Real Estate /
Poland's apartment prices continue to fall [1844]
I dare say you're right. FWIW been around Wroc today and quite astounded at how many new blocks are going up from Partynice to Opolska to Bardzka to Klecina. Build build build.
I don't know if this is to be taken as a bull market in apartments commencing, but an acquaintance whose word I trust told me some 80m2 flat near him (Partynice borders) sold in about a week. A quick check reveals it was not actually cheap, it was pretty much the usual price you'd expect these days (high in my opinion!) although it was in good condition. Either the seller got lucky or it's a good estate and so sold quickly (or it's not true, but I doubt he'd lie to me, no reason to do so).
Well, I think my acquaintance only knew half the story. Yes it's true the for sale banner was only up for 5 days before the flat sold, but a check on Trovit reveals the flat was actually bigger than 80m2, and was reduced over some months by approx. 20% until a buyer came along. If the buyer then rounded the price down, the reduction would be nearer 30%. I guess that compared to some other flats on the same estate where they're asking a fair amount more, that one was "cheap" but still a lot of cash considering local wages. For that price, I'd rather have a house.
So, this is a typical good but not spectacular estate in Wrocław.
In Q3 2006, a 70-80m2 off-plan (before being built) large estate flat would set you back 3300PLN per square metre excluding finishing. Off-plan prices are generally cheaper, of course.
Today, even after the fall in prices, the same flat on the same estate finished is fetching 5700PLN per square metre on average.
Of course, a finished flat does cost more. But even so, have wages doubled since 2006? No.
The demand is driven by employment hopes real or imagined, and most probably credit availability.
In a nutshell: the prices have increased hugely since 2006, even with the supposed correction in prices Wrocław 'suffered'.
None of this makes any sense to me, but the rises in the UK didn't and don't either.
In Q3 2006, a 70-80m2 off-plan (before being built) large estate flat would set you back 3300PLN per square metre excluding finishing. Off-plan prices are generally cheaper, of course.Today, even after the fall in prices, the same flat on the same estate finished is fetching 5700PLN per square metre on average.
Compare and contrast that with another part of Wroclaw just 1km away from the first. There, a year 1998 flat of the same size purchased for 265000PLN in Q2 2005 is still unsold at an asking price of 350000PLN now (and has been unsold for several quarters).
So, someone who bought a 1998 secondary market flat a full year before the 2006 off plan flat, for approx. 10% more money than the off plan flat, finds the value of their flat has gained much, much less than the buyer of the off plan flat on a plot 1km away -- something like a 20-30% gain versus 70% over the period 2006-2014. And this disparity exists between two private estates quite close to each other, both reasonably 'leafy' and near green spaces. In fact the flat that performed more poorly is even near a tram line when as the other one is only near a bus.
Throughout other parts of Wrocław, prices have probably done similar things between close estates, but this seems the most stark example I know of.
However, even on that same estate that displays little in the way of depreciation compared to the other 1998 one, a detailed look at Trovit reveals at least 2 or 3 incidences of flats listed in early or mid 2013 for higher prices than now, and those same flats relisted this year at a lower price (approx. 3% lower). Checking through some other sources and search engines, it looks exactly like even those flats didn't sell and were instead rented out until this year when the owners have tried again to sell, for a 2-3% lower asking price.
So, in final summary at this juncture, although some asking prices might be up (while many that I have researched are actually down, see above) it remains to be seen if they're actually higher selling prices.
But here's an example of how asking prices HAVE leapt 20% in some cases.
Similar size flats, duplex, same estate. Last year 329K 71m2.
This year 399K 68m2.