With prices still on the rise, buyers of apartments in Poland are adopting a realistic approach rather than wishful thinking in finding a property. The most noticeable change in purchasers’ preferences is that prospective buyers now tend to accept a smaller property and have a larger budget prepared.
- The factor which had the greatest impact on the behaviour of people looking for apartments was the rapidly increasing prices (on average in Poland at a rate of approx. 14-15% y/y).
- The largest group, 39% of buyers, are still looking for two-room apartments. However, this is almost 8 p.p. down on five years ago. At the same time, interest in studio apartments has been continuously growing in all four surveyed markets since 2020.
- Regardless of the preference for the number of rooms, all groups of buyers (investor, single, couple, family) saw a further decline in expectations of the minimum floor area.
- Those looking for residential units are setting more realistic budgets. In all four cities, the maximum declared budget of each group of buyers increased significantly in 2021. On average, from 12% in Warsaw to 18% in Kraków.
- During the year, the share of people accepting a size in the range of 30-39 sqm in sought-after units increased from 36% in Q4 2020 to as much as 47% in Q4 2021.
- Around 60% of singles, couples and families want to take out a mortgage when purchasing an apartment. Among investors, however, the figure was only 36%. Purchases for cash relate mainly to the smallest floor areas.
Buyers of apartments measure their strength against their intentions
Although last year’s demand in the housing market was close to a record high, the rapid increase in house prices in 2021, combined with rising interest rates, are having a detrimental impact on the purchasing power of those looking for a new place to live. As a result, we have seen a further fall in expectations for metros (apartments in a metropolitan area). Approx. 60% of people declaring their intention to buy an apartment for their own use want to take out a mortgage. However, because of an increase in the costs of this type of financing, the creditworthiness of customers is on the decrease. Hence, it should also be assumed that the actual budget finally available to buyers in the fourth quarter of last year was lower than declared,
comments Anna Karaś, senior consultant at the Housing Market Research Team.
It is worth noting, however, that in individual cities, the budget varies markedly. We have observed that the lowest budget for apartments is in Wrocław and the largest in Warsaw. This gap can be up to 30%. The higher the preferred number of rooms, the greater the variation in the declared maximum price,
points out Katarzyna Kuniewicz, Head of Residential Research w obido (Grupa OLX).
Smaller apartment or move further out?
In the last two years, however, we have observed a decrease in buyers' expectations regarding the area of an apartment they are interested in, although this tendency concerns one-room units to a small degree. In the case of two-room apartments, the change is 1.3 sqm when comparing Q4 2021 to Q4 2020, while in the case of four-room units it has already fallen by as much as 7.1 sqm. In the case of two-rooms and above, the largest units are still sought after in Warsaw, and the smallest in the Tri-City,
says Aleksandra Gawrońska, Head of Residential Research at JLL.
By closely examining the factors that are important for people looking for housing, we have been able to see a clear shift. In Q4 2021, the percentage of buyers willing to choose a peripheral location increased among couples to 41% (+16 p.p.) and to 48% among families with children (+15 p.p.). Looking at individual cities, the biggest increase in interest in the suburbs over the last two years was recorded in Wrocław – up by 14 p.p. (to 43%) and Warsaw up by +10 p.p. (to 37%). In the Tri-City, the share of people willing to move to areas away from city centres was already high, as it exceeded 40%, so the change was not as pronounced here. In Kraków the number of declarations indicating interest in the city’s most distant districts increased by 7 p.p.,
explains Katarzyna Kuniewicz, Head of Residential Research w obido (Grupa OLX).
