The supply of Irish rental accommodation has more than doubled over the last 12 months to an all-time high. A report today from the property service Daft says that the increase in supply has pushed rents downwards - with a fall of 2.2% in the past three months.
The report, which is based on an analysis of rental properties advertised on the site, says the increase in supply is having its biggest impact on rents outside the big cities. Rents in
Munster, Connacht and
Ulster are between 3% and 6% below their 2007 levels. Daft says rents in the bigger cities are largely at the same level as this time last year, having risen in the second half of 2007 and fallen over the past number of months.
Daft.ie economist Ronan Lyons says that although demand is holding up well, rents look set to fall for the rest of the year and possibly into 2009 as the number of rental properties coming on to the market is increasing every month.
In the student market, the Daft.ie report says that while overall the cost of accommodation for students is falling this year, there are significant differences in rents across the country.
It finds that a student at DCU staying near the college will pay an average of €525 per month for a double room, while UCC students in
Cork will pay less than €400. In Limerick UL students will pay on average €309 for a double room while students at
College will pay €649 for a double room in
Dublin city centre.
The average student will pay almost €3,500 per year on accommodation and that figure rises quite considerably for a student studying in
Dublin. However, having been at, or close to an average of €1,400 in late 2007, the national average rent has been falling progressively over the past number of months and is now just over €1,350. At the same time the amount of property available to rent has risen considerably – more than doubling over the past year. This bodes well for the student rental market.
Current trends from the Daft report show that for students, the costs of accommodation are falling. Comparing rents now to a year ago, rents are lower in two thirds of the markets that Daft analyse. Looking at more recent trends, the news seems more encouraging for students: between the first and second quarters of 2008, rents fell in 30 of the 35 markets around the country. With supply at all-time highs, it is likely that we will see continued falls in rents over coming months.
Employment is falling and the flow of immigration has slowed.
Developers have been letting properties that they are unable to sell and there are also a large number of empty properties across the country.
The CSO reported from the Census 2006, in August 2007, that there were 266,000 vacant dwellings in 2006 representing 15% of the total housing stock. Of these, 175,000 were houses, 42,000 were flats and 50,000 were classified as holiday homes.
Leitrim had the highest percentage of vacant dwellings (29.3%) while 11.7 per cent of dwellings in
City were vacant at the time of the census.
The Census 2002 had estimated that 140,000 homes were empty.