The Outlook for the Real Estate Market in 2024: Growth or Stabilization?

    Estimated reading time: 3 minutes

    As we bid farewell to the past year, characterized by unprecedented imbalances between supply and demand in the housing market, 2024 is expected to bring greater stability and certainty. The trajectory, however, hinges on decisions regarding the continuation of the first-home purchase support program and initiatives to enhance access to land for investments.

    The Role of Government Initiatives

    Expert Patryk Kozierkiewicz from the Polish Association of Developer Firms offers insights into the forecasts for the upcoming year. Projections are subject to various variables, including the fate of the BK2% program, the housing policy of the new government, and potential legislative changes. Monetary policy by the National Bank of Poland also plays a role, though significant interest rate cuts are not currently anticipated.

    The Impact of BK2% Program

    The potential non-renewal or reduced funding for the Safe Credit 2% program may impact developers in the coming year. If the program’s influence diminishes, developers are likely to adopt a more cautious approach, affecting the supply of new housing.

    Supply Challenges and Land Accessibility

    Inadequate supply remains a significant barrier to the market. While recent statistics on new investments inspire optimism, the initiation of some projects was influenced by the BK2% program. Withdrawal or limitation of this program may lead to increased conservatism among builders, limiting the supply of new developments.

    Rising Housing Prices and Financing Challenges

    The increasing difficulty in finding new land, particularly in major cities, coupled with soaring land prices, contributes to the rising costs of housing. The 25% surge in housing prices in 2023, especially in major cities, poses a considerable challenge to potential buyers, especially if commercial mortgage financing remains the primary option.

    Predictions for 2024

    Anticipating the upcoming market scenario, it is expected that the government may revive the BK2% program, albeit with reduced funding. This could result in slightly weaker sales performance compared to the past year.

    Balancing Supply and Demand

    Looking at the supply of new developments, it is projected to remain slightly higher than the last two years by the end of 2024. Positive market sentiment encourages investors, but limitations in acquiring new land and potential reductions in the impact of BK2% may prevent reaching the excellent supply results seen in 2021.

    Heading: Price Trends in 2024

    Forecasts indicate a less dynamic growth in housing prices in 2024, with an estimated increase of around 8-10%. Land costs and the need to adapt projects to new technical conditions may contribute to this growth, with changes planned for April 1.

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