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When the notice from the letting agent came last month, Shane was devastated. His rent for a three-bedroom (“if you count the tiny box room”) house in Carrick-on-Shannon is to increase from €650 to €1,000 per month next February and the separated father of two feels he has no option but to find the money somewhere.
“I was absolutely shocked. It is a 54 per cent increase,” he pointed out. His children, a boy and a girl, both aged under 14, stay will him regularly, so downsizing or moving to a different town is not feasible.
Shane – a pseudonym (as he doesn’t what to give his real name) – has been invited to engage with the landlord but he doesn’t expect much from the discussions. “I imagine the justification will be that it’s the market value,” he said.
The businessman knows very well that local letting agents have waiting lists of people anxious to move from the east coast to the northwest region. He’s also wondering if the possibility of rents being controlled at some future point if Carrick is designated a rent pressure zone, prompted such a large hike in rent.
“I reckon they decided that’s the rent they would be happy with in two or three years’ time.” He feels hard done by. Since moving in almost six years ago, he has had one rent increase of €50.
“I honestly don’t think the house is worth €1,000. I could probably live with paying that for a better house. I can hear the TV and the baby crying next door. My neighbours pay €630 a month for an identical house.
“I think the fact that I was there for nearly six years, treating the house as if it was my own, should count for something. The agent did say it is in immaculate condition.”
A friend who owns an end-house with a garage in the same development and who charges €750 a month, told him the proposed increase was “extortion”.
‘Stumbling blocks’
Colm Keane, manager of The Hive, a co-working and business centre in Carrick, is ideally placed to observe the implications of the dearth of accommodation in the county.
With the former MBNA site, now known as the Carrick Business Campus on sale with a price tag of €6.6 million for the 8,371sq m (90,105sq ft) property, he is aware of at least two interested parties who in the recent past were turned off by the scarcity of accommodation for potential employees.
“It was definitely one of the stumbling blocks,” said Mr Keane.
Three or four years ago if a “house for rent” notice was circulated among the cohort in The Hive it could be there for months, but now “it would not last to lunchtime”.
Since the March 2020 lockdown the profile of people using The Hive has changed, with many of the regulars currently young people in their 20s, some of them graduates who have never set foot inside the door of the companies who employ them.
Many others relocated from the east coast but there are also people who work for companies throughout Ireland or in the United Kingdom and farther afield. “We have a guy and if someone rings his Manhattan number it rings on his desk in The Hive,” said Keane.
The realisation that remote working was feasible focused the minds of many Leitrim people who had always intended to return to the county “but Covid hastened the move”, he believes.
The shortage of properties available to rent or buy means that landlords don’t need to advertise. “If someone in here is leaving a place, word spreads and it is snapped up really quickly.”
Noel Daly, manager of North West Simon, whose catchment area is Sligo, Leitrim and Donegal, can list off most of the available properties in Leitrim, without consulting the list his colleagues update daily because there are so few of them.
He knows that while well-paid workers in, for example, the financial services or technology sectors, are having problems finding homes in the northwest, it is nothing compared to the problems faced by locals at risk of homelessness.
Mr Daly recently found accommodation for a service-user in Letterkenny but the landlord was subsequently contacted by a US company desperate to find a house for an employee wanting to work remotely from Donegal. “They paid double what the landlord had asked for so we were gazumped,” said the Simon manager.
Salaries
Boyle-based estate agent Mike Smith whose company manages about 90 rental properties in Roscommon, Leitrim and Sligo, noticed a surge in interest following the recent advice from the Government that people should resume working from home where possible.
“There had been a bit of a lull for a few weeks before that when Covid had seemed to settle down and people went back to their offices,” he said.
With demand driven mainly by those wanting to relocate from the east coast and from the UK, he says landlords don’t need to advertise. “The first question people have is: how is the broadband?” he said.
Mr Smith said that while a recent Daft.ie report suggested rents in counties Leitrim and Roscommon had risen by more than 20 per cent in a year, demand is unprecedented.
“People who are paying €2,000 a month for a house in Dublin realise that they can rent here for €800 to €900. For people on Dublin salaries, this is very attractive.”
He knows this is driving up rents, making them prohibitive for some local people. “I also know of three couples who were intending to build but their constructions costs have gone up by €40,000 to €50,000 so they have pulled back and intend to wait for at least 12 months. They are renting now too.”
While there has been a marked increase in queries from the UK, Mr Smith expects interest to come from farther afield in the coming months.
“I think that when countries like Australia and the US open up their borders we will see a lot more inquiries from there.”
Two years ago if his office got a call from someone interested in renting in the locality “we could find them somewhere in a week. That’s just not possible now. People could wait for months.
“So far this morning I have had over half a dozen inquiries. It’s a nice position for those who can move from Dublin and pay less rent and just travel back to the office once a week or a fortnight, which is very easy to do now.”
To illustrate the point about the attractions of quitting the capital, he tells a story of a 62-year-old retired civil servant who recently sold his Dublin home for more than €450,000 and bought an equivalent property near Boyle for not much more than €200,000. “He feels like he won the Lotto. He cleared his mortgage, he has a good pension and he is in a position where he can give his adult children money – they don’t have to wait until he is dead.”
Meanwhile, Shane says he’s going to be “very stretched” from February if his rent does go to €1,000. “But I don’t really have any choice.”