If you’re considering becoming a landlord, you likely have questions about the current state of the rental market in Ireland. Is it still profitable to let property, or are rising regulations and costs making it tougher for landlords? What exactly does a property manager do, and could partnering with one make your investment less stressful? This article will explore the landscape for landlords in Ireland today, and provide key factors to help you determine if now is the right time to add rental properties to your portfolio.
Why are Landlords Leaving the Sector?
In recent years, Ireland has seen a decline in the number of landlords operating rental accommodations. Stricter regulations around rental caps, minimum standards, and other tenant protections have added complexity that some landlords wish to avoid.
Tax changes like the phasing out of mortgage interest relief have also increased costs for landlords. With property prices rising significantly in 2021 alone, over 12% higher than 2020, many existing landlords are choosing to exit the sector by selling their rental units. Between maintenance, tenant complaints, and paperwork, some landlords feel the hassle is no longer worth the stress involved with letting property.
Is Being a Landlord Profitable in Ireland?
However, while the increased requirements make renting property more labour-intensive, real estate remains a smart long-term investment if managed wisely. Ireland has one of the fastest growing rental markets in Europe, with encouraging signs that point to ongoing profitability for buy-to-let investors.
For starters, tenant demand remains high across Ireland, with average tenancies lasting 4-5 years once established. This provides reliable ongoing income. Gross rental yields average 5-7% nationwide, surpassing many comparable EU countries. Though returns are lower than the heady Celtic Tiger days, sustainable attractive profits can still be achieved, especially by working with a professional property management company.
Additionally, Ireland’s rental market has strengthened significantly, with average monthly rents ranging from €1,700 in Dublin to €1,100 nationally. With the economy forecast to grow steadily long-term, fueling jobs and migration to Ireland, demand for rental accommodation is expected to rise, likely driving prices higher. Experts estimate Ireland will need 90,000 new rental units by 2030 just to meet demand, presenting a terrific opportunity for investors entering the market now.
Is Now a Good Time to Become a Landlord?
For buyers looking to become landlords, the next couple years present very opportune timing. Mortgage rates are at historic lows, keeping financing costs down for those looking to purchase investment property. Acting sooner rather than later will allow new landlords to capitalise on low purchase prices and interest rates. Wise investors can acquire income generating assets now, before demand drives prices much higher.
What Does a Property Manager Do?
Once you’ve purchased a rental property, partnering with a proven property management company can optimise the landlord experience. An excellent property manager handles all aspects of renting on the landlord’s behalf, from advertising vacancies, to screening tenants, collecting rent and handling maintenance. This removes the daily headaches from landlords, allowing a hands-off approach if desired.
Property Management Ireland – KPM Group
KPM Group has spent over 45 years specialising in seamless end-to-end property management tailored to the Irish rental market. From rental valuations, to tenant finding, to routine inspections, to maintenance, we use cutting-edge software to maximise rental income while minimising hassle for landlords.
Our team stays on top of all Irish property laws and best practices. If you’re considering becoming a landlord, get in touch to learn more about how we can make the process easy, efficient, and highly profitable for you.
