Only 2,000 homes to let, as rent soars in the Dublin area

FAMILIES and single workers are struggling to find homes to rent in Dublin and its commuter belt, latest figures reveal.

And when they do find a place to live, they are facing astronomical rents of about €1,500 a month on average.

While population figures show that tens of thousands of families need to find housing in the capital and its radius, barely 2,000 homes are there for rent.

The exact figures for May 1 show that just 2,015 houses were available for rent in counties Dublin, Kildare, Louth, Meath and Wicklow.

This compared unfavourably with the 8,613 for let on the same day in 2010.

Meanwhile, the average rent in the city centre is €1,419, while across the county it is over €1,300. In South County Dublin it is €1,528, coming close to its 2007 peak of €1,600.

Rising rents even mean that for many it is more expensive to rent than repay a mortgage.

Nationally, rents rose by 8.2 per cent, on average, and in Dublin they increased by 8.3 per cent. Meanwhile, the capital’s four commuter counties have seen a 13.6 per cent rise since last year.

The shortage of homes comes despite Government promises to tackle the housing crisis, and it follows the publications of data that shows that while the population of Dublin grew by 50,000 in the last five years, only 8,000 houses were built in the capital over that time. The latest rental figures, from Daft. ie, show that the housing crisis in Dublin has bled into the commuter towns causing a sharp decline in rental stock.

For instance, in January 2010, nearly 3,000 properties were available on the rental market in the four commuter counties but this month only 376 are available. In Dublin only 1,639 are available compared to 5,831 at the same stage in 2010.

This is the lowest figure since the surveys started in 2006.

In those years, the capital and the surrounding counties have experienced a rapid rise in population despite the recession. As the economy improves, the problem of housing will be exacerbated.

Trinity College economist Ronan Lyons explained that while ‘the population is growing reasonably rapidly – by the standards of most developed countries’ – housing is just not keeping up.

He said: ‘Dublin might be growing by something like 2 per cent a year and that adds up over the last five years to significant growth.

‘In the same five-year period that we’ve had 50,000 new families, there were about 8,000 new homes built. It’s a squeeze.’

He blames the problem on tight Government rules that builders must comply with, and says that the average construction cost on a square metre in the capital is around €2,000, compared to between €1,000 and €1,200 in Belfast. The economist said that to break even on a new two-bedroom apartment in Dublin, a builder would have to charge €1,500 a month to rent it out.

However, the problem with that is a couple earning €45,000 between them cannot sustainably pay more than €1,000 a month on the cost of their accommodation.

Mr Lyons said: ‘The problem is that despite the fact that rents have gone up by so much, they still don’t cover costs because costs have grown a lot faster.

‘That’s as much driven by Government as anything else. The Government needs to target reducing that cost between by 30 and 50 per cent,’ he said.

However, The Construction Industry Federation disagrees with his argument that construction costs are the issue – and a spokesman said that access to finance is the prohibiting factor in the lack of new builds in Dublin.

‘Builders want to build, that’s their livelihood. They’re anxious to build but they can’t because they don’t have access to finance. Until finance is provided in the form of development capital, there will be no house building and the problems will continue to arise as in Dublin,’ said the spokesman.

The cost of building in Dublin compares unfavourably to stronger markets such as Germany – as rules mean that apartments must be a certain size and have amenities such as car parks attached.

‘All those extra features cost money and we don’t have the income to pay for those things so that’s why they’re not getting built,’ said Mr Lyons.

He added: ‘In general there’s an issue around housing and how the construction sector is organised as well.’

He said that the situation is getting so bad that some developers are considering shipping prefabricated units into Dublin because the cost of building in the capital far exceeds the cost of importing pre-built units from companies in Germany and Scandinavia.

He said: ‘Already I’m hearing stories that that may be cheaper than building on site, even though it comes with pretty significant shipping costs.’

‘8,000 homes for 50,000 families’ ‘It’s cheaper to ship in pre-fabs’