Lack of homes pushes rents higher in Louth

Figures released this week by property website, Daft.ie, show that market rents in Louth were on average 11.1% higher in the final three months (Q4) of 2022 than a year previously, with the average listed rent now €1,550, up 143% from its lowest point during the last recession. On a quarterly basis, it is up 0.9% on the third quarter (Q3) of 2022.

Introducing the Daft.ie Rental Price Report for 2022 Q4, Ronan Lyons, Associate Professor in Economics Trinity College Dublin, said that the stark finding from the latest report was that “Ireland’s private rental market remains chronically starved of homes.”

As of the morning of Monday 13 February, there were 17 properties to rent in the whole of CountyLouth on the Daft.ie website, a county with a population of 139,100, according to the latest census.

Rents nationally have seen a year on year rise of 13.7% in the annual listed rent, which represents the second highest year-on-year increase in market rents since the launch of the Daft Report in 2005.

Looking at rental prices in Louth in more detail, the largest annual increase was seen in three bed houses, with an average price of €1,416 – up 9% in a year.

The full available figures for the final quarter of 2022 are as follows:

• One bed apartment - €1,013 – up 6%
• Two bed house - €1,235 – up 8%
• Three bed house - €1,416 – up 9%
• Four bed house - €1,627 – up 8%
• Five bed house - €1,715 – down 5%

The latest report also compares the average mortgage payment for homes in Louth with average rents in Q4 2022. The report uses the following parameters: 3.25% variable mortgage, for a term of 30 years, with 85% LTV, while a figure is also given for the case where mortgage rates rise by two percentage points.

The figures are as follows:

• One bed apartment: mortgage - €444; mortgage +2% - €563; rent - €1,013
• Two bed house: mortgage - €567; mortgage +2% - €719; rent - €1,235
• Three bed house: mortgage - €785; mortgage +2% - €996; rent - €1,416
• Four bed house: mortgage - €1,523; mortgage +2% - €1,932; rent - €1,627
• Five bed house: mortgage - €1,463; mortgage +2% - €1,857; rent - €1,715

Commenting on the latest national figures, Ronan Lyons said, in relation to the private rental market being “chronically starved of homes”, that “the fact that it is persistent and shows little signs of abating must serve as a wake-up call”.

Mr Lyons continued, saying: “many – particularly those who have the misfortune of trying to find something in the open market currently – are only too aware of the challenges out there. To these people, it must seem almost obvious that it doesn’t need saying that, when faced with an acute shortage of rental homes, the solution is to build more rental homes.

“However, many others are shielded from how brutal it is out there. Some only become aware when a family member or new colleague has to run the gauntlet of finding a home to rent on the open market. But many are simply unaware that it is in Ireland’s rental segment – not its sales segment – where the country’s housing woes are concentrated.

“The lack of awareness of just how grim things are includes, it must be said, some local authorities and some national policymakers. Over the past year or so, various efforts have been taken to limit, not increase, the construction of new rental homes. This is, by any accounts, an extraordinary turn of events.”