Daft: Rents at lowest level in ten years

[cyberianpan]

Daft: Rents at lowest level in ten years




Dr Charles J. Larkin, Department of Economics, Trinity College Dublin

The third quarter Daft.ie Rental Report reveals significant reduction in rents across the country, with an average national reduction of 18.4% over the 12 months to October 2009.

These statistics reflect dramatic shifts in Irelandis demographic patterns. Net outward migration has begun, with 65,100 people leaving the country from April 2008 to April 2009. Of these, 30,100 were nationals of recent accession countries (69.4% male) and 18,400 Irish nationals (62.5% male). This represents a significant change. Net migration has not been negative since 1996.

Historically, property crises coupled with financial crises produce sharp and lasting falls from peak value. In Ireland's case, economic recovery will depend upon export competitiveness.

Commenting on the report, Ronan Lyons, Economist at Daft.ie said "While the number of properties available to rent is still at an all-time high, it would appear that these latest price falls are starting to have a positive effect on supply. In Dublin, where drops have been higher than average, the total number of properties available to rent fell by almost 8% in the past 3 months alone."

That said though I haven't noticed much fall since August

cYp

[Dreaded_Estate]

Makes a complete joke of the NAMA assumption of property prices increasing by 10% over ten years.

With residential yields at just 3.4% and rents falling by nearly 20%pa and still a record number of houses available to rent and sale there is no chance of a recovery even in 10 years.

Rental falls are still far in excess of property price falls. That means prices will have to fall significantly faster than just to keep up with rents.

[Scorpio]

Makes a complete joke of the NAMA assumption of property prices increasing by 10% over ten years.

With residential yields at just 3.4% and rents falling by nearly 20%pa and still a record number of houses available to rent and sale there is no chance of a recovery even in 10 years.

Rental falls are still far in excess of property price falls. That means prices will have to fall significantly faster than just to keep up with rents.

Daft economist talks about this NAMA aspect more on his blog:
Rents hit their lowest level in a decade | Ronan Lyons
Also has a chart on prices of various consumer goods from 2003 on.

[cyberianpan]

Makes a complete joke of the NAMA assumption of property prices increasing by 10% over ten years.

With residential yields at just 3.4% and rents falling by nearly 20%pa and still a record number of houses available to rent and sale there is no chance of a recovery even in 10 years.

Rental falls are still far in excess of property price falls. That means prices will have to fall significantly faster than just to keep up with rents.

Migration is a huge issue....

cYp

[cyberianpan]

Daft economist talks about this NAMA aspect more on his blog:
Rents hit their lowest level in a decade | Ronan Lyons
Also has a chart on prices of various consumer goods from 2003 on.

Very helpful thanks



Weirdly rent & sale prices are beginning to move in tandem.... hmmmmm

cYp

[Quinn Quinn]

Very helpful thanks
Weirdly rent & sale prices are beginning to move in tandem.... hmmmmm
cYp

Yes but we are now in the euro. You are missing the point that the punt no longer exists

[hammer]

There will be NAMA ghost towns on the outskirts of Dublin.

They wont be able to give the apartments / houses away !!

RENT ALLOWANCE FROM GOVERNMENT IS KEEPING RENTAL MARKET ALIVE.

[HarshBuzz]

Makes a complete joke of the NAMA assumption of property prices increasing by 10% over ten years.

With residential yields at just 3.4% and rents falling by nearly 20%pa and still a record number of houses available to rent and sale there is no chance of a recovery even in 10 years.

Rental falls are still far in excess of property price falls. That means prices will have to fall significantly faster than just to keep up with rents.

you beat me to it DE!

this assumption of property being at or almost at the floor is the single biggest weakness in the whole NAMA model and the one that dooms it to failure before it's even commenced.

[Cassandra Syndrome]

The stock is massive. Approximately 300,000 Units. 150,000 Holiday homes.

The population trends are not favourable either. Without migration demand will not increase from these levels. Emigration is increasing too. The crash hasn't even begun yet. The natural equilibrium is below 50,000 Euro for a house.

[HarshBuzz]

The stock is massive. Approximately 300,000 Units. 150,000 Holiday homes.

The population trends are not favourable either. Without migration demand will not increase from these levels. Emigration is increasing too. The crash hasn't even begun yet. The natural equilibrium is below 50,000 Euro for a house.

I've always said 1998 levels myself so I think that's about 70,000 punts on average

but quibbling over the actual final bottom of the trough is pointless; the main thing to understand is that we are nowhere near the bottom of the fall in property prices and there is still a helluva long way to go - down

QED: NAMA is screwed