Ireland's capital city rose to eleventh place in the regional ranking as the supply of high-end three-bedroom apartments, which the cost index is based on, outstripped demand, reports ECA International in its latest Accommodation Survey.The survey figures for Europe pre-date the UK’s referendum in June and recent speculation over which London-based banks are considering moving or expanding operations in Dublin. Cork also moved up the rankings to 54 off the back of large rent increases.

Rental market movements across Europe

In other European cities, London remained the most expensive European city and fourth most expensive rental market globally. This despite the fall in the value of sterling and a softening of the central London rental market.“London has continued to top our regional rankings,” confirmed Alec Smith, accommodation services manager at ECA International. “With a high population density and a consistently limited supply of property, average rents in the city have long been more expensive than in other high-profile cities in Europe,” he added.Across Europe, the rental price for a high-end three-bedroom property averages US$2,330 this year. Rents for an unfurnished three-bedroom apartment across popular expatriate areas in London average US$7,886 (£5,574) per month. In US dollar terms, rents in the city are significantly higher, approximately 40 per cent, than in Europe's next-most expensive location, Zurich.However, with the prospect of post-Brexit relocations and group moves, there is a question mark over where rental costs are headed.

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Uncertainty could polarise London rental markets

“Uncertainty over the projected impact of Brexit on the financial sector, combined with a recent unprecedented surge in supply in prime central London neighbourhoods, could lead to a polarisation in rent movements between central London and Greater London – where supply levels remain tight,” said Alec Smith.“As Brexit negotiations continue, the predicted loss of a number of banking jobs from London is likely to put downward pressure on rents in prime neighbourhoods in the near future,” he concluded.

Worldwide rental price movements

Worldwide, New York overtook Hong Kong to be the most expensive city in the world for high-end rental accommodation. In the past year, average rental costs here have risen by around four per cent to US$10,502 per month.“[New York’s] rental market continues to be very active and rental prices have been climbing since the lows of 2009. This has been fuelled by a strong employment market and an influx of business in key service sectors,” explained Michael Witkowski, vice president – Americas, ECA International.“Rents are expected to remain high and continue to dwarf income growth in the coming year. Although a surge in the supply of rental accommodation in popular expatriate neighbourhoods in Manhattan, combined with renters being unwilling, or unable, to pay ever higher sums, could see the rental prices peak.”

Global top ten rental costs: ECA International

1. New York (US)
2. Hong Kong (Hong Kong Special Administrative Region of the People's Republic of China)
3. Tokyo (Japan)
4. London (UK)
5. Port Moresby (Papua New Guinea)
6. Caracas (Venezuela)
7. Luanda (Angola)
8. San Francisco (US)
9. Moscow (Russia)
10. Dubai (UAE)

For the latest news and features from Relocate on relocating overseas, see our international assignments section.

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