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The current property boom in Poland is a bubble


davidpeake 14 | 451
12 Sep 2007 #91
point out that Australians are decended from British cast-offs

Many, thats not a overly true statement, more are actually from families that decided to move of their own free will.

But yes i agree some of us Australians do probably act correctly while away from home, but having travelled the world, i can say that you should not judge others until you see what your own country folk do while in other countries also.

Its not just aussies.
Spook
12 Sep 2007 #92
David Im winding you up :-)

Im blessed with both Australian and British nationality so feel qualified to comment on both
lietning921 - | 1
12 Sep 2007 #93
yes, once they begin with the easy credit...watch out the house will come tumbleing down....
hullo
12 Sep 2007 #94
To all you decent Australians out there I apologies for my rantings, but the majority of your country men are like chavvy Brits. Kunts

Stop talking about yourself in such a bad way, that reminds me your the one who was returning to Poland! Didn't work out, I thought so. Lol.

I'm glad you and the other Englishman have both left Poland, good riddance.
No decent Polish girl would be associated with you..
aussie
16 Sep 2007 #95
To all you decent Australians out there I apologies for my rantings, but the majority of your country men are like chavvy Brits. Kunts

Giles we are a group of true blue aussies, we have been known to enjoy a beer or two, we are heading to London for Christmas, would love to catch and discuss these comments with you, (we promise to leave out black belts at home)
milky 13 | 1,657
7 Jul 2010 #96
Its amazing how little discussion there is on this forum in relation to the massive property bubble in Poland..
f stop 25 | 2,513
7 Jul 2010 #97
get most uppity when decent British folk, like myself, point out that Australians are decended from British cast-offs and that many of them have a strange penchant for beastiality

way to deal with someone who just spent 20 hours on the plane! They might be rowdy, but Spook is just plain dumb.

er... what bubble?
milky 13 | 1,657
7 Jul 2010 #98
Its amazing how little discussion there is on this forum in relation to the massive property bubble in Poland..

buyinghousepoland.co.uk/polish-passports-visas.htm

I wonder why the"Discussion" button has not worked on the above for several months now.
I remember seen things like this before on Irish real-estate websites before the pop..
wildrover 98 | 4,451
7 Jul 2010 #99
Its amazing how little discussion there is on this forum in relation to the massive property bubble in Poland..

Maybe nobody gives a stuff about it...?
alexw68
7 Jul 2010 #100
That, and the big discrepancy between supply and demand mean it's not actually a bubble per se. Granted, there were a lot of developers who by 2008 were beginning to take the **** on a grand scale, but it wasn't anything like as systemic as what was going down in the US and the UK to a lesser extent with subprime.

Current prices may not reflect your conception of what constitutes fair value. That, however, has probably been true of the British property market for 15 years, not just the last 2 or 3.

So - supply demand inequality - yes: bubble, no.

A
milky 13 | 1,657
7 Jul 2010 #101
well according (wikapedia)to this they must
Over the span of years 2002-2008 real estate prices in Poland have increased drastically. Between June 2006 and June 2007 alone the average price of a square metre in Warsaw rose from 6,683 PLN (1,636 EUR) to 9,540 PLN (2,519 EUR) (over 50% rise in euro terms).[1]

According to a major Polish newspaper, Gazeta Wyborcza, the average monthly salary in Warsaw buys 0.26 m2, or in Kraków 0.22 m2.[2]

Same sources give rental profitability at 4% yearly. This is lower than interest rates on bank deposits (5% in Polbank etc.).[2]

In early 2007 the Polish property market began to show early signs of a property bubble; these included:

* banks increasing loan periods from 30 to 50 years to extend credit limits;
* over 1 million families already in debt, and roughly 300,000 more going in debt every year;
wildrover 98 | 4,451
7 Jul 2010 #102
Anybody want to buy my house...?
alexw68
7 Jul 2010 #103
Same sources give rental profitability at 4% yearly. This is lower than interest rates on bank deposits (5% in Polbank etc.).[2]

Rental profitability doesn't include the capital value of the asset. It also assumes that the majority of the rental income (the other 96%) goes towards paying off the loan - a benefit to the property holder in and of itself.

