In the Cushman & Wakefield report “Apartment at the crossroads 2.0” we read that high financing costs due to high interest rates have so far been the biggest obstacle to PRS development and as a result there was a decrease in the number of transactions in the last two years. When this problem disappears, which experts expect soon, the interest of investors in PRS will increase significantly.
A turning point in the history of the development of this market in Poland was in 2017, when Resi4Rent – currently the largest PRS platform in the country – came to the market, presenting its first project on Wrocław. Plants. Since then, we have been monitoring the dynamic development of this part of the real estate market.
Resi4Rent continues to hold a leading position on the Polish PRS market. His portfolio is the largest in Poland and is constantly growing. Currently, there are three apartment platforms for rent, Resi4Rent, Vantage Rent i Life Spotholding a total of 46 percent. entire PRS market in our country.
Apartments in institutional rent
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Cushman & Wakefield / Cushman & Wakefield
– The apartment rental market in Poland is characterized by a large segmentation, it is largely controlled by private landownersand at the same time with great concentration in the largest cities – says Karolina Furmańska, housing market expert at Cushman & Wakefield.
– Official Eurostat data shows that 4 percent of the Polish population lives in rented properties, paying market rent. However, when examining the market, it is clear that these numbers are greatly underestimated. Based on the number of apartments available for rent, it is clear that the rental market is much more dynamic and larger than official estimates suggest, he said.
30 thousand new apartments
According to market sources, the rental market is likely to develop significantly in the coming years. It is planned to introduce up to 30,000 new apartments from institutional investors.
This phenomenon is not limited to organizations that specifically share PRS. Developers, who until now have focused on selling apartments to individual buyers, are also seeing rentals as an attractive source of additional income. For this reason, they are increasingly deciding to implement projects that include apartments that are only for rent.
The proportion of dwellings in rentals compared to the number of dwellings in PRS projects
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Cushman & Wakefield / Cushman & Wakefield
Even if the demand for apartment rent shows a slightly weaker dynamics than immediately after the war started in Ukraine, it is still at a high level. After a period of significant increases, we are currently observing a correction in rental prices. Nevertheless, experts predict that the rental market will continue to grow gradually in the future.
It is worth noting that occupancy in existing PRS projects remains at an impressive 98%.. This confirms the great interest of tenants and the potential of the market, which still has room for development in Poland. In the context of the ever-growing offer and continuous demand, the apartment rental sector promises to be a key element of the real estate market in the coming years.
The most active market is still Warsaw, where there are currently more than 7.5 thousand. units, and investment plans include another 9.5 thousand. building
The number of dwellings will increase systematically, and investors are getting more land to build new projects.
– Obviously it is Although there are still very few apartments from institutional landlords compared to the overall rental market, they are very popular with tenants – says Karolina Furmańska. – At the same time, rent from these organizations is widely recognized by tenants as safer and more stable – he said.
What kind of apartments do Poles rent?
As Cushman & Wakefield experts say in their report, apartments in PRS projects, like the individual rental market, are mostly small and compact. 85 percent of all apartments offered to tenants are studio and 2-bedroom apartments. The average studio area is 28 sq m, while one-bedroom apartments are 41 sq m. offers (4-room) and the average here is 81 sq m. The average for all apartments for rent in PRS projects is less than 40 sq m.
Types of PRS houses
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Cushman & Wakefield / Cushman & Wakefield
Rent as a safe housing option
Real estate market analysts indicate that an increase in the number of apartments offered by professional groups could lead to a stable rental situation in the long term. First, the presence of institutions on the rental market includes clarity and predictability – tenants can count on clear rules and service standards, which often leave much to be desired in the traditional rental model.
In addition, the professionalism of property management by institutions translates into higher comfort for residents. Flexible lease types that can be adjusted to individual needs and expectations are becoming more desirable in a dynamic market.
It is also important that the presence of institutional players in the market may favor negotiation, allowing tenants to obtain better contract terms, including lower rental rates for long-term liabilities.
Such developments in the rental market could contribute to a change in the opinion of this sector. Renting, instead of being seen as a temporary solution, can become a full-fledged, safe and secure housing option.especially for those who can’t or don’t want to get involved in a mortgage loan in the face of rising prices in the main and secondary markets.
2024-11-09 19:35:00
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