Dublin - Significant reduction in rents coming?

dotsman

mrslancaster wrote: »

It doesn't help that more than 40% of the population live in Dublin and the number of people who want to live in the capital has seen a huge increase. Other parts of the country are still more affordable. Maybe if we had a more evenly distributed population the huge costs of housing and the transport problems in Dublin would be less acute.

But move them where? And how do you decide who gets moved, and who makes that decision?

People move to Dublin because that is where the jobs are. Companies move to Dublin because that is where the people are. This is not just an Irish phenomenon, but occurs everywhere (in many science fiction stories, this trend continues until you have giant megacities with little in between).

The reason is simple - the more specialist jobs become in the modern era, the more a company needs to base itself in a sufficiently large pool of potential employees to be able to attract the number of rare specialists it requires (similarly, highly skilled people will only find suitable employment in large cities).

Now, could/should Cork and a Limerick/Galway combo be planned better to attract some of these hi-tech/financial companies and thus, distribute some of the urban growth. I believe yes but, as per my last post, nothing has been done for the last 30 years (where they have received the same terrible urban planning as Dublin, resulting in them being just mini-dublins), so I wouldn't hold my breath on that front.

Phat Cat

My nephew and his gf are looking to rent a one bed apartment in South County Dublin. They have a budget of around €1,400pm but are finding it impossible to find anything decent. Most decent one beds are €1,600 - €1,800pm w/o bills etc, which is a crazy amount.

I actually though rents might have fallen since last March but that doesn't seem the case. I was wondering if anybody has successfully got a rent decrease in the last few months?

Zenify

Phat Cat wrote: »

My nephew and his gf are looking to rent a one bed apartment in South County Dublin. They have a budget of around €1,400pm but are finding it impossible to find anything decent. Most decent one beds are €1,600 - €1,800pm w/o bills etc, which is a crazy amount.

I actually though rents might have fallen since last March but that doesn't seem the case. I was wondering if anybody has successfully got a rent decrease in the last few months?

A family member of mine got a lovely studio in Ballsbridge for 900eur, now its probably too small for a couple but it shows what has come down in price. It would have been 1,300 at least last year.

cgcsb

mrslancaster wrote: »

It doesn't help that more than 40% of the population live in Dublin and the number of people who want to live in the capital has seen a huge increase. Other parts of the country are still more affordable. Maybe if we had a more evenly distributed population the huge costs of housing and the transport problems in Dublin would be less acute.

What country in the world has an 'evenly distributed population' and how do they function like that? Ireland has a small population and can only have one city of significant size. Other countries with similar populations like Denmark and Norway have the same set up.

Germany might be different because it's a federalised super power with touching on 90 million people, that cannot happen here.

Dublin is not Tokyo, we don't have an issue with space or indeed a real issue with transport. The entire population of Ireland could comfortably fit inside the M50 with lots of green space.

The problem with affordability is purely mismanagement, corruption and incompetence.

Northernlily

Dublin City apartment dweller here. Seeing an opportunity lower my rental expenses with this remote working craic, I have to ask.

Why are rental prices not falling in Dublin given we are having major shift in the nature of how we work? Remote working is here to stay for 2021 anyway.

Another reason rent should fall is all the Airbnb rentals have been let into the market increasing supply. This should further drive prices down with increased supply and less demand in the market.

Can anyone explain this to me? Are the landlords deluded that things will return to as they were?

A room in my own apartment has been left vacant since May. The landlord seen an opportunity to increase rent on the room and more or less took an unsympathetic view with my housemate who had been at the property for 4 years previous and had been put on furlough. He has lost about 6k in rent as a result.

I'm struggling to get into my mind of how rental prices are not falling. On the front of it, it seems like delusion and greed on the landlords part.

flazio

Is there any indication that the cost of owning a property has gone down? Not taking sides here but that would be the first counter argument I would suspect.

Grayson

Northernlily wrote: »

Dublin City apartment dweller here. Seeing an opportunity lower my rental expenses with this remote working craic, I have to ask.

Why are rental prices not falling in Dublin given we are having major shift in the nature of how we work? Remote working is here to stay for 2021 anyway.

Another reason rent should fall is all the Airbnb rentals have been let into the market increasing supply. This should further drive prices down with increased supply and less demand in the market.

