New survey could signal two-tier rent sector

RENTS ROSE fractionally in the first quarter of this year, but are still 25 per cent below the 2007 peak, according to the latest report by property website daft.ie.

Rents rose, on average, by half a per cent in the first three months of the year.

The average rent nationwide now stands at €825.

The latest survey, which shows some signs of the rental market stabilising, nonetheless reveals a strong disparity between different regions in the State.

While Cork city and some parts of Dublin have seen a 3 per cent rise in rents, in Waterford city and Limerick, rents are 6 per cent and 2.3 per cent lower respectively, compared to the same period last year.

Ronan Lyons, economist with daft.ie, said that while the latest figures confirmed a stabilisation in the market, a two-tier rental market might be emerging.

“While rents are rising in some urban centres, there is still significant overhang in other parts of the market which is pushing down rents.”

The Daft quarterly survey is based on an analysis of the database of properties posted for advertisement on Daft.ie.

The total number of properties available to rent across the State has risen slightly to 17,000 but remains well below the high of 24,000 reached in mid-2009.

Rental yields in Ireland are averaging 4 per cent, according to the report.

Commenting on the latest figures from daft.ie, financial analyst Prof Cormac Lucey said the stabilisation in rents evident in the latest Daft survey reflected the Irish economy’s underlying growth potential.

However, he added while rent levels had stabilised, “property prices have not”.