Dublin - Significant reduction in rents coming?

Jmc25

Claw Hammer wrote: »

The colleges coming back on campus will cause a massive surge in demand. There will be 10s of 1000s of students looking for accommodation by mid-September.

True, but the apartments lying vacant are on the mid to high end of the market. I'm not sure large numbers of students returning will fill these.

Claw Hammer

Jmc25 wrote: »

True, but the apartments lying vacant are on the mid to high end of the market. I'm not sure large numbers of students returning will fill these.

They will fill all other accommodation thus forcing people who might have taken the middle to lower end accommodation to go upmarket.

Baby01032012

Baby01032012 wrote: »

I have a 2 bed apartment pff Cork St., Dublin 8. Had been let at 1800. Its a small 2 bed and too small for the 2 girls working from home. So they moved out, I found that i had 20 enquires v 200 enquiries 2 years ago. It ruled out professionals working from home. Plus there is much more property on the market. So I let it for 1600 in the end. COVID definitiely had an impact. Workers and students returning after the summer will normalise the market, however i couldnt wait.

Good info, thanks.

Thestart

Claw Hammer wrote: »

They will fill all other accommodation thus forcing people who might have taken the middle to lower end accommodation to go upmarket.

Interesting to see how tourism and Airbnb will play out over next 6/12 months.

yagan

Claw Hammer wrote: »

The colleges coming back on campus will cause a massive surge in demand. There will be 10s of 1000s of students looking for accommodation by mid-September.

I do wonder about that when Dublin hotels currently have over 80% vacancy.

After the property bust it was very easy to get a room rate with Breakfast included for the weeknights and it still worked out cheaper than renting fulltime.

I don't see international tourism coming back in anytime soon, especially with new variants taking hold.

The tendency is to believe there's some upcoming date when everything snaps back to February 2020 but I don't think it will ever be the same.

Amadan Dubh

yagan wrote: »

I do wonder about that when Dublin hotels currently have over 80% vacancy.

After the property bust it was very easy to get a room rate with Breakfast included for the weeknights and it still worked out cheaper than renting fulltime.

I don't see international tourism coming back in anytime soon, especially with new variants taking hold.

The tendency is to believe there's some upcoming date when everything snaps back to February 2020 but I don't think it will ever be the same.

It's been cheaper to get hotels midweek than rent an apartment at average rents in Dublin for the past year. And not just shoddy hotels but 4 star hotels like the Hilton on the quays.

Students coming back and taking accommodation will mean they will also need to take on their part time work to subsidise their living in Dublin. That means retail, hospitality etc. jobs need to exist and also to exist with sufficient hours for them. I presume this won't be an issue given hospitality in particular can't get workers but once things are open a few weeks and people get the socialising out of their system we'll see. Hopefully it will work out for students. There's plenty of new student accommodation on the market the past 2 years for them in addition to the hotel offerings so I don't expect much of an impact to the rental market as a whole. Google "student accommodation hotels 2021"and ads are up for hotels going after the market.

Here is the Clayton in Ballsbridge for example
https://www.claytonhotelballsbridge.com/students-accommodation/

It doesn't advertise the rates but I've emailed them there to ask.

As for workers, I assume like my place companies are starting to formulate their post-covid WFH policies so we'll see how that evolves. Undoubtedly there will be a pick up in office attendance from September but to what extent is still open to debate and its impact on the rental market also uncertain right now.

EDIT: they're offering 70euro per night BnB for a single room with WiFi incl. car parking. Min. 3 nights. So Monday to Thursday would be 210euro or to Friday 280euro.

yagan

yagan wrote: »

I do wonder about that when Dublin hotels currently have over 80% vacancy.

..

The tendency is to believe there's some upcoming date when everything snaps back to February 2020 but I don't think it will ever be the same.

As you said that Hotels are at near capacity, so that doesn't compute so it could be really hard to get a hotel after the pandemic.

