Five graphs that tell the story of the Irish rental crisis
Smart Money: Rents in Ireland remain among the highest in Europe. Why?
Apartments in Dublin’s Heuston South Quarter. Photograph: Fran Veale
Rental growth has slowed, but rents are still rising and – averaging just over €1,400 per month – remain among the highest in Europe. And not only is the average level of rents high, but research confirms what anyone looking for an apartment knows – there are few cheaper properties available. There are signs of supply increasing but much more is needed if rents are to not to remain at levels that are unaffordable for many. And the crunch issue remains – we can’t seem to build apartments at an affordable cost. Here is the problem in five graphs.
1. Soaring rents and apartment living
The rise in rents is slowing – finally – after an extraordinary rise. According to the latest report from Daft.ie, the annual increase in rents has fallen from 12 per cent in mid-2008 to 5.2 per cent now. In Dublin, the rental inflation rate has fallen to just below 4 per cent. But prices are already at a level which are unaffordable for many – and a stretch for others. As economist Ronan Lyons points out in the report, rents in Dublin have more than doubled since bottoming out in 2010. Slowing rental growth now appears to reflect an increase in supply onto the market of rental properties – this increase is welcome, though supply remains below potential demand. And while the latest housebuilding statistics have shown an increase in commencements, analysts believe that supply will remain well below demand for some time to come and that the key issue – how to deliver affordable apartments – still has to be cracked. This is a big issue as a key part of the Government's spatial plan is to have more people living in apartments closer to city centres. As the graph shows, apartment living, while it has risen over recent years, is still much less popular here than elsewhere in Europe.