The final chord of the past year in the housing markets of the largest cities was a large increase in the average price of a square meter of new apartments in Warsaw and the Tricity. However, it was in the latter metropolis where prices rose the most in 2023, according to preliminary data from BIG DATA RynekPierwotny.pl.
“As recently as October, Kraków was the leader in raising the average price per square meter of apartments available in the offer of development companies,” recalls Marek Wielgo, an expert from RynekPierwotny.pl.
After a crazy third quarter in which the average price per square meter increased by as much as 11%, the end of last year brought some signs of price stabilization in this city. Preliminary data from BIG DATA RynekPierwotny.pl shows that in December the average price per square meter remained at the November level, and in the entire fourth quarter it increased by 2%. On the other hand, in the Tricity, price increases accelerated in the second half of last year, with the fourth quarter being record-breaking in this respect. The average price per square meter increased here by as much as 10%!
Since the introduction of the “Safe Loan 2%” in bank offers in July, there has been a marked price acceleration in almost all metropolises. The only oasis of stability among the largest metropolises was Łódź. Both in terms of the size of the offer and the average price of new apartments, which increased the least this year, by “only” 8%. In other metropolises, we had to deal with double-digit increases in the average price per square meter.
In 2023, the price per square meter increased the most, by as much as 27%, in the Tricity. In Krakow, the increase was 24%, and in Warsaw the average price per square meter of apartments in the developers’ offer increased by 23%.
“The moods among developers and their clients who are buying apartments are completely different than a year ago. Among them, there are probably many who deeply regret that they hesitated to buy a flat expecting a price decrease, which seemed likely after 2022,” comments Marek Wielgo.
The highest price was in Warsaw. Preliminary data from BIG DATA RynekPierwotny.pl shows that at the end of December 2023, the average price per square meter of apartments that were on offer from Warsaw developers exceeded PLN 16.7 thousand. So for a 50-meter new apartment in the capital of Poland, you had to pay on average almost PLN 837 thousand, or about PLN 155 thousand more than a year earlier, when you paid on average just under PLN 682 thousand for a flat with a similar area.
Experts from RynekPierwotny.pl point out that for the average price per square meter of apartments on the primary market to stop growing, developers would have to drastically increase the supply of apartments in the popular segment, i.e., built with credit clients in mind. We had such a situation in Łódź, where in December the percentage of apartments with a price below PLN 9,000 per sq m increased from 34% to 36%.
This year, however, there is a risk that at the beginning of 2024, developers operating in the largest metropolises will limit their investment activity due to a decrease in demand for the apartments they build. This may be caused by the suspension of the “Safe Loan 2%” program due to the exhaustion of funds for subsidies in this year’s state budget.
On the other hand, it is hard to imagine today a drop in prices for attractive plots and construction costs. Especially since from April changes in technical conditions for buildings and their location will come into force. For those buying apartments, the new regulations are beneficial in terms of living comfort. However, it should be emphasized that construction costs will increase, and at the same time the area of properties for sale will decrease. This may affect the increase in prices of new apartments.
At the beginning of this year, we can expect a lot of building permits and construction notifications, as such projects will be able to be implemented on the basis of current technical requirements. This is similar to the situation three years ago, when much more rigorous energy standards for residential buildings were introduced.
Author: RynekPierwotny.pl
