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


inkrakow  
3 Dec 2009 /  #61
especially that bank allows mortgage payment of ONLY 40% of the income.

The average LTV is 93.5%, going up... Maybe your credit rating isn't very good?

Coincidentally, that's what we're seeing right now in Poznan, with premium developments going for around 6,000PLN/sqm.

Exactly. Analysis by Open Finance shows that a working couple earning the average Polish salary (not the average Krakow salary, which is higher) can afford to buy a 50m2 flat in Krakow and that this is rising, whereas a single person earning the average Polish salary can afford to buy 24m2 in Krakow. To me this sounds about right.
Kowalski2007  
3 Dec 2009 /  #62
This is to prevent people accumulating huge debt and prevents the type of thing that your point suggests.

Good, so you agree with us. You are making finally many steps in the right direction.

inkrakow, LTV has NOTHING to do with how much you can use for mortgage monthly payment towards the bank, from YOUR TOTAL INCOME. 40% is the MAXIMUM allowed percent, and NOT 93 % ROTFL. Stay in your bench if you have no idea about how mortgages work.
delphiandomine 85 | 18,254  
3 Dec 2009 /  #63
Sean already pointed this out, but...

I'm not wrong, firstly the average wage is around the 3000zl mark, can we agree?? take home around the 2000zl agree?? x 2 is 4000, keep in mind that's the average wage

I've already told you - about 3300zl is the average brutto wage, netto about 2400zl or so. x 2 is 4800zl - and that's ignoring the somewhat well developed 'black' economy for trading of services.

I know many people who take home 1500zl ie teachers and bank workers, how are these people supposed to live on fresh air you may suggest, the reality is that things are pretty expensive in Poland ie running a car, computer, food etc

There are small, functional apartments in many cities that can be bought for these people. They're maybe only 25-30sqm, but they do the job for a first time buyer couple in such a case. And food is most certainly not expensive!

if say a couple purchased a modest apartment for say 450,000zl and had a deposit of say 100,000zl, it would take them a lifetime to pay off the morgage. Even a professional person in Poland looking at purchasing a house in the upper market would have a big morgage.

Who on earth on average wage is buying apartments for 450k when you can get a large-ish flat (3/4 rooms, 60-80sqm in a renovated communist-era block) for about 300k at the moment?

Professional people in Poland don't buy 'houses in the upper market' either, so the cost of them is irrelevant.

Take a good grip of yourself and think before you talk. Its either Polish incomes are too small or real estate properties are too expensive. by the way a pensioner receives about 800zl a month.

A pensioner also tends to live in a flat which they obtained during communist times, or lives in social housing. There's also plenty of pensioners out there who worked solely in Communist times and yet earns hard Zloty pension now - and these same pensioners are enjoying rather large pensions!

Again, pensioners aren't buying property, so what have they got to do with anything?

The Polish government is in debt.

Show me a government which isn't? :)
SeanBM 35 | 5,808  
3 Dec 2009 /  #64
Actually I think I may have been wrong.

They have just started selling appartments in the Wawel (an old building in the centre of Krakow). Needs a lick of paint and to be insulated but appartments are being sold for 48 000 - 80 000 pln! for 1000 metres square 15 bedroom apartments complete with gym, swimming pool and butler.

A person should not pay more than 5 years (let's say MAXIMUM 10 years)
for a shit_ty apartment, so 48 000 - 80 000 pln will be soon the MAXIMUM price
for a flat in the center of Krakow

You are off your head.

Good, so you agree with us.

hahahaha, there is just you and only you.

You are making finally many steps in the right direction.

You are not right and to be honest, you are unequivocally the biggest multiple personality
poster I have ever seen. But hey, why let facts get in the way of your delusions and regret?
milky 13 | 1,657  
3 Dec 2009 /  #65
bubble bubble The Polish property bubble is fcuking insane.. I have friends in Poland with mortgages that are criminally high.. They bought at these prices because of all that spin and hype spread by free market dogs..The prices are going to crash and its going to be worse than Ireland. Anyone stating the opposite is a developer or a fool who has been bitten and is in major denial..How the prices went to such an extreme height defies logic but greed was a big big big player.
SeanBM 35 | 5,808  
3 Dec 2009 /  #66
bubble bubble

Toil and trouble.

