Sales of new apartments in Poland’s six major markets totaled nearly 16.4 thousand in Q3 this year, up about 5% q/q, according to JLL data. At the time, developers launched just under 10,000 units, 3% less than a quarter earlier.
“In all cities, demand can be assessed as high, which is due in part to an increase in the number of buyers financing the purchase with a 2% loan. In many cases, there were several takers for a single apartment, and in this price range one can speak of a considerable unsatisfied market. The size and characteristics of the available offer also had a significant impact. The high sales in Warsaw, however, would not have been possible if not for the large number of apartments introduced for sale in the last quarter. The decline in sales in Krakow and only a slight increase in Wroclaw is related more to the small offer rather than a lack of demand. Rapidly rising prices and the prospect of further price increases have brought buyers back to the market, treating the purchase of an apartment as an opportunity to protect the value of their savings and earn from the expected increase in the value of the purchased unit,” said Aleksandra Gawronska, director of housing market research.
Sales results for Q3 2023 in most cities were slightly better than in Q2. The slight 5% increase compared to the previous quarter counted in total for the six main markets, namely Warsaw, Krakow, Wroclaw, the Tricity, Poznan and Lodz, is due to high sales in the capital, which approached the record results of the real estate boom period. A total of nearly 16,400 units were sold in these cities, more than in the otherwise good Q3 and Q4 of 2021, JLL reported.
The only city where supply clearly increased compared to the previous quarter was Warsaw – 75% q/q. In Krakow and the Tri-City, roughly the same number of units went on sale, and at the same time the same number as in the second quarter of this year. A smaller new supply was recorded in Poznań. In total, less than 10,000 units were put on sale in the six markets in the past quarter, 3% less than a quarter earlier. The offer at the end of the third quarter declined to just over 34,000 units. Fewer units on offer were last seen in the first quarter of 2010, but then it was a result of the global banking and financial crisis, according to the report.
When there are fewer apartments, the natural consequence is an increase in prices, JLL stresses.
The average prices of units remaining on offer at the end of the third quarter of 2023 increased the most in the last three months in the Tri-City (9%) and Warsaw (8%), while the least in Łódź (3%). The annual price increase was highest in Warsaw (20%) and Krakow (19%). Offer prices rose in the range of 15-16.5% in the Tri-City, Poznań and Wrocław. Only in Łódź did prices rise by less than 11%. The introduction of a cap on the total price of an apartment in the ‘Secure Credit 2% (BK2)’ program, combined with a shortage of supply, opened up the possibility of raising prices per square meter for those apartments whose total prices and limited competition allowed them to do so. In the case of Lodz, the high offer and strong competition of cheaper units from the secondary market makes it difficult to raise prices. In addition, a large part of the current offer are small units, designed for buyers looking for rental units, it further reported.
Source: JLL and ISBnews
