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Residential real estate values go down in Poland


Wroclaw Boy
14 Jan 2012 #301
and exposed you and Co, to be nothing more than a pack of opportunistic chancers

would that include the people that have banned property graphs from being published on the internet.
milky 13 | 1,657
14 Jan 2012 #302
people that have banned property graphs

banned?? your words buddy..
cms 9 | 1,255
16 Jan 2012 #303
So in other words, a newly-wed couple only have to earn 30k for a deposit. Not really difficult - they'll have little expenses and will simply have to cut back on "nice" things for a while - just like newly-wed couples all over the world.

I think you are out of touch with the typcial struggles of a Polish household. In fact if you ask bankers and economists raising a deposit is a major issue - when the banks wanted 10% or sometimes 5% maybe not a problem but if they start to look for say 15% then it will be out of reach for most.

Lets take this mythical couple with 2 full time earnings after tax of 3000 zloty. Assume they live in a flat already and rent at the market rate of 1200. One of them runs a modest car and the other one gets the bus to work. They have cellphones, internet access and the minumum furniture but they do have a fridge, telly, dvd and a few other standard things.

Rent 1200, czynsz and bills 500, internet and phone 250, car loan 250, petrol 600 (say 2,5 tankfuls), parking 150, insurance and car taxes and services 200, bus 150, food (bare minimum 10 zloty a day) would be 620, clothes (bare minimum 100 per month each in order to look smartish for work) 200, toiletries and cleaning plus car fluid etc 200, hire purchase for tv, fridge etc say 200.

Thats already 4200 zloty with no entertainment, no christmas presents, no medicine, no holidays, no decoration in their house, no "essential" unexpected expenditure (weddings, christenings etc), no books, no music etc presume you get the picture.

So they can have no nice things at all and would still need to save every groszek for 16 months in order for a deposit. Throw a child into that equation (which for many is the catalyst for wanting to buying instead of rent and you can surely see it is a huge problem.
delphiandomine 88 | 18,455
16 Jan 2012 #304
I think you are out of touch with the typcial struggles of a Polish household. In fact if you ask bankers and economists raising a deposit is a major issue - when the banks wanted 10% or sometimes 5% maybe not a problem but if they start to look for say 15% then it will be out of reach for most.

To be honest, if they can't raise 15%, then they shouldn't be buying a flat in the first place. I would be all in favour of raising it to 20% - yes - it would mean home ownership would decrease, but look at Germany - renting is common there and isn't seen as an issue.

One of them runs a modest car

And he's paying nearly a thousand a month to run it - so he should drop it. If a car costs you 1/6th of your income - it really is time to give it up.

bus 150

Most Polish cities - it's about 80zl a month.

So - we've already worked out that they can save about 1000zl a month easily.

And they could easily buy a flat in a satellite town - take Poznan for instance. There are plenty of decent flats available in places like Szamotuly, Oborniki, Wresznia, Srem, etc - for around 150k for a good sized, modernised flat. Train to Poznan is about 250zl a month, and takes around 30-40 minutes. Given that vast amounts of people around the world commute for 1.5 hours (look at London - 2 hour commutes are normal) - what's the issue?

Much of the problem is due to people wanting only the best and not being willing to work hard enough to get it.

Throw a child into that equation (which for many is the catalyst for wanting to buying instead of rent and you can surely see it is a huge problem.

Actually - this is interesting that you mention this. I think, honestly speaking, this is what breaks many Polish couples - women have a desire to get pregnant as soon as possible here, and I've seen several couples where they've let the hormones take over - and as a result, they'll probably be forever renting.

Sorry, but there's no right to buy property.
milky 13 | 1,657
16 Jan 2012 #305
renting is common there and isn't seen as an issue.

yes,renting would be better for sure, if protected by democratic laws,

it really is time to give it up.

easy for you to say.

women have a desire to get pregnant as soon as possible here, and I've seen several couples where they've let the hormones take over - and as a result, they'll probably be forever renting.

and where is this not the case?
delphiandomine 88 | 18,455
16 Jan 2012 #306
yes,renting would be better for sure, if protected by democratic laws,

What are you talking about now?