I agree that somethings will change. But tourism might well bounce back.

yagan

fvp4 wrote: »

As you said that Hotels are at near capacity, so that doesn't compute so it could be really hard to get a hotel after the pandemic.

I agree that somethings will change. But tourism might well bounce back.

I didn't say they were at near capacity, 80% vacancy means they're near empty.

Plus I can imagine increased travel insurance will actually suppress transatlantic tourism for the foreseeable. The indian variant is starting to spread in the USA and with so many there avoiding vaccines they're in for a risky winter.

yagan

Amadan Dubh wrote: »

As for workers, I assume like my place companies are starting to formulate their post-covid WFH policies so we'll see how that evolves. Undoubtedly there will be a pick up in office attendance from September but to what extent is still open to debate and its impact on the rental market also uncertain right now.

I can well imagine many workers preferring a couple of week nights in a hotel in return for not having to live in Dublin full time. Hotels will be glad to prioritise that business as a fixed income independent of tourism.

I remember noticing that in Paris years ago where there were great weekend deals in hotels away from the tourist zones as their main business was the monday to friday office worker in the administrative zone.

Amadan Dubh

yagan wrote: »

I can well imagine many workers preferring a couple of week nights in a hotel in return for not having to live in Dublin full time. Hotels will be glad to prioritise that business as a fixed income independent of tourism.

I remember noticing that in Paris years ago where there were great weekend deals in hotels away from the tourist zones as their main business was the monday to friday office worker in the administrative zone.

Having looked at the room rates there for the student accommodation I think it actually seems like a brilliant idea. Being in the office 2 days a week would only require one night accommodation. 70 quid for that a week would be worth it if it meant getting to live in the beach house two hours away!

yagan

yagan wrote: »

I didn't say they were at near capacity, 80% vacancy means they're near empty.

Plus I can imagine increased travel insurance will actually suppress transatlantic tourism for the foreseeable. The indian variant is starting to spread in the USA and with so many there avoiding vaccines they're in for a risky winter.

Hmm. Let’s see. It was 20% in the last Q but that was much more restricted.

yagan

fvp4 wrote: »

Hmm. Let’s see. It was 20% in the last Q but that was much more restricted.

I said over 80% vacancy rate, and the Irish Times reported a few days ago..

Internal industry figures show that Dublin city centre hotels are facing a disastrous summer, with average occupancy levels of only about 13 per cent forecast for the height of summer based on current bookings.

Pre covid tourism levels are not going to be back this year, if ever.

Blut2

13% occupancy levels across the busiest 3 months of the year for the hotels is an absolute disaster for them. If that (or anything close to it) continues into the autumn, an always less busy period than summer anyway, they'll be running a lot of Sunday->Friday offers to entice students.

UCD student accom for the coming year runs from 205e to 375e (!) per week. So theres a decent amount of pricing space for hotels in there, particularly if they offer packages including breakfast/dinner (as they did last year).

yagan

Blut2 wrote: »

13% occupancy levels across the busiest 3 months of the year for the hotels is an absolute disaster for them. If that (or anything close to it) continues into the autumn, an always less busy period than summer anyway, they'll be running a lot of Sunday->Friday offers to entice students.

UCD student accom for the coming year runs from 205e to 375e (!) per week. So theres a decent amount of pricing space for hotels in there, particularly if they offer packages including breakfast/dinner (as they did last year).

I think what's most important in the accommodation business multi year pandemic type interruptions have to now be factored into the businesses.

But ultimately the biggest loser in all this is Dublin city itself. Being around the "buzz" now mean getting caught up in scrote street battles.

I could actually see some Dublin hotels being converted to apartment complexes.

Amadan Dubh

Blut2 wrote: »

13% occupancy levels across the busiest 3 months of the year for the hotels is an absolute disaster for them. If that (or anything close to it) continues into the autumn, an always less busy period than summer anyway, they'll be running a lot of Sunday->Friday offers to entice students.

UCD student accom for the coming year runs from 205e to 375e (!) per week. So theres a decent amount of pricing space for hotels in there, particularly if they offer packages including breakfast/dinner (as they did last year).