But just being in Ireland during the crises does not make you an expert on Poland.

Or have you not had enough of bubbles?, that you want to leave Ireland after it has burst and come here to Poland to watch the next one? (according to you).

You haven't a clue what you are talking about.

I have friends

Such a reputable source and the detail leaves nothing to the imagination.
Wroclaw Boy  
3 Dec 2009 /  #67
I have friends in Poland with mortgages that are criminally high

CHF Swiss Franc mortgages play a large part of that problem, many borrowers bought in CHF when the Zloty was strong. It was never going to stay strong for a long time against an established currency like the CHF, so it weekend along with their property prices. Thats one hell of a situation to be in, most property owners need 20% equity just to cover the difference in order to pay off the foreign currency loan, add that to the fact that property prices have dropped and its a lose lose situation, no way out at all.

The mortgage brokers play a huge part in this, talking the talk to seal the deals, but intently missing the very vaild point that currency exchange rates fluctuat directly affect your monthly repayments.

Many banks are offering minimal payment schemes to limit the amount of reposessions.
SeanBM 35 | 5,808  
3 Dec 2009 /  #68
CHF Swiss Franc mortgages play a large part of that problem, many borrowers bought in CHF when the Zloty was strong.

It certainly depends on when you got your CHF mortgage.
Swiss dropped their interest rates (Q4 2008) and now the mortgage you pay is more or less the same as it was before the PLN was over valued.
Harry  
3 Dec 2009 /  #69
Many banks are offering minimal payment schemes to limit the amount of reposessions.

Not to limit the number of repossessions, it's to limit the amount of sh!t which they find themselves in. I've got a good friend in Warsaw who has a mortgage which is currently in the region of 400,000zl (or at least the CHF equivalent of that amount) and is secured on a flat which would probably now sell for 250,000zl (the wisdom of getting a 110% CHF mortgage!). Even if the bank repossessed, they'd still be out by 150,000zl! What they want to do is keep people paying something, anything at all, rather than just saying "Here are the keys, flat's yours now mate".
SeanBM 35 | 5,808  
3 Dec 2009 /  #70
I've got a good friend in Warsaw who has a mortgage which is currently in the region of 400,000zl

When did he take out the mortgage in CHF?
Peter Weg  
3 Dec 2009 /  #71
Goldman Sacks say the Zloty is clearly under valued, the Zloty will rise again.

blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100002454/top-tip s-for-2010-courtesy-of-goldman-sachs/

Obviously prices in Krakow are ridiculously high in relation to wages and should come down. However, A report on all Europes markets said two things about Poland. First, there is massive pent up demand for property, there is a shortage of living space for the population and a lot of it is ****** communist era.

Second , even in the boom, the number of new builds were small compared to other countries - there isn't really that many new buildings for sell.

Another thing holding up prices is the Polish expat community in the UK, France and USA etc who can buy here even at the inflated prices.
SeanBM 35 | 5,808  
3 Dec 2009 /  #72
Goldman Sacks say the Zloty is clearly under valued, the Zloty will rise again.

I agree but I doubt it will get back to 3.3 against the Euro.

Obviously prices in Krakow are ridiculously high in relation to wages and should come down.

The examples given by some of the posters on these forums is ridiculous but it certainly does not represent the average price in Krakow.

Kraków:

(average price per M2) = 6 533

(family a couple pluse a child can afford) = 47,5 M2

(single person can afford) = 23,6 M2

Open Finance
open.pl/news/wieksze_mieszkanie_za_srednia_pensje.html

And remember they take the average wage from Poland and the apartment prices from Krakow, so it is still a bit off but I won't argue it too much :)

Second , even in the boom, the number of new builds were small compared to other countries - there isn't really that many new buildings for sell.

Developers here were quick to stop new projects over the next few years, just finishing what had already been started and not coming down in price.

