This has produced a generation of 'reluctant landlords' but better-quality accommodation for a growing number of renters, according to a new research report.
The report, by online lettings site, Citylets, also highlights the gulf in renting costs in areas across the greater Belfast area, with leafier areas such as Malone, Stranmillis, Rosetta and Windsor contrasting sharply with areas such as Woodvale and Blackstaff.
The report reveals that the average monthly cost of a Belfast rental property in first quarter of this year stand at £544, a drop of 6.2% on the same period last year.
However, the average time it takes a landlord to let a property has come down significantly over the year, which suggests the over supply problems seen in some areas might be resolving themselves.
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For example, one-bed properties are now taking an average of 38 days to let, some 23 days less than a year ago.
Citylets founder and Managing Director, Thomas Ashdown, said: "Northern Ireland’s property market rollercoaster has contributed to a seismic shift in people’s attitude to private renting.
"As the number of properties sold plunged, estate agents have been shifting emphasis from selling houses to managing lettings in response to the growing number of properties and tenants available.
"Those who can't or are unwilling to sell in the current market are letting, those who can't buy are renting. Additionally some who are in a good position to buy are simply putting it off until the sales market bottoms out."
The report shows that the downturn in rental values was not the same for all properties and varied according to size.
Average rents for one-bed properties fell by 4.4% in the year, to £455, while rents for two-bed properties fell 5.2% to £510. Rental costs for three-bed properties fell by 8% to £521.
Two-bed properties (including apartments and houses) – the largest sector of the rental market in Northern Ireland – saw a decrease in the average time taken to let of 13 days to 58 days.
Another promising signal for agents and landlords alike is that the proportion of properties renting in less than four weeks has more than doubled in the first quarter of 2010 (41%) from the 1st Quarter 2009 (19%).
The Citylets rental index for Belfast was initiated in January 2008 (100) and at March 2010 stood at 98.9 down just 1.1% down – over a similar period house prices have fallen by 26%, indicating that the private rented sector has adapted well to the downturn.
(NS/BMcC)
