Krakow breaks the bank: within a year, apartment prices increased by 28%. Prices continue to rise

Within a year, apartment prices in Krakow increased by 28%. In Katowice, prices went up by 23 percent, in the Tricity by 19 percent, in Warsaw by 18 percent, and in Poznań – by 13 percent. during the year. Apartments are becoming more expensive because there are too few of them, and this in turn results from the fact that over the last two years developers have been building less than they originally built. Today, some customers can use the “Safe 2% loan”. and they hope for lower monthly installments, but they pay more than a year ago and the average salary increase does not compensate for this. And this is not the culmination of the price increases.

In the first four months of 2023, the number of apartments put into use was 3.1%. higher than a year earlier in the same period. In the same period, construction starts increased by 27.7%. fewer apartments. In turn, the number of building permits or applications increased by 32%. less. The third quarter was already better in that developers see “light at the end of the tunnel” and have the right to assume that the number of apartments sold will increase, thanks to the “Safe 2% Credit” loan subsidy program in force since the beginning of July. and decreasing credit costs. Two reductions in interest rates mean that already in December, current borrowers who have a 3M loan (i.e. with an interest rate updated every 3 months) will pay lower installments. In turn, borrowers will pay less at the very beginning than they would have paid if they had bought an apartment in spring or summer.

Prices go up by a dozen or even twenty percent during the year

Therefore, interest in purchasing an apartment is growing, but prices in large cities are a bucket of cold water. In several voivodeship capitals the price exceeds PLN 10,000. zloty. Expander’s data shows that in August in Poznań you had to pay PLN 10,500 per sq m, in Gdańsk PLN 11,300 and in Wrocław PLN 11,700. The most expensive were in Kraków (PLN 13,300) and Warsaw (PLN 14,482).

The August ceilings are no longer valid, September brought new records.

Krakow is characterized by the highest growth dynamics: within a year, apartment prices there increased by 28%. In Katowice, prices went up by 23 percent, in the Tricity by 19 percent, in Warsaw by 18 percent, and in Poznań – by 13 percent. during the year. This is all data from the RynekPierwotny.pl and Gethome.pl websites.

– In September, another threshold was crossed – 15,000. zloty. However, Warsaw still refuses to be pushed away from its leading position. Last month, the average price per square meter here exceeded the threshold of PLN 16,000. zloty – written by RynekPierwotny.pl and Gethome.pl expert Marek Wielgo.

In Krakow, the number of premises “shrank” by almost 50% in 9 months.

The supply problem has most likely deepened there. Preliminary data from BIG DATA RynekPierwotny.pl show that in Krakow at the end of September, the offer of development companies was as much as 49%. fewer apartments than nine months ago! However, in Warsaw the offer of premises decreased by 40 percent during this period.

The Tricity is still in third place on the price podium, although after sudden increases in the average price per square meter in July and August, September brought a 2% increase. reduction. Let us add that the offer of apartments in Tricity decreased by 25% over the year, but in September it increased compared to August. And this is probably the reason for the decline in the average price of apartments available from Tricity developers.

Subsidies will not help when there is a housing shortage

As long as there are few apartments on the market (and as developers have greatly limited construction in 2021 and 2022, it will take many quarters to make up for the losses), prices will continue to rise.

– In the third quarter, one of the main problems of the housing market was a further decline in the number of offers. When we consider all the advertisements for apartments on the secondary market that were published on Nieruchomosci-online.pl, we can see that the number of advertisements decreased by 14%. q/q In turn, compared to the beginning of the year, the number of advertisements is approximately 20 percent lower. less. Smaller apartments and unpriced offers disappear almost immediately. Unfortunately, in many local markets, new ads appear sporadically– said Rafał Bieńkowski from Nieruchomosci-online.pl.

According to the Nieruchomosci-online.pl survey, which was conducted among intermediaries after the third quarter, over 80 percent were more interested in apartments. real estate agents. However, this did not always translate into completed transactions. In other words, the increase in interest in the real estate market was visible primarily on advertising portals. When we compare the third and second quarters of this year, the number of contacts with advertisers via Nieruchomosci-online.pl was higher by over 39%. And it is now reaching 2021 levels, which were the result of near-zero interest rates at the time.

– In the third quarter, along with greater activity of searchers, the average offer prices of second-hand apartments also increased. Many sellers raised their expectations, believing that the beneficiaries of the “Safe 2% Loan” would contact them. However, it cannot be said that the higher prices were solely the result of greater demand caused by BK2%. An important factor was the shrinking supply. Sellers saw that there was a lack of offers on the market and therefore they raised prices. There are also those who based their valuations on speculations that real estate prices would increase and thus the price spiral continued. Let’s not forget about another important relationship: cheaper apartments disappear from the market most quickly, which means that more expensive ones remain on offer, and this also increases the reading of average offer prices –added Rafał Bieńkowski from Nieruchomosci-online.pl.