Not to say there are not new developments but a couple of gear shifts down.
There are also not very attractive so called "high end" apartments that are not being moved or just over valued apartments but a quick comparison would have you out of the woods on that one.
Harry  
3 Dec 2009 /  #73
When did he take out the mortgage in CHF?

June last year!
SeanBM 35 | 5,808  
3 Dec 2009 /  #74
Crud. Worst time to have bought CHF.
I was tempted myself because of the overvalued Zloty.

If I remember correctly it was about 2 PLN to CHF at the time and now it is about 2.7 but I would have to search to find out the exact figures for June last year.
delphiandomine 85 | 18,254  
3 Dec 2009 /  #75
Goldman Sacks say the Zloty is clearly under valued, the Zloty will rise again.

I'm going to argue with them and say that as long as Ukraine, Hungary and the Baltic States remain on edge of a great fall (and they are, there's no doubt about that) - then the Zloty is not overvalued.

If the Lat had devalued (and it still might - Latvia can't take any more shocks!), then it almost certainly would've taken the Kroon and Lita with it - with the Hyvrina and Forint going too. There's no way that the Zloty would stay where it is in such an eventuality - look at how people bailed out on the Zloty the second there was a hint of trouble in Eastern Europe.
Kowalski2007  
4 Dec 2009 /  #76
bubble bubble The Polish property bubble is fcuking insane.. I have friends in Poland with mortgages that are criminally high..

More and more people are seeing the TRUTH.

People's Greed plus speculators' greed and blindness plus banks' greed

equals the biggest current bubble in real estate in Poland !
SeanBM 35 | 5,808  
4 Dec 2009 /  #77
Prove it.
Back up your statements with facts.
Supply links to reliable sources.
Enough agreeing with yourself, time for some work on your behalf to backup your statements.
wawkrak - | 8  
4 Dec 2009 /  #78
I have a friend in a developer in warsaw and she says they are selling sweet FA. They are trapped because the bank who funded the developnment will not let them drop the prices.
Avalon 4 | 1,068  
4 Dec 2009 /  #79
kowalski2007, also known as, Emil Kowalski, Claituslux, popw, Claritus sux, popwasser, Polsky, Specialpolak, special-Polak, Mcduff, Michaelas, Tadeausz2007, spimowitzss etc..etc.etc

More signals of real estate price stabilization

3rd December 2009

Recent transactions on the real estate market indicate that the trend of falling property prices is coming to an end.

According to data from the Association of Polish Banks (ZBP), in the largest cities, prices have even begun to rise.

“The stabilization of prices in Poland is already a fact. After dynamic changes in the first half of the year, a lack of fluctuations after Q2 is something new,” said Joanna Tomczyk, an analyst with redNet Consulting.

Przemysław Pączek from advisory firm ProDevelopment added, “The prices of flats have already reached their lowest levels.”

The data revealed by ZBP also show that property developers will commence construction of around 60-75 percent fewer residential estates than in the previous year.

“First they will want to sell what they are left with," said Pączek.

The average transaction prices in Warsaw amounted to zł.7,853 per sqm in Q3 of this year.

Source: Rzeczpospolita

Read and weep you sad, deluded person.
wawkrak - | 8  
4 Dec 2009 /  #80
with all due respect AValon, the banks who did the survey "Association of Polish Banks (ZBP)"

Do have a motive to talk the market up because they are in deep doo doo. I do not care one way or the other because I do nto have any property in Poland. I would say look at who is spinning the story and also be wary of any body saying anything one way or the other.
mbiernat 3 | 107  
4 Dec 2009 /  #81
"In Warsaw the price for new apartments fell by 15%, declining more than
secondary market units, as the boom in supply (a record 17,500 units delivered in
2008) outpaced weakening demand. Ober-Haus forecasts that 16,500 new units
will be delivered to Warsaw in 2009 which together with financial crisis may effect
in further price correction"
Source: Peter Gage Morris
Managing Director
Ober-Haus Real Estate Advisors
Avalon 4 | 1,068  
4 Dec 2009 /  #82
wawkrak
with all due respect AValon, the banks who did the survey "Association of Polish Banks (ZBP)"

The artical I posted, cites 3 sources. And I suppose you are yet another alias of mbiernat who works at an accountants and cannot tell the difference between Pounds, zloty and euros.
wawkrak - | 8  
4 Dec 2009 /  #83
I do not care about the real estate market in Poland as I do not have property there but I do have friends in developers who tell me nothing is moving. Absolutely nothing because people need loans and the banks are not lending on indvidual units.

