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Back to college: the hunt for affordable accommodation begins

Shane Kelly, President of the Union of Students in Ireland (USI)

20th Aug 2008

Shane Kelly is our guest blogger, analysing the Quarter 2 2008 figures.

I started college at Waterford Institute of technology back in 2001, and accommodation was as much an issue then as it is now, and seems always will be. Being a native of a small town in Donegal, travelling all the way to Waterford, a place I didn't know and to live with people I didn't know, was one of the most daunting, yet strangely liberating experiences of my entire time at third level.

Finding the right accommodation is central to the college experience - deciding how many people to live with, and if you should live with strangers or people you already know. When I travelled from Donegal, I didn't know any of the people I was moving with, that might sound a bit crazy, but it worked out well for me. The people I lived with in that first year, ended up being some of the most interesting people in met throughout my entire college experience. The lesson I learned is to be daring and take risks, the potential rewards will always outweigh any potential risks.

August is coming to an end, the Leaving Cert. results have been published, and the 55,000 or so students who made up the class of 2007/2008 are currently considering the places offered by the CAO. As soon as they make their decision, they will join the other 190,000 students around the country in the quest for accommodation for the forthcoming college year.

Only about 8 percent of students live in what is known as campus-managed accommodation, so private rented property makes up the shortfall, and competition to find good quality, affordable accommodation can be fierce. Being proactive is the best advice that can be given when it comes to finding accommodation in the rental market. The students who are first out of the blocks will invariably have their choice of best accommodation.

Over the past twelve months we have constantly been reminded that consumer confidence is low and the housing bubble has well and truly burst. So what, if anything, has this done to the student rental market?

What About Rent?

The average student will pay almost €3,500 per year on accommodation and that figure rises quite considerably for a student studying in Dublin. However, having been at, or close to an average of €1,400 in late 2007, the national average rent has been falling progressively over the past number of months and is now just over €1,350. At the same time the amount of property available to rent has risen considerably - more than doubling over the past year. This bodes well for the student rental market.

Current trends from the Daft report show that for students, the costs of accommodation are indeed falling. Comparing rents now to a year ago, rents are lower in two thirds of the markets that Daft analyse. Indeed, looking at more recent trends, the news seems more encouraging for students: between the first and second quarters of 2008, rents fell in 30 of the 35 markets around the country. With supply at all-time highs, it is likely that we will see continued falls in rents over coming months.

The Regional Picture

Dublin, with over 70,000 students, is the biggest but also the most expensive rental market in the country. With average rents still close to €1,600 in South county Dublin and €1,300 in the city centre and South city, students of Trinity College Dublin and University College Dublin in particular have the unfortunate pleasure of being located in two of the most expensive areas to rent in the country. However there is some value to be found in Dublin, with rents falling 3.4% around the city since the first quarter of 2008 - only north county Dublin bucks this trend, with rents up 1.6% since the first quarter.

Outside of Dublin, Cork city remains the most expensive rental market. However, with rents now coming back to 2006 levels, this can only be good news for students. Waterford and Galway remain very attractive destinations for students but with the supply of properties to rent increasing across the board, the more proactive student will have the pick of the accommodation. Overall, for Cork, Galway, Limerick and Waterford cities, the average rent has fallen 2.8% in the last year.

Is it a case of water, water everywhere, but not a drop to drink? Or have we witnessed a turning point in the rental market: have market forces combined to ensure the sufficient provision of accommodation suitable for the student market?

The national trends point to falling prices and a greater availability of accommodation are to be welcomed by everyone, including students. However it remains to be seen if these trends have a direct impact on the student market or will they be confined to the "top end" of the market, a place not often frequented by prospective students.


HIGHLIGHTS:

National Rental Index
National Rental Index

Stock and Flow of Properties
Stock and Flow of Properties


SNAPSHOT:

A snapshot of rents across the country in Q2 2008
A snapshot of rents across the country in Q2 2008