Are high rents the real issue or is it the lack of supply.
We really need to rethink the rental property market and quickly within Dublin. With rents increased by almost 12 per cent year-on-year to June, the way we supply rental accommodation needs to be redesigned.
According to the survey from Daft.ie, average rents across the country reached a new all-time high of €1,159 a month. And Dublin city centre with average rents of €1,741. The report indicating that rents are now over 18 per cent, €260 a month, higher than their previous peak in 2008. While this is slightly misleading as during the boom there was a lot of pre 63 studio apartments which would have lowered the average at the time. A lot of these studio apartments are no longer lettable. Also during the boom, we did not have many serviced apartments either.
We now have thousands of serviced apartments in the capital. These serviced apartments offer much more than a standard apartment including gyms, meeting rooms, games room and a host of other services. In providing such services a higher rent is demanded, which in turn increases the average rent, so it is not really comparing like with like if we are comparing current rents to peak rents in 2008 as the offer has changed. However, the lack of rental accommodation could impact economic growth and affect Ireland’s ability to attract companies to Ireland following BREXIT.
The standard set apartment design is not suitable for everyone’s needs and makes it very costly for developers to build apartments that are rented long term. Planning and design guidelines need to be reviewed to allow for a changing city. Building heights and density need to be increased within the city centre and public transport routes. Building and fire regulations need to be adapted to allow for older buildings to be brought back into use.
Proposals to bring vacant units back into use will not work if the building and fire regulations that are stopping owner’s carry out work are not reviewed. Otherwise, the scheme will fail. Reviewing the building and fire regulations may have a bigger impact on vacant properties in the capital than any grants.
While the government and the public would like everyone to have an outdoor space, 83sqm of living space, dual aspect and storage space. It is not feasible to provide same at a very low rent. Therefore there is a need to have a different range of apartment design standards to meet the range of needs. I am not suggesting going back to shoe box designs but smarter designed apartments and micro apartments are being built all over the world to meet the needs of the city. Given the rental demands in Dublin, it is very much worth thinking about the standard design of apartments, as it could go a long way in resolving the issue. We got it right with student accommodation and supply has increased dramatically over the last two year due to changes in design requirements.