Latest News from Pension Property

The Irish rental market remained exceptionally competitive during the second quarter of 2026, with strong tenant demand continuing to outpace available supply. While policy changes introduced earlier this year have reshaped the market, rents continue to rise across most regions, and investors are still benefiting from comparatively attractive rental yields despite increasing property values.

Rental Growth Continues

Following the significant changes to Ireland's rental regulations in March, advertised rents experienced one of the strongest quarterly increases on record. National asking rents rose sharply during the first quarter and remained elevated throughout Q2 as landlords adjusted to the new legislative rules. Recent market data suggests that the increase was driven by the ability to reset rents to current market levels between tenancies, alongside the ongoing shortage of available rental accommodation.

Despite a modest improvement in the number of available rental listings compared to the beginning of the year, supply remains well below historical norms, resulting in continued upward pressure on rents.

Regional Trends

Although Dublin remains Ireland's largest rental market, some of the strongest annual rental growth has been recorded outside the capital.

Recent figures show:

• Limerick leads rental inflation, with annual rent growth of approximately 20%, supported by strong employment and university demand.

• Galway experienced rental growth of approximately 18%.

• Cork recorded annual growth of around 13%, reflecting sustained demand from both owner-occupiers and renters.

• Waterford also continued to post healthy rental increases at 8% than the previous year.

• Dublin remains one of the country's most expensive rental markets, with annual growth of around 4.3%, although growth has eased relative to some regional cities.

The continued strength of regional cities highlights an important trend: tenants are increasingly seeking more affordable alternatives outside Dublin, while improving infrastructure and hybrid working arrangements continue to support demand across Ireland's secondary cities.

Rental Yields Remain Attractive

For investors, rental yields continue to compare favourably with many European markets.

Current market estimates place Ireland's average gross residential rental yield at approximately 7.7%, remaining broadly stable despite rising purchase prices.

Regional differences remain significant:

• Smaller apartments generally deliver the strongest returns.

• Dublin continues to offer some of the highest gross yields nationally averaging at 7.2% but are moderated by higher capital values, particularly in premium suburbs where capital appreciation has outpaced rental growth.

• Cork's yields remain healthy at 7.1%

While gross yields remain attractive on paper, investors should continue to account for taxation, maintenance costs, regulatory compliance and financing expenses when assessing overall investment performance.

Outlook

Looking ahead to the second half of 2026, the Irish rental market is expected to remain resilient.

Demand continues to be underpinned by population growth, employment expansion and limited housing availability. While government reforms aim to encourage additional investment and improve housing delivery, meaningful increases in supply are likely to take time.

For investors, strong rental demand and solid yields continue to present attractive opportunities.

As always, local market conditions will vary considerably, making regional analysis increasingly important for investors when navigating Ireland's evolving property landscape.

Fiona Harris
ITC Marketing Manager