The askng prices for rentals are insane but is the rental sector popping?
It appears to me to be a reasonably clear cut case where supply constraints are accompanied by lagging price rises. However there are signs supply is coming on-line now and over the next 12-24 months in some ares of demand. Due to the heavily constricted supply of the rental stock any increase of supply will have a much larger affect than in a normally functioning market and since we are at a historical supply low not seen since 2006 you could be reasonably sure it will not reduce much further, as there has to be a residual turn over in the rental market since all units can never be expected to be fully let at once. Else we experience the Bethlehem effect! How quickly that might wash in terms of reduced rental asking prices I don’t know. It may take a full season turn to see real improvements from a renters point of view but summer lets festering in 2016 might be an early signs where multiple price reductions are observed. That rental prices can only go down over the next few year is a strong argument whose the case is clearly made by the supply side deterioration and those running slowly to make some hay of what looks like a healthy booming sector to the uninformed eye.
As for imminent supply arrivals one concrete example are the 500 student beds being constructed in Dublin 8’s digital hub. Such a singular proeprty might might translate into a reduciton of demand for approx. 166 x 3 bed house/apt shares. That is not a small number in relation to the chronic supply situation. There are are more student designated units coming on stream but I don’t have the exact details in at least one other location of varying capacity.
Meanwhile price gouging is in full effect which I would also class as a deleterious sign, here are but two examples.
Anecdotally as I’m searching over the last week it looks like at the higher end rentals asking anything over the €1800-2000 prices are being reduced in the hundreds of euros in some instances. Most likely to fall into more favourable search range criteria because the enquiry follow through has collapsed. Also it seems the views of such rental listing are much lower than the views on rental listing priced €1500 or less, regardless of beds.
Perhaps the rental market and housing market are finally syncing up with soon to be recorded price drops in tandem? I could be wrong but it has to happen at least once sometime somewhere surely!
Finally there is the pin effect, on a good many cases your new house has been occupied in favour of your previous rental. How is that affecting supply or is it being mopped up by hugely increasing demand?
I wonder what will happen to the rental sector once all the thousands of refugees being taken in the name of “European Solidarity with our German brethren who smirked and spat on us not to long ago” in a year or more once they enter the market.
That aside I pointed out in another thread the out of kilter situation in Galway where the number of properties for rent seems to at all time low (14x smaller population than Dublin while 20x less properties to rent), prices also gone mad here.
This is a good example of the kinds of price drops I wrote about in the upper range, this rental has dropped it’s asking price twice since the 24th of September, a €600 drop thus far. Perhaps ebay would be more suitable to shift some of these rentals no?
Rental is likely to get worse before it gets better. I know of one house being shared by two different families (both with children) because they can’t afford anything separately. This is a jarring throwback to tenement Ireland and the government deserve to be excoriated for it.
The govts since 2000 should take a lot of blame for getting out of the housebuilding business. People having kids they can’t afford should also bear some responsibilty (and they do, by having to live in smaller than acceptable dwellings).
As for rental price bubbles, that sounds like wishful thinking. There are always landlords who are greedy and lazy who set the asking rent too high and then have to drop it. I once set the asking rent too high by €25 and got 3 calls. I relisted at €25 lower and got 15 calls and 5 good tenants to chose from.
Heading back to tenements again, and childless families as nobody can afford anything bar a tiny one bed near an urban centre. To think , my old man, a mid level civil servant bought a decent sized detached house in Dalkey on a single income and fed four kids. These days he would be holed up in a one bed somewhere and wondering if he could ever afford to have children or should he move to Gorey.
I fear for the future for my children, maybe the Singularity rapidly followed by grey goo would be better for most.
It’s a common problem globally, shrinking house sizes, rocketing house prices, especially in the capital cities and economic centers. One can only hope that tech development may help to change the movement to the big cities but it hasn’t happened yet.
I work for a large corporation and the US office still asks them to drive an hour to work everyday to sit in their cubicles
In a building in the middle of nowhere. mY Japanese colleagues need to do the same
But they take the train for 1-2 hours each way and stay in the office longer hours. None of them need to be there everyday, we work across global
Teams, but they are expected to turn up in the local
Office. Strangely some personnel and some regions allow home working and then others almost completely prohibit it. I can’t see any relationship to work performance for most of the workers (obviously some of the designers and manufacturing staff etc need to be more physically present).
One of the other factors are the best schools are often in established urban areas and
The best transport networks.
Virtual reality might do some good. Surely better virtual reality will result in large savings on office space and commuting and transport costs for companies.
In the case of Ireland specifically it’s more of an self inflicted urban planning problem ie lack of public transport and medium
To high density apartment blocks
Yes, they were the lucky generation and comparing living standards to theirs make later generations feel hard done by. On the plus side they’ll eventually die and pass on their riches to the benefit of their impatient heirs.
This is the bit that I rarely hear people talk about. Like a house that I saw go for over €1m not long ago that was formerly owned by a Post and Telegraph technician and a former nurse (stopped working when marrying). Those kind of occupations today couldn’t hope to occupy that space. You can flip it the other way too and comment that relatively more prestigious occupations are reduced to living in semi-detached houses on northside Dublin that used to be owned by clerks/technicians.