What to expect from the Dublin Property market – Interview with Colin O’Regan, Head of Asset Management
Why is Dublin witnessing a large increase in investment in the Private Rented Sector?
When you combine high rents with low purchase prices, the ideal conditions are created for investing in property. In Dublin today, you can achieve the highest yield compared to all the other major cities in Europe with the security of knowing that you are investing in an expanding market that will continue to see an increase rents and prices.
What is the typical price of a 2 bedroom apartment in Dublin city centre and how much could it rent for?
Like any major capital city, the price of a property varies according to its quality, size, potential and location. In Dublin city centre, the average price of a 2-bedroom apartment is nearly €330,000 according to the latest data from the Property Price Register.
As there is a huge undersupply of all housing in Dublin, especially city centre apartments, it would be possible to achieve rent of at least €2,000 per month with growth over time. This means investors could get an average initial rent of nearly 7% in a major European capital city.
Which are the best areas in Dublin city to invest in for income?
Location, location, location! Spire Capital has identified three expanding areas in the city centre that are delivering the best income returns. These are:
Silicon Docks (Hi-Tech Quarter)
IFSC (Finance and Banking Quarter)
Smithfield and Stoneybatter (Legal Quater)
What are the main factors increasing rental income each year?
Whilst there are many factors affecting rental income the two most important in any functioning property market are Supply and Demand.
Following the global financial crisis, the number of new properties added to the Irish housing stock reduced by over 90%. This means that today we do not have enough units to meeting natural demand.
Ireland remains one of the few developed countries with a growing indigenous population. When added to this is the large influx of international workers, and their families, needed for the expanding hi-tech and financial services sectors, this has created more and more demand.
As a result of this chronic under-supply and massive over-demand, rents will continue to increase in Dublin city centre.
Recent data shows that over 60% of under 35’s are now renting in Dublin. Why has there has been a move away from home ownership to the Private Rental Sector?
Traditionally Irish people rented an apartment in the city then saved up to buy a house in the suburbs. Due to high rents it is not possible to rent and save even if they are highly paid. As a result people have decided to rent in high quality city centre locations close to their workplace.
How does Dublin compare with other European capital cities regarding PRS market fundamentals?
There is no doubt that Dublin is expanding economically resulting in a steep increase in rents. However, the rate of increase of property prices is relatively slower.
When compared to other European major capital cities, Dublin is in the top 5 of rental costs but is the lowest to buy. This makes it the best PRS market in all major European capital cities.
Apartment prices in Dublin have almost doubled since the bottom of the market in 2012. Is this trend expected to continue for the next 5 years?
Due to the low number of apartments being built in Dublin city centre, the trend for increasing prices is set to continue for the foreseeable future, especially from investors looking for income as a result of high rents.
Are apartments typically rented furnished or unfurnished?
When renting an apartment in Dublin city centre, the apartment is usually rented by the landlord complete with good quality furnishing, in line with market expectations.
What is the average time it takes to rent an apartment in Dublin city?
When a tenant cancels a rental contract, they must provide the landlord with a minimum notice period. This means that the unit can then be re-advertised for a new tenant with a move-in date to coincide with the departure of the existing tenant. Due to the huge built-up demand, the time to rent is measured in days not weeks or months.
What asset management services does Spire Capital provide for foreign investors?
Providing international investors with complete Entry-to-Exit asset management services is the cornerstone of our successful business. This leaves the investors in control whilst we maximise their investment return.
A important part of our asset management service is tax optimisation, which has always been a very important topic with our existing international investors. Working closely with expert Irish international tax consultants, Spire Capital can ensure that a tailored Irish tax structure is used to reduce Irish tax leakage.
If you are thinking of investing in property as a source of alternative income,
why not contact us today to discuss your requirements in more detail?
Phone: +353 86 325 0048 I Email: info@spirecapital.ie
Prices from: €350,000 Rental yields: 5% – 7%
Longboat Quay a central location in the Silicon Docks. Longboat Quay is a modern residential development, located in the heart of Dublin 2, The convenience of the location cannot be overstated, with every conceivable amenity within walking distance.
Prices from: €350,000 Rental yields: 5% – 7%
Longboat Quay a central location in the Silicon Docks. Longboat Quay is a modern residential development, located in the heart of Dublin 2, The convenience of the location cannot be overstated, with every conceivable amenity within walking distance.
Coronavirus uncertainty brings new opportunities due to the resilience of the Dublin Property Market
It is widely acknowledged that the negative economic impact of the COVID-19 pandemic will hit every major country’s economy and Ireland is no different.
Over the last fifty years, due to Ireland’s educated, English speaking work-force and international investor friendliness, Ireland has seen huge inward investment from global hi-tech, finance and pharma giants resulting in Ireland having one highest GDP growth over the last ten years.
One key sector which has established Ireland as centre of excellence is the pharma and high growth “med-tech” areas. 14 of the top 15 pharma companies have an Irish presence with Pfizer having a base here over 50 years. This has led to Ireland being the 7th largest exporter of pharmaceuticals in the world.
This is one of the reason why in March 2020, the OECD has stated that Ireland will be the least impacted country as a result of shutdowns due to the coronavirus pandemic as the chart below highlights.
How will this impact the Dublin residential property market?
Everybody needs somewhere to live and in Dublin there is still a huge shortage of properties to rent.
Investor focus is now firmly on pivoted to safety of their capital investment and security of the income that is generated as opposed to out-sized potential growth.
As Ireland will be the least impacted economy and due to being heavily centralised economy in Dublin, the knock-on effect of this will be the ability of tenants to remain in employment and to continue to pay their rents as their key priority as there is very little alternative accommodation.
The Dublin residential investment property market is perfectly suited to these conditions now and as global markets recover, Ireland will continue to be at the forefront.
Please register for updates where I will outline other reasons why Dublin will be least impacted.
If you are thinking of investing in property as a source of alternative income,
why not contact us today to discuss your requirements in more detail?
Phone: +353 86 325 0048 I Email: info@spirecapital.ie
Prices from: €350,000 Rental yields: 5% – 7%
Longboat Quay a central location in the Silicon Docks. Longboat Quay is a modern residential development, located in the heart of Dublin 2, The convenience of the location cannot be overstated, with every conceivable amenity within walking distance.
Dublin Property Market: One of the most liquid markets in the world
Imagine you have money in the bank or in an investment fund, but you have to give notice to access the money!
Then imagine you won’t know how much you will get money back or even when!
The same is true with property investments so investors must be able to realise their hard-earned returns by only investing in liquid and stable property markets. According to the latest PWC “Emerging Trends in Real Estate: Europe 2020”:
“Real Capital Analytics says Dublin is now ranked as one of the top 25 most liquid cities for real estate – in the world.”
If you are thinking of investing in property as a source of alternative income,
why not contact us today to discuss your requirements in more detail?
Phone: +353 86 325 0048 I Email: info@spirecapital.ie
Prices from: €350,000 Rental yields: 5% – 7%
Longboat Quay a central location in the Silicon Docks. Longboat Quay is a modern residential development, located in the heart of Dublin 2, The convenience of the location cannot be overstated, with every conceivable amenity within walking distance.
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