Primary residential construction market in Poland

Primary residential construction market in Poland

The housing market consists of all residential buildings that are used for permanent residence. According to the latest data published by Statistics Poland on housing construction, in the period from January to March 2021 the number of apartments completed was higher than the year before. Looking at the statistics from recent years, we can see that these numbers are still growing.

In this article, we analyse what the primary residential construction market in Poland and Europe looks like and how it is changing over recent years.

The primary residential construction market in Poland

New, unused apartments, houses, or commercial premises are buildings that fall within the definition of the primary construction market. The purchase of the real estate in this segment of the construction market means purchasing it directly from the investor (developer or cooperative). In the first quarter of 2021, both developers and individual investors completed 57% and 40.8% of the total number of apartments, respectively. In turn, throughout 2020, developers built 64.6% of all newly completed apartments, and individual investors – 33.5%.

The situation on the residential construction market in Poland

The report published by Statistics Poland shows that in the period January-March 2021 53.3 thousand apartments were offered for use. It is 7.4% more considering the data from the previous year. The average usable area of a newly commissioned apartment was 95.5m2 in this period of 2021, while in 2020 this parameter reached the value of 88.5m2.

In the first quarter of 2021, the construction of 63.7 thousand apartments has been started (it was by 21.2% more than in 2020). It is worth paying attention to the prices on the residential market in Poland. From year to year, the prices for 1m2 of usable floor space of a residential building are gradually increasing. According to data from Statistics Poland, in the second quarter of 2019, the price per 1m2 was PLN 4,484, while in 2020 it was PLN 5,000, and in 2021 it was already PLN 5,112.

Residential construction by Polish voivodships

Considering three key values (the number of completed apartments; the number of apartments for which construction permits have been granted or notified with a construction project; the number of apartments whose construction has just begun), the largest numbers were recorded in Masovia voivodship (respectively 10.6 thousand, 13.2 thousand, and 9.2 thousand apartments). High values were also recorded in the following voivodships: Greater Poland (5.7 thousand, 9.3 thousand, and 8.4 thousand), Lower Silesia (5.3 thousand, 7.2 thousand, and 5.5 thousand), Lesser Poland (4.7 thousand, 6.7 thousand, and 5.6 thousand) and Pomerania (4.6 thousand, 9.1 thousand, and 6.2 thousand).

Residential construction in Poland compared to other European countries

According to Eurostat, by the fourth quarter of 2019 apartments offered on the primary market in Estonia went up by +7% q/q, in Portugal by +6% q/q, and in Spain +5.2% q/q. On an annual scale, developer prices of apartments increased the most in Luxembourg +19.2% and Estonia +12.1%, while in Poland +6.5%. On the other hand, a decrease in annual terms was noticeable in the primary market in Sweden (-0.3%) and Croatia (-1.2%).

Despite the crisis related to the coronavirus pandemic and the related restrictions, the popularity of the real estate sector in the economy continues to grow. It is worth noting that the current global situation has practically not negatively affected the residential market, on the contrary – the key indicators are growing.

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Sources:

Obiekty budownictwa mieszkaniowego i ich klasyfikacja (Housing construction objects and their classification), www.cenabiznesu.pl.

Rynek pierwotny czy wtórny? (Primary or secondary market?), Jarosław Jędrzyński, www.rynekpierwotny.pl.

Budownictwo mieszkaniowe w okresie styczeń-kwiecień 2021 roku (Residential construction market in the period of January-April 2021), Statistics Poland, www.stat.gov.pl.

Budownictwo w 2020 roku (Construction in 2020), Statistics Poland, www.stat.gov.pl.

Cena 1m2 powierzchni użytkowej budynku mieszkalnego oddanego do użytkowania (Price of 1m2 of usable floor space of a residential building completed), Statistics Poland, www.stat.gov.pl.

House price index, Eurostat, www.ec.europa.eu.

Eurostat: Polski rynek wtórny drożeje najszybciej w Unii Europejskiej (Eurostat: The Polish secondary construction market is the most expensive in the European Union), Marcin Kaźmierczak, www.bankier.pl.