Dublin Rental Market – How has COVID-19 affected the rental market?
How has the Dublin rental market been affected by the COVID-19 pandemic?
The whole world has been affected by COVID-19 and Dublin’s rental market is no different. Daft’s recent report on the rental market shows us that rents have fallen in April by 2.5%. Although, the evidence suggests that rental prices had begun to slow down and decrease ever so slightly prior to the COVID-19 pandemic taking grip. Daft’s previous report in January (based on Q4 2019) showed the first quarter in 29 consecutive quarters where rents did not rise.
There are a number of factors that have resulted in the decrease in rental levels:
- Affordability. With rents at such a high level, affordability was always looming as an issue. The onset of the COVID-19 pandemic has resulted in salary cuts, hours reduced and unfortunately job losses. The real effect of the pandemic on unemployment levels won’t be known for a number of months (most likely 12 months) as business re-open and in some cases fail to reopen. With salary cuts and reduced hours, this has significantly impacted tenants ability to pay.
- Shutdown of the short-term rental market. This was particularly noticeable in city centre areas as within a couple of days of the government restrictions being put in place, Dublin 8 saw a surge of c 500 1 and 2 bed properties available for rent on the long-term market (according to figures from Daft.ie). It was obvious from the advertisement photographs that these were AirBnB properties (the folded towels on the beds are usually a giveaway!). The influx of similar properties to the market at the same time has resulted in a reduction in rental levels. For example, last year we let a 1 bedroom apartment in Christchurch for €1900pm while we have a property in the same development on the market at the moment for €1650pm).
- Lack of transactions. While government restrictions have been in place, there has been limited transactions in the rental market. While there have been some as both agents and landlords have introduced video or virtual viewings into their repertoire, tenants are unwilling to move given the uncertainty in the market.
Only time will tell for the long term effect of COVID-19 on the rental market but I believe there is still a supply issue but hopefully with more properties switching from short-term lets to the long-term letting market this will help improve the situation for tenants and will result in a more sustainable rental market. There are still a large number of factors that are causing a shortage of supply but I won’t deal with them today!
Residential Sales Market 2020 Predictions
Speaking to a lot of people over the past few weeks of lockdown, the main question I am asked is “How will the property market react to COVID-19?”. The residential property market was in relatively good health in Q1 of 2020 on the back of a reasonable 2019. There were a large number of transactions over Q1 with prices in excess of the asking price being achieved in many instances. This was, in my opinion, due to a surge in consumer confidence following Brexit worries in 2019. The market seemed to be functioning again at a normal level in terms of transactions. While prices were beginning to level off in many parts of the city, there was a healthy stock level available for purchasers. There was much optimism for 2020 but the COVID-19 pandemic has brought life to a shuddering halt.
It’s my opinion that once Government restrictions are lifted, the market will take a number of months to find it’s feet again. Agents are having to readjust their way of operating and embrace new methods (be it virtual viewings, upgrading CRMs, online bidding platforms amongst others). Vendors and buyers are also going to be cautious as the lessons learnt from the 2008 crash are still very fresh in everyone’s minds. However, I believe that the fundamentals of the property market are in a much stronger position than 2008 and a recovery will be made much quicker this time around. The biggest issue will be affordability as purchaser’s ability to borrow will be affected by job losses, reduced wages and reduced working hours. Given the Central Banks’ tight lending regulations (which I have always wholeheartedly agreed with), the amount a purchaser is willing or able to offer will be limited in most cases.
In my opinion, there will be a lot of people looking to upsize towards the end of this year going into 2021. For the first time, most homeowners are spending time in their properties and are working out how they want their homes to work for them. Whether it is an extra room for a home office, a larger garden to accommodate a trampoline or an area with strong community spirit. I’m of the view that the market will suffer a reduction in the coming months as consumer confidence is shaken but as life (hopefully) returns to the new normal, people will look to make the move. This will lead to a lot of activity in Q4 of this year and early 2021. This time over the past few weeks has given people the opportunity to reassess their lives and what really matters to them – for most people it is their families and their homelife. I believe there will be a shift in work/life balance for most people and that will be reflected in their requirements when looking for a home in future.
If you are looking for advice on selling your property please give me a call at any time on 087-9879834.
Launch of our new website – Book your valuation online.
Launch of our website
We are delighted to announce the launch of our new website HopkinsWard.ie. Our new website enables our clients to view our various properties for sale / rent. As well as providing more information for our landlords and property owners when it comes to selling their property. For those interested in selling their property, we have added a unique online booking platform for your convenience on this page. We are also adding content frequently in our News section, including some guidance for our clients, as well as general advice on Dublin 8 and living in the area.
2018 has been an exciting time for Hopkins Ward as we moved to our new premises on the South Circular Road in Dublin 8. We also increased our staff. Our new website is another step forward as we continue to grow to achieve our goal of becoming the number 1 estate agent in Dublin 8.
Dublin 8 is becoming top choice for renters.
Dublin 8 is to the west of Dublin city and includes the areas of Dolphin’s Barn, Inchicore, Islandbridge, Kilmainham, Merchants Quay, Portobello, South Circular Road and the Coombe.
It is becoming the top choice for the capital’s renters due to its old school character, hipster uprising and transport links. Access to the City and Docklands is quick and easy via Luas Red Line, Dublin Bus and Dublin Bikes. Residents here also have Heuston Station on their doorstep where you can catch a train to the west to Galway and to the south to Cork.
The sales market in Dublin 8 is very healthy, with purchasers drawn to the area’s green open spaces around Memorial Park and along the banks of the Grand Canal. Phoenix Park is located in Dublin 8 which is the largest urban park in Europe. The area offers a wonderful range of period properties alongside 1940’s – current day designs. The former Griffith Barracks aka Griffith College Dublin is actually on the same road as our office, where you’ll find the historic conservation buildings built circa 1892.
We are located at 207 South Circular Road and it is in this area we specialize.
Who are Hopkins Ward?
Hopkins Ward Estate Agents
Ian Hopkins & Robbie Ward have a combined 30 years’ experience in the Residential Sales and Rental market. Our partner led and personable approach to offer ‘effective advice’ manifests itself in a genuine understanding of the challenges and emotions involved in selling a house and renting out a home. Our commitment is to ensure a smooth and hassle-free process for our clients.
To find out more about the benefits of selling your property through Hopkins Ward Estate Agents or to arrange a complimentary market appraisal please get in touch. We would be delighted to help you.
Why Live in Dublin 8?
A lot of new trendy coffee shops, pubs and eateries have opened up around the Dublin 8 area (one of our favourites is Noshington!) catering for the new wave of buyers migrating from Rathmines, Ranelagh, Harolds Cross and Terenure.
There are numerous colleges within this postcode making it a young demographic for city slickers. The neighborhood statistics show that 36% of households in Dublin 8 comprise of one person, 23% are house shares and 18% couples. The average age group is 16 – 35 years old*. *CSO Statistics
If you’re thinking of moving to the area there are some great amenities and attractions nearby. The most famous sites in Dublin 8 are the Guinness Brewery and Gravity Bar at St. James’s Gate, Christchurch Cathedral, Kilmainham Gaol, the Grand Canal, Royal Hospital Kilmainham and Vicar Street, which is host to many comedy acts and gigs.
We are currently in a very buoyant market with 4 out of every 5 homes coming on the market with us selling within 4 weeks. We believe we are set to enjoy a good market for the short to medium term and there is plenty of property for investors to choose from.
If you are in the market to sell or rent your property, please get in touch. We love this area as much as your next purchaser and tenant does and this makes all the difference.
info@hopkinsward.ie www.hopkinsward.ie
01 4967954