According to Otodom Analytics, housing prices in smaller cities are equal to or even higher than in larger Polish markets. This growth is influenced not only by the increase in construction costs, but also by the limited availability of land and the dynamic development of small centers.
When analyzing the housing market in Poland, the seven largest markets are often considered: Warsaw, Krakow, Wrocław, Poznań, Katowice, Lodz and Tricity. However, in recent years, there has been an increase in the dynamically developing smaller markets – Otodom experts informed. Last year, 55 percent of all buildings provided by developers were built outside the seven largest agglomerations.
– Lublin, Szczecin, Bydgoszcz, Rzeszów, Kielce and Białystok are approaching the level of investment and prices of the largest city centers. They attract more and more investors and are characterized by the steady growth of the housing construction sector. Therefore, we can safely call them developing markets, which is worth watching to get a complete picture of the situation in the Polish housing sector, – said Katarzyna Kuniewicz from Otodom Analytics.
As Otodom experts reported, at the beginning of November, developers in Lublin offered about 4,000. apartments and houses, and in Białystok, the smallest city in the ranking, there were a little more than 1000 people. buildings – which corresponds to the average monthly sales in Warsaw last year. The total amount of housing offered by developers in all these markets combined is similar to the capital's current supply.
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Smaller cities 'catch up with bigger markets'
The number of developer buildings in these cities is almost 80% higher than a year ago. in the case of Szczecin and Kielce. At the same time, developers are introducing new investments there for sale. In October, 54% was recorded in Rzeszow. increasing the number of introductions. In Lublin, it was about 30 percent. y/y and in Bydgosh about 25 percent. dr.
Data from Otodom Analytics shows that in terms of house prices, smaller cities are on par with Poland's largest markets and even exceed markets where the average rent is around PLN 11,000-13,000. PLN/sq m – This price level is influenced not only by the increase in construction costs and limited land for new investments, but also by the dynamic development of these cities and the strengthening of the demand for apartments, – noted Kunevich.
In the most expensive developing market, that is, Szczecin, the price of one square meter of apartment builders exceeds 13 thousand zlotys. This is more than the average price per square meter. new buildings in Lodz (11.5 thousand PLN/sq m), Katowice (about 12 thousand PLN/sq m) and even Poznań (about 12.6 thousand PLN/sq m). In Lublin, the average price of housing remains above PLN 11,000. PLN per square meter from the beginning of 2024. As mentioned, the cheapest city mentioned is Białystok, where you can buy a building from a developer for less than PLN 11,000. PLN/sq m
Split market in Poland
As the authors of the report noted, the housing market in Poland is fragmented. In 2023, more than 220,000 were commissioned across the country. apartments and houses. OK. 138,000, or 62%, were created by developers. Almost every fourth apartment is built in the seven largest markets and in the so-called neighboring poviats. Agglomerations of Warsaw, Krakow, Wroclaw, Poznań, Katowice, Lodz and Tricity account for 19 percent. provision of all buildings. The rest are built in cities, towns and villages.
– The domestic housing market includes both large national development companies and smaller local entities that implement projects in specific cities or regions. Kunievic noted that differences in their organizational structure and available resources shape the size and nature of their investments, from large facilities with comprehensive infrastructure to small projects tailored to specific local needs and financial opportunities.
The expert noted that unlike countries such as France, Spain or Great Britain, where the offer and supply of housing is concentrated around a few dominant cities, and centers and small areas do not play such a big role, the Polish market is fragmented and diversified. – This trend will continue and the position of smaller regional cities will strengthen, – concluded the expert.
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