Can anyone explain this to me? Are the landlords deluded that things will return to as they were?

A room in my own apartment has been left vacant since May. The landlord seen an opportunity to increase rent on the room and more or less took an unsympathetic view with my housemate who had been at the property for 4 years previous and had been put on furlough. He has lost about 6k in rent as a result.

I'm struggling to get into my mind of how rental prices are not falling. On the front of it, it seems like delusion and greed on the landlords part.

Money grubbing bastards?

I'm looking to move onto the continent. I can't afford to rent anywhere near Dublin. Property is increasing too much in value. I could move down the country but as a single guy I'd be resetting my social life and moving somewhere quieter. Might as well move abroad at that stage. Plenty of large european cities where I can work from home.

But, that's a digression. I'm sure there's plenty of threads about this without driving this one off topic. I pretty much only log into boards to check this thread at this stage.

vrusinov

Northernlily wrote: »

Dublin City apartment dweller here. Seeing an opportunity lower my rental expenses with this remote working craic, I have to ask.

Why are rental prices not falling in Dublin given we are having major shift in the nature of how we work? Remote working is here to stay for 2021 anyway.

I had several folks in my team relocate to Dublin, and some changed rentals since April. Almost all stayed walking distance to the (currently closed) office.

Lockdown or not, majority of folks still prefer to live in a city and do so if they can afford it.

Ted_YNWA

Mod

Breaking posts out from thread in AH. Worthy of thread of it's own.

Best suited in this forum.

Fred Cryton

The reason is simple. There is a ridiculously low number of apartments coming on stream, so supply is nowhere near meeting demand. Dublin is still creating jobs especially in the tech sector who are the very people renting out apartments. Bear in mind if you're coming into the country from France to work in Google, you do not want to be remote working out in Meath. You'll still pay a premium to live in the city centre where all the other non-Irish live and to have a city experience. Such an employee would not be allowed to remote work from his native France.

To answer our question really precisely, Dublin city Council are the reason the rents are still so high. Insane planning laws and regulations make many city centre apartment developments unviable. DCC bringing Johnny Ronan to court in 2020 to stop him building apartments says it all .The council stopping developers building homes in a middle of a so called housing crisis, there you go.

DubCount

There are a few issues here

1) There was a large undersupply before Covid hit. New supply has not been gushing into the market, in fact more landlords may be leaving the market. The reduction in Demand from WFH etc., simply has not been enough to get back to supply meeting demand.

2) Rent Pressure Zones. All of Dublin is still covered by RPZ. If a LL reduces rent now, they could be years bringing the rent level back up again. If Demand increases when things get back to normal and WFH may not be as universal, a LL is better off not dropping rent now. This is especially true for REITS for whom the value of their assets is badly impacted by reducing rents - they are better off with empty units.

3) There has been no reduction in the risks of being a LL, in fact they increased with covid protections. The required returns for LLs has not reduced. Property prices have not reduced - why should rents?

Samuel T. Cogley

Northernlily wrote: »

Why are rental prices not falling in Dublin given we are having major shift in the nature of how we work? Remote working is here to stay for 2021 anyway.

Remote working will be 'elth and safety'd back into non-existence at the first opportunity bar maybe the odd very progressive multinational and the civil service.

Northernlily wrote: »

Another reason rent should fall is all the Airbnb rentals have been let into the market increasing supply. This should further drive prices down with increased supply and less demand in the market.

Drop in the ocean always was.

Northernlily wrote: »

Can anyone explain this to me? Are the landlords deluded that things will return to as they were?

Given property price rises it's potentially not a delusion.

Northernlily wrote: »

I'm struggling to get into my mind of how rental prices are not falling. On the front of it, it seems like delusion and greed on the landlords part.

LL's will always seek to get the most they can from their investment. Call it greed, call it business savvy it's not delusional if it's working and in the main it is.

Phat Cat

cgcsb wrote: »

The problem with affordability is purely mismanagement, corruption and incompetence.

.....and greed.

There are several one bedroom apartments in South County Dublin that were listed 8+ months ago yet are still vacant because they cost in and around €1,800pm. Other one bedroom properties in the area, that are listed at €1,400, or less, get snapped up within a few days.

What is the point of leaving apartments empty when they could be rented at a lower rate, especially during a global pandemic, where unemployment is high and the economy is struggling and probably on the brink of another recession.

