In November, the domestic market for building materials continued its months-long, modest correction in price dynamics. This time, the year-over-year rate declined by just under 1 percent, while month-to-month changes were practically nonexistent. However, as experts from RynekPierwotny.pl explain, such a situation cannot last indefinitely, and factors that may shift this trend seem to be within reach.
The slight negative price trend in building materials year-over-year, reported by PSB Group, remains consistent. The same index, measured month-to-month, once again showed practically no change. This marks yet another confirmation of a strengthening stabilization in the average rate of price changes. In PSB Group’s latest report, wholesale prices fell by 0.3 percent year-over-year, while retail prices dropped by 1.2 percent, showing no statistically significant changes in recent months.
The November reading of the year-over-year price dynamics of building materials shows a continuing dominance of declining product categories, with a ratio of 12 to 8.
Among the most discounted materials year-over-year are thermal insulation and drywall, both showing a decline of 4 percent. At the top of the table, OSB boards lead with an increase of nearly 7 percent, followed by cement and lime, which rose by 4 percent year-over-year. Walls and chimneys increased by 2.5 percent, and home surroundings saw a rise of 1.7 percent.
Experts from RynekPierwotny.pl note that the scale of both the largest increases and decreases in different product categories is shrinking month by month. This indicates that the building materials market is moving toward a state of full demand-supply equilibrium. The question remains whether this balance can be sustained in the long term.
Recently, another tranche of funds from the National Recovery Plan (KPO) amounting to PLN 40 billion was delivered to Poland. According to the Ministry of Funds and Regional Policy, these KPO funds will be invested in energy efficiency for homes and apartments, modernization of energy networks, and construction of wind farms. These investments could soon have a statistically significant impact on demand, and therefore on building material prices.
This is only the third tranche out of the planned nine, and given the limited time for spending KPO funds by 2026, it is expected that more large-scale infrastructure investments will launch in the new year, potentially driving up the prices of building materials and services.
The KPO funds also represent a potential stimulus for GDP growth and economic recovery, which in turn will affect the labor market and increase wages. This situation typically drives up demand for housing. Developers, unconcerned about any oversupply in the primary housing market, are already accelerating new construction projects, which could further boost demand for building materials.
It is therefore possible that the ongoing stabilization in building material prices is the “calm before the storm,” which may soon give way to another phase of cyclical recovery in the new year.
Author: Jarosław Jędrzyński, Expert at RynekPierwotny.pl
