The latest transaction data from Poland’s six largest cities show that Kraków is increasingly resembling Warsaw in terms of housing prices. Analyses conducted by SonarHome.pl experts indicate that this trend is particularly visible in the segment of the smallest apartments, which have traditionally attracted the strongest interest from both owner-occupiers and investors.
An analysis of median transaction prices shows that apartments smaller than 35 square metres cost an average of PLN 16,600 per square metre in Warsaw and PLN 16,200 in Kraków. Just a few years ago, a result in which the difference was only around 2% would have been difficult to imagine. The capital was the undisputed price leader, while the remaining cities formed a clearly separate group.
A similar situation can be observed for apartments measuring between 35 and 45 square metres. In Warsaw, the median transaction price stands at PLN 15,500 per square metre, compared with PLN 15,400 in Kraków. In practice, this means that prices are almost identical in one of the market’s most liquid segments.
“From the perspective of the housing market, this signals that Poland is increasingly resembling Western European countries, where several strong urban centres compete for residents, employees and capital. A decade ago, the gap between Warsaw and Kraków was far more pronounced. Today, we can see that Kraków’s housing market has reached a scale and maturity that allow it to compete effectively with the capital in terms of prices for the most sought-after properties,” says Anton Bubiel, a residential market expert at SonarHome.pl, a platform for property valuation and finding an estate agent.
Limited supply and strong demand drive prices
At first glance, the convergence of housing prices in Warsaw and Kraków may seem surprising. Warsaw remains Poland’s largest and wealthiest city, home to corporate headquarters, state institutions, the financial sector and many of the country’s best-paid jobs. It would therefore seem natural for it to maintain a clear price advantage over other housing markets.
However, Kraków has several characteristics that effectively support property price growth. One of the most important is limited housing supply, particularly in the most attractive locations. The city’s historic character and the limited availability of land make new development more difficult than in many other large urban centres.
At the same time, Kraków generates very strong demand for small apartments. This demand comes from students attending its numerous universities, employees in the business services sector and investors purchasing properties for rental purposes. Another factor is the well-developed short-term rental market linked to high tourist traffic.
“An important element that is often overlooked in discussions about the housing market is the situation in the local labour market. According to data on average wages in the enterprise sector, Kraków is no longer a cheaper alternative to Warsaw. The high concentration of well-paid jobs in sectors such as IT, finance and business services translates into real housing demand and helps explain why prices in Kraków are now so close to those in Warsaw. When comparing housing prices, it is also worth taking local purchasing power into account. In Kraków’s case, the relationship between apartment prices and average wages is no longer as unfavourable as a simple comparison of nominal prices per square metre might suggest,” the SonarHome.pl expert points out.
Larger apartments offer more space for every square metre
The data collected by SonarHome.pl also show that, regardless of the city, the highest prices per square metre are achieved by the smallest apartments. As floor space increases, unit prices decline steadily. In the largest properties, exceeding 80 square metres, the price per square metre is lower than for studio apartments by anywhere from several percent to as much as 26%, depending on the city.
The largest differences between small and large apartments can be found in Wrocław and Poznań. In those cities, larger properties are clearly less expensive per square metre, which may be valuable information for families looking for more living space. Warsaw and Łódź, on the other hand, have a more balanced price structure due to broad and stable demand across different market segments.
The overall picture, however, remains clear. Small apartments continue to hold their value best and remain the most desirable product on the market. At the same time, people looking for a larger home may find relatively attractive offers in terms of price per square metre. Although the total purchase cost of a larger apartment remains higher because of its size, the differences in unit prices show that larger homes currently offer the most space for every złoty spent.
