Rent prices pierce ceiling

Rent prices, something that seems to always be steadily increasing. In 2016, the Irish government began to take note of a fast moving, upward trend in certain zones and put a price ceiling on rent prices in an effort to regulate these changes. Areas that have a high likelihood to increase rent, specifically because of location and competition, are called Rent Pressure Zones (RPZ). 

These zones are primarily located in the larger cities, such as Dublin, Galway or Cork and have specifications that help to protect renters from exorbitant hikes in monthly prices. Any property within a Rent Pressure Zone are legally not allowed to increase their prices by more than 4pc each year. 

This ceiling in rent increases are intended to create a more affordable market for landlords and tenants so that they can have a good idea of how prices could rise; this is ideal for planning housing opportunities and finances in the future. This program worked for the most part, with many tenants seeing an increase of between 2.4 and 3pc a year from 2016 to 2018. 

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Affordable Rental Properties are Hard to Come by

Rental properties have provided the people of Ireland different options when it comes to living situations. People that cannot secure mortgages for various reasons and therefore are unable to buy a home look into the rental market.

A new Simon Communities Study has found that over 90% of homes available for rent within Ireland are not affordable for people with state housing benefits. The study indicates that the government needs to monitor and strictly enforce rent pressure zones, including the 19 new zones announced today.

The most recent publication of the Locked Out of the Market report found that approximately 8% of properties available on the market to rent were within the housing assistance payment limits. That percentage is drastically smaller compared to the percentage of the population that is using housing assistant payments.

The study found some alarming information that the government needs to take under consideration. Only one property was found available to rent within the Rent Supplement or HAP limits across all of the study areas for a single person. Additionally, only two unites were available within …

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Is Long-Term Renting Sustainable?

Lifelong renting is becoming increasingly popular within Ireland’s largest cities. Influential Cork developer, Michael O’Flynn, talked about instances when he heard of people suggesting that up to 50% of houses should be rented. O’Flynn heavily disagrees with this statement and suggests that ideas such as economic and pension polices should be reviewed.

O’Flynn most recently addressed this issue during his discussion at the Institute of Professional Auctioneers and Valuers (IPAV). He set out to prove that retirees could not sustain a long period of renting properties and instead should have a house paid off to retire in. He asked the audience, “There are currently five workers for every pensioner, but the projection is for this to drop to two workers for every retiree by 2050. Have we considered how that will impact on pension income?” The renting model is not affordable for many classes of people and can cause severe economic troubles down the road when savings begin to dry up. Renting can be a great alternative for people moving to new areas or students and young adults in the …

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UN Sent Irish Government a Letter on Housing Crisis

The Irish government received a letter in March from the UN rapporteur, Leilani Farha, stating that, “housing in Ireland is moderately unaffordable.” The UN was using this letter as a wakeup call to the Irish government and made some very serious allegations. One of the allegations that the letter made was, “house prices are now approaching levels last seen at the height of the property bubble.” This statement relives a terrible time in the history of Ireland. The Irish government responded by saying that average households only spend one-fifth of their income on housing costs but acknowledged some prominent issues that need to be improved.

A couple of the top problems stated in the letter related to land hoarding and equity landlords. First, land hoarding occurs when investors will purposefully sit on a property to increase demand and lower supply in the area before selling/renting. This is causing major problems for citizens that are struggling to keep up with the increasing prices. The other problem is landlords, “have openly discussed policies of introducing the highest rents possible in order to …

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Single Parents and Migrants at Greatest Risk for Homelessness According to New Report

If you identify as either a lone parent, migrant, or a member of a traveling community then you are at greater risk of homelessness according to Focus Ireland. Focus Ireland conducted a report examining the drivers of family homelessness in Dublin. The overarching idea was many families are being evicted from private rental properties and unable to find another place to live causing homelessness. Many of these families have a long history with residing in the same apartment and should not be threatened with homelessness due to the rising property prices and shortage of availability.

