Poland: What can buyers afford after interest rate cuts?
What is the maximum budget most buyers are working with when looking for a flat? Where does the credit limit typically fall for the largest group of buyers, and how has this threshold shifted following recent interest rate cuts? What types of flats are available within this price range, and in which neighbourhoods can they be found?
Andrzej Biedronka-Tetla, CFO and member of the management board at Atal
Analysing this year's transactions, the ceiling is around PLN 700,000. For this price, our customers can even buy apartments with the option of finishing, for which we currently have a very good offer. The size and number of rooms depends on the location and will vary from region to region.
Currently, properties with an area of 60 sq m and above account for about half of all transactions. Therefore, we do not see any particular advantage in any of the categories. Both small units and apartments worth well over PLN 1 million are popular with customers.
The reduction in interest rates will slightly improve customers' creditworthiness and, in time, will also have a real impact on reducing loan instalments. At present, the attractiveness of new banking products is still being undermined by other parameters, including high margins.
Tomasz Kaleta, Managing Director for Sales and Marketing at Develia
The most popular are flats in the PLN 500,000-600,000 price range. Depending on the city and real prices on a given market, the share of enquiries for such properties ranges from 25 per cent in Warsaw to as much as 50 per cent in Poznań. Properties in this price range can be found in virtually all of our developments.
The purchasing power of customers using credit is limited primarily by their income and interest rates. The May interest rate cut increased buyers' creditworthiness by about 10%. It is worth noting that both first-time buyers and customers with a stable financial situation who are buying larger properties are opting for loans.
Barbara Marona, Sales Office Manager Kraków, Matexi Polska
In Krakow, the largest group of buyers are looking for flats in the price range of PLN 700,000 to PLN 900,000. For singles earning around the average salary for Krakow, with a 30-year loan and a 20% down payment, the creditworthiness ranges from approximately PLN 590,000 to PLN 640,000. For couples with one child, where both partners earn around the average salary for Krakow, the maximum creditworthiness under the same assumptions is approximately PLN 1,100,000 – PLN 1,200,000.
We offer flats that fall within the above price ranges, e.g. in the Do Wilgi development, where 40 m² two-room flats can be purchased from PLN 670,000 and are most often chosen by singles or couples buying their first home. In the development on Lirników Street, small two-room flats with an area of 35 sq m are priced from PLN 618,000.
In the case of three-room flats, prices start at PLN 778,000 in the Kameralny Prokocim development, through approximately PLN 820,000 in the Do Wilgi project and PLN 900,000 in the Takt Lirników estate, reaching as much as PLN 1,500,000 in the Apartamenty Portowa project in Krakow's Zabłocie district.
Katarzyna Kwiatkowska, Sales Office Manager Warsaw, Matexi Polska
The largest group interested in purchasing flats in Warsaw is looking for offers in the range of PLN 700,000 - PLN 900,000 for singles or couples, and for families with children, this amount averages around PLN 1,000,000 - PLN 1,200,000. Under current credit conditions, a single person earning around PLN 7,200 net can obtain a mortgage of around PLN 550,000, while a family with two children earning approximately PLN 14,000 net can apply for a loan of PLN 1,100,000, in both cases assuming a 20% down payment. After the interest rate cut, the maximum loan amount under the above assumptions increased by approximately 15%.
We have properties that meet these expectations. For example, the XYZ Place development on Żwirki i Wigury Street offers one- and two-room flats ranging in size from approx. 31 sq. m to 39 sq. m, priced from PLN 560,000 to PLN 870,000. Similarly, in the Splot Wola development on Sowińskiego Street, customers can choose from two-room flats ranging in size from 37 sqm to 43 sqm, with prices ranging from PLN 798,000 to PLN 893,000. The Na Okrzei development, located in the atmospheric surroundings of Praga Północ, offers apartments with an area of 35 sq. m. at prices ranging from PLN 808,000 to PLN 850,000.
Agnieszka Gajdzik-Wilgos, Sales Manager, Ronson Development
The largest group of our customers in major cities are looking for flats in the price range of up to approximately PLN 650,000-700,000. This is the most common level of purchase expectations, which results from both the financial capabilities of buyers and current market conditions. At the same time, we note that the real creditworthiness of many customers ends at around PLN 500,000–560,000.
