# Rents falling - CSO: Has the Irish rental market reached a point of equilibrium?



## Howitzer (12 Oct 2007)

The Consumer Price Index for September released yesterday by the CSO show rents to be falling again (-0.2% over the month, +11% yoy).

http://www.cso.ie/releasespublications/documents/prices/current/pic.pdf

Has the Irish rental market reached a point of equilibrium as a result of the massive amounts of housing built over the last 5 years or is this maybe an indication of a reversal of inward migration?


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## Howitzer (12 Oct 2007)

*Re: Rents falling - CSO*



ClubMan said:


> Is it that rents are falling or the rate of change is falling?


 
It's the CPI index so it's rents in absolute numbers are falling, compared to a month previously so the year on year figures are still up.


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## ClubMan (12 Oct 2007)

*Re: Rents falling - CSO*

Sorry - I removed my post when I realised my mistake.


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## Calico (12 Oct 2007)

*Re: Rents falling - CSO*

I'm not surprised they are falling. I've have been out of Dublin a couple of years now and cannot believe the amount that rents have increased in the interim. What was 600p/m is now 900p/m as far as I can see. And the standard of accomodation is SO bad. I don't know how some landlords get away with it it.


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## Howitzer (15 Oct 2007)

*Re: Rents falling - CSO*

I notice from Daftwatch that the number of houses for Rent has shot up in the last couple of months, whilst the number for sale has plateaued off (@ 53/54 K). 

I can only assume this is as a result of Investors placing property back up for rent after failing to achieve a sale, and that the reason for the increase in rents over the previous 12 months was as a result of these same investors placing their properties for sale, evicting their tenants, and so creating a temporary squeeze in the market. Where now for rents?


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## badabing (15 Oct 2007)

*Re: Rents falling - CSO*

Interesting point, however I would advise looking at more data before being responsible about making a firm conclusion. -0.2% is -2.4% annualised, which pales in comparrison with the annualised +11% the rents have actually increased. We would need to see an acceleration in the rate of rent deflation and over a period of many months to have anything noteable

Yes availability of rental accomodation in DAFT has shot up. But with 50,000 or so more people living in Dublin year on year, we badly need this 'glut' of supply to prevent any more medium term rent hikes. Also the construction industry is winding down a little and will stop producing the 'excess' within a year or so. If rent continues to increase like it has, the foreign workers will stop coming.


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## dontaskme (17 Oct 2007)

*Re: Rents falling - CSO*



Howitzer said:


> I notice from Daftwatch that the number of houses for Rent has shot up in the last couple of months, whilst the number for sale has plateaued off (@ 53/54 K).
> 
> I can only assume this is as a result of Investors placing property back up for rent after failing to achieve a sale, and that the reason for the increase in rents over the previous 12 months was as a result of these same investors placing their properties for sale, evicting their tenants, and so creating a temporary squeeze in the market. Where now for rents?


 
funny that, it seems to spike in October when you would expect rental availability to be falling as students return to college.


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## Howitzer (8 Nov 2007)

*Re: Rents falling - CSO*

Rents are static for October set against an increase to 4.8% for all other items on the CPI.

[broken link removed]

Daftwatch also shows a dramatic increase of rental availability.


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## Stifster (8 Nov 2007)

*Re: Rents falling - CSO*

It would be interesting to get some further specifics on the types of property available.

I wonder are developers of apartment complexes not selling and renting in the short-term to see if things improve?


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## Remix (8 Nov 2007)

*Re: Rents falling - CSO*



Stifster said:


> I wonder are developers of apartment complexes not selling and renting in the short-term to see if things improve?


 
The MD of AIB said there is a trend for developers, in order to make a sale, are selling to themselves and then renting out. 



> ..a trend where developers are mortgaging and renting out homes rather than selling into a depressed market.
> 
> (Donal Forde, managing director, AIB Bank )


Not sure what happens down the road if these properties don't rent as expected and continue to fall in value. Sounds risky but they may not have a choice.


MD of AIB .

Discussed on ThePropertyPin.com here.


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## bacchus (8 Nov 2007)

*Re: Rents falling - CSO*



Howitzer said:


> Daftwatch also shows a dramatic increase of rental availability.


 
It may simply show that Daft may be becoming a more and more popular place to advertise properties for rent, but i dont think one can make any conclusion regarding national rental availability from these graphs.