The laws in Poland are fine when it comes to a landlord/tenant relationship. We could do with the introduction of a deposit protection service, but that's about it.

easy for you to say.

Well yes, I sensibly live very close to good public transport connections. Still have a car, but for ordinary day to day stuff, public transport is just as good.

and where is this not the case?

Poland is worse than others. You should know something about it, having a kid without actually working.
wielki pan 2 | 250
17 Jan 2012 #307
Much of the problem is due to people wanting only the best and not being willing to work hard enough to get it.

D thats a pretty harsh comment to make, to be honest I agree with cms, if you don't live in Warsaw you going to firstly find it hard to get a high paying job and most of Poland is made up of small towns, if a couple could muster up say 4000zl a month, take out living costs, rent etc and I doubt if you would have much change. To borrow 300,000zl would be a suicidal as monthly repayments would be in the range of 3000zl. All said and done why is there so much obsession about home ownership as people in other countries rent, take Germans for example.
delphiandomine 88 | 18,455
17 Jan 2012 #308
most of Poland is made up of small towns, if a couple could muster up say 4000zl a month, take out living costs, rent etc and I doubt if you would have much change. To borrow 300,000zl would be a suicidal as monthly repayments would be in the range of 3000zl.

300,000 buys you a decent house in much of Poland, really. A first time buyer would be looking at a 2/3 room flat (one interesting question - why the hell were so many 2 room flats built in the 50sqm range when 3 smaller rooms would make far more sense for the first time buyer?) - and in a small town, you're looking at around 150k these days maximum, and that's with a kitchen/bathroom fitted.

All said and done why is there so much obsession about home ownership as people in other countries rent, take Germans for example.

Poland has unfortunately followed the British model - and I think it's hurting them.

It's probably a lot to do with the way that many properties were sold for peanuts in the early 90's - everyone became a homeowner, and this generation wants the same. Of course, there aren't the huge social transfers to pay for it - so you're in the ridiculous situation where people in their 50's had very cheap property, while people in their mid 20's are now paying much more than they need to, simply because the older generation have priced them out of the market.

D thats a pretty harsh comment to make

It is harsh, but true - look at all these morons graduating and demanding jobs with high salaries to begin with. Many of them simply don't want to work hard for the big rewards - I've lost count of the amount of people I've interviewed, who have then backed off when I've mentioned "of course, some weekend work will be part of the job". I remember one girl in particular who refused to work weekends under any circumstance - all because she had a boyfriend in another city.

Unsurprisingly, she (and the rest) didn't get the job.
Avalon 4 | 1,068
17 Jan 2012 #309
To borrow 300,000zl would be a suicidal as monthly repayments would be in the range of 3000zl.

I know friends who have a 300,000 mortgage and their repayments are around 2000 per month. I suppose it depends on when and who you took your loan with.
Foreigner4 12 | 1,768
17 Jan 2012 #310
Poland has unfortunately followed the British model - and I think it's hurting them..

This is the single most insightful thing I've read on this thread.
gumishu 11 | 5,696
17 Jan 2012 #311
Given that vast amounts of people around the world commute for 1.5 hours (look at London - 2 hour commutes are normal) - what's the issue?

the issue is reliability of PKP Przewozy Regionalne in terms of punctuality and in terms of being able to board a train at all(some trains in some areas of Poland are full up for most of the route they travel)
milky 13 | 1,657
17 Jan 2012 #312
This is the single most insightful thing I've read on this thread.

He is partially right,But! he fails to include(the main players) the external forces that manipulated the situation for there own private gain, like banks, privatisation,EU membership,shock therapy.

or
The property buying age group 7.5 million; how many(50%) have emigrated(or seasonally) and what percentage of those who stayed are unemployed.
To blame the older generation for the bubble is like blaming the Irish for causing the great famine.
Gustav 1 | 50
17 Jan 2012 #313
so you're in the ridiculous situation where people in their 50's had very cheap property, while people in their mid 20's are now paying much more than they need to, simply because the older generation have priced them out of the market.

