In the third quarter of 2023, the average offer price of an apartment in large cities exceeded PLN 13,000 per square meter – according to a report published on Thursday by the Otodom website. At the same time, the share of apartments from the primary market in the entire offer dropped to a historically low level – 55.5 percent.
According to Otomdom and Polityka Insight publications, average offer prices increased by as much as 5.5% in the third quarter of this year. compared to the second quarter, which experts from Otomdom explain by the popularity of the 2% government loan. They also point out that despite a clear increase in buyer activity, developers remained cautious when introducing new investments.
The price increase is due to limited supply
The greatest price increase – as it was written – was noticeable in cities with over 500,000 inhabitants. inhabitants, where the average offer price exceeded PLN 13,000. PLN/sq m “Such a pace of increases did not affect the largest agglomerations even at the peak of the boom, i.e. in 2020-2011,” it was pointed out. The most, by over 10%. y/y, apartment prices increased primary market. It was written that the price increase is due to limited supply, because after the slowdown in 2022, some developers limited their investment plans and did not decide to resume them this year. Moreover – as it was added – in large cities there is often a lack of land for which building permits could be quickly obtained, which in turn has suspended the launch of new housing projects. However, the biggest obstacle – according to Polityka Insight’s chief economist Adam Czerniak – was the fear of a collapse in demand after the end of the government subsidies program. – Last quarter, developers sold their existing offers and adjusted them to the price limits applicable under the safe 2% loan. – he pointed.
Land prices have started again
It was indicated that the prices of construction land had remained stable for three quarters, while in the period from July to October this year. increased to PLN 241/sq m, i.e. by nearly 6%. compared to the second quarter. “The last time such high increases were recorded was in mid-2021,” it was written. – The shortage of attractive land within the largest cities may direct developers’ attention to cheaper areas on the outskirts of the agglomeration. This way they will be able to respond to the high demand, if it continues. The increase in plot prices may therefore be the result of such expectations, Czerniak noted.
Big changes are to be expected
According to the authors of the publication, no major changes should be expected on the market in the near future. – The offer on the rental market in the last three months has reached the highest level since the pandemic. The large supply of apartments for rent will therefore limit the possibility of increasing rents in the near future. Additionally, we can assume that some of the current tenants will become beneficiaries of the 2% safe loan program. and will soon move to her own apartment. Thus, the pool of available premises for rent will increase – explained Otodom senior analyst Karolina Klimaszewska. In turn, according to Adam Czerniak, much on the apartment sales market will depend on the upcoming changes in the state’s housing policy, including those related to limiting budget deficit. – It will continue to be a key factor shaping the landscape of the housing market inflation. Its persistently high level will limit the purchasing possibilities of households and, as a result, will translate into a slowdown in apartment sales – summarized the Polityka Insight expert.
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