Does the UCD accommodation include meals as that is outrageously expensive. How do students pay that? From my days as a student, those renting would typically only stay up Sunday night/Monday morning to Thursday evening/Friday lunch time. Assuming that's still the case, the hotel for €70 a night with its breakfast included, serviced rooms and flexible options is looking like a better option.

The biggest benefit is the flexibility - if you had a week off before exams, you wouldn't need to pay any rent that week; over Christmas when you're home for a month, again no rent needed to be paid. This hotel offering is definitely going to put downward pressure on those rents targeting students.

Ray Palmer

Amadan Dubh wrote: »

Does the UCD accommodation include meals as that is outrageously expensive. How do students pay that?.

It has always been expensive to stay on campus. Students don't pay it their parents do. No it doesn't include meals. Only well off students stayed in back in the day and I assume it is the same now.

It gives parents peace of mind so they are willing to pay. Foreign students also like it as they see it as normal.

Colleges are underfunded so it is a good revenue source for them. Like many things funding is a little sneaky. Government allow tax breaks to sustain funding by having the consumer pay

Blut2

Amadan Dubh wrote: »

Does the UCD accommodation include meals as that is outrageously expensive. How do students pay that? From my days as a student, those renting would typically only stay up Sunday night/Monday morning to Thursday evening/Friday lunch time. Assuming that's still the case, the hotel for €70 a night with its breakfast included, serviced rooms and flexible options is looking like a better option.

The biggest benefit is the flexibility - if you had a week off before exams, you wouldn't need to pay any rent that week; over Christmas when you're home for a month, again no rent needed to be paid. This hotel offering is definitely going to put downward pressure on those rents targeting students.

No meals included, thats just rent and utilities.

It is indeed insane though. I presume parents are helping out a lot, and/or maybe banks are giving big loans. ~10k a year (and not even a full calendar year, thats just for two semesters...) in rent would really add up over 3/4 years.

The 5* Radisson across the road from UCD was running 5 night Sun->Thur special offers including breakfast & dinner for 500e last year aimed at students. But like you say you wouldn't have to stay for midterms weeks, or over Christmas, or the week off before exams each semester etc. The actual lecture weeks are only 24 weeks a year total. So it would probably work out quite competitively with the student accom price considering the included food.

They also advertised it with "longer term rates negotiable", so I'd say if you were booking an entire semester (or two) you'd get another big chunk off of that too.

And thats also a fancy 5* hotel, there should be plenty of cheaper options around.

yagan

Fascinating piece from the USA about a reversal of the college business model that relies on student debt; the bit where he said only one student in the previous year had paid their student debt dues in full was a warning for the whole model.

I'm highly skeptical of the high cost model developing in Ireland so any opportunity like the current hotel vacancy rates to avoid on campus accommodation costs is welcome.

PommieBast

Thestart wrote: »

Interesting to see how tourism and Airbnb will play out over next 6/12 months.

Suppose AirBnB is the litmus test. If the de-facto ban goes unenforced as before, there is not a snowflake's chance in hell of the state fixing anything else.

JimmyVik

Blut2 wrote: »

13% occupancy levels across the busiest 3 months of the year for the hotels is an absolute disaster for them. If that (or anything close to it) continues into the autumn, an always less busy period than summer anyway, they'll be running a lot of Sunday->Friday offers to entice students.

UCD student accom for the coming year runs from 205e to 375e (!) per week. So theres a decent amount of pricing space for hotels in there, particularly if they offer packages including breakfast/dinner (as they did last year).

I stayed in a hotel in Wexford last weekend.
I was told all the hotels down there were fully booked for the summer months.
You now what the topic of conversation i heard most was.
"Jaysus, they seem to be going mad in Dublin. See all the videos of the fights and riots. No family in their right minds will be holidaying in Dublin".
All of this trouble and videos of it is having an effect.
People would rather go anywhere than Dublin for the summer. God knows what foreign tourists will end up getting back on google when they google "eating out in Dublin" by next year.