It is an immotive debate as people have vested interests. If you have property you are on one side if you have none you are waiting for armmegeddon.

The truth is somewhere inbetween in my personal opinion. Property was over inflated and it needed to come down, I would say we have another year of slight falls to go.
SeanBM 35 | 5,808  
4 Dec 2009 /  #84
In Warsaw the price for new apartments fell by 15%

From the same source.

2008 saw the reversal of previously meteoric price rises in residential real estate. After years of double-digit price growth, price rises in Warsaw were nearly flat (+2% on the year) while prices started to decline in all other cities. In Krakow, Poland's historic old capital, prices fell a moderate -1%, in Wroclaw -4%, in £ódź -6%, in Gdansk -8%, in Katowice -9%, and in Poznan -12%.
Price declines were driven mostly by reduced availability of mortgage financing, as was the case throughout all of the emerging Central European economies. Additionally, an earlier overshoot in prices set the stage for some sort of correction.
As the Polish currency, the zloty, fell by 14% on the year, price declines in euro were more marked.

PDF file from here
ober-haus.com/files/Short%20Real%20Estate%20Market%20Overview_Poland_1Q2009_.pdf

we have another year of slight falls to go.

I am not sure if anyone is arguing with that.
But there is a guy on here that spams these forums, using an array of aliases, screaming CRASH! who hasn't a clue about real estate.
Kowalski2007  
4 Dec 2009 /  #85
I do not care about the real estate market in Poland as I do not have property there but I do have friends in developers who tell me nothing is moving.

One or two or three or four or more years of price falls, after 20 years of ONLY PRICE RISES in Polish properties prices... ;)
SeanBM 35 | 5,808  
4 Dec 2009 /  #86
So tell us, what do you do for a living?
Have you ever bought or sold real estate in Poland?
Are you screaming about a crash from some previous disappointment?
How do you keep up with all your user names? do you have them written down on a piece of paper beside you there at the computer.

You will probably do what you always do and log in with yet another user name, beifre this one is no longer a guest and make a brash statement with no back up etc... and your cycle continues...
dtaylor5632 18 | 2,007  
4 Dec 2009 /  #87
If I knew someone with those symptoms I could section them under the mental health act ;)

This guy makes me laugh :)

Can't wait till I can buy a wing of the palace with my weeks wages here :D

Put me down for the west wing please, I'd like the river view.
Kowalski2007  
4 Dec 2009 /  #88
SeanBM it is funny that each time I talk SPECIFICS, and exact numbers and figures, all you do is just flame personal attacks, ignoring the COLD HARD FACTS AND ALL STATISTICS AND ALL CLEAR ARGUMENTS THAT ARE SHOWING WITHOUT A DOUBT THE CRASH IN REAL ESTATE PRICES THAT WILL BE IN 2010 in all Poland
SeanBM 35 | 5,808  
4 Dec 2009 /  #89
I dealt with 'your select section' taken out of context from Ober Haus to which you have no comeback I see, except for the same old negative opinionated uneducated failing statements.

What happened 20 years ago in Poland BOB? hey? And should prices now return to that of 20 years ago Bob?

COLD HARD FACTS AND ALL STATISTICS AND ALL CLEAR ARGUMENTS THAT ARE SHOWING WITHOUT A DOUBT THE CRASH IN REAL ESTATE PRICES THAT WILL BE IN 2010 in all Poland

You have no proof, no statistics that say this, no cold hard facts.
You are just pushing your own bias opinion.
Friday night and all, give it a break.
dtaylor5632 18 | 2,007  
4 Dec 2009 /  #90
Whats the ratio between the population of Krakow and the amount of new developments?

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