Banks granted a total of 256,456 new housing loans in 2021, according to the AMRON-SARFiN report. Compared to the results achieved by the sector in the previous year, there was an increase by 25.61%. In terms of value, the result achieved in 2021 increased to PLN 86 billion (an increase by 41.35%), and the banking sector achieved the highest credit result in the history of the Polish mortgage market.
The number of housing loans granted in the fourth quarter of 2021 amounted to 63,918, which is 6.49% less than in the previous quarter (nominally 4,435 loans less). The value of newly granted mortgage loans amounted to PLN 22.453 billion, which means a decrease by PLN 777 million, or -3.34% compared to the previous quarter. Compared to the corresponding period of 2020, in the fourth quarter of 2021, 10 162 (or 18.9%) more loan agreements were signed, while their value was higher by PLN 6,018 million (36.62%) than in the corresponding period the previous year was also reported.
“The second year of the pandemic was a period of continuation, if not a revival of the trends observed even before the pandemic. The number of loans granted in 2021 was more than 25% higher than in the previous year. At the end of the year, the average value of a housing loan granted reached a historic record of 350 thousand PLN,” said the president of the Center for Banking Law and Information, chairman of the Housing Real Estate Financing Committee of the Polish Bank Association, Jacek Furga.
According to experts, not without significance for such a high lending activity was a series of interest rate cuts made by the Monetary Policy Council (MPC) in 2020, which resulted in historically low interest rates on loans. As a result, at the end of 2021, the total number of active housing loans reached the level of 2,549,000. units, and the total debt on this account amounted to PLN 511.3 billion.
At the end of 2020, the average cost of the loan was 2.49% and at the end of 2021 – 4.7%, which, with a loan of an average value of PLN 330 thousand, which was just taken, meant an increase in the monthly loan servicing cost by about PLN 600.
Data from the AMRON Center show that the fourth quarter of 2021 brought further increases in apartment prices in most markets in the largest Polish cities. The highest increases were observed on the Warsaw and Wrocław markets, where the recorded price increases reached the level of 3.2% and 3.34%, respectively, compared to the values recorded a quarter earlier. In relation to the corresponding period of 2020, the largest increases in the average price of apartments were recorded in Kraków – 15.85%, Wrocław – 13.42% and Gdańsk – 13.14%. In Warsaw, this difference amounted to 9.93% and it was the lowest increase among the largest Polish cities.
“The rental housing segment turned out to be much more susceptible to turbulence caused by the pandemic. The fourth quarter of 2021 was the third consecutive period of recovery of the pre-pandemic level of private rental rates in all surveyed cities. After the period of turbulence related to the COVID-19 pandemic, the market again In most cities, rents returned to their pre-pandemic levels. In annual terms, the highest dynamics in the amount of rents was recorded in Krakow (by 15.42%) and in Warsaw (by 13.23%). In the same period, rents grew the slowest in Poznań. (by 4.45%),” added Furga.
In the expert’s opinion, the most likely scenarios for the housing market in the coming months are a further increase in the prices of apartments, houses and plots of land, but with a visible slowdown to at least half of the growth rates from 2021, and a weakening of the demand side due to the visible decrease in the number of loan applications at the end of 2021 r. Still an important factor behind the continued demand for flats are negative real interest rates, which still motivate to invest in the real estate market.
Source: AMRON-SARFiN and ISBnews
