Poland: Sales of new flats on major markets down 7% q/q to 12.4k in Q1 2024

Sales of new flats on Poland's seven largest markets totalled just under 12.4 thousand units in Q1 2024, down 7% q/q and up 14% y/y. Meanwhile, developers launched 15.9k units, up 6% q/q and 120% y/y, according to Otodom Analytics. As a result, at the end of March 2024, 43,000 units were available in development condition, nearly 17% more than just three months earlier.

In the last quarter, among the seven largest markets, it was Poznań and Wrocław that recorded the strongest increases in the offer of new flats for sale, 45% and 36% respectively. It is worth noting that for the capital of Greater Poland this is a record, as never before have so many developer flats been on offer there.

In Krakow and Łódź, the increase in the number of available flats was less than 20%, and in Warsaw - 8%. There was virtually no change in the Tricity, while Katowice saw a drop of 3%.

"However, the situation in Łódź, where there is a threat of oversupply, needs to be monitored all the time. The 8,100 flats currently available is the second largest offer in the country, standing out strongly above other large cities, apart from Warsaw, of course. At the same time, the market ranks only sixth in terms of sales. On the other hand, Poznań has now jumped onto the podium, offering more new flats than Krakow, the Tri-City and Wrocław," said Marcin Krasoń of Otodom Analytics.

In Q1 2024, the largest number of developer flats were sold in Warsaw, i.e. almost 4.2 thousand, 2% less than a quarter earlier and 8% more than in the previous year. Sales increases were recorded in Łódź, Katowice and Poznań, by 89%, 66% and 57% respectively. In contrast, the only city surveyed where sales fell over the year - by nearly 20% - was Krakow, it was also reported.

"Although we can speak of a slight calming of flat prices recently due to a larger offer of available developer units and a slight slowdown in sales, these are still significant increases in the annual perspective, ranging from 9% in Katowice to 20-25% in Krakow and Łódź. A modest quarterly correction in two cities does not yet mean a reversal of the upward trend. Potential buyers of new premises are waiting for the next government subsidy programme. They can also count on the reduction in inflation to be followed by falls in interest rates and interest rates on available loans," Krasoń pointed out.

According to analysts, although prices have stopped "galloping", this does not mean that they will not rise.

The problem with access to land is not going away, and the temporary advantage of supply over demand is too modest for developers to universally start lowering rates. Although the entry into force of the amendment to the regulation on technical conditions to be met by buildings and their location has been postponed, it is inevitable and there is no doubt that these changes, which assume, among other things, a dilution of development, will stimulate price increases. At the same time, the decline in lending is still balanced by active investors, who are not lacking not only in the largest cities.

The data includes the markets in Warsaw, Krakow, Wrocław, the Tricity, Poznań, Łódź and Katowice.

Source: Otodom and ISBnews