Today,17th August 2021, there are only 11 properties for rent advertised on daft.ie in Waterford city and county, excluding student accommodation (8) and holiday lets (1).
This is shockingly low but in fact, stock levels have been this bad for at least 6 months.
Demand is outstripping supply by a long shot.
We recently advertised a three bedroom home for rent in Cherrymount, Waterford and we had 67 enquiries within the first 48 hours.
As supply decreases, rents seem to be increasing. Based on our own rental portfolio the average one bedroom apartment in Waterford is renting for €775, two bedroom €850, three bedroom €1,000 and four bedroom €1,300-€1,400 per month.
Alarm bells are ringing on several levels – Why are landlords getting out? 85% of rental properties are owned by small scale private landlords who own one or two properties. They have been presented with a raft of legislation in recent years and are treated unfavourably for tax. Many were only covering their mortgage with the rent charged. Now the increase in prices for houses sold is tempting them to cash in on their property sooner than they planned – this is my view of it, at least.
According to the Residential Tenancies Board, 498 notices of termination were issued by landlords who intend to sell their properties between the months of April and June this year.
When I studied the 59 houses for sale under the €350,000 price bracket I concluded that 27 of these 59 were investment property sales – landlords bailing out.
Great efforts are being made to encourage big businesses to locate in Waterford. What if they are successful? If our city had the good fortune to announce that 100 new jobs were to locate here there wouldn’t actually be anywhere for these employees to live.
At present, the median amount people are spending on rent across Ireland, according to the RTB is 30% and it is likely to increase as supply further diminishes. This is not sustainable unless the average income increases in proportion.
There is no silver bullet to fix the rental crisis we have on our hands but my suggestions would be twofold.
We need to make being a landlord a more attractive prospect for the smaller investor while keeping things fair for tenants. Investment properties in Waterford are returning anywhere from 7-10% gross yields.
Waterford Council needs to bring more vacant apartments, houses and retail space back to life in the City Centre. This would help with supply and create a more vibrant City. As a starting point we need a current list of vacant properties to be available for investors.
I believe we will be entering a new phase in property in Waterford in the not too distant future and it is not all doom and gloom. We need to learn from what is happening right now to ensure that we have a positive, sustainable property market in our City and County that will help our communities to thrive.
Residential Tenancies Board – www.rtb.ie