Premium real estate market in Warsaw – analysis of the current situation part III
Premium real estate market in Warsaw - analysis of the current situation part III
This is the third part of our cycle in which we analyze how the pandemic influenced the prices of Warsaw real estate. We invite you to read the previous parts – „Premium real estate market in Warsaw – analysis of the current situation part I ” „Premium real estate market in Warsaw – analysis of the current situation part II.
How did the premium real estate market shape in the third quarter of 2020? Did the calming down of the epidemic during the holiday season increase prices? What are the experts’ predictions for the coming months?
THE III QUARTER OF 2020 BROUGHT STABILIZATION
According to the latest JLL report and data provided by the National Bank of Poland, the market situation in the third quarter of 2020 stabilized compared to the first half of the year. Specialists observed an average increase in transaction prices of new flats by 6% in 17 largest Polish cities. In Warsaw alone, the increase was 10.8%. The secondary market was characterized by slightly lower increases, which is explained by a delayed response of sellers to the changes.
4.5 thousand flats were sold in Warsaw alone, while 4 thousand flats were put on sale. The average price of flats (PLN / m2) in Warsaw was PLN 10,900.
„The Warsaw premium real estate market has experienced a dry footprint in the first wave of the pandemic. We have not noticed a decrease in interest in top apartments or houses. On the contrary, the demand for apartments with large terraces or gardens has even increased, which is measurably reflected in transactions carried out by Lions Estate. High interest in shopping translates into a stable price situation. Due to the pandemic, the price growth slowed down slightly, but there is no question of sharp drops in the premium segment”
– says Rafał Lewandowski, Partner Lions Estate.
GOOD PROGNOSIS FOR THE UPCOMING MONTHS
At the moment, the size of the offer of flats available for purchase in Warsaw hovers around 73% compared to the peak period. Despite the uncertain future and the dependence of the real estate market on the factors of the epidemic, the current situation is a good omen for the coming months.
„If the supply and demand remain in balance, there will be no reason to lower prices, and keeping them for the next 2-3 quarters will be a great argument for strengthening the opinion about the housing market in Poland as a safe haven for investors who want to allocate their savings” – JLL report says.
„The premium real estate market is rather resistant to any kind of turmoil. We are constantly contacted by new clients looking for a luxurious apartment. As experts, analyzing the development of the situation on an ongoing basis and analyzing how the industry reacts to it in this difficult time, we recommend using the services of a professional real estate advisor. This will help the customer feel confident and safe”
– says Bartłomiej Annusewicz, CEO Lions Estate.
BACK TO STANDARDS
During the winter and spring months, the real estate industry had to adapt to the new, epidemic everyday life. Meetings with customers and presentations of premises have moved to the online world. The stabilization that took place during the summer period allowed for a gradual return to traditional methods of work. Despite the arrival of the second, autumn wave of Covid-19, a change in market sentiment is noticeable. Compared to those known from the first half of the year, we have now adapted to the sanitary rigor; we know how to proceed and what we can expect.
„We have already returned to traditional standards and methods of work – of course with full sanitary rigor. We use online meetings with customers and presentations during the first wave of the pandemic mainly for foreign customers who cannot afford to come to Poland. Other clients, despite the epidemic situation, prefer traditional presentations during which they can see the property “live”
– comment Patryk Staniszewski, Premium Property Advisor in Lions Estate.
WHAT’S NEXT? THE UPCOMING MONTHS WILL ANSWER
Experts and analysts emphasize that in the era of a pandemic, the behavior of premium real estate customers and their decisions is also influenced by other external factors, for example related to their professional or health situation.
Does the current price level predict a longer stabilization of the market after the turbulent period of the first wave of the pandemic, and the current situation is the so-called new normality? Or is it to be expected that the fall wave of the epidemic will bring more market turmoil?
The answers to the above questions will come in the coming months, which will verify the experts’ forecasts. Much depends on the mood of premium real estate customers, health issues and economic regulation.
„The situation related to the reduced inflow of expats – foreign tenants – should clarify in the first half of next year, closer to the summer of 2021. Summing up, we remain moderate optimists about the nearest future on the market. The key issue will be the health situation of the society (the emergence of vaccines) and the mitigation of lockdowns that are extremely harmful to the economy”
– says Rafał Lewandowski, Lions Estate Partner.
UNDOUBTEDLY, ONE THING REMAINS UNCHANGED – STILL THE MOST VALUABLE CURRENCY IN THE INDUSTRY IS EXPERIENCE AND COMPETENCE, THANKS TO WHICH THE CLIENT CAN MAKE ONLY DECISIONS THAT ARE RIGHT FOR HIMSELF.
„A competent agent will help you make rational decisions. You will not succumb to pressure or attempts to take advantage of the current situation. Just because we are in a pandemic does not necessarily mean that property prices have to decline. Some even soar up, because there is a growing interest in luxury real estate – especially those with a large terrace or garden.”
– comment Lions Estate expert.