Owning a house remains a dream for many Poles. However, the cost of construction is high and rising, which affects the number of building permits issued. This number has been increasing but is significantly lower than during the pandemic. According to experts from Extradom.pl, the cost of building 1 m² of a house significantly exceeds PLN 5,000 net, and in Warsaw, it is likely to exceed PLN 6,000 by the end of the year. Moreover, they expect that with the start of investments from the National Recovery Plan (KPO) and rising energy prices, construction materials will begin to increase in price at a faster pace, which will affect the cost of building houses.
Many investors are choosing projects with significantly smaller footage than a decade ago. This is also influenced by demographic trends, especially the change in the dominant model of the Polish family to 2+1. Another argument for a smaller property is the high costs of its later maintenance, such as energy and heating.
“Poles most often choose small buildings, from 80 to 110 m² of usable space. There is slightly less interest in larger houses with an area of 130 m². Ground floor houses are the most desirable – this is a constant trend that makes up 60% of the market, although there is a growing interest in houses with a full floor, but this is still a margin – 5.5% on the market. The most popular houses have a living room and three-four rooms. They make up 75% of the chosen house projects”, comments Wojciech Rynkowski, expert from Extradom.pl.
Poles are saving not only on rooms but also on garages located in the building. More and more often, new houses can be found that do not have this room at all. “More than half the investors completely give them up, assuming that they will later build a carport or garage at a convenient time for them. The people who actually decide to have a garage are usually a bit wealthier and then they choose houses with two parking spaces”, observes Wojciech Rynkowski. The optimization of costs is also visible in the construction of roofs in newly built houses. According to calculations by Extradom.pl, three-quarters are gable roofs, which are definitely cheaper than more complicated shapes. It is also easier to arrange rooms in the attic and illuminate them with natural light.
Based on Sekocenbud’s data, the Extradom.pl expert calculated the costs of building a house in Q2 this year. The example used was a single-family house with a usable area of ​​151.6 m² in silicate block technology, with a single garage.
“The most expensive place is traditionally Warsaw. The cost of building 1 m² of a house at the end of Q2 2024 was PLN 5.9 thousand. The cheapest is Lubuskie, where it is about PLN 5.32 thousand. Apart from Warsaw, the most expensive region is Mazowsze, which is the natural hinterland for the capital and there prices amount to PLN 5.73 thousand per meter. Considering that every investor has individual opportunities to deduct VAT or take advantage of tax reliefs, each time it’s a net amount,” explains the expert.
On a quarterly basis, costs have slightly increased – from a little over 1% in Wielkopolska to 5% in Warmia-Mazury. However, over the years the increases are significant.
“Since the beginning of 2021, we have seen quite significant increases in the costs of building houses. The most in the Kujawy-Pomerania – by almost 53%, the least in West Pomerania – by 30%. However, we also need to look at the inflation we had to deal with during this period. If we calculate it as compound interest, because unfortunately that’s how inflation works, it amounted to 25-27% depending on how to count. This means that basically in these provinces where the increases were the smallest, we actually only had a price adjustment taking into account inflation, while in Kujawy-Pomerania we had a significant increase of over 20%”, explains Wojciech Rynkowski.
According to the expert, the cost of building houses will not increase significantly until the end of the year, as there are no economic premises. These will rather be changes at the level of 2-6%, depending on the region. However, this means that in Warsaw, the amount of PLN 6,000 net per 1 m² will probably be exceeded.
“For some time now, I have been observing a trend, which consists in leveling the costs of construction across the entire country. Individual provinces are ‘chasing’ Warsaw. When I started tracking construction costs three years ago, the difference was over 20%, and now the difference between the cheapest region of the country and Warsaw is less than 12%. This process has slowed for now, but it was clearly noticeable”, says the Extradom.pl expert.
According to data from Grupa PSB, in July of this year, the prices of construction materials were -0.9%: in the retail channel they were lower by 1.7%, while in the wholesale they increased by +0.2%. Data from the whole half of the year also indicates slight price drops, but this could soon change. Experts are cooling the optimism of people counting on a lasting downward trend.
“I expect that prices will start to rise soon,” adds Wojciech Rynkowski. “This results from two reasons. First, the prices of construction materials are highly dependent on energy prices, as many of them are energy-intensive in the production process. The second issue is that soon, large projects financed from the National Recovery Plan will probably start, and large quantities of concrete, steel, cement, and aggregate will be needed for their construction. Therefore, one could say that the end of 2024 is a good moment to start building a house, because I expect that the prices of construction materials and the wages of construction crews will also rise.”
