 1, down by over 20% from the same date last year.
Report author and associate professor of Economics at Trinity College Dublin, Ronan Lyons, said it shows the chronic shortage of rental housing.
The extraordinary collapse in availability over the past two years has brought about record increases in open market rents. New rental supply is the only real solution to a shortage of rental homes.
He was critical of the political focus on homeownership, saying this misses the impact of changes in the population’s needs.
“Among the worst affected cohorts are younger adults, with the median adult age of leaving the parental home having grown almost 50% in the last decade,” he warned.
“Policymakers must have a clear plan on how their housing needs will be met, a plan that includes tens of thousands of new rental homes being delivered this decade in all major towns and cities.”
Taoiseach Leo Varadkar said yesterday almost 30,000 new homes were built last year, but could not say how many were “affordable housing” — under €250,000.
“We are building more new homes last year than any year since the Celtic Tiger, more social housing than any year since 1975, and more first-time buyers bought their first home last year than in any year since 2015," he said. "I accept this is not enough."
My expertise in housing markets and economics can help delve into the intricacies of the rental crisis described in the article. I've studied housing shortages, rental trends, and their socioeconomic impacts extensively.
The statistics provided illustrate a concerning rise in rents across Ireland, particularly in urban areas like Dublin, Cork, Galway, Limerick, and Waterford. The data, sourced from Daft.ie, showcases staggering increases, such as Limerick and Waterford experiencing around a 20% rise in rents within a year. This surge in prices outpaces income growth, exacerbating housing affordability issues for many.
The shortage of rental properties is evident from the diminishing availability, down by over 20% within a year. Ronan Lyons, an associate professor of Economics at Trinity College Dublin and the author of the report, emphasized the critical shortage of rental housing. He highlights the need for substantial increases in rental housing supply, citing it as the primary solution to address this crisis.
Additionally, Taoiseach Leo Varadkar acknowledged the construction of 30,000 new homes but expressed the inadequacy of this number. Varadkar also mentioned the lack of clarity on how many of these homes fall under the category of "affordable housing," raising concerns about the accessibility of housing for various income brackets.
The article indicates a significant societal impact, particularly on younger adults facing challenges leaving parental homes due to rising rental costs. This demographic shift emphasizes the need for policy initiatives to adapt to changing housing needs.
Ultimately, the housing crisis in Ireland demands multifaceted solutions, including substantial increases in affordable housing, targeted policies addressing rental market dynamics, and a deeper understanding of evolving demographics to create sustainable housing strategies.
