Real estate prices are not only about the greed of developers. There is a shortage of apartments on the market

– When interest rates began to rise in 2021, driving up loan costs, the group of people ready to buy an apartment shrank. Seeing this situation, developers had to put many investment plans – even those that were close to the first shovel – into their pockets and give up on construction, focusing at the same time on selling what was already ready. The result is easy to predict: in 2022 and 2023, fewer apartments appeared on the market than before.

Fewer building permits, fewer investments started

Some data: from the beginning of January to the end of July 2022, permits were issued or construction notifications were made for 192.8 thousand. flats, i.e. by 3.9 percent. less than in the corresponding period of 2021. Permits to build the largest number of apartments were granted to developers (131.5 thousand, an increase of 4.1 percent y/y) and individual investors (58.4 thousand, a decrease of 18.8 percent). The start of this year wasn’t much better. in February 2023, developers started working on the construction of almost 6.6 thousand meters. premises. This is almost 42 percent. less than in the second month of 2022. In February by over 38 percent. (compared to the previous year’s result), the number of building permits issued to developers also decreased. Only 10.7 thousand of them were issued. in February 2023.

In fact, only recently developers dusted off the projects and returned to the construction site. However, we will have to wait for the result. The consequence is an insufficient number of apartments, which in the context of growing interest in real estate (“Safe 2% loan” combined with falling interest rates, which will affect the amount of monthly installments) increases their prices.

There is a shortage of apartments from developers on the market

In August, the average price per square meter of flats offered by Krakow developers approached PLN 15,000. PLN per square meter and was higher than in Warsaw a month earlier.

Data from BIG DATA RynekPierwotny.pl show that the prices of apartments offered by developers in Krakow increased by as much as 5% on average in August. per square meter. Despite this, the capital did not allow itself to be pushed away from its leading position. The average price per square meter increased by as much as 6%. Thus, it more than exceeded the threshold of 15,000. zloty.

Ekexpert of the portals RynekPierwotny.pl and GetHome.pl estimates that the growing average price of a square meter is mainly the result of the shrinking supply of apartments. Data from BIG DATA RynekPierwotny.pl show that at the end of August the offer of Krakow development companies was as much as 44%. fewer apartments than eight months ago! In Wrocław, the offer of premises shrank by 37% during this period, in Warsaw – by 34%, and in Tricity – by 37%.

Two-room apartments sell out the fastest

Flats from the “popular” segment are disappearing from the market the fastest: two-room apartments at a price of up to PLN 10,000. PLN per m². The interest in them is visible in the sales results. In Krakow, where the average price per square meter increased the most, the offer of premises priced below PLN 10,000 PLN shrank from 21%. up to 6 percent (in July it was 12%). However, the percentage of apartments priced above PLN 15,000. PLN per meter increased from 18%. up to 42 percent (in July – 34%). Spectacular changes in the price structure of developers’ offers were also noted, among others, in Warsaw and Tricity. It can be assumed that as early as September, apartments with prices below PLN 9,000 will disappear from the offers of Warsaw and Krakow developers. PLN per m² – we read in the analysis of the RynekPierwotny.pl website.