Average monthly rents across the country rose by an average of 5.2% in the year to September 2019, a report shows.
According to the latest quarterly Rental Report by property website Daft.ie, on average the cost of renting is now 1,403 euro per month.
This marks the lowest rate of rental inflation across the country since the second quarter of 2013.
However, at 1,403 euro the average monthly rent nationwide during the third quarter of 2019 marks the 14th consecutive quarter of record rents.
This report has found both improved availability and lower inflation. Nonetheless, rents continue to climb and from a base where they are already high compared to wagesRonan Lyons, report author
The average listed rent is now 373 euro per month higher than the previous peak in 2008 and almost 660 euro higher than the low seen in late 2011.
The report shows a two-speed market, with trends differing across urban and rural parts of the country.
In Dublin, the increase in rents in the year to September 2019 was 3.9%, the 33rd consecutive quarter where rents have risen but the slowest increase since mid-2012.
In the other major cities, rents have risen by between 5.5% and 6% year-on-year – a slowdown in inflation in some cases, the report notes.
Elsewhere in the country, rents continue to rise at faster rates, with increases of 10.1% in Munster and 8.2% in Connacht-Ulster in the year to September.
The number of homes available to rent nationwide is up 10% from the same date a year ago.
This marks the 11th time in 12 months that rental availability nationally has improved, albeit from record lows.
Despite the increase, this still amounts to only 3,500 rental homes for the whole country, the report notes.
Fixing it will involve the construction of tens of thousands of new rental homes every year for the foreseeable futureRonan Lyons
Ronan Lyons, economist at Trinity College Dublin and author of the report, said over the last decade, Ireland’s rental market has experienced a persistent and worsening shortage.
“Only in recent months have signs emerged of any improvement in this situation. The last Rental Report highlighted the new supply coming on stream over the coming years – roughly 25,000 new rental homes in Dublin and Cork.
“This report has found both improved availability and lower inflation. Nonetheless, rents continue to climb and from a base where they are already high compared to wages,” he said.
Mr Lyons said there is no “quick fix” regulatory solution for the sector.
“Rather, fixing it will involve the construction of tens of thousands of new rental homes every year for the foreseeable future,” he said.
The Irish Property Owners Association (IPOA) said the report shows there are fewer landlords now than there were in 2012 due to rent pressure zones being introduced.
A rent pressure zone is a designated area where rents cannot be increased by more than 4% per year.
IPOA chairman Stephen Faughnan said in 2012 there were 212,000 landlords in the sector, compared with 173,197 in 2018.
He said: “Rent pressure zones are a blunt instrument and do not take into account the level of rent being charged or the indebtedness of a landlord, making it uneconomical for some landlords to continue renting property.
“The state needs to protect the existing supply of accommodation by introducing a mechanism to increase rent where it is substantially below market rate, as well as incentivise further investment in the sector.”