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Prices of apartments in Krakow are collapsing further down in 2010-2011


polsky 2 | 84  
27 Oct 2009 /  #1
Over the span of years 2002-2008 real estate prices in Poland have increased drastically with over 1200.00%.

According to a major Polish newspaper, Gazeta Wyborcza, the average monthly salary in Warsaw buys 0.18 m2, or in Kraków 0.14 m2.


Same sources give rental profitability at 4% yearly.

This is lower than interest rates on bank deposits (6% in Polbank etc.).

In early 2009 the Polish property market began to show signs of a property bubble;

these included:

banks increasing loan periods from 30 to 50 years to extend credit limits;

over 2 million families already in debt, and roughly 500,000 more going in debt every year;

increasing interest rates number of new apartments for sale in Warsaw at Polish real estate portals exotic companies declaring real estate development plans;

Polish economy showing signs of the overheating due to government incompetence:

from 2006 to 2009 the foreign deficit almost tripled;

imports, which were decreasing (by 5%) in 2005, jumped to a 35% increase in 2009

stagnation of prices and dramatic drop of sales in a long period of time with dynamically increasing supply of residential properties.

All in all, the polish real estate bubble will burst very soon,
and prices will come crashing down
Michaelas  
27 Oct 2009 /  #2
Couldn't have said it better even myself.

99% of poles have no money to buy at these huge prices.

They make 2000 zloty per month on average, but the greedy sellers
ask for 6 - 20.000 zloty / sq.m.!!!

So the real estate market is blocked and it is going slumping down with a fuss
Grzegorz_ 51 | 6,163  
27 Oct 2009 /  #3
have increased drastically with over 1200.00%.

Nonsense number one... there's really many more of them in your post...
bolek 6 | 330  
27 Oct 2009 /  #4
All in all, the polish real estate bubble will burst very soon,
and prices will come crashing down

As I mentioned in a another post I don't think prices will crash, it just might level out a bit, sort after properties in central warsaw and krakow, gdansk will continue to rise because they attract a different type of buyer, definitely people who bought off the plan apartments may find the pinch and come out second best. Poles are not in the habit of selling there family home every five minutes like people in the west and all said and done the homes on the market for a population of 38 million people is very small, lets be clear a crash occurs when a mass of people are forced to sell for whatever reason and buyers are few, this causes a crash, this is not the case in Poland.

A lot of the spin and scare mongering usually originates from real estate agents.
Tadeusz2007  
28 Oct 2009 /  #5
Real Estate agents get more money if the prices are higher, so their best interest
is to come and say a lot of BS about how the prices which are absurdly high, that the prices
will rise even more blablablabla.

The REALITY FACTOR is that Krakow has bad infrastructure, the mayor is a guy with very primitive thinking, and as a result, the city is lacking almost everything to become a modern european city.

The prices of 7.000 - 20.000 zlotych / sq.m. will be soon a thing of the past.

But greed can be felt in the posts of many guys here, who own some Polish properties
and they still dream of selling them with some high profits,
IGNORING STILL ALL SITUATIONAL AND ECONOMICAL REALITIES
Popw  
28 Oct 2009 /  #6
Guys don't forget also that 4-6 millions poles went to work abroad,
and probably will never return to poland, meaning there is an

actual excess of 2-3 million houses/apartments that are for sale... ;)

Cars are a different thing than apartments.

If you buy an apartment, 4-6 people use it and that's it, for the rest of your life
mostly.

If you buy a car, you use it just 1 person usually, and you buy then a new car after
3-5 years, and then another new car and so on.

I talked with many real estate agents and I am sure that the polish real estate bubble will not explode in the very near future and prices will drop down dramatically
Wroclaw Boy  
28 Oct 2009 /  #7
The prices of 7.000 - 20.000 zlotych / sq.m. will be soon a thing of the past.

Thats a bit of an exageration, the high end 15,000 + PLN/m2 accounts for a very small percentage of stock. Many of those properties are the holy grail of Krakow real estate ie overlooking the Rynek, commercial is another story. I would have thought the current average to be around the 5500 PLN/m2 mark. You telling me that the old shite state communist blocks go for anything over 4500 / m2 and theres thousands of those.

The market in Poland is very strange, you can buy a huge house with acres of land in the country for less than 100,000 PLN, granted it may need some minor renovation but still. That just doesnt make sense. In the UK a collapsed barn in the country will cost you 1,000,000 PLN all day long.

I think the divide between rich and poor plays a significant part in Polish property prices.
southern 75 | 7,096  
28 Oct 2009 /  #8
I think in all communist countries there is lack of space to buid new aparments because the commies built everyhwere.So you have overpriced commie apartments.For sure prices will come dow,it is a bubble.

Unless foreign workers flood Poland which will not happen.
SzwedwPolsce 11 | 1,595  
28 Oct 2009 /  #9
I think the divide between rich and poor plays a significant part in Polish property prices.

Of course. The countryside and popular areas in Krakow or Warsaw are like different worlds.
It's a little different from some other countries where nice places on the countryside with some land cost a fortune.
Popw  
28 Oct 2009 /  #10
For sure prices will come down, it is a bubble.

