Developers operating in Poland’s 7 largest markets (Warsaw, Krakow, Wroclaw, the Tri-City, Poznan, Lodz and Katowice) sold in 2022, 40,900 apartments, 38% less than a year ago, according to Otodom data. At the same time, 22% more apartments were put on offer than sold (49.8 thousand), so that after a period of marked decline in 2020-2021, the number of apartments available for purchase at the end of 2022 returned to 50.9 thousand.
Sales at the level of 40 thousand per year mark a return to the scale of transactions we faced in 2013-2014. However, as in the case of the pandemic, the reaction of companies operating in this sector to changes in the environment, according to the expert, proves the maturity of the Polish market. Back then, sales techniques were adapted to the new conditions quite quickly. Now supply has been restricted, according to Otodom.
“Braking took place on both sides and demand and supply sides, which is good for the stability of the market. The extension of the sales period in investments already under construction forces companies to commit more of their own resources during the construction phase or to obtain external financing. In either case, ensuring adequate cashflow forces a reduction in the scale of concurrent projects, thus ensuring the security of projects in progress,” commented Otodom expert Katarzyna Kuniewicz commented.
Even the “technical” increase in supply determined by the entry into force of the amendment to the Buyer’s Rights Protection Act, when sales of more than 10,000 new units were launched in June alone, did not result in an oversupply that would justify price adjustments.
Using the assumption that the market is in equilibrium when the time of theoretical sale of the entire available offer equals sales from 12 to 18 months (1.5 years), it can be concluded that we have returned to just such a situation, it was announced.
According to Otodom, what shape the “First Apartment” program and its “2% Safe Credit” part will ultimately take and when it will be implemented will determine the behavior of both buyers and developers.
“Those who can wait to buy an apartment will do so – because why shouldn’t they take advantage of preferential lending terms – even if they don’t need it. And that means slowing down already poor sales in the first half of 2023. Developers won’t be burning to start new investments either, waiting – analogous to MdM or RnS until potential purchase limits are set. If all the power of the program is directed to the primary market, it could have a beneficial effect on boosting other housing-related sectors of the economy. If, conjuncturally, the new program equally covers the primary and secondary markets, it will have no effect on increasing the availability of housing. Those who didn’t have the capacity will still not have it. Then all hope is in the KNF and the MPC,” Kuniewicz concluded.
Source: Otodom and ISBnews