Amadan Dubh

Blut2 wrote: »

No meals included, thats just rent and utilities.

It is indeed insane though. I presume parents are helping out a lot, and/or maybe banks are giving big loans. ~10k a year (and not even a full calendar year, thats just for two semesters...) in rent would really add up over 3/4 years.

The 5* Radisson across the road from UCD was running 5 night Sun->Thur special offers including breakfast & dinner for 500e last year aimed at students. But like you say you wouldn't have to stay for midterms weeks, or over Christmas, or the week off before exams each semester etc. The actual lecture weeks are only 24 weeks a year total. So it would probably work out quite competitively with the student accom price considering the included food.

They also advertised it with "longer term rates negotiable", so I'd say if you were booking an entire semester (or two) you'd get another big chunk off of that too.

And thats also a fancy 5* hotel, there should be plenty of cheaper options around.

I wonder how prep for college in September is going now, particularly with today's shocking announcement of no further easing of restrictions until nearly the end of July.

Will we get rid of all restrictions by September 1st (necessary because of lecture halls attendance and public transport capacity to name but 2)? Unlikely it appears as I cannot see how we can go from very limited ability to sit in a cafe or bar to within 5 weeks having 100% capacity allowed on public transport with no social distancing requirements.

Blut2

Theatre L in the Arts block in UCD has from my distant memory of college a capacity of about 600 people. And is usually full throughout the day, with many different groups of 600 people filing in to mix together and then leave an hour later. So a few thousand people passing through in any given day.

Given in mid-July we're still not going to be allowed have 5 people sit together indoors, at socially distanced tables, if I were betting I would not give it high odds that 500+ people will be allowed gather indoors, in close company, 6 weeks later on September 1st...

C14N

Amadan Dubh wrote: »

Does the UCD accommodation include meals as that is outrageously expensive. How do students pay that? From my days as a student, those renting would typically only stay up Sunday night/Monday morning to Thursday evening/Friday lunch time. Assuming that's still the case, the hotel for €70 a night with its breakfast included, serviced rooms and flexible options is looking like a better option.

The biggest benefit is the flexibility - if you had a week off before exams, you wouldn't need to pay any rent that week; over Christmas when you're home for a month, again no rent needed to be paid. This hotel offering is definitely going to put downward pressure on those rents targeting students.

I remember from my days in UCD that student accomodation was very expensive too at the time. I think it was around €6000 a year at the time (about 10 years ago now), but the thing about was that this was still often a bit cheaper than alternatives. Most open-market rentals wanted 12 month leases, and you'd have been very lucky to get something for €500 or less per person at the time, at least not with the same level of facilities (like a private bathroom) and proximity to campus. Rental prices have only increased since then on the open market too, so for a lot of students whose parents don't live in Dublin, it probably still works out.

Hotels are a different story, but they're probably far less reliable than a lease for the year. No guarantee that they'll keep up the mid-week deals for the entire two semesters.

Amadan Dubh

C14N wrote: »

I remember from my days in UCD that student accomodation was very expensive too at the time. I think it was around €6000 a year at the time (about 10 years ago now), but the thing about was that this was still often a bit cheaper than alternatives. Most open-market rentals wanted 12 month leases, and you'd have been very lucky to get something for €500 or less per person at the time, at least not with the same level of facilities (like a private bathroom) and proximity to campus. Rental prices have only increased since then on the open market too, so for a lot of students whose parents don't live in Dublin, it probably still works out.

Hotels are a different story, but they're probably far less reliable than a lease for the year. No guarantee that they'll keep up the mid-week deals for the entire two semesters.

Yes, I recall it being about 350 for a shared room near UCD and 500 for a room in a house. On campus was 4500 to 6000 IIRC.

UCD won't be issuing guidance for their on campus attendance until the end of July so we won't see any take up of student accommodation before then. It does leave it quite tight though to inform potential students as to when they can attend on campus next year.

