What results did developers record in the third quarter of this year? How are sales compared to the second quarter of this year and 2021? What influenced the result? The poll was prepared by the real estate website dompress.pl.
Andrzej Oślizło, CEO of Develia S.A.:
In the third quarter of this year, we found buyers for 261 units. By comparison, in the second quarter of 2022, the figure was 361 apartments. In contrast, a year earlier, in the third quarter of 2021, we sold 438 apartments. The weaker performance is due to buyers being cut off from mortgage financing. As a result of interest rate hikes and the entry into force of the Financial Supervisory Commission’s so-called revised Recommendation S, a large group of potential customers lost their creditworthiness and were forced to postpone their purchase plans for the future.
Zuzanna Należyta, commercial director at Eco Classic:
The third quarter of this year brought no deterioration in sales performance compared to the previous quarter. However, since the middle of this year, the sales performance of the entire industry has dropped significantly, and the reduced sales level has persisted so far. The main reason for this situation is the tightening of the way banks calculate creditworthiness and the increase in interest rates.
The continuation of the recommendation worsening creditworthiness has already resulted in the suspension of further investment plans, and thus a significant reduction in supply. This will next result in the closure of smaller and weaker development companies and an increase in unemployment. According to the latest position of the Authority of the FSC, developers have such large margins that they should lower prices and thus ensure greater availability of housing. It’s just a shame that such serious decisions are based on the wrong data. The profitability cited by the FSC refers to the performance of listed developers and transactions finalized with final deeds in a given quarter. However, these are transactions concluded as development agreements sometimes even a year earlier i.e. in a completely different sales reality and with different construction costs.
Jacek Wesolowski, Managing Director of Trei Real Estate Poland:
Despite the difficult market situation associated with interest rate increases and a drastic drop in the number of mortgages, we managed to maintain satisfactory results.
In the Bacciarellego 54 development in Wroclaw, we have maintained a steady sales pace for two quarters. In the same quarter last year, we recorded several times higher sales, which was due to, among other things, a wider offer. Last year at Bacciarellego 54, we had 160 available apartments within the third stage of the project and the newly launched fourth stage. Currently, we have only 20 units left for sale.
We face a similar situation at the Kraft estate in Lodz. Its construction is scheduled to be completed by the end of this year, and we have the last 6 apartments to offer to customers out of a pool of 191 units under construction as part of the first and second stages of the project.
Angelika Kliś, Atal S.A. board member.:
In the third quarter of 2022, we concluded 376 development and preliminary agreements. This is a worse result compared to the same period last year. However, one should keep in mind the very high comparative base. Sales-wise, 2021 was a record year, which, among other things, was reflected in the volume – 2,617 units sold in Q1-Q3. In Q3 2022 revenues, we recognized a total of 833 residential and commercial units handed over to buyers in the period.
Michal Witkowski, sales director of Lokum Deweloper S.A.:
From January to September this year, we found buyers for 280 apartments. In the third quarter of this year alone, we contracted 103 units, which entails a 29 percent year-on-year decrease in the result. On the other hand, this level is comparable to the result for Q2 this year, in which we sold 1 unit more. Q3 2022 remained under the influence of a setback and sales downturn.
Due to the Monetary Policy Council’s interest rate hikes, WIBOR rose, which translated into a significant increase in mortgage installments. If we add to this the recommendation of the FSC, which orders banks to add an additional 5 percentage points when verifying creditworthiness, it turns out that most buyers are unable to finance the purchase of real estate. We are observing a steady interest of customers in buying apartments, with the fact that more and more buyers have to revise their plans by fulfilling their housing needs on the rental market. Surveys show that Poles live in overcrowded apartments, and the ratio of apartments per 1,000 residents is below the European average. The state should look for solutions to improve the housing situation in Poland. Any measures that make it difficult for customers to buy real estate lead to a deepening of the already large housing deficit. Particularly unreasonable is the recommendation of the FSA, which, with the current high interest rates, dictates the adoption of such a large buffer for changes in the WIBOR index.
As a result, the creditworthiness of many of our customers has fallen by 60% or more. This has prompted us to cancel the launch of two major projects – one in Krakow, one in Wroclaw. This year, we launched only 130 apartments compared to 930 last year, as a result of which our offer will be slimmer every month. We plan to expand it as our customers’ financial situation improves.
Andrzej Gutowski, Vice President, Sales Director, Ronson Development:
In the third quarter of 2022, we contracted the sale of 85 units and handed over 129 apartments. In the same period in 2021, we sold 162 units and handed over 187 apartments. By contrast, in the second quarter of 2022, our sales were at 114 units and 77 handovers.
The sales result recorded in the third quarter of 2022 is closely related to the current economic situation – inflation, interest rate hikes and, consequently, the deceleration of the mortgage market, which excluded a large group of customers.
Sebastian Barandziak, CEO of Dekpol Deweloper:
In the third quarter of 2022, we concluded 78 new contracts, while 170 contracts were signed in the same period last year. As for the second quarter of 2022, then we sold 127 apartments. The current result was mainly influenced by the macroeconomic situation, including high inflation and rising interest rates, as well as the availability of the sales offer.
Janusz Miller, director of sales and marketing at Home Invest:
In the third quarter of this year, we recorded sales that were about 25 percent lower than in the previous quarter and a decrease of about 45 percent in sales compared to the same period last year. The result was mainly influenced by a depleted offer of apartments, especially with respect to 2021, as well as customers being cut off from loans by rising interest rates and the FSA’s recommendation.
Marcin Michalec, CEO of Okam:
In recent months, the vast majority of housing units have been sold to cash customers with spare capital and also to those who, when joining a loan, have a significant portion of their own capital and treat it as a contribution. Due to the difficulty of obtaining mortgages, many people who do not have spare capital cannot afford such a purchase at present.
Marek Pawlukiewicz, spokesman for Aria Development:
In the second quarter of 2022, we sold 30 percent more apartments than in the third quarter of this year. In contrast, we had record sales in the third quarter of last year, but at that time there was a favorable macroeconomic environment and credit was definitely more available with low interest rates.
Source: dompress.pl
Photo: Bouygues Immobilier – Lune de Malta
