No Decision on Government Program, High Interest Rates, and Summer Vacation Impact Q3 2024 Housing Sales.
The lack of decisions regarding government programs, persistently high interest rates, and the summer vacation period were factors that may have significantly influenced the sales results of residential developers in the third quarter of 2024. Are we facing a slowdown, or has the stabilization of housing prices accelerated Poles’ purchasing decisions? And will this trend continue over the next three months? RynekPierwotny.pl asked representatives of the largest development companies for their insights.
Andrzej Gutowski, Sales Director at RONSON Development
From the perspective of apartment sales, Q3 2024 brought a positive surprise, especially after the summer slowdown. The end of August and September showed a noticeable increase in customer activity, both in reservations and contract signings. A key factor contributing to this growth was the uncertainty surrounding government programs. Political discussions and uncertainties prompted some clients to expedite their purchasing decisions, which stimulated market movement. This was especially noticeable in Warsaw, Poznań, and Wrocław, where we saw significant activity from the end of August onward. Property prices remained stable, dispelling customers’ expectations of potential price drops and encouraging them to make quicker decisions.
We expect this positive trend to continue into Q4. Everything indicates that the market will experience further activity. Customers are no longer waiting for potential government mortgage subsidy programs. We predict that the results in the final months will be better than in the first half of 2024.
Edyta Kołodziej, Sales and Marketing Director at NICKEL Development
The third quarter of 2024 saw the stabilization of the number of transactions in the housing market. After a period of intense growth due to the “Safe 2% Loan” program, the market is entering a more balanced phase.
Key factors include the lack of a new government support program, high interest rates, and continued limited access to mortgages. As a result, many people are holding off on purchasing decisions.
Looking at the supply in Poznań, data from the JLL report shows that despite declining sales, the supply of apartments in our city is at a record high – over 7,000 units were available at the end of June 2024.
Despite the decline in housing loan demand (down 13.7% in August compared to July – BIK data), which may be related to the peak holiday season, it remains higher than before the introduction of the Safe 2% Loan program. Additionally, the average requested loan amount has increased to over PLN 430,000 (BIK data), which partially compensates for the decline in the number of loan applications.
For Q4 2024, we do not anticipate major changes. Some customers are waiting for the introduction of a new government program, although we believe it will not significantly impact the market. Clear communication from the government would undoubtedly help our clients make decisions, but the situation with the recent flooding has pushed this issue aside.
Zbigniew Juroszek, CEO of ATAL SA.
Since the beginning of the year, our group has seen stable interest in our offerings. However, we observe that some buyers are holding off on signing contracts due to the lack of a decision on government support for homebuyers. We still believe that this support will not play as crucial a role as some commentators predicted. Moreover, its selectivity in terms of the target group will not be a factor affecting housing prices. A clear decision regarding whether or not to launch the program would convert most current reservations into developer contracts.
What would significantly improve both demand and supply is a reduction in interest rates, which would lower mortgage costs for customers and investment costs for developers. Additionally, since the end of the vacation period, we have noticed more customers deciding to buy apartments. We expect that the fourth quarter will bring increased contract signings. As a result, we are consistently executing construction schedules and launching sales to ensure we are ready with our expanded portfolio when demand increases.
Justyna Hamrol-Wasielewska, Sales and Marketing Director at Eiffage Immobilier Polska
The lack of the long-promised 0% mortgage definitely impacted Q3 results in the real estate industry. Customers were waiting for government decisions, as for many, this loan could provide an attractive alternative to traditional mortgages. Analyst forecasts of upcoming price drops also played a role. However, as Q4 begins, we can see the market gradually picking up. Investors are no longer delaying their buying decisions, knowing that the 0% mortgage will not come into effect this year. Our offerings are positioned in the premium sector, which is resistant to market fluctuations, and we expect stable results with a slight upward trend, as the housing stock on the market will continue to decrease.
Leszek Stankiewicz, Vice President and CFO of Dom Development S.A.
In Q3 this year, similar to Q2, we observed a slight cooling in housing demand in the primary market compared to 2023. At the same time, developers have not halted construction, replenishing their offerings, which has led to increased housing supply in the largest urban areas.
Dom Development Group continues to introduce new attractive projects in Warsaw, Kraków, Wrocław, and the Tri-City. In Q3, we sold 1,156 units net, a result 7% higher than in the same period in 2023, when we sold 1,081 units, and 23% higher than in Q2 of this year.
