The summer in the real estate industry was marked by a relative stability in prices and a gradual increase in the number of offers. Can we still hope that the government’s support program will have a real impact on this sector? Where is the sale of apartments highest? What are developers expecting at the moment? We decided to investigate.
Back to Balance
After the turbulence related to last year’s “Safe Mortgage 2%”, which brought a significant increase in real estate prices and a dramatic decrease in supply, the sales of apartments slightly dropped in the first half of this year in comparison to the second half of 2023, and the increase in prices slowed down. These trends had their continuation in the third quarter.
The past few months have been a time of normalization – gradual rebuilding of the offer, especially in big cities and creation of new investments. Banks are once again granting more and more standard housing loans. A slight rebound is taking place. However, developers’ main problem is still the poor availability of land for investment, which prevents full supply and demand balance.
“From our observations, sales in Lodz and Wroclaw are increasing. The prices in Warsaw remain stable, but this may change at the turn of the year. Many potential buyers see the current time, when the offer is quite wide and prices relatively stable, as an opportunity to look for an apartment that really meets their needs. We have a selection of larger apartments in quiet areas, usually preferred by families, as well as smaller ones in the city center, which are particularly attractive from the perspective of career-building singles, students or investors – explains Tomasz Stoga, CEO of PROFIT Development, a company that has been conducting investments in Warsaw, Wroclaw and Lodz for the last two decades.
The past quarter also saw a number of promotions aimed at encouraging potential buyers. Examples include discounts of up to several percent and flexible payment schedules, such as the 20/80 system, where the first instalment at the time of signing the contract is 20%, and the second – 80% – is only paid upon the delivery of the apartment, with a price non-rise guarantee.
Waiting for the Government Support Program
The real estate market has also witnessed some buyers holding off on their decision to finalize the purchase of an apartment due to the uncertain fate of the delayed “Start-up Housing” program. Some of those planning to buy their own “M” are still waiting, but more and more people are no longer believing in the implementation of the government’s promises or the reality of this support, and decide to buy without waiting for a possible further price increase.
The implementation of the program is currently announced for January 2025. The problem is that there is no agreement within the ruling coalition on this form of support – Poland 2025 and the Left are against the program – so it may turn out that the bill will not find majority support. It seems that the prospects of “Start-up Housing” no longer significantly impact the market. Especially for those investors who have the appropriate financial resources and are not dependent on credit possibilities, and those who buy an apartment now due to certain life circumstances. In addition, there are those who potentially would not qualify for a potential support program or even if they qualify – they fear repeating the “Safe Mortgage” scenario.
What Will the End of the Year Bring?
According to the August Developers’ Sentiment Index, which conducted a survey among 200 Polish development companies, most of them, 77%, expect further price stabilization at the current level. Only 9.9% predict an increase. Moreover, the percentage of developers anticipating an increase in sales is the highest it has been in four months. Also, customer respondents tend to agree that prices will not undergo sudden fluctuations in the next quarter.
Price stabilization, skepticism towards the government’s support program, the end of the holiday period and the increase in the availability of apartments are factors that are causing sales growth, which is already happening and will likely continue.
“This final quarter of the year will be a time for open house days, presenting current offers and preparing investments for completion. It seems that the demand will grow and we, developers, will certainly try to respond as best as possible to the expectations of our customers – ensures the CEO of PROFIT Development.
Source: https://managerplus.pl/stabilizacja-cen-i-rosnaca-oferta-co-przyniosla-koncowka-lata-w-branzy-nieruchomosci-i-czego-spodziewac-sie-do-konca-roku-36153
