Annual rent price inflation rose to a five-year high of 11.7 per cent in the first quarter of 2022 as the supply of available properties slumped to a new low, according to property website Daft.ie.
In its latest quarterly report, the company said there were just 851 homes available to rent nationally on its website as of May 1st last, the lowest number since its series began in 2006.
"Things have never been so grim" for prospective tenants, Daft economist and the report's author Ronan Lyons said.
“As ever, in a rental market dogged by chronic and worsening shortage of homes, the only real solution is to increase the number of homes,” he said.
“With more pressure from certain quarters to stop new rental homes being built, policymakers must hold their nerve.”
According to Daft, the average monthly rent nationally stood at €1,567 in the first quarter of this year, up 11.7 per cent or €160 on the same period in 2021.
This was more than twice the low of €765 per month seen just over a decade ago in late 2011 and more than 50 per cent higher than the Celtic Tiger peak of €1,030 per month, seen in the first quarter of 2008.
While the report acknowledged there had been different regional trends in rents in recent quarters, the rate of increase detected in the first quarter was similar across all major regions.
In Dublin, market rents rose by 10.6 per cent year on year to average €2,102, while in Cork and Galway cities rents rose by 10.2 per cent and 13.8 per cent to average €1,607 and €1,585 respectively.
Inflation was higher in Limerick and Waterford cities, at 15.5 per cent and 16.2 per cent, while average rents were €1,485 and €1,262. Outside the cities the average price increase was 12.7 per cent.
Daft’s report also calculated the different rates of inflation experienced by “sitting” tenants as opposed to prospective or “mover” tenants.
For 2021, sitting tenants saw their rents increase 1.5 per cent while “movers” or new tenants paid rents that were 10.3 per cent higher, the report found.
“New figures confirm that sitting tenants have experienced much smaller increases in rents – both during 2021 and over the last 10 years,” Mr Lyons said.
“Thus, the focus for policymakers must remain on creating the conditions for tens of thousands of new rental homes – market and social, all across the country – to be built over the coming years.”