‘No one should have to live like this. It’s diabolical’

The cost of rent is rapidly outpacing wage growth in the capital, causing hardship for many

Mon, Jan 20, 2014, 01:00

On cold nights, Mae Robbins goes to bed wearing an old fur coat to help keep warm. There is no central heating in the bedroom. Nor is there hot water. Occasionally, she wakes to find the glass of water she keeps by her bed has iced over. The rambling old house where she rents a single room – just off Dublin’s North Circular Road – has just a single working shower between at least 10 tenants.

Robbins is not reliant on welfare. Nor is she disabled or incapacitated. She is, as she says herself, a taxpaying citizen on a modest salary who is working in adult education. “I don’t think it’s fair, in this day and age, that working people should have to live like this,” says Robbins.

She pays €360 a month for the room, which is crowded with cardboard boxes full of her books, clothes and other possessions. “The rental situation in Dublin is diabolical. There is very little suitable accommodation for people – especially single people – that is in any way affordable. We have to get our politicians to address this. It’s not even being discussed.”


Shortage
An acute shortage of affordable accommodation, increased demand and a dramatic slowdown in construction have combined to create what some campaigners say is a looming social crisis.

It is most pronounced at the lower end of the rental market. The abolition of the bedsit and a near-halt in the supply of social housing mean it is increasingly difficult to find a place to live .

But it is also a growing problem for middle-income earners. Many are struggling to find affordable accommodation of decent quality that is convenient for work or family. Employers and recruiters say it is emerging as a new barrier in attracting talent into the country.

For now, at least, it is a problem mostly confined to the capital. Rents have been rising at about eight times income levels in Dublin over the past year or so. The average rent in the city towards the end of last year rose to €1,041, an increase of almost 15 per cent over the past 18 months.

For a nation that until recently was obsessed with homeownership, renting has been soaring in popularity. The most recent census showed the number of people renting their homes grew by 47 per cent between 2006 and 2011.

As a result, the supply of rental properties has been drying up. Stock in the capital stood at just 1,500 in November, compared with 6,700 vacant properties in 2009.

The trend likely to emerge in Dublin is easy to forecast, say experts. In the absence of a dramatic increase in housing in the capital, rents are likely to continue to increase over the coming year, resulting in affordability problems for tenants.

Even for those with jobs, rental costs can eat up so much of their income that there is often little left.

Amy Murphy (23) works in the centre of Dublin, earning about €9.50 an hour as an office administrator.

“I find about half of what I earn goes on rent these days,” she says. “You end up going without basics, or living on noodles or cans of soup.”

She says it is impossible to cut back on much more. “You can’t save any money, so if I lost my job tomorrow there wouldn’t be any safety net.”


Supply shortage
The rent increases and supply shortages mean finding an affordable place is a trying experience.

Rachel Ahearne (29) works in communications and has a good salary. But she finds the atmosphere among would-be flat-hunters has changed.

“It’s quite competitive. To view apartments nowadays, there are queues to see them. You have to come with lots of references. It’s like applying for a job,” she says.

“The first thing you’re asked is if you’re in full-time employment. That wouldn’t have been asked before. Landlords are able to be much more choosy.”

She worries, too, that her generation may end up stuck in rented accommodation. “It’s very difficult for anyone in their 20s and 30s to save for a deposit, so you do feel stuck in a limbo. We don’t even have a discussion about buying anywhere. I can see things getting to the situation where there will need to be some form of regulation.”

Madeline Lyes (35), an academic, rents an apartment with her partner. She has seen friends getting stung with negative equity and is happy to keep renting.

But the fact that so many of those renting out properties are so-called accidental landlords leads to a greater sense of uncertainty among many tenants.

“You’re not sure if the landlord is going to sell or what. We’re lucky, in that our landlords are emigrants,” she says.

“But renting for many people stills feels very short term. In Germany, there are long-term leases. You pick what you want for now – you don’t look further than a year or two down the line.”

Rising rents are a problem for the Government, which has been keen to promote private rented accommodation as an alternative to homeownership. Government policy quietly changed in 2011. In light of the damage caused by promoting homeownership at all costs, it envisaged a more prominent role for the rental sector.

It promised regulations that would give more certainty to both landlords and tenants, and make the rented sector a stable and attractive housing option for all, delivering true choice across tenures.

“In the longer term, the provision of equitable regulatory treatment for all forms of non-ownership housing, and how best to enhance the stability of the sector, must be considered,” the policy document states.

Rent control is one key way of tackling rents (see panel) ).

Jan O’Sullivan, Minister of State with responsibility for housing, says such a model could ensure rents would not increase by more than the consumer-price index, for example.

“I wanted to open up a debate about this, as well as providing more security for both tenants and landlords,” she says. “I’m very openminded over how this could be done: it might be on a voluntary basis or it could be statute-based.”


Other measures
Other measures being examined by her department include longer-term tenancies compared to the current system, which runs in four-year cycles, while there are advanced plans for new schemes that would see deposits held by third parties rather than landlords.

Most experts agree there is really only one sure-fire way of reducing rents in the longer term: build more homes where they are needed.

Given the number of ghost housing estates and empty apartment blocks that have blighted the country, it might seem counter-intuitive that our problem is now a lack of construction. But Dr Peter Stafford, director of Property Industry Ireland, says a failure to help turn on the construction tap in the capital risks creating a barrier to badly needed economic growth.

“You need a supply of rental property for a growing economy and for Facebookers, Googlers and other mobile workers who are used to having a choice of rental accommodation in good areas,” he says.

“We’ve been working really hard to get a critical mass of international firms, start-ups and so on. That took a lot of policy input. We can create an environment in which to do business – but where do they live?”

It is a theme that some – though not all – recruiters say is a barrier to attracting talent to these shores. While salaries well in excess of €100,000 might be attractive to highly skilled workers on paper, some recruiters say rental costs mean this money does not translate into the quality of life many workers expect.


Immediate problem
For renters such as Mae Robbins, her problems are more immediate. She is due to leave her accommodation shortly – the landlord is selling the house – but cannot find anywhere close by that she can afford.

“No one should have to live like this today,” she says. “What I don’t understand is how we have blocks and blocks of apartment around the city that are still empty, yet we have all these problems.”

She grew up in Africa, where her father worked as a doctor, and witnessed poor conditions there. “Compared to what I saw, there are people living in worse conditions today in Dublin. People who are working on modest incomes deserve more. The Government needs to act now.”