The latest report on the rental market from Daft.ie shows signs of rents stabilising in Dublin, but strong increases elsewhere. The average annual increase of 8 per cent nationwide does not tell the story – in Dublin rents rose 4.3 per cent, while elsewhere in the State the rise was 11.5 per cent. Looking at changes since the start of the year, Dublin rents are up 1.3 per cent while those elsewhere rose by 9 per cent.
The near stabilisation – at least for now – in Dublin rents is welcome, but costs remain too high, with an average rental of between about €2,200 per month and €2,600 per month across the four Dublin local authorities. The number of homes available for rent at the start of this month rose to 1,800, a 64 per cent increase on one year earlier but still well below the level that would indicate an overall stabilisation in the market.
Depending on wider economic and migration trends, rental levels could still go higher. And while supply remains short in Dublin, it is at least increasing, while elsewhere – and particularly outside the major cities – it remains in chronic short supply.
The continued increase in supply to the market in recent months, despite the departure of some private landlords, is welcome. While it remains below what is needed, it comes after forecasts earlier in the year warned of lower supply due to landlords leaving and higher costs and interest rates hitting supply. It remains to be seen what kind of new properties are coming on to the market and the extent to which new Government schemes providing support to developments are starting to have an impact.
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In framing policy from here on, a recognition of the trade-offs is needed. Further restricting rent increases, while helping those who already have accommodation, may limit supply and thus make life harder for those who are searching. Policies to increase supply must remain central, but this means an increase in affordable rental properties, as well as more expensive accommodation. As things stand, too many are still priced out of the market.