There is much more stock out there for rent than before: so, if you limit your thesis to 'there's a buy-to-let bubble', you begin to have a point with respect to those investors - and only those investors - who imagine they'll get a rental income while still paying a mortgage off on a property.
milky 13 | 1,657
7 Jul 2010 #104
If property triples or doubles in price over a short period of 3 yrs..Its a bubble...In Ireland the prices and wages tripled and it is now world famous world champion bubble burster.

Wages are as sh1t as ever inPoland and property has gone through the roof so its a bubble. Simple fact
wildrover 98 | 4,451
7 Jul 2010 #105
its not eactly a bubble though...more like a bit of froth , but more foamy..... i think..?
milky 13 | 1,657
16 Jul 2010 #106
Brendan Burgess, Founder, Ask About Money was on on RTE Pat Kenny Show 14th July
This guy(hypocrite) was on the radio on wed advising people on how to handle their major money problems in such hard times. He has just wrote a book(how to handle your money kind of thing lol) and people were ringing in, mainly all those people in the sh1t because they bought property during the bubble and now they cant pay and have not paid in months ets etc..

At the end of the show this "Guru" got a text from a viewer accusing him of encouraging the property bubble by closing down the debate on property prices on the askaboutmoney, website.

Burgess(who had huge audience) at the time of the bubble very very strongly encouraged people to join the property ladder before it got too expensive to get on. Now he has turned around to help people for money to fix what he helped create.

Anyway his answer to the critical text was basically, that the debate at the time was getting out of hand and a lot of people were using "bad language" so he closed down the debate.. Looks like we have these guys in Poland as well eh
pawian 170 | 11,336
18 Jan 2013 #107
the current property boom is a bubble- this bubble will burst, investors- beware! do your research, This is a wise advice so that is why I am passing on

Indeed. You predicted it well. Prices have gone down. People who took out loans in 2007 to buy their flats/houses are complaining about the drop of the real estate value.
pip 10 | 1,661
18 Jan 2013 #108
Indeed. You predicted it well. Prices have gone down. People who took out loans in 2007 to buy their flats/houses are complaining about the drop of the real estate value.

good grief, any idiot with a brain could have predicted a drop in prices. But there is no bubble. The prices have been slowly decreasing. Which, by definition, is not a bubble. A property bubble is defined as a sharp increase followed by a massive drop, kind of like jumping off a cliff.
milky 13 | 1,657
18 Jan 2013 #109
as a small developer in london, with a personal interest in poland, i have followed the polish market for a while - but never invested in it.
the polish residential market is being driven by easy credit by the banks, usually in swiss franc, the banks usually have an interest in the construction companies, the banks also have customers all of which are looking for an easy way to make money- anyone see a pattern ?
the fundamentals in poland are not there, it does not have a strong economy, poverty is rife, wages are still low, the current property boom is a bubble- this bubble will burst

Yea , he was right, and a long way to go yet. The media and experts are claiming 10%(closer to the 15, I reckon) drop in 2013. Due to Polish remittance and bandit/ government developer grants, the bubble has been deflating slowly. Anyone who bought since 2007 is in negative equity or denial.

remittancesgateway.org/index.php/press-clippings/economic-news/945-polish-remittances-expected-to-hit-new-record-in-2011
pip 10 | 1,661
19 Jan 2013 #110
Anyone who bought since 2007 is in negative equity or denial

we are actually neither. and we bought in 2009/2010.
Richfilth 6 | 415
19 Jan 2013 #111
Yesterday's announcement regarding the postponement of the Rodzina Na Swoim replacement will also send tremors through the markets.

Wyborcza reported yesterday that Mieszkania Dla Mlodych will be postponed until 2014. This caused outrage among developers who have promised to lobby against it.

The ramifications are serious. Developers who had built a glut of new real estate were counting on government sponsoring to shift units. Without that incentive, demand will slump, pulling prices down.

The most important change is the consent of the Ministry to the fact that in the villages adjacent to the provincial cities increased price ceiling giving the right to purchase an apartment with government support. Indicators still will differ from those for cities , but much less than expected .

In fiscal subsidies are to benefit only those who buy a new apartment in a price not exceeding the specified index by the governor of the average cost of construction . It is determined separately for the province and the provincial capital , for example . Warsaw price sqm . Could not now exceed 5790 zł per sq m . , And the rest of the Mazowieckie - 3450 zł per sq m.

MoOli 9 | 484
19 Jan 2013 #112
we are actually neither. and we bought in 2009/2010.

