Experts: House prices await stabilization

In the coming months, house prices are expected to remain at their current level, experts predict. They indicate that the market is waiting for a recovery in mortgages; an impetus can be a government-subsidized soft loan program.

Experts unanimously list the key factors that have been decisive for the real estate market over the past year: the war and the resulting influx of refugees, high inflation, rising interest rates and a change in the recommendations of the Polish financial supervisory authority, which led to a drastic decrease in the creditworthiness of potential apartment buyers.

“If the outbreak of the pandemic and the initial uncertainty were completely alien phenomena and difficult to translate into possible scenarios for the real estate market, the military operations in Ukraine have shown that the real troubles may just be beginning. First of all, the first effects of the war were visible on the rental housing market The constantly increasing prices of rental apartments started to grow sharply due to the unexpectedly high demand for rent, noted Metrohouse expert Marcin Jańczuk. He added that currently the situation on the rental market has stabilized, but in any case compared to the beginning of the year we can speak of an increase in rates of around 20 percent on average.

When it comes to apartment purchase prices, it was a two-speed year – emphasized Otodom Analytics expert Marcin Krasoń. “Prices were still rising until the spring, but then they stopped. Year after year, we can see increases—on average, 5 to 10 percent, but if you look back just six months, they’re minimal,” he said. .

Jańczuk added that since the middle of the year there have been fewer and fewer clients entering the real estate market. “Either they have completely lost their creditworthiness or the current creditworthiness remains at a level which makes it impossible to purchase real estate of interest to the client. Regardless of the reason, everyone monitors the market, as evidenced by the unexpectedly good ratings of portals advertising, and is waiting for the right moment to enter the market” – noted the expert from Metrohouse.

Analysts reserve that it is difficult to predict how the market situation will develop next year, because there are too many variables. In their view, at least in the coming months, house prices should stabilize at their current level.

“I believe that the next few months will not bring particular twists and will be marked by the persistence of a certain stagnation in prices on the real estate market, or taking into account high inflation, a real drop in real estate prices. Certainly the situation will change depending on the segment market. Currently, much smaller “Interest is in the real estate market and perhaps a reduction is to be expected here. The condition of the real estate market in recent years has been excellent, but let’s remember that a very liquid product is not on sale, and the cost of maintaining such a property has a big impact on customers’ decisions” – underlined Jańczuk.

“Since spring 2022, there has been a stabilization in terms of apartment prices and I expect the first part of the year to continue this trend. During the stabilization period, fluctuations of several percentage points in individual markets are a phenomenon real estate located in even the unattractive localities will lose value, expensive to maintain, but this is a normal market phenomenon” – added Krasoń.

As he pointed out, we are facing a difficult year, which after many years of prosperity is an obvious phenomenon. At the same time, she emphasized that sales can be made even in difficult times: data from Otodom Analytics shows that the fourth quarter of 2022 was better in terms of sales than the second and third quarters in many cities.

«The market is still waiting for a recovery in mortgages, the 2% Safe Credit program may be an impulse, but it will create another statistical confusion. Those eligible will abstain from shopping until the program goes into effect, which means that the second quarter of 2023 may be weak again, but in the third quarter this cumulative demand will come out to the world. cut), then this accumulation of demand will inevitably lead to an increase in prices” – assessed Krasoń.

Jańczuk stressed that in the current situation, developers will limit real estate investments and wait for a stimulating signal from the market. “Information on the development of the loan subsidy program can be such information. In this case, the price limits per square meter do not apply, which should contribute to the increased popularity of the program” – said the expert. (PAP)

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