Has the A**e fallen out of the rental market?

shoegirl

I was just looking at the prices for one bed rentals in Dublin at the moment on www.daft.ie and was shocked.

There were one bedroomed cottages and studios within 2 miles of the city renting at 550-650 euros a month. In many cases this even covered areas with onstreet parking.

Ok there are still the ubiquitous apartments renting at 800 or so, but there are plenty of one bed apartments even in the city, for less than 750 a month - and for as little as 125 a week. This is in early September - at the beginning of the student rush! 4 or 5 years ago it was hard to find a one bed for less than 600 pounds a month and even in Cork there was little to be had for less than 140 euro a week circa 2002.

But now it seems to be a buyers market - not only are the flats and apartments there, they are not the kips they were a few years ago. Anybody else noticing this trend? Tenants - are you finding it easier to get nice places at affordable prices? Landlords - are you finding it harder to rent, are you having to cut your rents in order to get suitable tenants?

With house prices currently soaring as much as 10 years ago, where is the justification for huge increases, when it is almost cheaper now to rent than it is to buy, for some people anyway?

gary the great

Ive been looking at rental prices in Tallaght as I plan to move in November and the same apartments are on DAft.ie for the last couple of months. Even in June the rent was 950 on every one bed, but its now down to an average of about 900, I can certainly see a differnce anyway.

shoegirl

The other strange thing I've noticed is that suburban rents in places like Tallaght, north Dublin etc, seem to be actually lower than Dublin city and inner suburbs - is this a first? Also noticed that rents are still much higher in Cork and Galway? Perhaps supply is starting to meet demand? Or am I wrong?

The_Conductor

While certain suburbs always were more expensive than the city centre (read D4/D6 and a few of the more affluent areas northside) in general the city centre did tend to be higher than the less afluent suburbs (but keep in mind you were not always comparing like-with-like- as in a 3 bed semi with a garden may not be comparable to a city centre apartment).

Certain areas of the city centre in previous years had massive stigma associated with them- as areas of deprivation/drugdealing/prostitution etc. These areas have largely been cleared up- and run down housing has now made way for modern apartments and other developments that people are more than willing to pay for.

Annecdotal tales do indicate that rents in the Dublin's suburbs are dropping. E.g. a 3 bed townhouse in Lucan village which may have commanded Euro 1500 18 months ago is now making 1100 (and vacant for several weeks between tenants).

There is an acceptance that the imbalance between supply and demand, particularly in the rental sector, may have been reached. This is not to say that the similar imbalance in FTB properties has corrected itself. In essence- we have built a load of apartments over the last few years. That market is largely saturated. The market for housing (as opposed to apartments) is still strong though.

There was an interesting article in yesterdays Irish Indo where a buy-to-let investor was relating how he had been advised by several estate agents that the market had peaked and to divest himself of his properties immediately.

Rents no longer bare any relation to property prices- a 500,000 apartment in Dublin rents for between 1000 and 1200 per month. Rents are not going to go up, and with interest rates on the rise, peoples purchasing power is going down, so property prices are not going to enjoy their previous stellar rises. The age of cheap cash is over. Pay rises over the next 27 months are not going to cover inflation (currently over 4%).

Times they are a'changin'.......

connundrum

shoegirl wrote:

Perhaps supply is starting to meet demand? Or am I wrong?

It would seem that way, and hopefully this will lead to 'investors' fcukin off from buying key location property to rent, which has forced house prices up all over the country.

My house is directly across the road from DCU and its fairly reasonable at €1300pm for a 4 bed. I really can't see it going up and I look forward to the day when I can say to the landlord that €1300 is too much in comparison to similar properties in the area

Sponge Bob

The arse has gone out of it in some places but not right beside a college in a nice comfortable place with all mod cons .

hmmm

Rents have been static for the past 6 years, I haven't noticed a major change recently. It's funny how relaxing it is to see your salary increase and your rent stay the same, whilst your bleary eyed and stressed out friends commute from outer mongolia and worry about interest rate rises, all for the sake of buying "property".

