Record 4,600 applications for apartments to rent in south Dublin

More than 4,600 people applied to become tenants of just 195 rental apartments at Shanganagh Castle in the south of the country. Dublinthe highest figure ever recorded among state-subsidized rental programs.

The high number of potential tenants seeking to be selected for one of the Land use planning agency (LDA) demonstrates the popularity of the new rental model which offers long-term rentals and stable rents generally 25 percent lower than local rates.

However, it also speaks to the acute shortage of rental accommodation, particularly in the Dublin area.

Applications for the apartments, with monthly rents of €1,175 for a studio, €1,250 for a one-bed, €1,575 for a two-bed and €1,775 for a three-bed, were only open for a week. As of Tuesday afternoon, 4,608 completed applications had been received, but just under half of those applicants – 2,215 – met the program’s eligibility criteria.

A lottery will be held the first week of January to select tenants from eligible candidates.

Rental accommodation is aimed at low- and middle-income workers earning up to €66,000 after tax. However, other eligibility conditions apply. Applicants must be able to demonstrate that they can afford the advertised rent, which must be no more than 35 percent of their net monthly income, although some flexibility is given to tenants who can demonstrate that they can managed to pay higher rents in the private sector. .

Housing academic Lorcan Sirr said the large number of applicants for rental homes at such high prices indicates not the need for more rental homes, but the lack of homes available for purchase.

“The rent for these accommodations is equivalent to a mortgage. In fact, a three-bed costs more than a €350,000 mortgage. This tells me that there are an awful lot of people out there who are desperate for a home to own, who could afford to pay off their mortgage, but can’t find anywhere to buy.

In another indicator of the big affordability challenge for potential buyers, a report released on Friday shows that first-time buyers are generally paying €88,000 more for a house today than they were five years ago.

In his last mortgage market report, the Banking and Payments Federation of Ireland (BPFI) indicates that the median income of first-time buyers purchasing new property in the first half of 2024 was €90,000, while their median age was 35 years. This figure is significantly higher than in previous decades.

The median income for existing homeowners moving into a new property with a mortgage was €118,000.

The report reveals that the median or average price paid for a property by a first-time buyer (which can be a single person or a couple) increased from €272,000 to €360,000 between the first half of 2019 and the first half of 2024.

Candidates for rental housing cannot benefit from any social housing assistance, in particular rent supplement or housing assistance (HAP), and must not be owners of real estate. The accommodation they apply for must also match the size of their household.

At Shanganagh Castle, the one and two bed apartments have proven by far the most popular within the complex. Of the 2,215 eligible applicants, 216 are looking to rent the 19 studios, 896 are vying for the 40 one-beds, almost the same number, 892, are looking to rent one of the 107 two-beds and 211 are looking to rent one of the 29 three-beds. beds. -beds.

Although renting at cost offers more security than the private rental sector, it is proving too expensive, particularly in Dublin, said Mr Sirr, a senior lecturer in housing policy at the University of Technology Dublin. “There is a fundamental flaw in the Irish model of cost rent, which appears unique in Europe, and that is that cost rent is more expensive than a mortgage.

“The policy focus of the next government should not be on developing housing specifically for rental, but on developing housing that people will be able to buy at affordable levels. »

The figures published by the Housing Department As of Thursday, construction of 54,574 homes began in the first 11 months of 2024, 84% more than the same period last year.

The highest number were in the Dublin City Council area (6,724), followed by Fingal (5,483) and South Dublin (4,486). However, only 2,995 were at Dún Laoghaire Rathdown, where the Shanganagh Estate is located.

The LDA is building almost 600 homes on the estate near Shankill, in what is the state agency’s biggest development to date. The first 51 “affordable” homes costing up to €495,000 were recently sold, with a further 40 apartments being offered for sale next year. A further 111 apartments for rent will be available in 2025. The remaining 200 apartments will be intended for social housing.