John Burke reports on the increase in property prices in South Dublin
The Central Statistics Office (CSO) figures for December show a 12.3% annual rise in prices, the highest since 2015.
A large number of prospective buyers are finding themselves priced out the market or pushed into second or third choice market areas in the city. Eileen Sheehy, managing director for Sherry Fitzgerald, was quoted saying: “The market is in a healthy place, it’s beginning to go back to the Celtic Tiger Era”.
Michael Cantwell from Threshold Ireland does not believe it is good that the market is back to the era of the Celtic Tiger: “New legislation was brought in by Simon Coveney to predict rents in rent pressure zone areas. However, this has had the reserve effect. Rents have increased by 10%, this is due to a significant drop in supply of property. The rise will continue until such time as the legislation is removed to encourage investors back into the rental market place.”
The Stillorgan area has seen a vast increase in rent costs going up 4% from 2016 to 2017. The rental market remains strong across the city despite the new legislation brought in by the Residential Tenancies Board (RTB).
“The market is in a healthy place, it’s nearly back to the Celtic Tiger Era”
The introduction of Rent Pressure Zones (RPZ) has not controlled rents but given tenants rent predictability instead. Investors are no longer purchasing buy to let properties as there are too many restrictions on a landlord. There are now approximately 3,000 properties available to rent in Ireland. This time eight years ago there was 33,000 properties to rent across the country. Whilst the demand outweighs supply there will be no significant change in the market in the foreseeable future.
On recent statistics from the RTB, the Government should be building ten times the amount of housing allocated to somewhat salvage the housing crisis. Two-bed houses have risen from €1,700 to €1,800 in 2016 up to €2,000 in 2017 and into 2018. Three-bed houses have risen from €2,300 to €2,600 in 2017 where they were only at €2,000 to €2,200 at its peak in 2016.
The RTB has been very instrumental in solving issues, both by telephone mediation and in RTB hearings. It has had a huge impact in the speedy return of security deposits to tenants and has streamlined the notice in periods for tenants vacating properties and landlords giving notice.
The RTB preferably favour tenants over landlords as landlords can make unfair decisions. The RTB’s new legislation brought in last year  has given tenants predictability of rents and a security of unfair tenure.
Sheehy also stated that: ”We have strong enquiries from the corporate sector of the rental market. High end properties in the region of eight to fifteen thousand a month are renting within a four to eight week period. This time last year it could have taken four to six months to find a suitable tenant for houses of this calibre. The most significant rent increase has been in Dublin 1 and 2”.