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    Higher Interest Rates Benefit Banks

    Despite the rising housing prices and changing market conditions, the banking sector in Poland achieved an impressive financial result in 2023, amounting to 27.6 billion Polish zlotys according to GUS data, marking a significant jump compared to 10.6 billion zlotys from the previous year. Net operating income of this sector also recorded a growth of 16.4%, while financial assets increased by 8.0%.

    Łukasz Tarnawa, the chief economist of the Bank Ochrony Środowiska SA, emphasizes that higher interest rates bring benefits to banks, despite the increased costs of acquiring funds. With the rise in NBP interest rates, banks notice increased interest margins, contributing to an improvement in their financial results.

    However, the issue of Swiss franc loans remains a significant concern for banks. Although reserves for Swiss franc loans are still being formed, they are not currently the most important issue for the banking sector. The expected inflation increase from April may affect further changes in the level of interest rates, but most experts expect the Monetary Policy Council to maintain rates at their current level throughout 2024.

    Real Estate Market Perspective

    The recent increase in housing prices has raised questions about the further development of this sector. Łukasz Tarnawa points out that despite the reduction in interest rates, the overall interest on loans is still higher than before the interest rate hikes, which may slow down the pace of housing price growth in the coming quarters. The demand barrier remains a significant factor in the market.

    According to experts, rising rental costs may prompt many people to consider the choice between buying and renting a property. However, despite the slowdown in price growth, there are still factors such as expected new building standards that may affect the further development of the real estate market.

    It is also worth noting that despite the overall trend of rising housing prices, there are local differences that need to be taken into account when analyzing the market situation.

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