Demand for apartments low in Poland's main cities

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Edited by: peterweg Oct 19, 11, 13:04 #1

Demand for apartments low in Poland's main cities

19th October 2011

Apartments anyone? That's a question being asked by a group of six large Polish municipalities, including Warsaw, Kraków, Łódź and Poznań, after the stock of unsold apartment buildings shattered records developers would rather not know about.

Rzeczpospolita reports that more than 48,000 newly built apartments in Poland's largest cities are still sitting unoccupied, awaiting eager buyers.

The next logical question asked by analysts is whether this flooded market will cause residential prices to drop significantly. At present, prices have only fallen slightly.

http://www.wbj.pl/article-56556-demand-for-apartments-low-in-polands-m ain-cities.html?typ=pam

And there is this, Polish 2012 growth forecast slashed
http://www.wbj.pl/article-56558-polish-2012-growth-forecast-slashed.ht ml?typ=pam

WedleThreads: 24 Posts: 786 Joined: Sep 27, 11 ♂	Oct 19, 11, 13:17 #2
Great if property prices go down it will be a good time to buy again.

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Oct 19, 11, 13:35 #3

peterweg:

At present, prices have only fallen slightly.

No, they've gone down by as much as 20% in some sections of the market: you can't call that 'slight'!

Are they going to go down more? In some sections of the market I would expect so, and in other sections of the market there will be rises in prices. Fortunately for me, prices for what I want to buy haven't bottomed out yet, so I can wait another year or so and save up more for the deposit.

rt3dThreads: 18 Posts: 56 Joined: Mar 9, 08 ♂	Oct 19, 11, 15:40 #4
No, they've gone down by as much as 20% in some sections of the market: where did you gather your source of info from... PWEI

PWEIThreads: 5 Posts: 894 Joined: Jul 28, 11 ♂	Oct 19, 11, 17:08 #5
rt3d: where did you gather your source of info Comparing the prices in a particular development I was interested in a couple of years ago with what places there are going for now.

milkyThreads: 10 Posts: 1,229 Joined: Oct 26, 09 ♀	Oct 19, 11, 21:32 #6
PWEI: No, they've gone down by as much as 20% in some sections of the market: you can't call that 'slight'! In some places like Lublin, prices have 'not' gone down 'at all' yet; the sh1t has yet to hit the fan,big time. Denial has sunk deep___ but!!!, without the government's phony grants(interfering with the market when it suits Banker-developers), Prices will go down +20% this year, is my bet.

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Oct 19, 11, 21:46 #7

milky:

Prices will go down +20% this year, is my bet.

Money where your mouth is!
Specify:
city (or cities) in which prices will go down by more than 20%;
price per sq. m bands in which prices will go down by more than 20%;
flat size bands in which prices will go down by more than 20%;
the period which you refer to by "this year".

I'm willing to bet you 100zl at odds of ten to one (i.e. if you win you get 1,000zl but if I win I get only 100zl) that not even one city in Poland will see falls of more than 20% in all price per sq. m bands and all flat size bands this year and I'll bet you 500zl at even money that no city in Poland will see falls of even 10% in all price per sq. m bands and all flat size bands this year.

rt3dThreads: 18 Posts: 56 Joined: Mar 9, 08 ♂	Oct 19, 11, 22:55 #8
supply and demand will determine theses prices.. any way the article was written on the bases of newly built apartments.. are the any realistic figures for newly built houses also PWEI, where the development which you Compared depend greatly on locations could you state those locations..

AvalonThreads: 3 Posts: 814 Joined: Sep 11, 07 ♂	Oct 19, 11, 23:25 #9
milky: Prices will go down +20% this year, is my bet. Another prediction? Not a very good track record so far.