KlodaX

I found it VERY difficult to find a 1 bed apt in Cork. Found one for 650 a month from the Echo. There was one in Daft for 550 but it won't be ready untill end of Sept. In the Letting agents they laughed when I asked for anything under 700 ... they even have adds in their windows looking for Land lords with 1 bed apts and bedsits to let! This is only 2 weeks ago. Can't imagion much has changed ... especially considering all the college heads are arriving right about now.

Raskolnikov

I see five 1-bedroomed apartments in Cork on daft.ie for under €700 a month right now. So maybe KlodaX just picked a bad time to rent? Also, I would highly doubt that students could afford the €550 a month minimum for a 1 bedroomed place. I can't say I ever knew any student who rented a 1 bedroomed place.

shoegirl

KlodaX wrote:

I found it VERY difficult to find a 1 bed apt in Cork. Found one for 650 a month from the Echo. There was one in Daft for 550 but it won't be ready untill end of Sept. In the Letting agents they laughed when I asked for anything under 700 ... they even have adds in their windows looking for Land lords with 1 bed apts and bedsits to let! This is only 2 weeks ago. Can't imagion much has changed ... especially considering all the college heads are arriving right about now.

From my own experience (I lived in a city centre 1 bed flat in Cork for 2 years until mid 2004). I paid 140 a week and for that i got free electricity, and the rent didn't go up for 2 years but towards the end the LL did put in a meter and unforutnately set it at double the ESB rate so I left before the end of the summer as I knew I wouldn't have been able to afford it in winter as I'd only a2 electric heaters heating the flat.

That said 1 bed flats and apartments are ALWAYS in very short supply in Cork city so tend to be disproportionately expensive. Part of the reason for this is that they are very popular with social welfare tenants (I was the only person out of 6 flats in the house with a job) and they don't move around much, so its extremely hard to find one in Cork.

I'm surprised though that nobody has capitalised on this by building a few more - but thats the way things went in Cork.

On the other hand my supervisor at work pays only 700 a month for a 2 bed apartment - these and 3 bed mid 70s semis are in plentiful supply in Cork for some reason. Maybe more cork people want to live alone?

The_Conductor

Seems to be the other way around in Dublin- an excess of small flats and apartments, and a severe shortage of of semidetached or detached houses of any nature whatsoever. Maybe send our Polish builders down to Cork and yours to Dublin......

mentalson

Raskolnikov wrote:

Also, I would highly doubt that students could afford the €550 a month minimum for a 1 bedroomed place. I can't say I ever knew any student who rented a 1 bedroomed place.

The student village in Cork. Sec 50 so they can only rent to students. They charge from €440 pm for a standard room to €490 pm for an ensuite. That's with a shared Kitchenette/ living room. The rooms are pretty small and basic

mentalson

shoegirl wrote:

That said 1 bed flats and apartments are ALWAYS in very short supply in Cork city so tend to be disproportionately expensive. Part of the reason for this is that they are very popular with social welfare tenants (I was the only person out of 6 flats in the house with a job) and they don't move around much, so its extremely hard to find one in Cork.

thats the case. There are not that many 1 or 2 bed places in Cork and rent allowance tenants have pushed prices up. It would be difficult to find a half decent 1 bed for less than €800 p.m. according to Daft rent levels in Cork have increased by 10% in the last year and that's my experience too.

mentalson

shoegirl wrote:

I'm surprised though that nobody has capitalised on this by building a few more - but thats the way things went in Cork.

?

me too. However the CSD anti high rise lobby are pretty powerful and there's not that much building land in the City.

Mrbrianmolko

My dad owns 17 houses that are converted into about 50 apartments and bedsits or so and he says the rent prices have gone down slightly in the last while, but there is very rarely a week that goes by when an apartment is empty for more than a few days unless theres work being done on it.

On the other hand he says the houses that we own that aernt converted(about 8 or 9) have seen the rent rise in the last year or so?

So the arse definetly hasnt fallen out of the market yet anyway.

nimble75

hmmm wrote:

Rents have been static for the past 6 years, I haven't noticed a major change recently. It's funny how relaxing it is to see your salary increase and your rent stay the same, whilst your bleary eyed and stressed out friends commute from outer mongolia and worry about interest rate rises, all for the sake of buying "property".

I agree...check this out, interesting read..

http://www.gold-eagle.com/editorials_05/saxena082206.html