Data published by REDNET Consulting shows that in response to weaker housing sales, developers have massively stopped starting new projects. In the six largest real estate markets – Warsaw, Krakow, the Tri-City, Wroclaw, Poznan and Lodz – developers launched sales of only 6743 apartments in Q3 of this year, compared to 14,941 as recently as Q2, a drop of nearly 55%.
Interestingly, the decline in new offerings was much more dynamic than the decline in sales, which fell by nearly 23.5%. In Q3, more apartments were sold than there were new offerings. The biggest decline was in the Tri-City, where as recently as Q2 developers launched sales of 3892 apartments, but already in the current quarter there were only 1211, a drop of nearly 70%. By comparison, only 193 fewer apartments were sold in the Tri-Cities in Q2 than in the previous quarter, a drop of only 14.14%. On the other hand, the largest declines from Q3 2021 were recorded in Lodz, where 299 apartments were put on the market in Q3 this year, compared to 1,898 units in the same period last year, a drop of a record 84.3%.
“We expect supply to be even lower in Q4,” forecasts Ewa Palus Head of Consulting at Rednet Property Group.
Despite record-low sales, which in Q3 were more than half of what they were a year earlier, developers still managed to sell more apartments than they started offering new ones. This is particularly evident in three cities. Krakow sold 44.3% more apartments than were put on the market, while Poznań sold 26.3% more, and Łódź sold over 66% more.
At this rate, the situation could be dramatic in a few months. If new developments are not started, there will be no ready apartments in some time. Even if developers start selling new projects, it will unfortunately take at least a year and a half before they are built. During this time, rental prices – already horrendously high today – will continue to rise, notes Robert Chojnacki, founder of the housing website tabelaofert.pl.