Graham

Mod Note

Threads merged

Samuel T. Cogley

Phat Cat wrote: »

.....and greed.

There are several one bedroom apartments in South County Dublin that were listed 8+ months ago yet are still vacant because they cost in and around €1,800pm. Other one bedroom properties in the area, that are listed at €1,400, or less, get snapped up within a few days.

What is the point of leaving apartments empty when they could be rented at a lower rate, especially during a global pandemic, where unemployment is high and the economy is struggling and probably on the brink of another recession.

RPZ - explained in full a couple of posts up by Dubcount.

Dav010

Phat Cat wrote: »

.....and greed.

There are several one bedroom apartments in South County Dublin that were listed 8+ months ago yet are still vacant because they cost in and around €1,800pm. Other one bedroom properties in the area, that are listed at €1,400, or less, get snapped up within a few days.

What is the point of leaving apartments empty when they could be rented at a lower rate, especially during a global pandemic, where unemployment is high, the economy is struggling and probably on the brink of another recession.

You are confusing stupidity and greed. When you consider that renting is a service-for-payment, wanting the max that can be achieved is not greed, it is good business. Leaving it empty though, for such an extended period may be stupid. You have to consider why a LL does not want to drop the rental price, saying it is greed is simplistic. Some may be assessing whether to sell, some may be mindful of RPZ regs and the long term effect on rental earnings if the price is dropped now, some may think that there will be a stampede for rentals in the summer when vaccination is further along and offices/3rd level reopen, no doubt the owners of empty properties will raise rents then, the previous tenants will have long gone.

cgcsb

The decision to outright ban coliving will surely increase rents. A strange decision really. Basically the government is saying if you are in a position where a coliving unit is attractive to you (say someone working in the city on a temporary basis, or someone who needs a place at short notice with a view to finding something better after a few weeks), then the answer is no, you have to share a 3 bed semi in the burbs with ppl you don't know and commute or take a bunk in one of the basement Georgian slums in the centre. And of course government is not going to create new housing to compensate for removing this private sector housing from the market.

Melanchthon

cgcsb wrote: »

The decision to outright ban coliving will surely increase rents. A strange decision really. Basically the government is saying if you are in a position where a coliving unit is attractive to you (say someone working in the city on a temporary basis, or someone who needs a place at short notice with a view to finding something better after a few weeks), then the answer is no, you have to share a 3 bed semi in the burbs with ppl you don't know and commute or take a bunk in one of the basement Georgian slums in the centre. And of course government is not going to create new housing to compensate for removing this private sector housing from the market.

The idea of co-living isn't that terrible, the issue the huge rents they were going for and the fact that co-living places seemed to be dominating the new builds to come online.
I think banning bedsits was a bigger mistake, they might not have been great but a lot of them were genuinely cheap and better than sharing a room.

Edit: there seems to be this thing maybe it's to do with FG where there is a push for really high/expensive standards but on the flipside be fine with 6 people to a room.

cgcsb

Melanchthon wrote: »

The idea of co-living isn't that terrible, the issue the huge rents they were going for and the fact that co-living places seemed to be dominating the new builds to come online.
I think banning bedsits was a bigger mistake, they might not have been great but a lot of them were genuinely cheap and better than sharing a room.

Edit: there seems to be this thing maybe it's to do with FG where there is a push for really high/expensive standards but on the flipside be fine with 6 people to a room.

Well if the high rents are a reason to ban one type of residential development outright then all private residential development should be banned outright then?
I agree they were dominating new builds but that's a planning issue and up to the planning authority to say if there's too many in a particular area, an outright ban is a different story.

I agree the push is for super expensive property development only with basically no new public or affordable housing being provided by government. So nothing for the middle classes to do but emigrate.

Melanchthon

cgcsb wrote: »

Well if the high rents are a reason to ban one type of residential development outright then all private residential development should be banned outright then?
I agree they were dominating new builds but that's a planning issue and up to the planning authority to say if there's too many in a particular area, an outright ban is a different story.

I agree the push is for super expensive property development only with basically no new public or affordable housing being provided by government. So nothing for the middle classes to do but emigrate.

https://www.rte.ie/news/2020/1123/1179877-coliving-housing/

Are they actually banned? Even if they are it would seem that it would be more a reversion to the status quo and allow local authorities more freedom to reject.

