November data from Otodom shows that not much happens in the rental market towards the end of the year. Demand from potential tenants in November fell by 4% month-on-month, resulting in rents remaining at October levels. We did not see any price corrections, as the activity of landlords also fell, and there were 11% fewer new listings than the previous month. However, there are indications that we can expect a rise in rental interest after the new year.
Generally, the fourth quarter of the year is a time of slowdown in the rental market and a reversal of the trend by the end of the year is not expected. Otodom Analytics data has been showing a drop in activity from both landlords and potential tenants since October. In November, 11% fewer new offers were added during the month than in October. The drop in Poznan and the Tricity was even greater than the national average and amounted to 15%. The number of closed offers and resumed offers more than twice declined. The lower by 18% month-on-month turnover level also points to a slowdown, which is the number of new offers in relation to October, but closed before the end of the month (6.5 thousand versus 8 thousand).
Lower base of rental offers and lower tenant interest
The number of available rental apartments is shrinking. In November, among the 16 provincial cities, only in Olsztyn it remained at a level similar to October. However, in other cities it fell significantly – from 6% in Szczecin, through approx. 10% in Kraków, Katowice, Tricity, Warsaw, up to 20% in Rzeszów, Kielce and Białystok and almost 25% in Zielona Góra.
“If the trends from recent years repeat, the offer of rental apartments in the largest Polish cities will continue to shrink in December and will likely fall by several or even several percent. We can expect a rebound at the beginning of the year. Many tenants then decide to change their current apartment and the premises they occupy go back onto the market.”- emphasizes Karolina Klimaszewska, Senior Analyst, Otodom.
In November, there was also a decline in interest from potential tenants. The number of searches for rental apartments was 4% lower than in October, and compared to August, when tenant activity was the highest this year – over 30%. However, compared to August, the number of viewings of searched offers and responses to them has only dropped by 4% and 16% respectively. This may indicate that although we are looking for rental apartments less frequently than during the peak season, we still intend to rent, not just find out about the market.
Prices slightly down
Lower interest from potential tenants resulted in rental prices being maintained or slightly adjusted. In November, the largest reductions were noted in Opole (-3%) and Wrocław, Tricity, Rzeszów and Kraków (- 2%). Of course, there were also cities where increases were noted, but they concerned the smallest markets in terms of offer, such as Kielce and Zielona Góra. The increase was also minimal and did not exceed 2%.
“In annual terms, the price increase dynamics slowed down to 6% in November. This is the lowest reading since September 2021, which confirms that prices are stabilizing and the rental market has returned to a state of relative balance.”- notes Karolina Klimaszewska, Senior Analyst, Otodom.
In November, a double-digit price increase year-on-year was only visible in Rzeszów and Olsztyn. On the other hand, in Kielce, Białystok, Warsaw and Lublin it was 6-9%, and in Wrocław and Zielona Góra – just 2-3%.
Waiting for the New Year’s peak
Historical data suggests that with the arrival of the new year, tenants begin to think more about changing their apartment. .Last year, just after Christmas, on December 29, the number of page views in the rental category was 80% higher than on the day before Christmas. . Meanwhile, in the first 10 days of January, it jumped by another 20%. Similar statistics were also recorded in previous years.
“The rental category usually enjoys the greatest interest from July to September. The second period of increased traffic falls at the beginning of the year. There are many indications that after the pandemic and a sharp increase in demand caused by the war beyond our eastern border, the market has returned to a known cycle. In January, we can therefore expect greater activity both from tenants and landlords.”- summarizes Karolina Klimaszewska.
