Serious concerns about lack of available rental property in Co Kildare and nationwide in new report
In Co Kildare, rents were on average 10.2% higher in the first three months of this year than a year previously. The average advertised rent is now €1,246, up 77% from its lowest point.
Rents rose nationwide by an average of 11.5% in the year to March 2018, according to the latest quarterly Rental Report by Daft.ie.
The Irish Property Owners Association is very concerned that constant legislative interference and penal Tax Treatment is damaging the private rental sector. The Daft Report again reflects the increasing shortage of available accommodation and the increasing cost of renting.
There were 3,086 properties available to rent nationwide in April. This is the lowest number ever recorded for this time of year since the series started in 2006, and the figure marks a 17% decrease on the same date a year previously. In Dublin, there were just 1,265 homes available to rent, one third below the average over the last five years and just one quarter of the average in the period 2008-2013.
Ronan Lyons, economist at Trinity College Dublin and author of the Daft Report, said:"Rents have now been rising almost three times as long as they fell in the crash and the increases show no signs of moderating."
“When will the State listen?” asked Stephen Faughnan, Chairman “The Daft Report does not reflect the rents payable for existing tenancies, which may be 50% less, and are constrained by Rent Pressure Zone Legislation of 4% max. which not alone dwarfs the income but also dwarfs the capital value of a property”.
Addressing IPOA members, Chairman Stephen Faughnan drew a stark comparison between what rent is payable to a private landlord and what is left as profit at the end of the day.
He said:"Every euro of rent received by landlords is significantly reduced by a variety of taxes, levies, charges and maintenance costs. With approximately 62% of rental income going back to the State it is not surprising that more private rental investors are leaving the sector than are entering the sector.”
He added: "The fundamental problem around the private rental sector is that there are not enough properties to rent. Investors require confidence and stability to invest, balanced legislation and fair Tax treatment. Legislation around the sector is changing on a yearly basis, continually increasing tenants’ rights without protecting the rights of the owner. Over 90% of Irish landlords have less than three properties. Landlords that have kept rents low have been restricted to keeping them low in rent pressure zones. This does not take into account their indebtedness, the result of not being able to increase income means that landlords in these cases have to subvent their rental property, which is not sustainable, forcing them to leave the market, further reducing the amount of accommodation available. Mr Faughnan went on to state that “RENT CONTROL” was declared to be unconstitutional in 1982 by the Supreme Court, and no constitutional change has taken place to reverse this Supreme Court Decision. When will justice be afforded to the providers of rented accommodation? Property Owners are leaving the sector in their droves. 40,000 have already made their exit – more to follow. It does not appear to matter to politicians.”