Unless foreign workers flood Poland which will not happen.

Even if foreign workers will food Poland and come to work
here for the average wage of 1500 PLN/month,
still they will never have the cash for even the 10-30% advance
payment for any apartment these days... at the overinflated bubble prices
bolek 6 | 330  
28 Oct 2009 /  #11
actual excess of 2-3 million houses/apartments that are for sale... ;)

as if every person owned a house or apartment, most of the people who left poland were no hopers who neither owned a house or had a no job. The were what they call gentlemen of no means who would seek there fortunes abroad.
Claritaslux  
28 Oct 2009 /  #12
This is completely untrue pfff....

I have plenty of friends poles who are working abroad... they prefer having a salary
of 2000 GB Pounds per month instead of 2000 zlotych per month ;)

They had good situation in Poland, mostly owned apartments also.

Real estate agents will just say ANYTHING to convince you to buy in this overinflated
huge real estate polish bubble
bolek 6 | 330  
29 Oct 2009 /  #13
sure I agree that people who purchased off plan are now biting their fingernails, the obviously had nothing between the ears except suffering from delusions of grandeur in other words greed, as mentioned by somebody else some of the new apartments were stuck up in seconds and maintenance will be a bit issue in the future, most Poles due to lack of funds did not purchase these properties.

Lets be clear a person buying a house to be used as a family house is a good investment.
I think Real estate as a means of investment is out of bounds for a lot of astute investors.
Claritaslux  
29 Oct 2009 /  #14
Here is the opinion of a big investor from France, who lived in Krakow for 5 years:

when in march it is 0 degree celsius in krakow with no sun , in cannes it is 20 degree with big sun and bleue sea.
there are festival of cinema .
why rich people go for holliday in the french riviera ? and not krakow ?

there is nothing special in krakow , just young foreigner came before just because the girls was easy. that’s all.

venisia , florence , roma , paris , prague , budapest , are 10 time more beautifful than krakow

and krakow is only 750 years old ,there are many other city much older in europe.

sorry but jagiellonsky is not the oldest university in europe
the older is bolognia from italia and after it is paris

krakow is not the most beautiful city in europe , poor infrastructur , too cold , dirty city .

this is the reality .
it is my opinion , if you want think krakow is the top the the world , as you want
Ziemowit 13 | 4,258  
29 Oct 2009 /  #15
why rich people go for holliday in the french riviera ? and not krakow ?

They will not go for holidays in Stockholm either. Stockholm has not got the climate of the French Riviera.

You seem to be very frustrated about Kraków, yet all your thoughts here on the forum are about Kraków. Isn't it perhaps a matter of personal disappointment? If so, it is understandable and I am sorry for you because of that. But why won't you try to think of another place, move somewhere else and forget Kraków altogether. Just give yourself another chance; if anyone may advise you anything, I might think they will be just happy to do so.
Wroclaw Boy  
29 Oct 2009 /  #16
I have plenty of friends poles who are working abroad... they prefer having a salary
of 2000 GB Pounds per month instead of 2000 zlotych per month ;)

knowing the Poles they should be saving plenty of that so hey presto deposit for a property back in Poland.
Claritaslux  
29 Oct 2009 /  #17
Yes, Bulgaria which is very similar to Poland, has an average price per sq.m. of 375 euros/sq.m. and their construction sector declined now in october 2009.

But in Poland, where the developers still sell with 200-300.00% profit margin, and in Krakow where they sell with 400-600.00% profit margin, the construction sector are up

and building and building for awesome big profits :)

The Bulgarian construction sector is among the hardest hit – third from the bottom in Europe – but the worst fall was in Spain where the sector shrank by 20.5 per cent over the identical period. Romania, with a 17.5 per cent decline, is in second place. Poland marked increased activity – a 10.6 rise – whereas Germany's construction rose by 1.9 per cent. On average, Europe's construction sector is down 12.9 per cent

Source:

w w w.sofiaecho.com/2009/09/24/788904_bulgarias-construction-sector-shrink s-by-145-per-cent
Popw  
4 Nov 2009 /  #18
yes poles should be saving a lot, cause price of properties in the frozen cold Krakow, are much higher than in sunny Greece, France or Spain...
Claritaslux  
5 Nov 2009 /  #19
They will not go for holidays in Stockholm either. Stockholm has not got the climate of the French Riviera.

Yes, but in Stockholm the average salary is about 4 000 euros/month, while in Krakow the average salary is about 400 euros/month.

So if the average price per sq.m. in Stockholm is about 2 000 euros / sq.m.,
the correct price per sq.m. in Krakow should be 200 euros / sq.m.

Yes it sounds unbelievable, but it is this kind of prices we will have after the real estate
bubble finally crashes back to normal correct levels based on demand and supply

Everywhere in the whole wide world, the prices per sq.m. are directly effect of the level of the average wages/salaries per month.

