There is huge unmet demand for purpose-built student accommodation (PBSA) across Ireland’s four major cities, an economist has said.
Ronan Lyons, assistant professor in economics at Trinity College Dublin, said that the 19,000 units available in Dublin fall well short of the 26,000 needed this year.
The Student Housing report, published by property website Daft.ie, also shows that the cost of student accommodation in Dublin – either for a single or double room, or for an entire property – has stayed largely unchanged.
Meanwhile, rents elsewhere in the country are on average up slightly compared with a year ago.
Mr Lyons said the picture reflects not short-term disruption due to Covid-19 but a “long-term mismatch” between supply and demand.
The cost of renting a double room in Dublin continues to rise and now tops 800 euro per month.
Outside Dublin, in the rest of Leinster, room rates are up year on year, with a single room available for 350 euro in west Leinster.
Nationally, rents for full properties rose by 1.2% in the year to July but were largely unchanged in Dublin city, rising by just 0.2%.
The cost of renting a room in Munster, Connacht and Ulster has risen, on average, over the last year, with Munster seeing 4% increases and Connacht-Ulster seeing double-digit increases.
The average monthly cost of a room varies from just over 300 euro per month for a single room in Connacht outside Galway city to 600 euro for a double-room in Cork city centre.
Countrywide, the current shortfall is estimated to be close to 19,000 – and without more projects coming into the pipeline in coming years, it will grow to 23,000Ronan Lyons, economist
Mr Lyons said that students still drive seasonality in the rental market.
“This year, students face largely unchanged rents compared to a year ago. If you had offered this to students last year or the year before, they would have happily taken this – rents have risen every year since 2012 in some parts of the country,” he added.
“This year, though, it would have seemed reasonable to think that students might have been able to derive some small benefit from the Covid-19 economic crisis.
“With unemployment soaring, surely rents should be falling? It seems that rents are, for the moment, stuck where they are – either due to the hopefully temporary nature of the unemployment shock or perhaps more likely due to the nature of the Rent Pressure Zone rules, which punish landlords that cut their rents to fill the tenancy.”
He added that there is demand for PBSA in Cork, Galway and Limerick.
“The three cities combined are similar in scale to Dublin, in terms of current need and the shortfall,” Mr Lyons continued.
“Countrywide, the current shortfall is estimated to be close to 19,000 – and without more projects coming into the pipeline in coming years, it will grow to 23,000.”