December 1, 2022

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This is how developers are trying to "supply" apartments.  Price reductions up to 100,000. With

This is how developers are trying to “supply” apartments. Price reductions up to 100,000. With

The rapid decline in sales (up to 50-60% per annum) forces developers to take measures to attract people interested in buying an apartment (the number of which has decreased significantly) to their projects

– He writes in his book “Monitoring Promotional Campaigns” for the third quarter of this year. Analytical company REDNET Consulting. As he points out, by the end of 2021, the flats were falling apart. The procedure for buying an apartment was often limited to one visit of the client to the sales office and the signing of documents at the next meeting. Currently, buyers spend much more time looking for an apartment, comparing offers and looking for promotions.

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Another separate vote in the Monetary Policy Committee. This time it was about the 2023 budget.

Developers with upgrades for every third investment

Promotions appear of course. According to data from REDNET Consulting, in the third quarter of this year at least one promotional campaign was recorded in every third investment. However, this mainly applies to apartments under construction or even holes in the floor (here, upgrades were recorded in about 45-47 percent of projects). In the case of completed investments, this percentage was approximately 20%.

Completed investments are more popular with buyers and therefore promotions are not carried out on such a scale as ongoing projects

The company explains.

It should be noted that promotional campaigns are not always associated with the price of an apartment. They also include, for example, the organization of an open day, the bearing of notary costs by the developer or gift cards to partners. In general, however, price promotions (23.6%), a documented price guarantee (11.5%), a payment schedule (eg, 80-90% of the amount only paid when keys are received; 10.7%) or a venue are often offered. Parking (free or on a promotional basis). I appreciate; 9.1 percent).

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Interestingly, roadshows are often offered as part of larger investments – with more than 100 buildings. Here they are recorded in the condition of 47-57 percent. For about 15-20 percent. For investments of up to 50 units.

When it comes to quotations, they usually only apply to selected apartments – say, of a certain type, in a certain layout or, say, only the first 10 apartments, although there are special offers for customers with cash or those who have bought Another apartments in the investment. Often you can get promotions in the case of larger apartments.

The deductions were quantitative calculated from the total mixing price of different amounts – from PLN 14 to PLN 100 thousand. zlotys. Discounts calculated on the price of 1 square meter range from PLN 500 to PLN 1000. zlotys

– reports REDNET Consulting.

Jaroslav Kaczynski, Chairman of the Law and Justice Party.Kaczyński talks about the euro: It is the currency of a very strong economy, and we don’t have it

Developers convince: we have nothing to get out of

Despite the appearance of promotions from developers, the industry argues that it can’t get away with much. According to other data from REDNET Consulting, apartment bid prices are stagnant.

Prices are not going down and will not go down. Developers have a choice – either to introduce new, more expensive investments, because their financing costs have increased significantly, or to abstain

– said Katarzyna Torska, managing director of the real estate agency RedNet 24, citing the press release.

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As we wrote on Gazeta.pl, Developers argue that if they lower the prices of the apartments offered, they will not be able to cover the construction costs. Therefore, they simply prefer not to launch new investments. They explain that the collapse in housing demand is the “fault” of higher interest rates and the new recommendation of the Polish Financial Supervisory Authority – both of which have trampled on the creditworthiness of Poles. The number of applications for housing loans decreased by about 70 percent.

Allegations against its actions have recently been refuted by KNF, which calculated that the average overall profitability of the development sector in the first half of this year was more than 29 percent. It noted that developers “have the opportunity to adjust their margin policy.”

Overall, however, the data shows less activity in the construction sector. data Central Bureau of Statistics She reports that in September construction started at about 28 percent. The number of dwellings is less than in the previous year (and in the first nine months of this year by about 24%).

REDNET Consulting analysts note that despite the weak sale of apartments (half less in the third quarter of this year than in the previous year), sales volume was still higher than the number of new offers.

At this rate, the situation could be catastrophic within a few months. If new investments do not start, there will be no apartments ready for some time. Even if developers start selling new projects, unfortunately, it will take at least a year and a half before they are built. During this time, rental prices—horribly high today—will continue to rise

– said Robert Chojnacki, founder of the housing site tableaofert.pl, citing the company’s press release.

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