Rate of monthly rent rises slowed in Q2 - report

Monthly rents experienced a slowdown in growth during the second quarter, according to a report by property website Daft. Market rents increased by 1.4% from March to June, marking a notable decline from the record 4.4% increase seen in the previous quarter and below the average quarterly growth over the past decade. Rental inflation remained elevated in major cities outside Dublin.

The report revealed that market rents were 13% higher year-on-year in Galway, 12% higher in Cork, and 11% higher in Limerick. However, rental growth in Waterford was comparable to Dublin, with June figures showing a 6.5% year-on-year increase. Outside urban centers, annual rent inflation in Leinster, Munster, and Connacht-Ulster ranged between 9% and 10%.

The average market rent for a two-bedroom apartment nationwide stood at €2,204 per month, while Dublin's average rent was €2,634. The survey also indicated a rise in availability of rental properties outside Dublin, with nearly 2,400 homes available at the start of August, a 5% increase compared to the same period last year. However, availability fell by 18% in Dublin over the year, dropping below 1,150 homes.

Despite this, nationwide availability remains well below pre-pandemic levels, with around 4,300 homes typically available. The report's author, Trinity College Dublin Economics Professor Ronan Lyons, noted that the second quarter provides insight into the impact of the newly implemented rent control system. He suggested that the significant rent increases in early 2026 were a one-time reset rather than the beginning of a new trend, as market rents rose by just 1.4% between March and June, suggesting the adjustment was largely completed in major cities.

Lyons also highlighted a shift in the market, with the additional cost of renting in Dublin relative to the rest of the country reaching its lowest point on record, even as Dublin rents remained above pre-Covid levels. Rent levels in Connacht-Ulster and Munster, however, have surged by 90% and 75% over six years, respectively. The report emphasizes that rental scarcity is a nationwide issue, and efforts to expedite new market rental supply should be adaptable to areas beyond Dublin.