Housing market in Poland
Despite numerous marketing efforts and a wide selection of properties available, sales increased only slightly compared to the previous, very weak quarter
In total, in the fourth quarter, developers sold 9,600 flats across the six largest markets, which is only slightly better than the July-September period (+4.9% quarter-on-quarter). For three consecutive quarters, the number of units sold did not exceed 10,000.
Each market experienced a few per cent growth or stabilization in the last quarter. Only in Poznań, the sales result was significantly higher than before (+18% qoq). The greatest disappointment was the annual sales in Warsaw. The number of apartments sold in Poland's largest housing market was around 12,800 units. Even a significant increase in offerings did not help developers improve their sales results (-33% yoy). However, this was a better result than in the even weaker 2022, when sales did not exceed 11,000.
The lower sales did not discourage developers from introducing new projects to the market. The annual surplus of new supply over sales was record-breaking – on the six markets, 17,000 more units were added to the offer than developers managed to sell. In total, over the past 12 months, more than 56,500 apartments entered the market, with 54,400 available in the primary market at the end of December (+50% yoy). The largest surplus of new supply over sales was recorded in Warsaw, Wrocław, Kraków, and Poznań.
The change in average prices of apartments on offer ranged from -0.05% to +3.7% in the fourth quarter. Over the 12-month period, the largest increase occurred in Łódź (16.4%). Warsaw, Kraków, and the Tricity saw average prices rise by 8-10% year-on-year. Meanwhile, in Wrocław and Poznań, the annual increase in average prices was 4.5-5.0%. When analyzing the average prices of newly introduced projects, it is important to note that in the current situation, a large pool of new developments is aimed at affluent buyers with substantial savings or creditworthiness. We see more exceptionally luxurious project entering the market, especially in Warsaw.
Key Takeaways
- Despite numerous marketing efforts and a wide selection of properties on offer, sales results in the fourth quarter were disappointing.
- New supply increased despite weakening sales, resulting in a record surplus of newly introduced units over sales.
- The market is anticipating a decrease in interest rates, which should help bring mortgage costs closer to the 5-6% range.