Why should Krakow be the only place in the whole wide world, where average salary is 400 euros and average price per sq.m. is 3000 euros/sq.m. which is totally absurd and nonsustenable and therefore will collapse
Wroclaw Boy  
5 Nov 2009 /  #20
Everywhere in the whole wide world, the prices per sq.m. are directly effect of the level of the average wages/salaries per month.

Not in:

London and 100's of other English towns and cities
Barcelona
Sharm el Sheikh
Moscow
the list goes on and on

the thing is mate, i personally know many mortgage brokers in Poland and its the Poles that have and will be buying the majority of property on the market. I sold a house last year at a very good price to guess what? a Pole. Statistically speaking one particular mortgage company through 2006 - 2007 brokered 95% mortgages to Polish people, go figure, and guess what the average price / m2 was around 5500PLN.

Dont ask me where they get the money from but they do....

I agree property is over priced in the cities and needs to come down a bit, but your logic is just absured.
Popw  
5 Nov 2009 /  #21
90% of the people think like me.

The rest 10% are wishful thinkers or banks or real estate agents, who think prices can stay so high in a bubble... forever =)))
SeanBM 35 | 5,808  
5 Nov 2009 /  #22
90% of the people think like me.

Only because you have so many accounts.

The rest 10% are

The rest of us.
Wroclaw Boy  
5 Nov 2009 /  #23
You mean 90% of people who dont own property, if i owned a property in Krakow id be one smiling muthafcuker. Any property owner and there are many in Krakow will be hoping and praying they go up even further, i dont think 90% is at all accurate.

When i first got married in England early 2000's and wanted to buy a property i also thought as you did as did others not on the ladder, i waited and waited for a crash, watched the market defy all odds in its ever increasing capacity. Mortgage loans increasing from 3 times an annual salary to 5 then up to 7 and beyond. In the end average Joe Bloggs didn't have a chance of getting on the housing ladder unless you were married and both had above average salaries and that you could find at least 5% deposit. Once your on the housing ladder its easy to upgrade, you simply move equity onto the next property, getting there is always difficult.

The fact remains that the vast majority of property bought in Poland is and was by Poles. Its not a bubble, if you want to blame anybody its the money hungry developers prematurely pushing up the prices. A bubble is Florida, Spain, Bulgaria mainly overseas investors. Poland does not and will not fall into that category.

A market correction is what were witnessing right now, not a crash at all.
OP polsky 2 | 84  
8 Nov 2009 /  #24
Supply is outstripping demand on Poland's real estate market when it comes to investment plots. This trend in turn has triggered a sharp downward trend in prices, according to a report compiled by Colliers International.

Source: constructionpoland.com/next.php?id=76791
Wroclaw Boy  
8 Nov 2009 /  #25
POland's freezing Krakow prices are average 3 000.00 euros/sq.m.

What? 3000 EUR is 12,707.53 PLN at todays exchange rate, you are done my friend. So youre claiming 12,700 PLN is the average price / m2 in Krakow.

Your figures are changing all the time, I dont have any more time for you fool.
Avalon 4 | 1,068  
8 Nov 2009 /  #26
polsky

#27
"Supply is outstripping demand on Poland's real estate market when it comes to investment plots. This trend in turn has triggered a sharp downward trend in prices, according to a report compiled by Colliers International."

So, plots of land are not selling and could go down in price. Which should explain to you that,
nothing new is being built at the moment and that soon, there will be a shortage of new accommodation to buy. You contradict yourself on your other posts.
OP polsky 2 | 84  
8 Nov 2009 /  #27
Bronowice and Nowa Huta should not be counted as being Krakow.

I think that the avrage price in Krakow is about 8000 pln/sqm which is still much much too high.

And this if you count the suburbs and the dirtiest places in Krakow where NOBODY wants to live...
Grzegorz_ 51 | 6,163  
8 Nov 2009 /  #28
Over the span of years 2002-2008 real estate prices in Poland have increased drastically with over 1200.00%.

So in 2002 the prices in Poland were 150-600 zł per m^2 ? lol...

this thread is about the expected, or not, drop in property prices in krakow
bolek 6 | 330  
8 Nov 2009 /  #29
The reason why prices have gone up is that those 2 million poles who went abroad, sent back to Poland some 125 billion Euro in the last 5 years, most of this would have gone to real estate, this may explain why prices have gone up against a general down turn in the real estate market in the world and now with less money coming in from foreign sources the real estate market is coming down.
SeanBM 35 | 5,808  
8 Nov 2009 /  #30
this thread is about the expected, or not, drop in property prices in krakow

Gregs comment was pointing out the nonsense of the OP spammer's bogus claims.

the comment was not directed at Greg, but to all who wish to post in this thread.

polsky
Michaelas
Tadeusz2007
Popw
Are all the same person.
This spammer has found a loop hole in PF's guest system and continues to post bogus statements with no back up and manipulating the facts.

Over the span of years 2002-2008 real estate prices in Poland have increased drastically with over 1200.00%.

This is opinion with no facts or knowledge of the real estate business.

the real estate market is coming down.

Links???

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