"The move will involve amending the 2018 Planning Guidelines, brought in by previous minister for housing Eoghan Murphy, which introduced co-living developments.

They also relaxed height and density restrictions on housing allowing developers to override local authority development plans"

I understand the disagreement with this idea philosophically but we are so far from a free market in relation to this stuff anyway, like the ideology behind it doesn't make sense, like look at the "offices" people put in to live in their parents back gardens, illegal/against planning but often the alternative is for a young couple (and even child) is to live in a small bedroom in the parents house is fine? Same way with the energy efficiency standards, yeah it would be great to have a warm house with low heating bills it's little use of you can't afford it as a normal working person.

Phat Cat

Samuel T. Cogley wrote: »

RPZ - explained in full a couple of posts up by Dubcount.

I realise that the whole of Dublin is pretty much a RPZ at this stage, but where does it stop? Are rents going to raise by 4% per annum until people simply can't afford to live anywhere half decent? Similar size cities in the EU like Copenhagen are much cheaper to rent in compared to Dublin, and the average salaries are better too. Dublin has totally eclipsed the likes of Helsinki, Munich & Amsterdam for rental prices, and are possibly on par with Paris and London now, which is absolutely insane!

Melanchthon

Phat Cat wrote: »

I realise that the whole of Dublin is pretty much a RPZ at this stage, but where does it stop?

I know this sounds like absolute political shilling but it's going to take an election, FG have consistently shown they are either incapable of don't want to deliver on this front for the last 4/5 years now and looking at the polls they are going to be punished for it.

Dav010

Melanchthon wrote: »

I know this sounds like absolute political shilling but it's going to take an election, FG have consistently shown they are either incapable of don't want to deliver on this front for the last 4/5 years now and looking at the polls they are going to be punished for it.

There is a FF Taiseach. It doesn’t matter who the Government is, they will not be able to stop prices/rents rising, anymore than they can stop them falling. SF will claim they can, but their policies will both drive away investors and when asked where they would get the money to do all the reforms they promised, poor old Pearce Doherty was left looking like a boy at a grown ups party on TV, and that was before Covid plunged us further into debt.

Unless you think the Government can stop tens of thousands of people looking for rentals later this year, or they can magically build 50k more houses before then, the market will have its way.

cgcsb

Dav010 wrote: »

There is a FF Taiseach. It doesn’t matter who the Government is, they will not be able to stop prices/rents rising, anymore than they can stop them falling.

Sorry but this is just clearly false. Of course the government can have a massive impact on the housing market if it chooses to do so and indeed it has demonstrated that it has great power here. The government has:
- Introduced HAP which inflates rents in areas that would not naturally attract a high rent.
- Given tax incentives to REITS which has given us multiple luxury developments (mostly empty because the REITs can afford to wait)
- Given investors state land at massive discount and then paid same investor market value or more for some luxury units to use as social housing. These developments also having low occupancy because the investor can afford to wait.
- Ceased construction of social housing
- Outsourced contracts for small social housing developments to 'charities' (cluid etc.) who deliver and manage high cost social housing, taking some money for themselves in the process despite the councils having this function as part of their remit.
- Having depleted the social housing stock, high cost models of emergency housing have emerged, hotels and renting from private land lords.
-Starting this year they will start offering a shared ownership scheme, i.e. they'll throw in 30% of the cost of a new home and own a share for first time buyers. This means more money chasing the same stock of homes which = price inflation.

On top of all that, more than half of the cost of a new apartment is tax.

Dav010 wrote: »

SF will claim they can, but their policies will both drive away investors and when asked where they would get the money to do all the reforms they promised, poor old Pearce Doherty was left looking like a boy at a grown ups party on TV, and that was before Covid plunged us further into debt.

Probably because it's a ridiculous question. The state has demonstrated during the covid crisis that it is capable of plucking €20bn out of thin air in emergency one off spending. The housing crisis could be solved by government with a lot less money, the savings from no longer paying for HAP, hotels and buying back apartments from vulture funds that you sold to them for a song.

You're saying oh but having abundant cheap housing would scare off investors. Well yeah, good. We have so many 'investors' because it's easy big money. Investors aren't going to solve our housing crisis, it would be against their interests to do so. Dublin has had housing many crisis in previous generations and not one of them were resolved by investors.

