The cost of renting a home increased by an average of 9 per cent over the course of last year, a slight easing back on the 10.7 per cent price jump reported in 2014, according to the latest quarterly report from property website daft.ie.
The average monthly rent being paid between October and December of 2015 was €979, compared to €898 over the same period a year previously.
While the rate at which rents are increasing has eased slightly, the average annual cost of renting a home has gone up by close to €1,000 according to the figures.
For the third quarter in a row, annual inflation for rental properties outside Dublin was higher than in the capital. The average rate of increase across the rental sector when Dublin was excluded stood at 9.8 per cent compared with an average increase of 8.2 per cent in the capital.
The highest rates of inflation were recorded in urban centres outside Dublin where the rate of increase was almost double that of Dublin in some instances.
The annual rate of rent inflation was 15.4 per cent in Cork city while the rate of increase reported in Galway city was 13.3 per cent. In Limerick and Waterford rents stood at 12.4 per cent and 10.3 per cent respectively.
One of the reasons rent continues to increase is because demand continues to outstrip supply. According to the daft.ie research, supply on the market on February 1st was at its lowest point on record with just 3,600 properties available to rent nationwide. That compares with a figure of more than 5,200 a year ago and almost 16,000 five years ago.
Lack of supply
The capital remains effectively starved of rental properties, with fewer than 1,400 rental homes on the market at the start of February, less than two weeks supply.
“Ahead of the election, there is no sign of any improvement in the extreme lack of rental accommodation throughout the country, particularly in Dublin,” said Ronan Lyons, economist at TCD and author of the report.
“The shortage of accommodation was first identified in the Daft.ie Report in late 2010, ahead of the last election.
“Unfortunately, at the time, the political focus was on legacy issues related to ghost estates and negative equity. Hopefully, the new Government will focus on taking the necessary steps to increase availability of homes to rent early in its term of office.”
