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Housing Market Shows Signs of Stability, Developers’ Outlook Improves

REAL ESTATEHousing Market Shows Signs of Stability, Developers' Outlook Improves

In November, developers in Poland commenced the construction of 10.9 thousand homes. This is according to the latest data from the Central Statistical Office. This is 48% more than a year ago, but 11% less than last month. The housing market is slowly stabilising, and we can talk about developers’ relative optimism. Although the next few quarters remain a true mystery, for now, demand and supply remain balanced. Marcin Krasoń, an expert in the housing market at Otodom Analytics, commented on this.

The Safe Credit 2% has stimulated the market over the past months, allowing it to regain life. Demand grew first. Developers did not entirely believe in its sustainability and long-term nature, which is why many constructions were halted. According to data from Otodom Analytics, at the beginning of the year, over 4 thousand apartments were sold every month in the primary market in seven major cities. Each month between June and October, sales exceeded 5 thousand properties. In November, sales were similar, but more new homes (over 6 thousand) were brought to the market, causing the available offer to grow.

Central Statistical Office data corroborates the thesis of a reviving market. Both the number of constructions started and the number of construction permits obtained have increased. The 14.1 thousand permits in November (+6% YoY) is much less than in the best months of 2021 and 2022 (even over 25 thousand), but it is similar to the average from the last 5 years. As Marcin Krasoń, a real estate market expert at Otodom Analytics, suggests, the number of developer homes handed over is at a level of several thousand a month. However, it is important to remember that this will begin to decline next year, which is related to the smaller number of constructions started in 2022.

CSO data aggregated in three-month periods provide a broader picture of the market, as monthly values ​​are sometimes distorted by large developer projects. Currently, it is clear that the number of construction permits and new constructions is increasing rapidly, but we are still far from record levels.

What will the New Year bring? The upcoming quarters in the market are truly a great unknown, primarily due to the still unknown future of the Safe Credit 2% program. We also don’t know the housing policy objectives of the new government or the strategy of the Monetary Policy Council for the next years. For now, demand and supply are relatively balanced. The prices are also calming, despite significant YoY increases.

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