RTB/ESRI Rent Index shows average rents grew nationally by 7.1%
The RTB/ESRI Rent Index Quarter 1 2018 highlights that low unemployment and an improvement in wages are contributing to strong inflationary pressures in the housing market. Positive economic performance combined with demand-side pressures continue to put upward pressure on the private rental market with an average increase nationally of 7.1% annually.
The Residential Tenancies Board (RTB) is the public body that supports the rental housing sector including both the private rental sector and not-for-profit housing providers or Approved Housing Bodies (AHB). The Rent Index is based on the RTB’s national register of tenancies and is considered the most accurate rent report on the private rental sector in Ireland. At the end of 2017 there were approximately 340,000 tenancies registered with the RTB; of these 313,000 were private tenancies with the remainder made of up tenancies managed by Approved Housing Bodies. The number of tenancies registered with the RTB in Q1 2018 was 19,879. The overall landlord profile remains relatively stable with the majority of the 174,000 landlords (86%) owning 1-2 properties.
The Dublin rental market is the largest in the country. RTB research shows on a year-on-year basis, Dublin rents were up 7.8% in Q1 2018, an increase in the growth rate from 5.1% year-on-year growth in Q4 2017. While rental pressures are evident in Dublin, many of the surrounding counties are also facing increasing rents. As of Q1 2018, the average national rent for a house was €1,060 per month, up from €998 one year earlier with the corresponding figures for apartments €1,162 for Q1 2018 up from €1,081 per month in Q1 2017. Year-on-year, rents for houses increased by 6.2% while apartment rents increased by 7.5%.
According to the CSO, average weekly earnings have increased by 2.4%. In other words average earnings are not increasing in line with increasing rents making it increasingly difficult for people to afford rents. Affordability pressures are a significant issue as demand for rental accommodation continues to grow, supply remains restricted and rents continue to increase.