More permits, but there is no one to fight for. NBP summarizes the market situation

In the second quarter of 2024, 74.3 thousand building permits were issued. apartments – more than a year ago. Last year, or rather its second half, will be remembered by real estate analysts as a time of crazy and very quick apartment purchases. This was related to the existence of a loan subsidy program. This year, none were introduced and this explains the low interest.

The National Bank of Poland summarized the situation on the real estate market in the second quarter of 2024. At that time, 74.3 thousand construction permits were issued. apartments, which means an increase of approximately 7.6%. quarterly and 23.8 percent on an annual basis. Construction of 62.3 thousand square meters has started. apartments (more by approx. 3.7% q/q and an increase by approx. 32.5% y/y).

However, demand measured by the number of development contracts sold decreased. An interesting fact is that buyers financed more purchases with cash (this was the case with approximately 59 percent of transactions).

Real estate prices are rising

NBP notes that the nominal average transaction prices per square meter of apartments increased on primary markets, especially in Gdynia and Poznań. Similar trends occurred on secondary markets – quarterly nominal price dynamics were particularly high in Gdynia and Wrocław.

The level of average rental rates per square meter of apartments (excluding service and utility fees) increased during the quarter in Warsaw and slightly in 6 cities, while a slight decrease was recorded in 10 cities. The estimated cost of servicing a housing loan was higher in relation to the cost of renting an apartment due to the level of interest rates and rent rates.

Real estate prices in autumn 2024 – what’s happening on the market?

Why is the price of new apartments rising despite discounts and promotions? Warsaw is a perfect example. The website TableOfert.pl analyzed almost 10,000 offers and almost 200 investments and noticed that:

cheaper apartments within a given investment sell better, and more expensive ones are offered, which increases the price of the entire investment,
cheaper investments are sold, so their share in the offer decreases, which increases the price of the entire offer on the market,
above all, projects with prices higher than the current offer enter the market.

So how do we explain the overall price increase? It’s an effect of statistics. In recent weeks, developers have introduced so much more expensive apartments that they have increased the overall rate.

The largest increase in the average price was recorded in Kielce (+7.0%), Kraków (+4.3%), Wrocław (+2.1%), Gdynia (+0.9%) and Poznań (+0, 2%), where projects in more expensive locations were put on sale. It was similar in large agglomerations – Kraków (excluding Kraków: +2.5%), Tricity (excluding Tricity: +1.5%) and Silesia (excluding Katowice, Chorzów, Gliwice and other cities with county rights: +1.0% ). We write more about it here.