I actually 75% disagree on that as some places are still selling for same or MORE,all mine were bought before 2008 and are commercial never paid over 6800pln a sq metre,was offered till 11000,and some the offer is still there(mainly cuz the neighbour wants to expand) and some are down to 9000.Practically in Poland one can hang around with even vacant property longer as the real estate taxes are negligible and chenze is affordable.Any way the crisis has just started and it will with my 20 yrs in real estate,it will level off in around 2015 and boom/bubble will start and will be at its peak in 2020,it infact is time to buy in the USA where the banks are choking(EG.last 4/5 years i stopped getting even 1 letter for credit card offer from 10/12 letters and now i get 4/6 letters with credit card offers).

I am looking for commercial places in Nowe Bemowo now where with my research I found the price range was vast from 4700 pln to 8200 pln depending on location,size,renter,condition,work needed etc.So far 13 years coming to Poland and buying I figure there is no hard and fast rule in prices just an approximate,and location.About residentials I dont pay much attention but I think same rule applies and most Poles and new investors tend to buy flats as investments and go through the hassle of renting to students after students and pay no taxes,thus more hard work and illegality,thats why so many flats to choose from,whereas commercials are usually sold to known peoples and rented by companies before some are even built.Lately fresh point(there smaller version Zabka) and carefour express is looking badly to open places 75 to 155 sq metre ones.

Property prices will go down more thats for sure but they will hit right back ofcourse in that decade and a half period of time,and if even if you bought it in bad time,so what live in it and will shoot up guranteed eventually.
InWroclaw 89 | 1,915
19 Jan 2013 #113
Interesting, thanks for posting that.
pip 10 | 1,661
19 Jan 2013 #114
Practically in Poland one can hang around with even vacant property longer as the real estate taxes are negligible and chenze is affordable

But what people are posting here, with no real estate knowledge or experience, is that the market is going to explode like it did in the u.k or in u.s.a. It will not happen. There will be a steady decline then it will hit a point --it will not crash like the so called experts are saying here.

and many people also need to understand that Polish real estate is an enigma. It doesn't follow the rules of the rest of the world....otherwise it would have exploded by now.
MoOli 9 | 484
19 Jan 2013 #115
It doesn't follow the rules of the rest of the world....otherwise it would have exploded by now.

I agree because poles have more holding power(I think)then the banks who are choking(by the regulations) already to lend and make money(I read somewhere...3 banks got fined for bad lending practice).Just like any other country they will lend again and people will pay more to get what they want,even if it will be 50 year credit and dont forget the cash economy still exists in poland(like everywhere) esp when the sale of real estate occurs.
pawian 170 | 11,336
19 Jan 2013 #116
But there is no bubble. The prices have been slowly decreasing. Which, by definition, is not a bubble. A property bubble is defined as a sharp increase followed by a massive drop, kind of like jumping off a cliff.

Don`t be so meticulous about the words. Bubble or not, the fact is that prices have gone down by 30% since 2007.

September was the seventeenth consecutive month when the real estate in Poland got cheaper . Taking into account inflation, housing prices are almost a third lower than five years ago - the portal domy.pl.

Housing prices go back further lows. Domy.pl value calculated by the Housing Price Index declined 17th time in a row . It was 13.8 percent . lower than in September 2007 . Last , a slight price increase took place in April 2011 . The value of that index rose 2.1 points then oo .

Noteworthy is the value of the index price trend adjusted for inflation . It was lower by 32 percent . than in September 2007.

Grzegorz_ 51 | 6,163
19 Jan 2013 #117
There will be a steady decline

Will ? It's been happening for years.
Wroclaw Boy
19 Jan 2013 #118
is that the market is going to explode like it did in the u.k

The market didnt explode in the UK, Poland has seen bigger drops over the same time frame. The last UK crisis in the early 90's maybe described as a bubble but not the current one.
pip 10 | 1,661
19 Jan 2013 #119
Don`t be so meticulous about the words. Bubble or not, the fact is that prices have gone down by 30% since 2007.

sorry, but it is important. There is a huge difference between a steady decline and a bubble bursting. And that is basic economics.

And nobody has ever said that the prices were not going down. not ever. But there is no bubble and that is a huge difference.
pawian 170 | 11,336
19 Jan 2013 #120
sorry, but it is important.

If it is, let it be so. :):)


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