PWEIThreads: 5 Posts: 894 Joined: Jul 28, 11 ♂	Oct 19, 11, 23:35 #10
milky: my bet. Come on, place the bet you want to make! You have the odds now and the details. rt3d: also PWEI, where the development which you Compared depend greatly on locations I am talking about three specific developments in Warsaw offering flats of about 80 to 90 metres in which prices have gone down by 20%.

gazzaroonThreads: - Posts: 43 Joined: Aug 8, 11 ♂	Oct 19, 11, 23:42 #11
What have been the last 5 year drop or gain figures out of interest does anyone know?

scottie1113Threads: 11 Posts: 873 Joined: Mar 13, 07 ♂	Oct 19, 11, 23:47 #12
Talk to me about Gdansk. Newly built blocks of flats have have down a little, but not in the Old Town. Care to talk about that?

gazzaroonThreads: - Posts: 43 Joined: Aug 8, 11 ♂	Oct 19, 11, 23:49 #13
scottie1113: Talk to me about Gdansk. Newly built blocks of flats have have down a little, but not in the Old Town. Care to talk about that? I would suggest that some cities will see a fall and some will not depending on geographic and so on.

PWEIThreads: 5 Posts: 894 Joined: Jul 28, 11 ♂	Oct 20, 11, 00:33 #14
gazzaroon: I would suggest that some cities will see a fall and some will not depending on geographic and so on. No major city is going to see falls in all price per sq. metre and size bands. Most will see falls in some band and rises in others. A select few will see rises in almost all bands, perhaps even in all. However, I have very little idea which will be which or where.

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Edited by: milky Oct 20, 11, 07:50 #15

PWEI:

the period which you refer to by "this year".

Whoops, sorry I meant the next 12 months, however I can't see the prices going down too much in Poland B as the purchasing is largely done by Poles working abroad . Gamble??no thanks that's a developers game. Time is on the buyers side.

PWEI:

Not a very good track record so far.

says a developer hahah

PWEI:

No major city is going to see falls in all price per sq. metre and size bands.

nonsense and you know it.

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Oct 20, 11, 09:52 #16

milky:

says a developer hahah

Exactly, someone that actually does this. Not someone who guesses, makes stupid predictions and who has no knowledge of the property market.

As regards the so say lack of demand for housing, I have my own theory. Until the banks sort out their liquidity problems and what percentage of capitol they are supposed to keep in reserve then any major lending will be put on hold. The banks feel safer lending small sums of 3,000PLN to 100 individuals than 300,000 to one person for a mortgage. Why settle for 7-8% interest when you can charge 12-19% for a short term loan that will not be on the books for 30 years. Its no different than the banks in the UK that are refusing to lend to small businesses, yet are pushing personal loans and credit cards.
Once the fate of the "Euro" is sorted, out one way or the other, life and trade will go on, it might take a while but the demand will return.

peterwegThreads: 35 Posts: 1,997 Joined: Feb 16, 07 ♂	Oct 20, 11, 11:59 #17
Avalon: Once the fate of the "Euro" is sorted, out one way or the other, life and trade will go on, it might take a while but the demand will return. In Poland it maybe sooner, but in the UK and other western countries you are looking at FIVE years at least before a recovery.

AvalonThreads: 3 Posts: 814 Joined: Sep 11, 07 ♂	Oct 20, 11, 13:07 #18
peterweg: but in the UK and other western countries you are looking at FIVE years at least before a recovery. If not longer.

LwowskaKrakowThreads: 49 Posts: 504 Joined: Mar 9, 07 MEMBER ♀	Oct 20, 11, 13:17 #19
Bubble in Spain, Bubble in Florida,Bubble in China, Bubble in Ireland, and now Bubble in Poland. Less than 3 months ago we had a debate on PF about Polish Real Estate falling down and i with some others had the same opinion this article is reflecting now in October 2011. If thousands of newly built flats are sitting empty in Poland the bubble will burst in less than 2 years.

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Oct 20, 11, 14:34 #20

[quote=LwowskaKrakow

Bubble in Spain, Bubble in Florida,Bubble in China, Bubble in Ireland, and now Bubble in Poland.

If thousands of newly built flats are sitting empty in Poland the bubble will burst in less than 2 years[/quote]

And this is your quote from July, 2008

"So now we have this bubble , normal correction but if the Polish Government continues to attract speculation it will be worse"

Is this a 3 year bubble now or will it be a 5 year bubble in 2 years time?

pipThreads: 11 Posts: 1,293 Joined: Jul 4, 11 ♀	Oct 20, 11, 14:43 #21
there is no bubble. why does everybody keep saying there is. there is a saturated market and the prices are leveling out. they are not going to fall drastically- which is the definition of a bubble. They will level out and developers will finally have to charge fair market value- not the inflated prices they have had.

