Despite the massive number of mortgage applications in March, apartment prices remained stable. There are strong indications that the March mortgage boom was largely an illusion, resulting from an enormous volume of loan refinancings. At the same time, lower interest rates significantly improved housing affordability. A report by Rankomat.pl and Rentier.io shows that in Warsaw, Kraków, and Katowice, the monthly installment for a 70-square-meter apartment fell by over PLN 1,000 compared to Q1 2025. However, the risk of interest rate hikes and an increase in installments by nearly PLN 200 is once again appearing on the horizon.
Was the March Mortgage Boom Just an Illusion?
In early April, BIK (Credit Information Bureau) data regarding a massive surge in mortgage applications was widely published. In March, as many as 63,000 applications were filed, the best result in 18 years. The number of applications was 71% higher than a year ago, and their value was up by as much as 80%.
However, it must immediately be added that these applications will translate into the number and value of loans granted in April and May. They should not be linked to the data just released by BIK regarding the value and number of loans actually granted in March. That result was influenced by applications filed in January and February, due to the relatively long process of granting a mortgage.
the aforementioned March boom in credit applications seems very suspicious. Such a large jump in demand should also be visible through the prism of sales results, changes in supply, and apartment prices.
Regarding sales performance, developers are reporting sales 40% higher than last year. Thus, there is a boom in this market segment, though not as large as the demand for mortgages.
As for the supply of apartments for sale on portals, in the 17 cities analyzed, it decreased by only 9% year-on-year.
Furthermore, high demand for credit did not cause apartment prices to rise. In March, across the 17 cities studied, we recorded 9 where prices fell and 8 where they rose. The average monthly change was -0.03%, meaning prices remained at a level similar to February.
So, why are the market effects so moderate despite a record number of loan applications? It seems very likely that approximately half, and perhaps the majority, of these applications concern refinancing—replacing an old loan with a higher interest rate with a new one at a lower rate. BIK just reported that in March, the share of refinancing was 30%. However, this is the result of applications from January and February. March applications will likely cause this share to rise even higher in April, which we estimate at around 50%.
In our opinion, this boom is largely driven by people who refinanced fixed-rate loans. According to regulations, they cannot switch from a fixed to a variable rate; the new loan must also have a fixed rate. Therefore, many of these individuals had been waiting, as further interest rate cuts were predicted for this year before the conflict in the Middle East.
When the war broke out, forecasts changed. The risk of rate hikes even emerged. Consequently, these individuals quickly decided to refinance. Demand for truly “new loans” was therefore much lower than it might appear at first glance.
Banks Defend Against Refinancing Competition
It is worth noting that the movement in refinancing has been so significant lately that some borrowers report banks taking “defensive” actions. When a client requests a debt certificate (needed to obtain a refinancing loan), some banks offer to lower the interest rate, including fixed rates.
Of course, this reduction usually does not offer an interest rate as low as a refinancing loan. On the other hand, the advantage of staying with the current bank is avoiding the somewhat tedious procedures associated with taking out a refinancing loan.
Currently, it seems like a good idea to request said certificate even if one does not plan to refinance. The bank might then offer better terms. However, it is best to compare what your bank offers with what can be obtained from the competition through refinancing.
Large Apartments Increased in Price by 3.4% Y/Y
Regarding apartment prices, in this report, we will not analyze March data in detail but will focus on the entire first quarter. This data provides a unique opportunity to look at apartment prices in individual market segments.
The most dynamic situation is found in the large apartment segment (above 60 m²). Prices in Q1 2026 were higher than a year ago in 15 out of 17 cities studied. The average price change in the studied cities was 3.4% y/y. For comparison, the average change for small apartments (under 35 m²) was 1.8% y/y, and for medium-sized apartments (35 to 60 m²), it was 0.9% y/y.
Lower Installments Improved Housing Affordability
The vast majority of those buying apartments for their own needs finance the purchase with a mortgage. These, in turn, became cheaper again in the first quarter thanks to the March rate cut. In total, interest rates have fallen by 2 percentage points over the last 12 months. This means that despite the aforementioned slight price increases, buying an apartment is significantly easier than a year ago. Installments are much lower, especially for large apartments.
Installments Over PLN 1,000 Lower in Warsaw, Kraków, and Katowice
For a 70 m² apartment, the installment amount dropped by over PLN 1,000 in three cities. In Warsaw, the installment for such an apartment is currently PLN 6,338, which is PLN 1,328 less than in Q1 2025. In Kraków, it is PLN 5,595, a decrease of PLN 1,064.
Katowice is a bit of a surprise in this group, as it does not have as high a price level as the previous two cities. Unlike them, we are dealing here not only with a drop in interest rates but also with lower prices for large apartments compared to a year ago. The combination of these two effects resulted in such an impressive drop in the installment.
At the other end of the spectrum is Gdańsk, where the situation is the opposite of Katowice. The installment for a 70 m² apartment in Gdańsk fell by only PLN 324 over the last 12 months. This happened because most of the benefits from lower mortgage interest rates were swallowed up by the rise in prices for large apartments. Prices for large apartments in Q1 2026 were as much as 15% higher than a year ago.
Installments Could Rise by Nearly PLN 200
Unfortunately, there is a risk that housing affordability will deteriorate again. In recent days, futures contract quotes suggest a risk of an interest rate hike. The 6M WIBOR rate was 3.7% in early March and is currently 3.9%. Meanwhile, contract quotes suggest that in 6 months, it will be 4.31%.
If such an increase were to occur, the installment on a PLN 500,000 loan for 30 years would increase by PLN 196 (from PLN 2,902 to PLN 3,098).
Buyers May Still Have Room for Negotiation
Regarding the future, the most likely scenario remains price stabilization, especially since there are elements on the horizon that could maintain significant supply and strengthen the bargaining position of buyers.
“From May 20, 2026, an EU regulation on the collection and sharing of data regarding short-term rentals will come into effect, which may increase the formalization of this segment in the coming quarters and influence the sales decisions of property owners in tourist cities. Additionally, greater data transparency and a more cautious approach from buyers could increase pressure for realistic valuations where fundamentals are weaker. In such a setup, a continued sideways price trend with local shifts seems more likely than a single, uniform movement for the entire market,” notes Anton Bubiel, CEO of Rentier.io.
