Rents in Cork still on the rise but Covid starting to have an impact

SHORTFALL IN SUPPLY IS STILL A KEY PROBLEM

NEW figures have shown that while COVID-19 is beginning to have an impact on the housing rental market in Cork County, average rental charges are still moving in an upward curve.

The latest Daft.ie Rental Report for the first quarter of this year has shown the average rent charged in the county at the tail end of April stood at €1,045 – representing a 2.9% increase on the final quarter of 2019 and year-on-year increase of 3.9%.

The latest figure represents a 79.4% increase on the their lowest point, or trough, in late 2010 when Ireland was in the grip of recession.

The report showed that the average rent for a singe bed property in the so called ‘ commuter towns’ in the county stood at €429 (an annual increase of 7.5%) at the end of Q1 and for a double-bedroom property €505 (an increase of 5.9%%).

The Daft.ie report, which presents a comprehensive over view of recent trends within the Irish rental market also showed that Cork still has the highest rental average rental prices of any Irish county outside of the capital and the so-called ‘commuter counties’ of Wicklow, Kildare, Meath and Louth.

The figures for Cork City showed average rents there stood at €1,396 at the end of Q1, a 0.7% increase on the figure for the final quarter of 2019. This figure represented a year-on-year increase of 4.8%, making them a whopping 95.4% higher than at their 2020 low point.

The report showed that the average rent for single-bed property in the city centre was €521 and a double-bedroom property €621. It will cost an average of €442 to rent a single-bed property in the city suburbs and €531 for a double-bedroom property.

However, the report did suggest that COVID-19 was beginning to have an impact on rental prices across Munster during the month of April, with average rents across the province dropping by 1.8% during the month.

This trend was also reflected on a national level, with rents dropping by 2.1% across the country during April compared to March, the largest single monthly decrease in more than a decade.

The reports author, Trinity College Professor of Economics Ronan Lyons, said the figures in the report point to the start of a COVID-19 impact on rental prices.

“Rents are, perhaps surprisingly, still higher than a year ago but the prospects for the rest of the year must surely be for rents to fall as unemployment rises,” predicted Professor Lyons.

However, he said the shortfall in rental homes, as witnessed in Munster which recorded just 769 properties advertised for rent in April (the lowest number since late 2006), could still present major problems for people seeking rental accommodation.

“If Ireland’s rental sector were wellstocked with homes, there would be no additional concern other than the concern about peoples jobs and incomes. However, despite large and growing shortages, Ireland’s rental sector saw effectively zero new rental homes added over the past decade,” wrote Professor Lyons.

“The concern, therefore, is that the 30,000-odd rental homes at various stages of planning and construction – although mostly planning – are affected (by the COVID-19 pandemic), thus prolonging Ireland’s rental woes even as rents fall,” he added.