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## Howitzer (8 Nov 2007)

*Re: Rents falling - CSO*



bacchus said:


> It may simply show that Daft may be becoming a more and more popular place to advertise properties for rent, but i dont think one can make any conclusion regarding national rental availability from these graphs.


I heard this point being made over a year ago and I reckon I'll keep hearing it for another few years. I've been a renter off and on for about 10 years. Daft has been the no 1 source in the Dublin area since about 2000. The figures on Daftwatch are broken down by county and the nationwide increase in rental figures is also reflected in Dublin where Daft reached critical mass many moons ago. 

While I'd like to see another 4 months CSO figures to see if there's a real trend, rather than a statistical blip, I'm pretty comfortable taking the Daftwatch figures at face value.


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## corkfella (8 Nov 2007)

*Re: Rents falling - CSO*

from my own experience in cork i put an add on daft yesterday for a single room 10 mins from city centre for 300 euro and had about 30 phone calls and about 15 people called to the house, I let it to an irish girl and she was delighted to get it as she had been looking for 2 weeks for something so there seems to be a major shortage in cork at present.


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## Trustmeh (9 Nov 2007)

*Re: Rents falling - CSO*

repeat above story for limerick.

By howitzer: "
While I'd like to see another 4 months CSO figures to see if there's a real trend, rather than a statistical blip, I'm pretty comfortable taking the Daftwatch figures at face value."

you are entitled to your opinion, but anyone can make any statistical figures say anything they want.


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## Persius (10 Nov 2007)

*Re: Rents falling - CSO*

Most new stuff getting built these days is far away from the city center. Most young renters want to live in the city center. Therefore it is perfectly reasonable that the number of properties available to rent is increasing dramatically, yet when people like corkfella dnd yankinlk offer a room/property to rent, they are snapped up immediatly and the demand is very strong. The "location, location, location" cliche is very true

And as for the arguement in daft gaining in popularity as a medium to advertise. This may be true in the case of property for sale, but doesn't hold IMHO for property to let. As Howitzer says, it's been the number one site since about 2001.


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## Howitzer (10 Nov 2007)

*Re: Rents falling - CSO*



yankinlk said:


> repeat above story for limerick.
> 
> By howitzer: "
> While I'd like to see another 4 months CSO figures to see if there's a real trend, rather than a statistical blip, I'm pretty comfortable taking the Daftwatch figures at face value."
> ...


I'm not analysing the figures, I'm simply reproducing CSO figures which haven't otherwise got any publicity. 

On every property related article I hear or read the notion that rents are increasing dramatically is mentioned. A year ago they certainly were but now they seem more static. Not according to the (hugely discredited) University of Howitzer, but according to the CSO.

The Daftwatch figures again aren't a straw poll sample but an absolute measure of all the properties for rent/sale on Daf and are presented in a graphical format. There is no analysis, just a presentaion of figures which otherwise would be hard to gauge (these figures have also matched the figures produced by DAFT in their quaterly reports)


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## Howitzer (8 Dec 2007)

You know the story is old news when the Indo picks up on it.

Rental market cools down as more properties are available for lettings




> Analysis of the Daft.ie property website shows that rents have slowed noticeably in recent months.
> They were 6.6pc higher in October than the same month last year, which is almost half the rate of increase recorded earlier in the year.


 
This equates to quite a fall in rents over the last few months. It will be interesting to read the CSO stats for November out next week.


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## Killter (9 Dec 2007)

ive lived in galway since 2001 and because i was a student i moved about alot-about 7 places since then. However contrary to all the news reports ive heard on the topic-im still paying the same amount of rent for a one bed apart as i did back then. 600pm.


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## Howitzer (13 Feb 2008)

Daft seem to be confirming the observations laid out in this thread, though strangely the CSO figures have been slightly up or static over the last couple of months, still showing yoy increases of ~12% with the DAFT yoy figures being of the order of 5%.

