Results of construction in Poland in June 2019

First, wages surprised, then industrial production, then stabilization through retail sales. The disappointment is again due to Polish construction, which fell by 0.7% in June 2019. y / y. Like the previous cases, the main responsible is the calendar. "We can no longer dream of GDP growth of 5%," says Jakub Borowski, chief economist of Crédit Agricole.

In June of this year, this was two fewer business days than in June 2018. Hence the bulk of negative surprises in the core macroeconomic data released every 30 days by the US. Central Statistical Office (unfavorable trend encompassing wages, industrial production and, in part, retail sales). The time has come for construction.

Results of construction in Poland in June 2019

The output sold by construction companies fell 0.7% in June 2019. vs. 9.3%. growth in May. The market consensus assumes an increase of 3.5%. The Central Bureau of Statistics writes:

After eliminating the influence of seasonal factors, the production of construction and assembly increased by 4.7%. than in June of the previous year and 0.1%. higher compared to May Br.

With a full data set for April, May and June, GDP growth in the second quarter of this year can be more or less estimated. We already know that it is probably lower than the first three months of 2019.

"This is the end of the construction led Eldorado by the EU and the local government funds" hill ". The end of dreams on GDP growth of 5%. The current and expected construction portfolio shows a steady slowdown in growth, "said Jakub Borowski, chief economist at Credit Agricole.

In addition, according to Urszula Kryńska of PKO BP, in addition to the calendar effects, psychological factors also acted at this precise moment: very early holidays began which, in the opinion of an economist, could have encourage previous vacations.

– Another problem not to neglect is the record temperature. At such temperatures, the outdoor float can be dangerous, businesses can save time off. Submission of these factors slowed production. These factors will rather reverse in the months to come – estimates Urszula Kryńska.

"The second quarter of the Polish economy has turned out as weak as the first was strong, which is clearly visible in this quarter," say mBank analysts. Economists estimate that GDP growth over this period will be about 4.5%.

Budowlanka legacy

The information on the results of construction is not the only data published by the CSO today in this industry. We also learned that the number of apartments whose construction has just started has also decreased by 14.7%. y / y. In addition, the number of building permits has also been increased – by 4%. y / y.

Does this mean that the housing market in Poland is getting colder? Probably not.

– A reduced number of building permits issued should be associated with excessive bureaucracy of the administrative authorities. This is not related to the demand for housing which, in my opinion, will always remain at a high level. Unacceptable construction procedures, lengthy administrative procedures and procedures related to various types of decisions have a negative impact on the real estate sector – said some time ago Zbigniew Juroszek, president of the development company Atal.

The availability of land is also a problem. – Certainly, the lower number of building permits issued may be related to the availability of new land. Developers want to build more and more, but unfortunately, the stock of plots for investment is limited. In addition, after the purchase of land, the extended administrative licensing procedures are another obstacle to the rapid introduction of market investments – explained Janusz Miller, Director of Sales and Marketing at Home. Invest.

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