The presidents of development companies discovered the cards. They talk about the challenges and housing prices

The latest data from the European statistical office a few days ago showed that during the year housing prices in Poland, they increased by an average of almost 9 percent. This result is at the level of the average in the entire European Union.

In the real estate market, rates are increasing every year and it will also be so in 2022. There is no chance of changing this trend. The presidents of leading development groups in Poland have no doubts about it, although they suggest that the scale of the increases may be smaller than in the previous year.

– It is difficult to predict the behavior of the market in 2022, but we expect increases of several percent – he admits in an interview with money.pl Zbigniew Juroszek, president of Atal and one of the richest Poles.

See also: Money. It counts

The president of Polnord, Tomasz Łapiński, who is also the managing director of residential investments in Cordia Polska, is more precise. Expects that a square meter of an apartment may become more expensive by 3-5 percent. per year.

– According to our estimates, the prices of flats in the largest Polish cities will continue to grow, but they will not be as dynamic as in the last two years – he emphasizes in an interview with money.pl.

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Tomasz Łapiński estimates that no records in terms of sales volume or the number of new ones should be expected either investment housing. Notes that in the past year in the largest cities in Poland there were more apartments sold than those introduced to the market.

– Given the limited availability of land as well complex and lengthy administrative processes, one should not expect it to be any different this year – indicates.

Problems with land for housing

It is precisely the limited availability of land that is indicated as one of the main challenges facing the development industry in 2022.

The choice of attractive plots of land is decreasing, which means that their prices are also higher – explains president Juroszek. He admits that his company has an adequate land bank and is secured for the next 3-4 years, so he feels stable. However, many developers cannot say the same.

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President Łapiński makes use of hard statistics. They show that in the third quarter of 2021, the number of new apartments available in the six largest Polish cities fell by as much as 26 percent. per year.

– This year in the largest Polish cities, in the absence of new investments, the offer would sell out faster than in 12 months – judges.

Inflation affects developers

– Adapting to high inflation will also be quite a challenge. The more so because the developer takes the risk of more expensive materialsbecause the customer has a guaranteed fixed price after signing the contract – indicates the boss of Atala.

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He adds that the highest increases in the prices of building materials were in the first half of 2021 and he expects that in 2022, the dynamics of price growth will be lower.

Polnord and Cordia also take into account the risk of constant price pressure from contractors. In addition, in 2022, the list of factors that will generate additional costs on the developer’s side and, consequently, affect the increase in apartment prices, are also added by Development Guarantee Fund. From July, developers will pay 1 percent to it. gross prices for each payment for a sold flat or house.

A flat on a loan will be more expensive

Tomasz Łapiński is expecting cooling down the demand for housing. He believes that important purchasing decisions will be more difficult for consumers due to lower creditworthiness and fear of rising loan costs.

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– It will be influenced, inter alia, by increase in interest rates and reduction of the income of certain groups of consumers in connection with the tax regulations of the Polish Order – indicates the president of Polnord.

Zbigniew Juroszek points out that the first months after the interest rate hike did not have any significant impact on the sale of apartments by his company. However, it does not rule out that this effect will be visible in 2022. Especially that the risk of further interest rate increases – as he points out – is considerable.

– For sure the period when money is cheaper is good for developersbut it is also not the case that the industry will not cope with higher rates. There will be companies that will actually feel it, but there will also be companies that will successfully find themselves in the new reality – he emphasizes.

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