Amadan Dubh

Has anyone else been seeing the Quayside Quarter ads for over a year now? They have even described as new the whole time but these must be vacant (as in ready to let but not actually let) for well over a year at this stage.

Greystar, of course are the owners, with little interest in writing down the book value of the assets hence why they are happy to keep them vacant despite looking for 2500+ for a 1 bed apartment!

FionnK86

Amadan Dubh wrote: »

Has anyone else been seeing the Quayside Quarter ads for over a year now? They have even described as new the whole time but these must be vacant (as in ready to let but not actually let) for well over a year at this stage.

Greystar, of course are the owners, with little interest in writing down the book value of the assets hence why they are happy to keep them vacant despite looking for 2500+ for a 1 bed apartment!

I noticed same with apartments in Northwood, Santry from REIS. I contacted them about apartment which was being readded to Daft.ie every 2 weeks. It's a real pain as it produces results in the search that are not valid.

Phat Cat

Rent increases to be capped at inflation in pressure zones. It's like locking the stable door once the horse has bolted.

Rent increases in so-called rent pressure zones (RPZs) are to be capped in line with inflation, and a ban on evictions of struggling tenants has been put in place for the rest of the year under new laws set to be introduced by the Government.

Rent controls were introduced in December 2016 to temper an overheating rental market. The controls mean that landlords of properties in so-called rent pressure zones – which includes all of Dublin and much of the rest of the country – cannot increase rents by more than 4 per cent a year.

However, in a statement on Wednesday, the Department of Housing said the caps will be replaced with caps in line with inflation only.

“The current cap of 4 per cent on annual rent increases will be replaced and rents in RPZs can now only go up, if necessary, in line with general inflation as recorded in the Harmonised Index of Consumer Prices (HICP),” it said.

“This will result in far lower rent increases for the estimated 74 per cent of all tenancies which are in RPZs. HICP averaged 0.73 per cent over the past three years.”

The Department added that for those outside of RPZs, the provision for bi-annual rent reviews will be extended for an additional three years from January 1st, 2022 to December 31st, 2024. “This provides rent certainty for tenants outside of RPZs for a minimum two year period at a time,” it said.

Minister for Housing Darragh O’Brien said the 4 per cent cap on rent increases in RPZs had become “a target rather than a limit” for landlords.

“We are now taking action to ensure that tenants will only pay rent increases, if required to, which are in line with general inflation, which is currently below 2 per cent,” he said.

Mr O’Brien said the Bill will also restrict the level of upfront payments required of tenants, to a total value that does not exceed two months’ rent to cover any deposit and one month rent in advance.

“We are also extending protections for those most impacted by Covid-19, in arrears and at risk of losing their tenancy,” he said. “Such tenants will be protected from rent increases and/or evictions to January 2022.”

The changes to the law will take effect upon the passage of the Bill, which is expected by July 9th.

Sinn Féin housing spokesman Eoin O’ Broin described the reforms as “closing the gate after the horse has bolted”, and “too little, too late”.

“The Minister’s plans to keep the RPZ legislation is place, while limiting increases to inflation will do little to help tenants already struggling with high rents,” he said.

“Furthermore, what about the 26 per cent of tenants who live outside rent pressure zone areas? Those tenants will still be subject to the current system, which is deeply unfair.

“If this Government is serious about protecting renters, it will ban rent increases for three years for all new and existing tenancies. In Budget 2022, it should also introduce a refundable tax credit for renters, which would help reduce rental costs.”

lawrencesummers

Phat Cat wrote: »

Rent increases to be capped at inflation in pressure zones. It's like locking the stable door once the horse has bolted.

Pity we can’t link politicians pay to inflation.

Dav010

lawrencesummers wrote: »

Pity we can’t link politicians pay to inflation.

I suspect quite a few will find themselves subject to market forces next time around though.

C14N

lawrencesummers wrote: »

Pity we can’t link politicians pay to inflation.

Probably wouldn't want to. This would just encourage politicians to drive inflation up, which isn't really a good thing.