According to the most recent rental data from the real estate search website, rentals rose to an average 12.6% higher in the second quarter of this year than they were in the same quarter in 2021.
This sharp surge, which coincided with a record-low rental housing supply, is the largest one that Daft has seen since it started compiling its reports in 2006.
Between April and June, the national average market rent in Ireland was €1,618 per month. This is more than double the low of €765 per month witnessed in late 2011 and an increase of 3.3% from the first three months of the year.
For the first time since 2018, Dublin rental costs increased by 12.7% (The average monthly asking price for a new rental in Dublin is now €2,170.), outpacing the national average for inflation.
Even more startling price increases were seen in the cities of Limerick (17.7%), Waterford (17.1%), and Galway (16.4%), while the annual change in market rents in Cork city was 11.8%. The average yearly growth rate outside of the cities was 12%.
Average rents and year-on-year change for quarter 2 of 2022:
● Dublin: €2,170 – up 12.7% year-on-year
● Cork city: €1,670 – up 11.8%
● Galway city: €1,663 – up 16.4%
● Limerick city: €1,559 – up 17.7%
● Waterford city: €1,312 – up 17.1%
●Rest of the country: €1,255 – up 12.0%.
‘Unprecedented’
According to the Daft research, the narrowing of rental availability is what is causing the increase in rent, as it has for much of the past 10 years. It does, however, emphasise that the lack of rental properties has been "unprecedented" in recent months.
On August 1, there were just 716 rental properties nationwide, a new record dating back to 2006, down from roughly 2,500 a year earlier.
There are now only three rental properties available now compared to 100 in 2009, a startling 97% decrease in rental availability.
An examination of data from Cortland Consult on the supply of new rental properties is included in the report.
The pipeline has expanded by about 23,000 during the past year. Of them, 13,000 are now being built, while 28,000 have planning applications submitted. Additionally, there has been a 17,500 decline in pre-planning.
The number of rental homes for which planning has been approved but construction has not yet begun is still around 43,000.
Ronan Lyons, an associate professor of economics at Trinity College Dublin and the report's author, claimed that the persistent housing scarcity in Ireland has been made worse by the country's recovering economy.
"Although there are over 115,000 rental properties in the works, they are mostly located in the Dublin region. A threat to addressing the rental shortage is the rise in legal challenges to new developments, even though only about 23,000 are currently under construction, Lyons continued.
The research paints a "dire picture of both the existing and future situation for private tenants in Ireland," according to housing charity Threshold, together with other recent statistics about homelessness and renters receiving orders to quit.
According to a Threshold statement, "These steady rent rises occur despite the fact that around 75 percent of tenancies are placed in Rent Pressure Zones, where annual increases are regulated at 2%."
John-Mark McCafferty, the organization's chief executive, claimed that those wishing to rent a room "had seen unreasonable hikes in rent."
"At a time when inflation is about 10%, those renting a single room will spend about an extra €100 month compared to last year," he said.
In the upcoming Budget, "Threshold hopes to see greater subsidies for renters as well as tax reforms for landlords that are connected to improved security of tenure for tenants and their families," McCafferty noted.
It is "obvious that Darragh O'Brien and the Government have lost control of the housing market," according to Eoin Broin, a spokesperson for Sinn Féin on housing.
"After two years in government and almost a year into his housing strategy, Darragh O'Brien is in charge of rents, home prices, and homelessness that are at all-time highs. Meanwhile, the private rental market is contracting and social and inexpensive housing are far behind schedule, according to Broin.
He stated that the Housing Minister's "final opportunity to implement the level of change necessary to remedy our worsening housing issue" is in the Budget 2023.
For the next ten years, we must dramatically increase spending in order to build 20,000 social and affordable homes annually. To stop the chaotic exodus of landlords from the private renting sector and to minimise homelessness, urgent intervention is required, he said.
"It is unclear if the Minister is aware of the severity of the catastrophe he is causing. The days of this administration are numbered if there isn't a significant shift by September.
The research "shows the depths of the rental calamity," according to Holly Cairns, social justice spokesman for the Social Democrats.
"This cannot continue. Ordinary workers are being pushed to the breaking point by exorbitant rents. This is especially true because the cost of everything else is also rising, including fuel, food, and energy, at a time when the cost of living crisis is getting worse, she said.
"Each new Daft report demonstrates how rents are rising to previously unheard-of levels while supply is falling to all-time lows. The government's housing strategy is obviously a failure, but renters and people who want to buy a house are the ones who have to pay the price.
When will the government acknowledge that its housing policies are worsening, not improving, the rental problem and detail what it plans to do to address what is already a societal catastrophe?
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