Cost of rent stops rising as supply doubles
http://www.independent.ie/business/irish/cost-of-rent-stops-rising-as-supply-doubles-1288359.html


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## ionapaul (13 Feb 2008)

I've just moved back to Dublin and all the places I viewed before taking a room reported things are very, very slow with regard viewings compared to last year and previous years.  One guy in Ranelagh told me two years ago his phone was ringing every few minutes for a week when he was looking for a roommate, this time around he'd only had 20 phone calls over the course of 5 days.  I've taken a nice single room in Rathmines paying €500pm and sharing with just one other person in a very nice apartment, the same sort of money I was paying the last time I lived in Dublin from 2004-2006.  I just don't understand some of the rents being asked on Daft, €700+pm to live out beside or past the M50.  Who pays these rents?


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## Glenbhoy (14 Feb 2008)

ionapaul said:


> I've just moved back to Dublin and all the places I viewed before taking a room reported things are very, very slow with regard viewings compared to last year and previous years. One guy in Ranelagh told me two years ago his phone was ringing every few minutes for a week when he was looking for a roommate, this time around he'd only had 20 phone calls over the course of 5 days. I've taken a nice single room in Rathmines paying €500pm and sharing with just one other person in a very nice apartment, the same sort of money I was paying the last time I lived in Dublin from 2004-2006. I just don't understand some of the rents being asked on Daft, €700+pm to live out beside or past the M50. Who pays these rents?


I don't think many people pay the rents being quoted in daft - they are simply a reaction by the landlords to the reports of huge increases in rent.  
I know my brother when negotiating an apartment back in Oct was able to obtain a 7.5% drop from the asking price back down to the price that had the apartment had been rented at since 2005.
A friend recently put a room up for letting at the prices being quoted in daft for his development, he got 1 call in 2 weeks, he dropped the price by 20% last weekend - unfortunately, I haven't been in contact since, but I'll update when I hear how that turned out for him.


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## Marie (15 Feb 2008)

What you say about 'actual' rents paid is true from what I hear and the advertised prices are being asked for but in many cases the arrangement made is lower.  Further falls in rent predicted on the latest Daft report, here:-  [broken link removed]


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## Howitzer (11 Sep 2008)

More great news for renters. It looks like the bottom has completely fallen out of the rental market. Rents are down by 2.9% in August alone

[broken link removed]

This was one of the largest single factors in bringing the Anuual Inflation rate down to 4.3% from 4.4% in July. Expect high fives all round from Union and Government officials.


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## groom (11 Sep 2008)

...making sales prices of houses more silly


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## Jethro Tull (12 Sep 2008)

this is also in a month where a lot of college students would have been looking for a place to rent. look at post #12 here to see august movements for the last few August's


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## Howitzer (11 Dec 2008)

Rents have fallen off a cliff. Down by 6.1% in November!!

[broken link removed]

That's an annualised rate of -73.2%


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## Thomas22 (11 Dec 2008)

That is an absolutely huge fall in a single month


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## Jister (11 Dec 2008)

Was Tom Parlon was trumpeting 10% year on year  rent rises earlier this year? Rental stock on daft is exploding. It looks like all the sheepeoplespecuvestors have jumped off the for sale path and onto the for rent path at the same time.

What should people do now that rents and house prices are collapsing? Live in a caravan for the next year?


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## Berni (11 Dec 2008)

Thomas22 said:


> That is an absolutely huge fall in a single month


Its not really a single month though. Rent data is only collected every quarter, so that reflects the change since august.  
The last four months figures have been:
Aug -2.9%
Sept 0%
Oct 0%
Nov -6.5%


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## Carramore (21 Dec 2008)

The recent falls in rents make sense. In fact, the big puzzle was why they held up and even increased a couple of years ago when we all knew that there were lots of empty houses and apartments in Dubliin and around the country.  (Reports from census enumerators in 2006 were a strong early indicator).  The explanation lies in the fact that, a few years ago, investors weren't interested in the "chicken feed" available from renting when all they had to do was leave the property empty and flip it for an enormous profit after a short period, without the hassle of tenants, etc.  

The picture has now changed dramatically.  The prospect of selling at anything approaching a reasonable price has disappeared and investors must pick up whatever crumbs they can to pay the interest on their mortgages.  This inevitably leads to an increase in the supply of properties available for renting. Simultaneously, I presume that we're now seeing a reduction in demand with the increase in emigration/ return of immigrants.  There are still lots of empty properties, so expect rents to keep falling for some time to come.


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## Howitzer (13 Mar 2009)

Down 5.7% in Febuary.


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