Land in Warsaw for multi-family housing development in H1 2020

Land in Warsaw for multi-family housing development in H1 2020

The real property industry has been very successful in recent years. The demand for flats has been growing year by year. The largest property developers have started even a few development projects each at the same time, while looking for new land for more projects. They are not discouraged even by the rising cost of land.

The situation in the land property market is good despite the COVID pandemic.

In Warsaw alone, the number of deals in the first half of 2020 was up by 20 percent compared to the same period of 2019. The average price of land in H1 2010 was PLN 2,100 per sq. m. In UFA (usable floor area) terms, the average price hovered at PLN 1,300 per sq. m.

Interestingly, nearly 70 percent of the deals closed during the first half of 2020 were properties covered by local zoning plans or local land use plans. It is somewhat strange given the fact that the percentage of transactions conditional upon obtaining outline planning permission or regular planning permission was significantly higher.

“The third quarter of 2020 already saw tens of new deals in Warsaw, the Tricity and Wrocław. This confirms that the market is still active and that property developers are not putting off their purchasing decisions. The majority of them have already experienced problems regarding land banks for new development projects. Despite the moderate sales of flats, investors are set to start new projects in the second quarter of 2020. According to figures from the Polish office for national statistics, property developers started the construction of more than 17 thousand flats in September 2020 (www.forsal.pl)”. “Land is still in short supply and therefore I do not expect a sharp fall in demand for land needed for new projects,” says Daniel Radkiewicz, chairman of INWI.