Shortages in the Rental Market


The September Locked Out of the Market report by the Simon Community shows a further decline in housing availability along with an associated rise in rental prices. The report notes that on August 1st, there were just 716 homes listed to rent nationwide, just one fifth of the average number of homes available to rent on the same date between 2015 and 2019.”

According to this year’s Rental Price Report for Q2 from; “rent prices increased by 12.6% in the 12 month period between Q2 2021 and Q2 2022.” If we look at Central Statistics Office for the same period, average weekly earnings have only risen from €850.81 to €871.62, which is only 2.45% showing that rent increases are vastly in excess of increases in earnings.

In a study of 16 areas over 3 days, the Locked Out of the Market report found that  in all, there were 392 properties available to rent... This represents a 61.5% drop from the 1,017 properties available in September 2021 and 84.6% less than the 2,543 available in September 2020.” Of the 392 properties, 239 (61%) were found in Dublin City which demonstrates an increasing issue of housing availability outside the capital. In the Irish Examiner on the 8th of November, an article was published (linked here) which featured warnings, by the CEO of the Tipperary Chamber of Commerce, over how the lack of accommodation in Tipperary was frustrating employers attempts to fill positions.

As feared in our previous e-Bulletin article on Housing Assistance Payment (linked here), the increase in HAP limits has proven insufficient as “no properties were affordable under a standard HAP rate for any household type.” There were, however, 25 properties available under the discretionary rate of HAP which has a higher limit. This was “81.7% less than 12 months prior (192) and a drastic 95.2% reduction from the 738 HAP properties 24 months prior in September 2020.” Of those properties

65.7% (23) were available in Dublin. “In Dublin the discretionary rate allows up to an additional 50% on the standard rate; this is limited to 35% elsewhere in the country.”

Again the acuteness of the housing crisis outside of Dublin was demonstrated as “In nine of the 16 study areas, there were no properties available to rent in any household category within standard or discretionary HAP limits.” The nine areas were spread across the country with no region being unaffected.  “These were Athlone, Galway City Suburbs, Galway City Centre, Co. Leitrim, Limerick City suburbs, Limerick City Centre, Sligo Town, Portlaoise, and Waterford City Centre.”

According to CSO Census 2022 figures, there are 166,752 unoccupied dwellings in Ireland. In the short term many of these could be used to alleviate the pressure on the rental market. In the long term more homes will need to be built. This is backed up by the census figures, which show  9% less vacant properties since the previous census in 2016, which itself showed a 25% drop since the 2011 census.

The urban/rural divide persists with reasons for properties being vacant. Urban areas such as “Galway City (38%) and Dublin City (30%) were the areas with the highest proportions of vacant rental properties.” Vacant rental properties include short-term rental properties, for example Airbnb,  and removing them from the rental market has for some time now been sought as one way of quickly increasing housing supply.

In rural areas it was more common for properties to be left vacant because of the owner being deceased or a farmhouse having been abandoned.  In “Roscommon (25%), Galway County (24%) and Mayo (24%) properties were most often vacant because the owner was deceased” and abandoned farmhouses were “more common in rural areas such as Leitrim (17%) and Sligo (16%).” To get these into the housing or rental markets would be more difficult with properties where the owner is deceased, in particular if it takes time to establish who will inherit the property. Abandoned farmhouses on the other hand would require investment to bring them back up to a habitable standard.

Other reasons for properties being vacant included For Sale (17,826), New Build (6,752), or Renovations (23,748) where the properties are likely to go into the market. There were three categories where there is no clear answer to whether or not they can be brought into the rental market: Nursing Home/ Hospital (11,130), Emigrated (2,478), and With Relatives (5,138). Each of these categories hold a wide scope for different circumstances which would need to be looked at on a case by case basis. The final and third largest category was Other (24,477) which “included dwellings for which the enumerator could not clearly ascertain a reason for vacancy.

Overall the problems in the rental market look to persist into the near future, and there is no quick fix to the problem. There are a number of smaller fixes that can buy time to increase housing supply.