Advice on what Polish city to invest in....

How many times do i have to tell you before it sinks in.I am a property investor,i am not an agent.How can you possibly call me deceptive.I have answered all of your questions.

The reason i care what happens to the Swiss Franc is because it is my money that i am investing and i am the one that is taking out the loan something you do not understand because you have probably never bought a property in your life!

I will give you a current example of one of the flats that i am about to exchange on and just for you i will keep it simple so just maybe you can grasp the facts.

The flat is in Lodz city centre,off plan with completion in over 2 years time.It is approxamately 54sqm at a price of 6300zlm2 with a deposit of 10% and a garage space at 22000zl.I have also included 15% for fit out that the bank will finance.After the 10% deposit the bank will be financing this to the tune of 371907zl.After a couple of years the interest rate on swiss Francs may well be about 3.75%, so on an interest only mortgage this will equate to a monthly mortgage of 1162zl per month.I have established that for this type of flat ,in this location i can get a rental of around 1600zl per month at present.It will be more in over 2 years time.I am more than covering the cost of the mortgage and will keep the flat for at least 5 years with the capital appreciation that this will bring over 7 years.

This development is closer to the city centre than Schleibera ,the implications of which given your previous comments you would probably not understand.

Your comment about michael c ,dmmm ,and myself is so ridiculous that it does not deserve a reply.

One other thing i will say is that Location is the single most important factor in property investment and one thing that i will agree with matey on is that some developments in Lodz are very overpriced and in less than desirable locations,as a result of this some investors both Polish and foreign will catch a cold.

ok, i see what is on here.... either you are completely a novice with the confidence and attitude of donald trump or you are pulling us a leg here...

the scenario you are describing is a sales case for agents. that is exactly, i mean exactly what they say to people, i mean this is the rosy scenario coming to life!!! are you real? its detached from reality in the city of lodz. the rent you say you can get is imaginary. i am sorry to be harsh, but generally the way you do your math is naive.

anyway, lets keep in touch. i may be buying your appartment at 4300 plz definitely in less than 5 years when your costs will be much higher any income you may get and you will be in hurry to get rid off.

ok,
if i am so naive why dont you show me the figures !

Do not even think about buying a flat in Poland nowadays.

The flats are highly overpriced since it's cheaper to build Your own house instead of a stupid flat, and many, many do! Building credit for first 7 months of 2007 is over 1,000,000,000 PLN (it's 46% more than OVERALL CREDIT from last year, so at least 4x more people will raise a loan in 2007 tan in 2006!).

Actually my mother is working as developer and I know it's much harder to sell a flat, because speculators made the prices really to high and there's no way to find people to buy these flats.

NOBODY wants the flats. You can loan the flat to students (but there's less and less students every year!) and then get cash from them, usually not more than 300-600 zl (in my city max 250 zl while 1 square meter is 6000 zl+) after 100 years or smth like that You will have Your cash back, lol.

OK, let's talk about my city.

1^2 meter flat - 6000 zl (average)
500000 zl / 6000 zl = 83 square meters flat

1^2 km = 100000 zl (depends on place, 100000 in about 20-30 kms to my city)
1^2 meter of house - 2250 zl (average)
(500000 - 100000) / 2250 = almost 180 m^2 HOUSE !!!

See the difference? It's 3x bigger NEW house than the used flat for the same cash!

And NOWADAYS flats in BERLIN are more CHEAPER than in Poland (I'm sure was few months ago). Really, much better is to find something in rich Germany (especially Bavaria wich is the richest area of EU) than in Poland, where You will sell You flats in next 10 years to Russians, because all Young Poles will have houses and the rest will work in UK, Holland, Netherlands, Spain, Italy, France, Germany or the USA.

I have been looking at the Polish market for some time and i find the rental yields unattractive. At current prices versus rents you are looking at gross yields of 5% at best. You have to strongly believe in future growth for it to make sense.

If you are looking for short term gain i.e to assign the preliminary contract before the project is completed, you have to consider that the end user buyer can only get a mortgage based on the original contarct price not on the uplifted price. So prices may have risen but you might not ne able to take advantage of them.

Hi Bigmoe,

You can now obtain a 90%--10% LTV irrespective of the original contract price.Up until a very short time ago you could not leverage ,this has changed and there are some financial products available now that will enable you to do this.I will ask my broker if she minds her email being posted on this site so you could contact her directly if you like ,and obtain a more detailed explanation.

Kneehawk,
I would very much be interested in details of how and which banks will lend to end users based on full value rather than original contract value.

Bigmoe,
Her email which she does not mind me posting is,marta@connectoverseas.co.uk
Let me know how you get on.

bigmoe, be careful with the brokers...

hi kneehawk, did you get my PM?

Hi Lodzinvest,

If you mean the one on Lodz, yes and it was sock on.