Coronavirus: Is the drop in Dublin rents here to stay?

Image copyright
Warchi/ Getty Images

When Jessica Boylan started looking for somewhere to rent in Dublin at the start of the coronavirus pandemic, it did not go the way she was expecting.

“We were getting so many replies and so many more places – we could really pick and chose,” she told BBC News NI.

On the face of it, this would seem to be an odd experience in a place ranked among the top five most expensive places to rent in Europe.

However, the of Covid-19 pandemic has resulted in falling rental costs.

Image copyright
Jessica Boylan

Image caption

Jessica Boylan found her search for accommodation to be much smoother than she was anticipating

The 26-year-old accountant is originally from Dublin, but spent some time away in Canada and had recently been living at home to save money.

She and her partner have now moved into new accommodation in the East Wall area near the centre of the city.

“Before, for some of the places we were looking at it would have been around €1,600 (£1,430) for a one-bedroom place,” said Jessica.

“This time, I wrote [on a rental Facebook page] asking if anyone had any accommodation in the city centre for under €1,500.

“Someone got back to say they did and we’re actually paying a few hundred euro less than that, for a two-bedroom house in the city centre.”

‘Clawing back employment losses’

Earlier this week, a cost-of-living survey from pay and pensions specialist Mercer found Dublin to be the most expensive place to live in the eurozone – ahead of Paris, Berlin, and Rome.

Rental costs are a big part of this, but the market is being dramatically altered by the coronavirus pandemic.

Last month, according to property website Daft.ie, there was a 40% increase in the number of properties available to rent in the city and the largest fall in monthly rental costs in more than a decade.

Factors that have been cited for this change include short-term holiday rentals coming onto the market and workers from overseas returning home.

Ciaran Nugent, an economist with the Nevin Economic Research Institute, said lower wages and changed working practices meant lower rents could be here to stay.

“It will be dependent on how quickly we can claw back the employment losses, and if these workers will still be paid the same amount,” he said.

“There are indications from some staff and companies that if they are going to be hiring people back, it won’t be at the same rate.”

The increased number of companies allowing employees to do more work from home in the future would also be a factor, added Mr Nugent.

“It has become quite clear that in February we didn’t know a lot of types of work could be done from home – and now we do,” he said.

There is also the possibility that recently built offices could be converted into flats.

“With so many offices being built, was that at the expense of apartments?” he said.

“Those resources could be, at least in part, reverted, if the demand for office space is not seen to be there or not seen to be as strong.”

‘It was much easier’

Théo Blochet is someone else who has reaped the benefits of the reduced rental costs.

The 26-year-old tech industry worker, who is originally from France, had to look for a new place after being given notice by his landlord.

When he and his wife went searching, they found a changed market.

Image copyright
Théo Blochet

Image caption

Théo Blochet has lived in Ireland for six years

“It was much easier, with more places that stayed on longer, and you could see from the history of the places on property websites that they (prices) were decreasing,” he said.

He has been living in Dublin for the past six years, but spends time away for work.

Théo said some tech companies that had shared properties through internal networks, now advertised them externally.

He said he was “kind of in a bubble” from working in the tech industry, but had found Dublin to be “way overpriced”, considering its size and cultural offerings compared to other cities.

Here to stay?

The glut of short-term holiday lets coming onto the market has driven down costs in other high-rent cities.

In early March, before full lockdown measures had been introduced, rents in London had seen a decrease of more than 10%, as well as a 45% increase in rental properties available.

The trend can also be seen in Canada and the United States, as well as in cities across Europe.

However, there are some indications the trend may not be here to stay.

Short-term rental company AirBnb, which last month announced it would lay off 25% of its staff due to the pandemic, has reported a surge in business in countries where lockdowns have been eased, bolstered by the public opting to holiday in their home countries.

In addition to this, it is expected there will be more activity in the rental market as lockdown restrictions are lifted.

‘They still get a zillion answers’

For travel agent Anouck Gaillard, who is from France, things have not gone as smoothly.

She has been house-hunting since the start of lockdown in March, and said that while prices were down in April, demand still seemed to be strong, and discounts from landlords were only temporary.

“I am looking for a studio, I am not looking for a house-share. They must receive a zillion answers every time they have something on,” she said.

Image copyright
Anouck Gaillard

Image caption

Anouck Gaillard has found that landlords are only offering temporary reductions in rent

“I am looking to spend €850, I think that should be the price on the market,” she said.

“Really, it would be better value for me to buy a one-bedroom rather than to keep renting one, so that is something I am considering as well.”

Prices were frustratingly high in comparison to what some of her friends in other countries were paying, she said.

“I do love Dublin, but accommodation can make me mad. It’s not worth what you’re getting,” she added.

“I have friends in France, Spain, and in Italy. For what they’re getting, beautiful apartments for not that much money.

“What do we get? Not much.”

Source Article