Buying an apartment is one of the most important decisions in the life of every human being. No matter if it is bought for investment purposes or for yourself, making the wrong choice can have far-reaching consequences. One of the most important factors when looking for an apartment to buy is the choice between the primary and secondary real estate market. Both options have their advantages and disadvantages, which I present in this article.
The primary real estate market in Warsaw
In 2018, over 16,000 new apartments in Warsaw were opened for use. This is 32.7% more than in 2017. Such a dynamic growth of the real estate market is evidence of a large demand. Not only Poles, but also people from abroad invest in housing in Warsaw. The primary market is therefore in excellent condition, which results from several factors.
Apartments from the Warsaw primary real estate market are often located in the vicinity of other modern buildings, which significantly increases the aesthetics of the area. The buildings have elevators, underground garages and even green terraces on the roofs.
A new flat offer much larger arrangement possibilities than secondary market premises. However, this is not always an advantage, many people prefer to buy an apartment, where you can live immediately. In the case of arranging a new flat one has to take into account the average cost of 1000 PLN per square meter.
However, the primary market also has its downsides. New apartments are often located in areas far away from the city center. This is due to the fact that the center of Warsaw is already densely built-up and there is no room for new investments, as well as the fact that land on the outskirts is cheaper, so the developer’s costs are smaller.
Flats from the primary market are often bought while they are still being built, so it may take some time from finalizing the transaction to getting the keys. Therefore, not everybody decides to buy from the primary market, especially that many people are afraid of the developer’s bankruptcy before completing the investment.
Apartments on the secondary real estate market
Buying an apartment on the secondary market means, first of all, certainty in what you invest in. The apartment is already completed, and often fully equipped. You can see all its advantages and disadvantages. The surrounding infrastructure is also certain, and even neighbors can be known in advance and consulted about the standard of living in a given place.
The advantage of the secondary market is also that the purchased flat is immediately available to the buyer. If you do not decide to renovate or replace equipment, you can move in immediately.
Apartments from the Warsaw secondary real estate market often have more attractive locations than those on the primary market. The premises are available in densely built-up, perfectly communicated areas of the city. Such apartments can be found in every district of Warsaw, so there is a large freedom of choice.
However, it should be remembered that flats from the secondary market often require renovation, which entails additional costs. Poor technical condition of some buildings is also associated with faulty infrastructure – problems with heating, sewerage and electricity occur here much more often than in new premises.
A flat from the secondary market also means higher maintenance costs related to the presence of a renovation fund and a lower standard of the building itself, i.e. worse thermal insulation. When buying, you must also remember about the tax on civil law transactions in the amount of 2% of the market value of the premises. When purchasing on the primary market, this tax does not apply.
Prices of apartments on the primary and secondary real estate market in Warsaw
One of the most important factors determining the choice of a flat in Warsaw is the price. It would seem obvious that apartments from the primary market will be more expensive, but it is not so easy. The price is affected not only by the technical condition of the flat and the building, but also by many local factors.
It turns out that while in most districts new flats are actually more expensive than those from the secondary market, there are regions where the situation is reversed.
In 2018, the new apartments in Praga Północ were worth over 1,000 PLN more per square meter, but the situation was reversed in Wilanów. A flat from the secondary market cost 1044 PLN less than the original market.
You should also remember about additional costs – in the case of the primary market it is the equipment and finishing of the flat, and in the case of the secondary market, possible renovation and rearrangement.
Experienced real estate agent from Warsaw will assist you in making a detailed valuation. Excellent knowledge of the market and local conditions that influence the price is required here. Consultation with a housing agency from Warsaw is especially important when you want to buy an apartment for investment. If you plan to earn a rental, it is worthwhile to consult a real estate broker who knows the demand in Warsaw and knows which apartments in which area are popular.
At Biarda Estate, I will not only find a flat that meets all your requirements. I will also help in negotiating the price and completing all formalities, and even in finding a renovation team.