According to the data of Narodowy Bank Polski (NBP), the dynamics of average transaction prices in the primary market for the 7 largest cities in Poland (Gdańsk, Gdynia, Łódź, Kraków, Poznań, Warsaw, Wrocław) amounted to 15.6% y/y in Q4 2021 which was the fastest growth rate since Q1 2018. Thus, the transaction price exceeded PLN 10,000. PLN per m2.

Credit Agricole analysts forecast that housing prices will increase both this and next year. According to them, the growth rate of housing prices in the primary market will decrease to 9.8% y / y on average in 2022 compared to 11.1% in 2021.

In 2023, it is expected a slowdown of the growth of housing prices to 7.8% y / y, and a stabilization of price dynamics at the level of 8.3% in the years 2024-2025. This means that the average transaction price in the aforementioned seven cities will increase from 9.600 PLN on an annual average in 2021 to 10.500 annually in 2022, to 11.300 PLN in 2023 and then it will increase by another 1000 PLN in 2024 and 2025.

In their forecast, analysts assume that the growth rate of the prices of building materials will accelerate in Q2 this year. to circa 40% y / y, compared to 28.3% in Q1. By 2022, material prices will grow slower and slower due to the expected end of the war in Ukraine and the easing of supply barriers.

At the same time, they point out that the factors of uncertainty for their forecast are the strength of the impact of higher interest rates on the demand for and prices of flats, with the probable simultaneous limitation of their supply by developers. The scale of the impact of the war in Ukraine on the housing market is difficult to precisely estimate. The outflow of Ukrainians hitherto employed in Poland (often in the construction industry) will contribute to an increase in housing construction prices, and at the same time, the inflow of new refugees will increase the demand for apartments.

Adrian Andrzejewski