Latest Rental Statistics for Wicklow & Wexford

Is 10% inflation the new normal?

The most recent rental report from Daft.ie came out last week and deals with rental properties all around the country throughout the first three months of  2016.  Current rental prices are directly compared the prices of the same property type within the same period (January to March inclusive) last year.

The results will not surprise market watchers.  The average price of rented homes has increased for the fifteenth (yes, 15th!) consecutive quarter.  While Dublin remains the most expensive location, with average rentals costing €1,365 to €1,663 per month, Wicklow and Wexford have both seen significant increases.  

The average cost of a rented home in Wicklow has risen 7.4% to €1,029 per month.  While the increase in Wexford has been slightly more modest, at 6.3%, the average monthly rental is now €626, which is almost on par with Waterford City pricing.

The Daft.ie report brings up the thorny issue of examining whether renters would be financially better off purchasing (based on a 90% LTV or Loan-to-Value mortgage) or continuing to rent.  For two-bed apartments and three-bed houses, in many areas, tenants would be better off paying a mortgage, rather than ever-increasing monthly rent, but of course this only applies to would be first-time buyers who can afford the 10% deposit and whose jobs and credit rating are considered suitable by the lenders.  

One observation that we have seen in recent years is that would-be buyers are slow to apply for their first mortgage if they feel that they are likely to be turned down.  In many instances, they would make ideal mortgage candidates but media-watching has led them to believe that banks are not lending.  In our experience, this is simply not the case at the moment.  Mortgage lenders are fighting to attract the best buyers and have started to consider Irish applicants living abroad who are planning to return in the near future.

A few points became very clear from this latest industry report, specifically, stock of housing is at an all time low.  This applies not only to the rental market but to the sales market too.  This creates an ideal opportunity for investors to enter the marketplace, knowing that upward trends in the rental market are likely to continue for another few years.  

It is less ideal for current tenants, who are facing ever-decreasing choice and likely rising prices.  This scenario makes for interesting opportunities for our recent emigrants who are currently living overseas but hoping to return to Ireland at some point.  Ought they compete for what housing stock is left and rent it out to produce an income until they are ready to move back?  By doing so, not only are they creating an income but they are essentially 'hedging' their bets by investing in  property that can be used or sold (at market price) when they return.

One thing is for sure, now is definitely the time for sellers to bring their properties to the market.  With more buyers than available properties in most locations, properties that are reasonably priced will certainly attract attention in the marketplace.  This will be very relevant for owners of derelict buildings that might have struggled on the market over the past few years.  Here at Kinsellla Estates, we are dealing with queries from self-builders and would-be developers who have a interest in derelict buildings with and without lands attached, give us a call to discuss this further and we can advise on current supply and demand trends in your locality.  

To view the full Daft.ie Rental Report, click here: http://www.daft.ie

For specific queries or to speak with a local property expert about your buying and selling needs in Wexford, Wicklow and surrounding areas, contact Michael, Alan or Eileen Kinsella at www.KinsellaEstates.ie .  

Email me directly on michael@kinsellaestates.ie or telephone : +353 53 94 21718 

Gorey's Newest Community: Gleann an Ghairdin

Kinsella Estates are delighted to announce the launch of an exciting new development in Gorey, County Wexford (less than an hour from South Dublin):  We have started taking bookings so please do take a look at the brochure below and contact us to arrange a viewing, we would love to show you around!

 

For specific queries or to speak with a local property expert about your buying and selling needs in Wexford, Wicklow and surrounding areas, contact Michael, Alan or Eileen Kinsella at www.KinsellaEstates.ie . 

Email me directly on michael@kinsellaestates.ie or telephone : +353 53 94 21718            

Helping Returning Buyers

Unsurprisingly, the past decade has seen massive emigration from Ireland.  But the movement of people does not affect all areas equally.  Not only are younger rural dwellers more likely to emigrate, but those who remain are more likely to move from their local areas into larger towns and cities.  This effectively shifts the population away from rural areas into the main cities and, in the past, the only way to halt or reverse this was to encourage large-scale employment in the rural areas.  But as the economy recovers, this trend is starting to shift slightly.  In the last year or two, we are starting to see the return of our more recent emigrants.  Specifically, we are starting to see these people - who are or have been working on contract basis in the high-tech or telecommunications sectors in Australia or Asia - plan a return to Ireland.  For some, the move to Ireland is immediate, for others, they will work abroad for another few years before returning permanently.  For many, they will continue in their contract roles, with their existing employers after they return to Ireland.  As remote workers, they can generally work from anywhere in the world.

These buyers are typically Irish, or with an Irish partner, living and working overseas for much of the past decade and with cash savings in excess of €50,000.  Many have multiples of this amount and do not require any mortgage funding.  While these buyers do not appear in national statistics as first-time buyers, they usually are, and they appear as investors, despite buying the homes to eventually live in themselves.

What most returning buyers want is a property that will work as a good investment initially until they return to Ireland, at which time they need it to function as a home for some length of time.  This is a tricky balance to achieve.  Generally, a suitable family home will be more expensive than suitable rental home but will not achieve a higher rental income.  Similarly, an affordable rental/investment property might not be in the type of setting that makes a long-term family home.  There is certainly a fine balance with this, and when added to the fact that these buyers tend to be researching and buying while still overseas, the process can be difficult.   One of the major challenges experienced by buyers overseas is that some auctioneer firms are reluctant to engage with them or to accept bids from 'unknown' bidders.  This can be frustrating for buyers, especially for those who are unable to get back to Ireland on a regular basis.  The technology exists for buyers to see the area, the street, the property and full 360 degree views of every nook and cranny internally; booking deposits can be transferred on-line; buyers, together with their solicitors, can complete a Power of Attorney to facilitate conveyancing… There is no reason  not to deal with buyers in Australia in much the same way as we would deal with buyers who walk into our offices!  

 Here at Kinsella Estates, we understand that returning buyers have enough on their plates without trying to master the finer details of sourcing an investment property as compared with house-hunting for their family home.  We now have a dedicated team member, Aisling, who will be helping remote buyers work through their buying requirements, she can carry out viewings on  their behalf and unlike other estate agencies, we have adopted a policy of accepting bids from qualified remote buyers.  By ‘qualified buyers’, we are referring to those who have supplied us with proof of identification, as required to satisfy anti-laundering legislation, and proof of funds.   

If this is something that you need or are interested in finding out more about, contact Aisling in our office or you can email me directly on Michael@KinsellaEstates.ie with your Skype (or similar) contact details.

For specific queries or to speak with a local property expert about your buying and selling needs in Wexford, Wicklow and surrounding areas, contact Michael, Alan or Eileen Kinsella at www.KinsellaEstates.ie . 

Email me directly on michael@kinsellaestates.ie or telephone : +353 53 94 21718