Our results confirm that interest in Dom Development Group’s apartment offerings remains consistently strong, both from clients financing their purchases with mortgages and cash buyers.
Our goal for 2024 remains to increase the number of apartments sold compared to 2023 when net sales reached 3,906 units.
In the first three quarters of 2024, Dom Development Group handed over 2,235 units to clients, 12% fewer than in the same period in 2023. However, in Q4, we plan to begin handing over units in a large number of projects, and we expect that 2024 will end with better handover results than 2023, when we delivered 3,831 units. All our construction projects are being completed on schedule.
Piotr Ludwiński, Sales Director at Archicom
Analyzing sales results from recent months, we observe a stable upward trend that accelerated towards the end of Q3. The sell-out ratio is currently about 17 months. This means apartments are disappearing from the market faster than new developments are being completed. The full development process now takes an average of 18 to 24 months. Despite reports of market slowdown, the data proves that it remains active. A good example is Wrocław, where, despite reports of lower sales than last year, the market offering continues to sell relatively quickly. Additionally, at Archicom, we are seeing a shift in customer profiles. High interest rates are pushing some buyers to use cash instead of mortgages, which helps us maintain stable sales regardless of the availability of government programs. In Q4, we aim to maintain the current trend, despite the challenges posed by the market environment, prioritizing the adjustment of our offerings to evolving customer expectations.
Piotr Zyska, Sales and Analysis Support Department Leader at PROFBUD
In Q3 2024, our sales performance was comparable to previous quarters. We continued sales in projects nearing completion, such as the Goslove Estate in Warsaw’s Gocław and Złota Oksza Estate in Ursus. These locations still offer apartments with various layouts and sizes, which will soon be available for occupancy, making them a great opportunity for customers who want to move into a new home quickly.
In Q4 2024, we plan to increase sales levels, made possible by a diverse offering, including apartments in the prestigious Primo IV project in Łódź and energy-efficient homes in our eco-friendly Gaia Park development in Konstancin-Jeziorna. Additionally, the introduction of a new, exceptional project in the Warsaw metropolitan area will contribute to the continuation of the positive sales trend this year. We will provide more details on this project soon.
Tomasz Kaleta, Managing Director of Sales and Marketing at Develia
In the first three quarters of 2024, we sold 2,700 units, a 31% increase compared to the same period last year, bringing us closer to achieving our annual sales target of 2,900–3,100 units. We plan to meet or slightly exceed this goal. We are pleased with this result, especially considering the current, somewhat challenging market conditions.
In Q3 2024 alone, we sold 751 units compared to 875 in the same period in the record year of 2023. Most of the sales were in the Centralna Park and City Vibe projects in Kraków and Bemosphere in Warsaw. Comparing Q3 developer sales results across the six largest urban areas with Q2, a slight decline is visible, which is also reflected in our performance. We expect the current trend to continue in Q4, with more significant market changes likely coming with the anticipated interest rate cuts forecasted for 2025.
Our key advantage remains our diverse portfolio of projects in Poland’s largest cities, tailored to the needs of different buyer groups. In the final months of the year, we aim to focus on preparing an attractive offering that will provide a solid foundation for strong sales next year. Our priority for Q4 is also the handover of apartments, which is progressing according to the schedules of our projects.
Magdalena Gosk, Sales Leader at BPI Real Estate Poland
In Q3 2024, the real estate market experienced the typical seasonal slowdown in apartment sales during the summer. As expected, customer activity was lower during this period. However, as September arrived, we noticed a clear revival, confirming the return of customers who had postponed their purchase decisions until after the holidays. While we observe a prolonged decision-making process among buyers, interest
in our offerings remains high. We are optimistic about the coming months and expect this trend to continue. Customers are particularly interested in our portfolio’s projects that are ready for occupancy, such as the Bernadovo project in Gdynia, Czysta4 in Wrocław, and Panoramiqa in Poznań, where units are available for viewing and immediate move-in. This offers potential buyers a valuable opportunity to quickly move into a new home, which is highly appreciated in the current market.
Source: https://managerplus.pl/sytuacja-na-rynku-mieszkaniowym-deweloperzy-oceniaja-sprzedaz-w-iii-kw-2024-r-82882