SF might be economically naive and maybe they won't succeed in fully resolving the crisis. But I'd rather have a government that tried to resolve the crisis instead of a government that only wants to increase profits for investors.

Phat Cat

Melanchthon wrote: »

I know this sounds like absolute political shilling but it's going to take an election, FG have consistently shown they are either incapable of don't want to deliver on this front for the last 4/5 years now and looking at the polls they are going to be punished for it.

I agree, I think the last election proved that people were becoming tired of the status quo in this country and demanded change. Even Sinn Féin spokesperson for housing Eoin Ó Broin said that the new figures showed that the rental crisis is getting worse.

“What the Daft.ie data shows is that the rental crisis is getting worse. Rents are too high and in many places are continuing to rise. All the while there is no response from the Minister for Housing Darragh O’Brien,” Ó Broin said.

Ó Broin said that Budget 2021 including “no action to stop rent rises, no measures to put money back in renters pockets, and no funding to deliver the volume of affordable cost rental accommodation that our cities urgently need”.

polaco

Dav010 wrote: »

t.

Unless you think the Government can stop tens of thousands of people looking for rentals later this year, or they can magically build 50k more houses before then, the market will have its way.

Tens of 1000's where all those people coming from?

110 empty apartments ready to move in
https://www.daft.ie/for-rent/swiss-cottage-santry-dublin-9/2838258

still plenty apartments
https://www.daft.ie/for-rent/mount-argus-apartments-mount-argus-road-harolds-cross-dublin-6w/1442430

brand new apartments
https://www.daft.ie/for-rent/phoenix-park-racecourse-castleknock-road-castleknock-dublin-15/2584943

This only few examples there are big number of developments in progress
There is huge development in Cherrywood with 5000 apartments/house all for rent this should be finished by summer.

Blut2

cgcsb wrote: »

You're saying oh but having abundant cheap housing would scare off investors. Well yeah, good. We have so many 'investors' because it's easy big money. Investors aren't going to solve our housing crisis, it would be against their interests to do so. Dublin has had housing many crisis in previous generations and not one of them were resolved by investors.

SF might be economically naive and maybe they won't succeed in fully resolving the crisis. But I'd rather have a government that tried to resolve the crisis instead of a government that only wants to increase profits for investors.

One thing thats also not mentioned by the "scare off investors" crowd is the high rents in the Dublin market currently scare of investors as it is - and not property investment ones, but financial or tech companies. ie ones that provide far more jobs, and far more tax revenue to the state.

The high cost of renting for the young staff in these sectors is a huge issue with attracting talent to Dublin these days. And has required salaries to increase to account for it. This is regularly mentioned as the main reason companies thinking of opening offices in Dublin choose not to.

Dav010

polaco wrote: »

Tens of 1000's where all those people coming from?
.

Third level students are likely to resume classes in September, and not all offices will remain wfh once it is safe to reopen, people will continue to move to Dublin for employment.

"Rent pressure zones could be replaced with broader protections for the whole market under new plans being considered by the Minister for Housing Darragh O’Brien"

https://www.irishtimes.com/news/ireland/irish-news/minister-may-replace-rent-pressure-zones-with-new-protections-1.4451571

"In an interview with The Irish Times, Mr O’Brien said he and a team of officials have begun work on a possible system to replace the pressure zones"

“One of the things with the rent pressure zones is that, while they work to a degree, in setting the 4 per cent increase rate, 4 per cent nearly became a target for landlords. Most people haven’t got 4 per cent increases in salary. So rents are still too expensive in most parts of the country now"

“We’re actually looking now at what potentially would replace them"

JimmyVik

polaco wrote: »

Tens of 1000's where all those people coming from?

110 empty apartments ready to move in
https://www.daft.ie/for-rent/swiss-cottage-santry-dublin-9/2838258

still plenty apartments
https://www.daft.ie/for-rent/mount-argus-apartments-mount-argus-road-harolds-cross-dublin-6w/1442430

brand new apartments
https://www.daft.ie/for-rent/phoenix-park-racecourse-castleknock-road-castleknock-dublin-15/2584943

This only few examples there are big number of developments in progress
There is huge development in Cherrywood with 5000 apartments/house all for rent this should be finished by summer.

Tiny numbers in the grand scheme of things.