Mike Allen, Director of Advocacy at Focus Ireland, appeared on RTÉ’s Morning Ireland to discuss his companies recent report. He was quoted saying, “the vast majority of the families surveyed had been living in the private rental sector without any problem until the crisis came along.”  Mike Allen has witnessed an increase in many property owners exiting the rental market especially those that are offering more affordable properties to rent. This is one of the many reasons contributing to the growing numbers of homelessness in …

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IHREC Upset Over Eoghan Murphy

Homelessness is increasing drastically throughout Ireland due to the rising property prices and shortage of available properties for sale or rent. Homelessness numbers reached 10,378 people at the end of April with almost 40 percent being children. In response the government has initiated some new programs and taken action into building social housing. Housing Minister, Eoghan Murphy, has claimed that his new Rebuilding Ireland Program has been working well since he implemented it.

Has Eoghan Murphy spent enough time and effort solving homelessness?

Emily Logan, Head of the Human Rights Body for the Irish Human Rights and Equality Commission (IHREC), would say otherwise. The IHREC accused the government of blaming this crisis as, “the by-product of market dynamics, or the price our society pays for progress.” Part of the housing shortage and rise in homelessness can be contributed to market problems, but the government needs to step up and take more action into drafting policies that would make a significant difference. The IHREC is very blunt when it comes to pointing the finger, they stated that the rising level of …

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Reactions to New Rental Laws

Homelessness is an issue of uttermost importance in Ireland. Two staggering numbers mentioned below are being directly addressed by members of the Irish government.

10,378 – number of homeless people as of April

3,794 – number of homeless children as of April

Eoghan Murphy, minister for housing, planning, and local government, blames short term renting (letting) as a big contributor. Ireland has seen increasing numbers of people immigrating over plus many British citizens are moving to Ireland due to Brexit concerns. With this influx of people coupled with an increase of short-term renting, many citizens find the lack of few homes for sale too expensive and are resorting to homelessness.

The new legislation will be going into effect on July 1st. The legislation mainly targets the multinational company, Airbnb, who allows people to post their homes for rent on the web. Owners who reside in a rent pressure zone (rpz) will be required to fill out a form at the beginning and ending of each year. Additionally, a ninety-day total limit per year will be enforced and each rental session …

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Property price are set to rise and rise… (then crash)

We have been clear about our views on property cycles for many years. That is why we said when many were saying the crash would run and run, that we took a contrarian view and said the market would rise and rise quickly, then experience a mid-cycle slow down and return to a rapid increase in prices.

Our ‘mid-cycle’ was called in 2015 as the Macro-Prudential rules kicked in that they wouldn’t calm the market. We said any effect would be temporary at best and that price increases would return and lead us up and up into a crash in the mid 2020’s. This prediction has been one we made long before almost anybody else in the market and we see no reason to believe (for now) that it won’t happen.

The frustration now is about what to do in light of this, for people who want to rent you need to nail down rental contracts – even though more than half the country has rent control because it is going (meant to) end in 2019. For those looking to …

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Rents continue to increase over the year by substantial amount

In reference to Irish private sector rents grew by 7.37% from 1st quarter 2016 to 1st quarter 2017 by Robert McHugh on 15 June 2017 in Business World.

Over the course of only a year, the average rent increased by 7.37% from 1st quarter 2016 to 1st quarter 2017. The standardised average national rent being €987, Dublin is one of the highest amongst the other counties as well as Cork and Galway. Looking over the houses and apartments market the trend of rents are continuing to grow.

Outside the Dublin county, the houses and apartment rents at a overall growth rate of 1.3% in private sector rents. Annual growth increased by 7.6% in houses and apartments. The margin is shrinking between the peak of 2007 and the 2017 first quarter however, it is still 8% below.

So far the 19 Rent Pressure Zones (RBZ) are located in parts of the following counties: Dublin, Cork, Galway, Meath. No other parts of the country are currently able to become Rent Pressure Zones, according the to latest Rent Index.

Mr. Simon Coveney, …

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