Residential rents will continue to rise in the main Irish cities in 2013 and could increase by as much as 7% by 2014, according to one of the country’s leading estate agents.
Savills Ireland have said rents have dropped by 25% from the peak in 2008 but insist they have begun to rise again in a pattern that they expect to continue.
Letting manager at Savills, Clarie Neary, said that demand remains particularly strong in prime locations with rents rising between 5% and 7% in the last year for properties in Dublin 2 and Dublin 4.
Rents remain solid in the Dublin suburbs with demand and rental levels remaining stable over the last 12 months.
Savills undertook an analysis of current rental stock throughout Dublin and found that typical rents in the capital for a 2-bedroom apartment vary between €1,000 and €1, 400 per month, with €1,200 being the average.
Ms Neary said the number of families and couples choosing to rent as opposed to purchasing has increased dramatically over the past five years which has led to a particular shortage of houses in the rental market.
“During the boom, many twenty-somethings went straight from their parents’ home to owning their own home.
“Property values are already beginning to bottom out in many locations, and although people are recognising the value in the housing market many cannot secure the finance to buy.”
Ms Neary said she expected couples will continue to rent in the medium term until the supply of mortgage finance improves.