The supply of rental properties in the Irish market increased by 50% in the fourth quarter of 2007, according to a report from property website Daft.ie.
The increase in supply led to a levelling off in rents, with the average rent nationwide remaining unchanged at €1,388.
The report said the increase in supply was likely a consequence of investors who had put up their properties for sale in 2007 - or who had left their properties vacant up to now - releasing more properties onto the rental market.
These properties have pushed up the overall level of supply and contributed to the slowdown in rents, particularly in non-city areas, it said.
Last month, the Irish Auctioneers; and Valuers' Institute said that there were 40,000 empty apartment in Dublin.
The report indicates average monthly rent in Dublin is now €1,467, up 8.7% on 2006; average rent in Cork is €1,160, up 7.7%; in Galway it is €1,008, up 6.6%, while in Limerick it is €914, up 11.2%.
Economist Dan O'Brien said: "One of the drivers of demand for property has been a rapidly expanding population. With the highest fertility rates in Europe and rates of inward migration unsurpassed by any other continental country, Ireland’s population grew by 19.4% between 1995 and 2006. But labour mobility is a two way street. Recent immigrants to Ireland are likely to be unusually mobile, and can be expected to up sticks quickly not only if they lose their jobs, but even if opportunities elsewhere appear relatively better.
Nor should the possibility of the return of “indigenous” emigration be discounted. It is little remarked upon, but young Irish people have continued to leave the country in large numbers. In the five years from 1997 – the very height of the boom – outflows averaged 28,000 a year. In the previous five year period, when unemployment was in double digits, the average number leaving the country was 33,000.
Although Irish emigrants recently have probably left for short periods of horizon broadening, my guess is that the Irish remain unusually mobile. Moreover, the prospect of leaving home in an era of cheap airfares, email and Skype is considerably less daunting than it was the last time the country haemorrhaged its youth."