Wojciech Wilhelm Zhang-Czabanowski, President of the Management Board, Waryński S.A. Holding Group
Our observations and market analyses show that the largest group of apartment buyers in major cities are looking for properties in the PLN 600,000–750,000 price range. This is the range that corresponds to the average creditworthiness of a household, in particular a couple with a net monthly income of around PLN 10,000.
The creditworthiness limit for most individual customers is currently PLN 750,000–800,000. Above this amount, there is a noticeable increase in the number of rejected loan applications or decisions to withdraw from the purchase due to excessively high monthly instalments or the need to make a higher down payment.
Joanna Chojecka, Sales and Marketing Director for Warsaw and Wrocław at the Robyg Group
Our observations and market analyses show that the largest group of buyers in major cities, including Warsaw, are looking for flats in the price range of up to approximately PLN 700,000–800,000. This is the threshold at which the creditworthiness of many buyers, especially singles and young families, often ends. It is in this segment that the greatest demand and the largest number of enquiries are concentrated.
In recent years, restrictions on the availability of credit have significantly affected customers' purchasing power. Their choices have been more cautious. Not only the size and location were important, but also the availability of financing and the total cost of the investment. Recent interest rate cuts and the stabilisation of the credit market have improved the situation for many people, increasing their creditworthiness and restoring the real possibility of purchasing a flat.
For up to PLN 800,000, we offer flats in the Początek Piątkowo project in Poznań and the Foresteria investment in Gdynia. In Gdańsk, properties within this price range are available in the Nadmotławie, Porto and Szumilas estates. In Wrocław, we offer properties in the Port Popowice, Apartamenty Krakowska and Przystanek Tarnogaj projects. In Warsaw, they can be purchased in Sady Ursynów, the Metro Life, Royal Residence, Modern City and Rytm Mokotowa developments.
Michał Witkowski, Sales Director at Lokum Deweloper
Most customers interested in our offer are looking for properties priced up to PLN 600,000. It is worth noting that this amount does not so much reflect their actual housing needs as it results from their limited creditworthiness, which determines the real level of their purchasing power. Initially, the May interest rate cut did not translate into higher creditworthiness, as some banks responded to the MPC's decision by raising margins on new loans. Thus, the creditworthiness of potential buyers remained virtually unchanged.
We currently offer flats in three developments in Wrocław for up to PLN 600,000. These are flats in the Lokum Porto estate in the Old Town, in the Lokum la Vida estate under construction in Sołtysowice and in the completed Lokum Verde development in Zakrzów.
Damian Tomasik, President of the Management Board of Alter Investment
We have observed that the largest group of buyers in major cities are looking for flats in the price range of up to approximately PLN 600,000-700,000, which corresponds to the current creditworthiness of most of our customers. The reduction in interest rates has slightly improved the availability of financing, but has not radically shifted this threshold – the greatest demand is still concentrated on two- and three-room flats with an area of 40 to 60 sq m. Such flats are available, among others, in our projects in Gdańsk at Madalińskiego Street, Warszawska Street and Trakt Świętego Wojciecha. These are offers for singles, young families and people looking for an attractive investment for rent.
Marcin Malka, President of the Management Board of Real Management S.A.
Some of our customers buy houses, usually obtaining financing of around 50% of the property value. The price of a house at around PLN 4 million is definitely a clear threshold limiting the financial capabilities of customers. Above this amount, the number of potential buyers narrows, which is why we make every effort to ensure that our Neo Natolin homes are unique in terms of location, urban planning, architecture and space layout. We want to meet the expectations of demanding customers in the luxury segment.
Mariusz Gajżewski, Head of Sales, Marketing and Communication, BPI Real Estate Poland
Our customers are mainly people who do not use credit when buying a flat or only use additional financing to a limited extent, for whom creditworthiness is not an issue when choosing flats from our offer.
Source: dompress.pl
Photo: Sady Zoliborz, Matexi
