How are Poland's properties priced?

Have been in Polska for sometime now and i'm beginning to wonder how in the world are the Polish properties priced? I look at the Average Flat for starters and i'm talking of the ones built from the 70's to early 90's if you've been here long enough you know what i'm talking about.These flats were built from thin concrete panels sorry to say like Domino blocks probably in a child's play ground. Most of then are 4 to 5 stories high and the concrete is already cracking from the outside even though you can see some sort of fortification happening here and there.

One rule i know about these flats is that you are not allowed to knock down or move any of the so called walls with in which is quite logical. But there is a lot of upgrading happening in these buildings every day things like fittings, new bathroom units, double glazing and satellite dish fitting. Considering what is involved i always wonder what will happen enventually when the panels give into fatigue caused by all this upgrading.

So this brings me to my question how does one part with say 150 000zł for such properties knowing very well what is in store for them? How do they come up with a valuation for such properties? THIS TO ME SOUNDS LIKE A BIG JOKE I'D NEVER PAY HALF OF THAT AMOUNT TO BUY SUCH. There is'nt much difference with the Houses either you'll pay through your nose for a pile of rubble. Compared to the wages in the country it just makes me wonder if first time buyers can really get on to the property ladder.

You seem to misunderstand what value actually is (a common problem here when it comes to property). Something is worth what a person will pay for it. So a flat is worth what somebody will pay for it.

there is no property valuation as it's known in the west... the price is, like harry said, arbitrary and mainly based on greed but not on real value.

Or what someone will loan you to pay for it. Money is close to free at the moment, once that changes, prices will adjust accordingly.

I purchased a apartment, and can honestly say that it has NOT gone up in the last 3 years, in fact if I were forced to sell quickly I would have to reduce my price by about 30%. The fact remains more than obvious now is that buying real estate in Poland (unless to live in yourself) is a bad investment decision, no capital gain, poor rental returns and lots of maintenance. The problem was brought about by real estate cowboys telling people of a Polish housing boom, Its interesting to note that these one day wonders no longer post on this forum, they have either packed there bags and returned home or living off scraps in railway rest rooms. Ireland is in deep recession, and if you add on Spain, Greece, Portugal, hmmm Poland may be next!!!!

economist.com/world/europe/displaystory.cfm?story_id=15394158

I'm hoping somebody will jump in with a clue...
I know that there are certain fees as a percentage of the value of the property, does anyone knows on what are they based? From what I see, it's better to go with a 'second hand' classification, but I still can't find how is the value determined.

sorry what are you talking about or are we talking double dutch?

i already told you.. it's purely based on greed and whatever some sucker is willing to pay.. there is no valuation of properties in PL like it is in USA, 4 example.. it's like magic, man.

Same magic as in the US, and a magician called appraiser can tell you the given value based on the same magic numbers of the properties sold recently in the area.

The US also uses the bubble magic valuation. Where is that thread where some houses are valued at one dollar in the US? How would they arrive at that value?

They are overpriced (well, most are and few aren't).

If thats what i was missing here in terms of valuation, then its best to conclude that it aint worth investing in Property in Polska. Considering that property is the biggest investment that most people will ever make in their lives then it would definately be rediculous to purchase a house or flat in this country.........

No, it isn't worth investing in Polska. If I were you, I would just go to the Detroit area and buy as many houses valued at 1 dollar each as I could afford ...

I find this post interesting. Its not just how properties are valued.
I was looking at some Polish property websites the other day and decided to play around with their "mortgage calculators", it seemed on average that to buy a house or apartment in the region of 300,000 PLN, the maximum they would lend you was 154,000 PLN, only 50% of the cost.

My conclusion was that the banks are still unwilling to take even the minutist risk at all.
This Summer, the EU Banks, UK and USA are supposed to be coming up with proposals to regulate all banks. This will involve, setting a limit to the amounts of liquidity that these banks have to hold at all times to protect them from any future crises.

The percentage of ther liquidity has still not been decided so in the meantime, the banks are only investing in government bonds and increasing the interest rates to existing customers to build up as much cash as possible to make sure that they have adequate reserves to meet any regulations that may be brought in.

A prime example of this is the UK. Many billions of pounds of tax payers money was used to bail out the Royal Bank of Scotland and yet this bank is constantly being criticised for failing to lend to small business's, despite so called pressure from the British government which holds a 70% stake in the bank.

A large number of small business's in the UK who have never been in trouble financially are now having their overdraft facilities withdrawn or having to pay ursuary rates of interest on exisitng loans. The UK government bleats on about "recovery" and as usual, does nothing.

The banks do not seem interested in long term loans, they are so used to making huge amounts in the short term. Credit cards at 26% interest, small loan amounts ie:3,000 - 10,000 PLN and paying huge bonus's and dividents to their shareholders, that, they seem to have lost the plot about what the banks are there for.

Everyone now has to pay for the irresponsible lending/greed of these banks and indeed, to a certain extent, irresponsible borrowers. But, if you offer large amounts of money to people, without checking carefully on their ability to repay, defaults are bound to happen.

The value of property will be governed by the ability to borrow and the supply and demand.

Banks already have liquidity ratios which they have to uphold, but 1:9 doesn't do much good when 20% of your loans go sour.


Spot on, you've already explained the cost of construction here. On the flip side, buyers will either have to make enough money to afford the new constructions, or the price will have to come down.

No. Even if somebody were willing to lend me a million zloty to buy an apartment in the proposed Daniel Libeskind building, I still wouldn't pay the asking price for one. I don't think that those places will be worth the money. Also, when loans are harder to come by, people are likely to be willing to pay less money for something.


