What factors will have the greatest impact on the development of the housing market in the coming years? What will determine the main directions of its development? The poll was developed by the real estate website dompress.pl
Andrzej Oślizło, President of the Management Board of Develia S.A.:
The real estate market is characterized by great inertia. It reacts with a delay to what is happening in the economy. Therefore, we do not expect any revolutionary changes this year. The needs of Poles remain unsatisfied. According to various estimates, even 1.1 million apartments are lacking in our country. The buyers’ financial health remains good. Unemployment is low and wages are consistently rising, so they are not afraid to make decisions about buying real estate. In addition to people purchasing premises for their own needs, we also have a large group of investment buyers. Despite successive increases in interest rates, with inflation above 9%, the real rate remains deeply negative, which means that housing is still a good, safe investment that allows you to protect savings against inflation.
The shrinking offer of plots for development in large cities and prolonged administrative procedures mean that the industry is unable to adequately increase production. In this situation, it is difficult to expect a scenario other than further price increases, although not of the same intensity as in previous years.
Angelika Kliś, member of the management board of Atal S.A.:
The housing market is not a typical industry that is determined by boom and bear periods. Moreover, it should be remembered that the sector is also stimulated by factors such as the housing gap, the desire to improve the existing housing conditions, internal migrations from smaller towns to large agglomerations and the growing number of foreigners settling in Poland permanently. Moreover, inflation also favors the investment of capital in real estate.
In the current situation, we expect consolidation moves and the professionalization of the sector. Limited availability of land, more demanding market environment, higher costs of building materials and labor will make the largest entities that are able to function effectively in such conditions perform best.
Customers are looking for something more than just a place to live. They expect attractive common areas, such as wellness zones, ecological solutions and multifunctional projects, where apart from apartments, there will also be commercial and service premises and offices. The so-called 15-minute cities, where shops, services, workplace or green areas will be in close proximity to the house. There is a growing interest in spacious apartments, preferably with a terrace, balcony or garden, with flexible space that can be rearranged according to your needs, e.g. for an office.
Cezary Grabowski, sales and marketing director of Bouygues Immobilier Polska:
Housing prices are determined primarily by the costs of their construction, and these continue to grow. This is due to many factors, including higher and higher land prices, abruptly rising prices of building materials, systematic increase in labor costs. These phenomena, of course, translate into the conditions for the implementation of investments, and in addition, there is also the decreasing supply of new flats on the primary market.
All this makes a further increase in housing prices inevitable. However, it is difficult to say at what level. A price increase is very likely even with possibly lower supply as there are currently no indications that these market trends will weaken.
I would like to point out one more long-term trend, the idea of sustainable construction, which is becoming an increasingly important point of reference for both developers and clients. In the company, we adopt the principle that in each new project we will use at least three ecological solutions. Our goal is to create the best spaces to live in, conducive to activity, relaxation and contact with nature. We also care about solutions that enhance biodiversity and allow us to use resources responsibly.
Małgorzata Ostrowska, director of the Marketing and Sales Division at J.W. Construction Holding S.A.:
According to estimates, even 2 million apartments may still be missing in Poland, over 30 percent. houses are overcrowded. Due to the importance of owning a flat or striving to improve housing conditions, the market will continue to develop. However, whether it will develop fast or slower will depend on many factors, both on the demand and supply side. Demand may be slowed down by rising interest rates. The supply and the rising costs of housing construction.
Meanwhile, there is a growing group of people who do not want to or cannot decide on their own accommodation, but want to improve their quality of life. They want to be more mobile, to be able to quickly move to another city. They choose to rent. You can also see that the interest in renting is growing not only among young, independent people, but also among families with a stable and good situation. In the face of constantly rising home prices and interest rates, the PRS market will definitely gain in popularity.
Bartosz Kuźniar, president of the management board of Lokum Deweloper S.A.:
There is a significant shortage of flats in Poland. It is especially strongly felt in large cities to which people migrate due to well-paid work. Social changes are progressing, as a result of which young people leave the family home earlier, as well as setting up their own, often one-person, households. For several years, we have also experienced an influx of economic migrants from the east, and after Russia’s attack on Ukraine, we are facing a massive influx of refugees. Even if the war won’t last long, many of these people will have nothing to come back to. You will have to provide them with decent living here.
At the same time, the Polish state has not pursued any housing policy for decades. Ad hoc, ill-considered laws are created on selected issues, without any housing development strategy. Meanwhile, our activity is more and more limited every year. Trade in land owned by the state is blocked, administrative procedures relating to the adoption of local spatial development plans and the issuing of building permits are outdated and increasingly slow. No wonder that developers are not able to meet the demand for housing. This state of affairs is not improved by the depletion of land resources for development.
In the last three years, we have experienced a very large increase in the cost of producing apartments: land, materials, workmanship and, recently, financial costs. This forces home prices to rise by more than 10 percent. annually. At the same time, rising interest rates limit the group of people who can afford to take out a loan sufficient to finance the purchase of real estate. Therefore, despite the fact that the offer of flats on the market is poor, there is little hope that it will be expanded significantly. Many development investments that already have building permits will not be included in the offer and will be put on hold until the clients’ financial capacity improves enough for the apartments to find buyers.
The situation could change if there are programs supporting the purchase, financing or rental of housing. It is important that it be real support for customers, which at the same time will stimulate the sustainable, ecological development of cities. This aspect seems to be very important. Due to climate and political changes, in the coming years we should revise the approach to buildings, limit private car traffic in the city in favor of public transport, abandon concreting the space between buildings, underground and above-ground car parks in favor of tall greenery. At the same time, development in the downtown area should be intensified in order to limit the spreading of cities to the periphery, and to strive for the creation of 15-minute cities.
Sebastian Barandziak, president of the management board of Dekpol Deweloper:
There are several factors shaping the current market situation, incl. rising interest rates, inflation, low availability of land, rising prices of building materials or the new developer and developer guarantee fund act.
As far as the housing sector is concerned, the supply of new apartments in Poland still does not keep up with the demand, which suggests that 2022 will continue to be conducive to maintaining a high level of sales.
The direction of the housing sector development will undoubtedly be influenced by the interest rate policy. In the case of very high interference, it may limit the demand, but the relatively low supply will still support the market value.
In addition, institutional investments that may soon become a direction on the real estate market thanks to the cooperation of developers with funds have a chance to gain popularity.