PWEIThreads: 5 Posts: 894 Joined: Jul 28, 11 ♂	Oct 20, 11, 15:17 #22
pip: there is no bubble. why does everybody keep saying there is. Because: a) they do not know what a bubble is; and/or b) they believe that by talking down the market prices will go down and they will thus be able to afford the properties which are currently out of their reach.

ZiemowitThreads: 10 Posts: 1,063 Joined: May 8, 09 ♂	Edited by: Ziemowit Oct 20, 11, 16:01 #23
Avalon: Is this a 3 year bubble now or will it be a 5 year bubble in 2 years time? In 10 years time it will be a 12 year bubble, and in 15 years time it will be a 17 year bubble. This bubble will never ever stop as it is an ongoing bubble. That's what it really is.

AvalonThreads: 3 Posts: 814 Joined: Sep 11, 07 ♂	Oct 20, 11, 16:04 #24
pip: there is no bubble. why does everybody keep saying there is. Because pip, by the law of averages, one day they might be right. Just like people who buy lottery tickets, somebody has to win.

PWEIThreads: 5 Posts: 894 Joined: Jul 28, 11 ♂	Oct 20, 11, 16:18 #25
Ziemowit: This bubble will never ever stop as it is an ongoing bubble. Which by definition means that it is not a bubble.

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Oct 20, 11, 18:27 #26

While I agree you aren't going to make any money on Polish real estate, 48,000 empty new flats may not be that many in a country that actual has a need for new flats.

Spain has a similar population, less need, and over 700,000 new flats empty and signficantly more new & used flats sitting empty.

Additionally, at least part of the reason for the fall in prices is developers are building cheaper flats intentially, as that is what the market wants, in often less desireable parts of the cities to a lower standard (but still of reasonable quality).

Having said that, I'm interested in seeing how long it takes to sell some of the projects currently being built, eg. ul.Twarda at an average price of PLN 20,000 and zlota 44 at an average price of PLN 30,000 - I have a hard time believing the Polish market will absorb such flats at such prices even over a period of 5 years, will be fun to watch.

Let's hope prices crash accross the board, I would love the possibility to purchase quality apartments in Mokotow at a fraction of the current price, sadly it is unlikely to happen - maybe there will be some good deals in Białołęka if anyone would like to move out there

PWEIThreads: 5 Posts: 894 Joined: Jul 28, 11 ♂	Oct 20, 11, 18:31 #27
BRS: maybe there will be some good deals in Białołęka if anyone would like to move out there From what I'm seeing and hearing, prices out there are very stable or actually going up (in large part because city centre and outer centre stuff has become unaffordable for many people).

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Oct 20, 11, 20:11 #28

pip:

there is no bubble. why does everybody keep saying there is.

because you 'keep saying' that there is no bubble even though prices tripled in many places over a three year period.

PWEI:

they do not know what a bubble is;

Oh yes we do..............
http://en.wikipedia.org/wiki/Polish_property_bubble

Avalon:

Because pip, by the law of averages,

yeas the law of averages definitely states there is a bubble(wages-Prices)

PWEI:

From what I'm seeing and hearing, prices out there are very stable or actually going up

hhhahahahahah
I hope all you rational people out there are laughing at the above statement... Do you get paid per word or per letter from that developer you work for.

JonnyMThreads: 16 Posts: 4,487 Joined: Mar 9, 11 ♂	Oct 20, 11, 20:24 #29
milky: tripled in many places over a three year period. examples of prices 'tripling' then this 'bubble' bursting, please. PWEI: prices out there are very stable or actually going up In some parts of Poland this is certainly happening. milky: hwikipedia.org/wiki/Polish_prop... Is it just me or is the style of writing on that wiki page somehow familiar.

pipThreads: 11 Posts: 1,293 Joined: Jul 4, 11 ♀	Edited by: pip Oct 20, 11, 20:41 #30
a wikipedia source. you can't be serious. and from 2007.

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