How a property is valued and what it is actually worth are two entirely different things!

And this is good, I think - better for them to avoid risk and stay stable, rather than getting involved in a mess elsewhere. Look at Sweden - they've practically had to resort to all sorts of threats towards Latvia, simply to stop Swedish banks from crashing and burning quite badly.


Depends - unfinished buildings are often available at a killing. I saw one building where you'd need about 500k to buy and finish it - but it was clearly worth at least 750k, if not more. For someone with the cash to do it, they'd be laughing.

The prices of Property in Poland have absolutely nothing to do with the economy of the country.Crap little apartments in areas where there is almost zero chance of gaining employment and even if you got a job it would pay less than half of what you would get on the dole in Ireland sitting on your arse. The property is bases on the wages of Poles living outside the country and naive investors. The average property if based on Polish wages would be the prices of 2003-04 or maybe 20% more. Just look at Mandom etc etc and their prices if you want to see a big joke. Supply and demand is an issue as well with their scumbag politicions holding back development so they can leech their people dry.I think the recession will have to really really hit Europe before the property in Poland reflect its reality.As long as there are Poles in Ireland and England etc working in Mcdonalds and other sh1tholes the property will remain through the roof. The investors are now running and it is time for the Poles to refuse paying for property as if it was built with bricks of gold...Gods playground...

Of course there are property valuers in Poland.. how on earth do yo think a bank assesses the value of its collaterral when it lends? They ask property valuers to give them an estimate...

PLK (glad youre doing good) hits the nail on the head when he says that property prices are based on greed. thats the long and short of it.

you will go and view 2 properties, next to each other - one has been renovated beautifully, the other is a mess. strangely enough they will be priced identically. mr greedy in property 2 thinks his is worth the same as the one that has been renovated. because he is a greedy fool.

long and short of it. no logic as we would understand it. this is poland.

harry says a property is worth what someone will pay for it. plenty of fools in poland prepared to pay over the odds.

mr bullfrog is right too. but the above polish property valuation technique applies. what else would you expect. seriously

No, he does it because he knows that the banks will loan some sucker to money to buy. Mr. Greedy has changed his tune a bit over the last couple of months, but he knows it's just a matter of time before the slop bucket comes out again.

I agree with Bubba, they are chancers and I've never met people as greedy as landlords. Mine is the exception as he goes out of his way to help but I've had to help others before who have had to contend with ludicrous claims by them. Too many people here want to be a 'Wielki Pan' but they shouldn't forget their peasant roots ;)

lol, what has happened??? you have changed your colors, are you not the same person who was telling us of a property boom in Poland?.

because the boom is a bust now.

i try, i try... thanks bubbawoo. :)

I think it is a bit sharp for people from the U.S., Ireland, England etc... whose housing prices have just been completely and utterly bust to be poking fun at a relatively, let me repeat "relativity", stable priced market here in Poland.

If it is so arse-ways here, why are all your countries wiping a great big bloody nose on the tax payer?


The banks send out their own evaluator when you get a mortgage here.
Admittedly this did get slack a couple of years ago when things were on the up-and-up but all this rigmarole credit crunch has popped that one.


Great post as always.

4 years of 25% year on year increases is relatively stable?

It's not poking fun, it's just a couple of simple questions. How can someone making an average salary afford to buy a place?

That has not been the case for a while.

It did shoot up at the beginning, from about 2000 but it is not up 25% year on year these last few years.

As that other poster is saying, a dollar for a house in the states?? is that realistic?

And as for Ireland it is still a long way to Tipperary and for the prices to be in anyway realistic.
In London it is a buyer's market, if you have the cash but that was after a fairly hefty lull.


There are sites (like open finance Poland) that provide answers to this and it is published in the papers too.

The 25% has been from '04-'08


No, that's idiotic.


Alright, according to your link, in Wroclaw it's 51 m2 for 306,000, seems about right (we won't even add in the 7% tax, or fees).

"Average" gross salary is 3,283.18, seems a bit high, but ok, we'll go with that.

That gives us a net salary of 2700 a month.

Lets be generous and say that you can come up with 25% for a down payment (37 months of full salary), that leaves us with a mortgage payment (on the low end, and adjustable) of 1400 a month, on a 30 year note. Fixed you're looking at 2000 a month.

That leaves the new "average" family with a 2+1 with 1300 a month, before things like insurance and bills.

Would you loan that family money?

For bonus points, salaries are expected to be stagnant for a good while to come.

looks like quotes are f*cked up

Its great to see a bit of common sense return to this topic, lets face it the the real estate boom crashed in the US was caused by the banks and the reason why property prices increased in Poland was due to foreign buyers and of course a limited amount of Poles returning and cashed up, buying at a inflated price, the majority of Poles cannot enter the real estate market and this is also the case in many other countries in the world. Greedy land lords are no greedier in Poland than any where else in the world. I'm sure many a land lord could give you stories of bad non paying tenants etc. I don't think renting out properties is a good way to make money.

because the way the polish real estate market has never made any sense.. it's not as stable as many people seem to think it is.. it's on very thin ice.. maybe what is saving PL is what avalon said.. that the PL banks are completely unwilling to take any risk at all..



exactly.. the perfect example. voodoo economics..


special conditions... most of the time it means the purchaser will have to MOVE that house off that property.. i've seen it many, many times.. sometimes it may be because the city/county wants the tax income.. like i said.. special conditions..


properties are way and i mean, way more affordable in the states then they are PL.. way more..


but it is if one does it right.. otherwise there wouldn't be any rentals out there at all.. one can make great money renting properties.. great money man.