Cost rental is not cheap in Cork

[Greenbook]

Article here about a new cost rental development in Cork City centre.

One beds will rent for around €1425 to €1575 and two beds for €1725. These are both 29% below market rents in Cork, which suggests a one bed in the PRS would rent for €2,100 or so and a two bed for €2,500 - both of those would be top of the range prices here. These are modern A rated apartments, but they have no parking.
Rents increase annually by HICP and there is no cap. HICP seems to be currently approaching 4%.

The articles says that these cost rentals are a permanent housing solution for people ie. the person rents forever and never buys. That is expensive, buying something for €300k would have a lower monthly payment and you would eventually own an asset. The cost rent will keep increasing forever, unless interest rates go mad, mortgage repayments will fall in real terms over the term.

Now I don't think anyone should stay in the PRS forever either. In Ireland anyway it is really for people who are moving on. But cost rental doesn't seem to be a magic bullet solution either.

 

[JohnFlory]

Market rents floors are set by HAP and RAS. These are an option for certain people who are earning above landlord subisidy limits and are not entitled to the high end social housing the govt is now spending billions on acquiring on private market through AHBs and councils. Maybe still living in parents box rooms or indians in well paying IT roles. Or couples who no longer want to house share. But people not on enough to get a mortgage for anywhere decent. Agree not a long term solution for anyone. Paying those kind of rents is unlikely to leave much to save for a deposit. Assume if anyone in one of these leaves high paying employment the govt will step in to pay the rent through HAP or another mechanism.