What kind of customers are going to developers’ sales offices now? Are apartments bought mainly by investors with cash? Are the companies adjusting the new offer to the current needs? The poll was prepared by the real estate website dompress.pl.
Andrzej Oślizło, CEO, Develia S.A..
Currently, almost 80 percent of the contracts we conclude are cash transactions. The remaining 20 percent are purchases with credit support, where we can also see a lower level of credit than a year ago. The most affected were investments in the popular segment, where the use of mortgage financing was common. In these projects, sales fell by almost half compared to previous years.
At the moment, the most popular investments are the more expensive ones, in locations closer to the center, purchased both for investment purposes and for personal use. We don’t see much change here in terms of demand. However, it is worth noting that cash purchases dominate for these properties. The square footage doesn’t matter much, with multi-room apartments selling just as well as smaller ones in projects with higher standards and better locations. This is perfectly illustrated by the average area of apartments transacted. In 2021 it was about 56 sqm, currently this indicator is 53 sqm with us.
We do not expect the number of studios and compact two-room units to increase significantly in new developments. Keep in mind that the average development preparation time is about 2 years. The projects being launched now will hit the market in late 2024 and early 2025, when the economic situation in Poland may already be quite different. In addition, a large number of small apartments within a single development is associated with certain limitations and inconveniences for residents. The offer of developers in major agglomerations should therefore not change significantly. On the other hand, we expect that in smaller towns or unattractive locations, investments will be put on hold due to higher development costs and the level of prices currently possible.
Angelika Kliś, board member of Atal S.A.
The group of so-called cash customers accounts for a much larger percentage of buyers than usual. It is currently about ¾ of buyers. The others mostly finance the purchase in a combined model. Those purchasing apartments for investment purposes are also active. Whether to protect capital from inflation or encouraged by the prospects of the rental market in the coming years. This group prefers compact, two- or three-bedroom apartments in very good locations.
Regardless of the market situation, issues of housing quality and comfort are a priority for us. We make sure that our offer is attractive to different groups of buyers.
Boaz Haim, president of Ronson Development
In 2022, a big role was played by individual investors, who are close to the belief that real estate is a safe investment for capital regardless of market circumstances. And this capital they have. On the other hand, the proportions in the structure of buyers have clearly reversed. While just two years ago 70 percent were customers supported by credit, now they are about 30 percent of the minority.
Cash customers are most likely to choose one- and two-room apartments in good locations, which means extensive surrounding infrastructure, but also efficient transportation to other parts of the city. Functional layout of the apartment and a low global price are also important.
Joanna Chojecka, sales and marketing director for Warsaw and Wroclaw at Robyg Group.
Currently, more than 80 percent of our customers are cash buyers, while in previous years they accounted for 40-50 percent of buyers. We see such a change in the structure of customers in all the cities where we are present. Recently, customers have been asking more often for smaller apartments, two or three rooms, well designed and functional. Robyg Group has adapted to this trend and we are offering more units that meet such demands.
Zuzanna Należyta, commercial director at Eco Classic
In our investments, cash purchases account for 60 percent to 80 percent of transactions. These are traditionally one- and two-room apartments, which are just as easy to rent or possibly sell later. We still have customers opting for credit. However, there are far fewer of them. Some customers are holding off and waiting for the loan terms to change, while others are deciding to rent.
Malgorzata Ostrowska, director of the Marketing and Sales Division at J.W. Construction Holding S.A.
Investments in real estate provide good capital protection against inflation and are one of the most profitable assets. Investing in additional housing in an attractive location has enormous potential, such as the premium apartments in our Nad Odrą development located on the Szczecin boulevards, overlooking the Oder River.
It is also profitable to purchase a so-called investment apartment. Such premises are secured by a notarial deed and an entry in the land and mortgage register, and do not generate risks related to the effects of the Law on the Protection of Tenants’ Rights. This type of product, belonging to the so-called aparthotel category, we have on offer in the Apartamenty Pileckiego 59 investment in Warsaw’s Ursynów district. When deciding to buy a unit, you can deduct 23 percent VAT. Prices start at PLN 295,000 gross.
Sebastian Barandziak, CEO of Dekpol Deweloper
In 2022, most of the transactions we made were financed with cash, accounting for about 80 percent of all contracts. About 20 percent of purchases are still supported by credit. We note demand for both residential and investment needs. In purchases, there is a definite predominance of two-room units between 30 sqm. – 40 sqm, which account for about 65-70 percent of our sales volume. The new offer we plan to introduce for sale in 2023 will be similar to the current one.
Marcin Michalec, CEO of Okam
Due to the low level of credit granted, a significant portion of apartments is currently being purchased by customers with spare cash and savings. We realize high-standard investments with numerous amenities, primarily in central locations of large cities or those that are well connected. Buyers appreciate the surrounding retail and service infrastructure, the additional solutions we use.
One- to three-room apartments of small size and practical layout are currently the most popular among buyers. We offer units in Warsaw as part of the Central House and CityFlow projects under development. In Łódź, in Strefa Progress, and in Katowice in the Inspire project.
Marek Pawlukiewicz, spokesman for Aria Development
Customers purchasing apartments for cash are choosing units with small areas and buying mainly for investment purposes. They opt for compact studios or two-room apartments. The number of people financing the purchase with a loan has decreased significantly. There is also a noticeable decline in sales of apartments over 60 sqm, which are the main ones financed with credit.
Mariola Zak, sales and marketing director at Aurec Home
Our observations show that apartments for cash from the Miasteczko Jutrzenki investment are mainly bought by people in the 30-40 age range. They are most likely to choose spacious two-room units, which have thoughtful layouts, storage units and large balconies. The current market situation is most acutely affecting young people who want to leave the “family nest”, but have no creditworthiness. That’s why we offer apartments for cash, on credit or financed with the help of the 10/90 system, where only a 10 percent down payment is required and the remaining 90 percent can be paid when the apartment is ready for delivery. We are also noticing unrelenting demand for the purchase of apartments for investment.
Janusz Miller, director of sales and marketing at Home Invest
The current market situation is dominated by customers who buy apartments for cash. They most often choose two-room apartments for investment in well-connected parts of the city. The most popular at the moment is our Warszawski Świt investment, located near the new Bródno subway station.
