According to the latest price report from property website daft.ie, 2017 was another year of double-digit rent increases across Ireland. On average rents increased by 10.4% last year when compared with 13.5% in 2016 and 9% in 2015.
Outside of the Dublin area, Limerick, Cork and Galway have experienced significantly larger rent increases than the national average, more than 65% in each case.
According to the report average rents in County Clare are now €499 for a 1 bedroom apartment (up 9.6% on last year; €579 for a 2-bed house (+8.9%); €690 for 3-bed house (+8.2%0; €752 for 4-bed house (+8.3%) and €776 for a 5-bed house, down by 1% from last year.
In its analysis, daft.ie also publishes a guide comparing the cost of renting with repayments on a 30-year variable mortgage.
In Clare, the cost of buying a 1-bed apartment at 4.3% interest is €238 while renting is €499. For a 2-bed house, it costs €304 to buy and €579 to rent.
A 3-bed house costs €455 to buy and €690 to rent. A 4-bedroom home costs €876 to buy and €752 to rent and 5-bed costs €914 to buy and €776 to rent.
Using this as a guide, there appears to be value for prospective homeowners in buying an apartment or 2/3 bedroom house.
Economist Ronan Lyons, who researched the report, has stated that structural change in Ireland, from agriculture and manufacturing to a service economy, is putting pressure on the housing market, especially in urban areas.
At present two-thirds of Ireland’s population lives in urban areas and this figure is continuing to grow.
“Over the coming generation,” he said, “urban areas will continue to grow by something like 2% a year, while rural areas will see their populations shrink by 1.5% a year.”
The Society of St. Vincent de Paul (SVP) has described the 10.4% average rent increases as “extremely worrying”.
SVP national president Kieran Stafford said the report confirms the mounting scale and reach of the rental crisis, which is no longer confined to Dublin.
“Across the country, our volunteers are supporting more and more households who have received either notices to quit from their landlords, or who have been told their rents are going to increase.
“The threat of homelessness that such households face places them under incredible stress.
“The continued trend of escalating rent also results in many families often putting up with unsuitable and poor-quality accommodation.
“For most families, their priority is to stay in their home, and this can mean they cut back on essentials like food, clothing and heating.”
The daft.ie report also highlighted that the availability of properties is at an all-time low, with just over 3,100 properties available for rent across the country.
Mr Stafford said, “This further puts increasing pressure on families relying on the rental sector.
“Those on a low income and lone parent families are particularly affected as they find it increasingly impossible to find rented accommodation within their price range.”