Country Report Poland Q3-2022
“The Polish real estate market remains attractive to foreign investors.”

Dear readers,

“High interest rates have caused demand for residential real estate to plummet, with the focus now shifting more to the rental segment instead. Rents are rocketing due to the low supply of housing. International investment funds see an opportunity here and are investing in ready-to-rent projects, which also represent a chance for developers – whose business has slumped by 40 % – to compensate for the decline in the construction of owner-occupied properties. The office market is proving stable and has seen only a slight increase in vacancy rates. As there are relatively few new builds, international investment funds are increasingly looking for old office properties in need of renovation and are prioritising those in central locations. The hotel sector performed very well in the third quarter. Times are still tough for business hotels, but the booming tourist demand has led to reports of occupancies at pre-pandemic levels. However, the outlook is less favourable due to the rising operating costs. As a result, hotel financing is difficult to obtain. Although the situation is challenging overall, the Polish real estate market remains attractive to foreign investors, and Polish market participants are creative and will overcome the crisis.”


Your Beata Latoszek

Contact

Ms Beata Latoszek
Managing Director Poland

Phone: +48 22 828 02 53
E-mail: Beata.Latoszek@Deutsche-Hypo.de

REECOX Poland down 4.3 %

The Polish real estate index recorded a loss of 4.3 % compared to the previous quarter, placing it in the mid-range of the Deutsche Hypo REECOX. A moderate decline in July (0.6 %) and a further drop in August (1.4 %) were followed by a comparatively sharp downturn of 2.4 % in September, which left the index at 175.1 points.

Polish real estate shares still under pressure

All input variables show a negative trend for the third successive quarter. Poland’s blue-chip index WIG 20 continued its downward trajectory and again posted a double-digit loss of 18.8 % as against the previous quarter to stand at around 1,378 points. The key factors here were the losses in August (11.2 %) and September (9.8 %). The WIG Real Estate share index also continued to decline, dropping by 7.5 % compared to the previous quarter to finish Q3 at 2,358 points. Business sentiment in Poland has also displayed a continued downward trend since May. It was negative across all months in the third quarter, leading to a fall of 7.7 % over the quarter as a whole to 88.2 points.

Synopsis of Input Variables and Real Estate Economic Situations Q3-2022

Country

Stock Index

Real Estate Economy Index

Economic Indicator

Base Interest Rate

Interest Rate 10-Year Government Bonds

Q2-2207/2208/22Q3-22Delta (%)
Q2-22 / Q3-22
DE
do
dodo
dodo
eq
upup
289.8
289.2
278.1
258.9
-10.7
GB
do
dodo
dodo
upup
upup
202.5
195.8
198.1
189.5
-6.4
PL
dodo
do
dodo
upup
up
183.1
181.9
179.4
175.1
-4.4
NL
do
do
dodo
eq
upup
184.8
189.5
183.2
175.8
-4.9
FR
do
do
dodo
eq
upup
225.6
231.9
227.5
219.3
-2.8
ES
dodo
do
dodo
eq
upup
178.4
174.9
175.3
172.9
-3.1