Lack of housing supply behind spiralling cost of rents in Cork

THE latest Daft.ie Rental Report has revealed that rents across Cork city and county have continued their upward spiral over the first quarter of 2017, reflecting the acute lack of available rental accommodation.

The situation in Cork is mirrored across the entire country, with the report revealing rents have increase nationally by 13.4% between January and March.

This was slightly less than the 13.5% increase seen in late 2016, which represented the biggest annual increase on record.

The report put the average monthly rent in Ireland at the end of March at €1,131 compared to €1,006 for the same period last year, with properties in Dublin City, county and the so called ‘commuter counties’ the most expensive.

It showed that Cork had the highest rents of any county in Munster, with the average advertised rent sought by landlords increasing by 13.4% over the 12-month period from €713 to €806. This compared to 9.7% and 6.7% increases respectively over the previous two years.

The latest figures for Cork county show an increase of 38.3% from their lowest point.

It is also worth pointing out that Cork was the only Munster county to record average rents in excess of €700 at the end of March.

As the parent of any student hoping to attend a college in Cork City will readily testify the shortage of rental accommodation has become a serious problem, with rents rising by 10.4% in the year to March, the tenth quarter in a row of double-digit growth.

While the increase is somewhat below the 16% recorded this time last when compared to 2015, the average rent in the city now stands at €1,107.

The overall increase in rents across the wider Munster region has been driven by the lack of accommodation and while that number has risen by almost 100 over the same period in 2016, as of May 1 there were still less than 800 properties available to rent across the entire province.

Nationally, the number of houses available for rent at the end of April stood at 3,084, down from almost 4,000 three months previously and the second lowest number recorded by Daft.ie since they issued the first in their series of Rental Reports back in 2006.

Peaking at almost 24,000 in mid2009, the figure has declined at an alarming rate since with 7,200 available properties in 2014 and 4,300 in 2015 and 3.082 last year.

The reports author, Trinity College economist Dr Ronan Lyons, said the that overt he past five years the rental market had shown “increasing signs of distress” with stronger demand but weaker supply with each passing year.

“Rents are at an all time high, while the number of homes remains at the lowest levels on record. The message from the rental market to policymakers is the same as it has been for more than five years now – more supply is needed,” wrote Dr Lyons.

“Until policymakers understand why it costs so much to build a two-bedroom apartment here, compared to anywhere else in Europe, that’s unlikely to happen,” he said.