How much is 'much more than they need to'?

For all its failings the capitalist system does a fairly reasonable of allocating resources and matching supply & demand.

Your subjective value judgement is exposed for what is- a Utopian dream of how things should be 'fair'.

Do they teach Brits any basic economics at school?
delphiandomine 88 | 18,455
17 Jan 2012 #314
How much is 'much more than they need to'?

If it wasn't for the massive social transfers, prices would undoubtably be lower. That much is obvious.

For all its failings the capitalist system does a fairly reasonable of allocating resources and matching supply & demand.

The problem is that the current situation isn't the result of the capitalist system. It's the direct result of state interference - the State sold much of the housing stock at heavily subsidised prices, and now, we see the effects - those who were subsidised can outbid those who weren't.

Do they teach Brits any basic economics at school?

Looks like you're the one who hasn't learnt basic history.
JonnyM 11 | 2,620
17 Jan 2012 #315
For all its failings the capitalist system does a fairly reasonable of allocating resources and matching supply & demand.

Unfortunately it doesn't, given the number of empty flats and the low wage level in relation to prices.

a Utopian dream of how things should be 'fair'.

Or joined-up housing policy.

Do they teach Brits any basic economics at school?

Evidently more so and better than wherever you oozed from.
delphiandomine 88 | 18,455
17 Jan 2012 #316
Or joined-up housing policy.

A joined-up housing policy would have started with prohibiting the purchase of state-owned flats for anything less than the market value.

The 'right-to-buy' has caused chaos in the UK, and the same thing is seen here. Basic economics - transferring huge social subsidies is always going to cause pain somewhere down the road.
Gustav 1 | 50
17 Jan 2012 #317
Gustav: For all its failings the capitalist system does a fairly reasonable of allocating resources and matching supply & demand.
Unfortunately it doesn't, given the number of empty flats and the low wage level in relation to prices.

Note the use of 'fairly reasonable' and 'not perfect'

Gustav: How much is 'much more than they need to'?

If it wasn't for the massive social transfers, prices would undoubtably be lower. That much is obvious

Your statements about the level of prices is a subjective opinion, plain simple. Waste of time trying to dress it up as some sort of prevailing wisdom.
JonnyM 11 | 2,620
17 Jan 2012 #318
'not perfect'

Very 'not perfect'. Nor do we have a strict capitalist system in Europe.
milky 13 | 1,657
17 Jan 2012 #319
Nor do we have a strict capitalist system in Europe.

The system is -let the market dictate; which means 'all power to the rich'.
delphiandomine 88 | 18,455
17 Jan 2012 #320
Or in this case, "all power to those who were in a comfortable situation post-1989".

Which also includes many of those PiS loving Babcia's sitting in massive flats in city centre locations, paid for by the efforts of today's youth.
Avalon 4 | 1,068
17 Jan 2012 #321
The system is -let the market dictate; which means 'all power to the rich'.

Socialism seems to have worked in UK, Greece, Spain etc, thats why they are all in **** street.
gumishu 11 | 5,696
17 Jan 2012 #322
Which also includes many of those PiS loving Babcia's sitting in massive flats in city centre locations, paid for by the efforts of today's youth.

in what manner - does the city hall pay for any serious upkeep? you seen it? - renovations? by the council? outside the representative areas? - so in what manner do the youth pay for the babcias lodgings? - and what is the solution to that? where are you going to evict these people to? and why when they are able to pay their monthly rents? raise the rents? sure - then where do you move the people? physically. (is there enough places to move them into? - there's gonna thousands upon thousands) - would you like to do that personally? a little bit of babcia evicting is what you dream about at night?
delphiandomine 88 | 18,455
17 Jan 2012 #323
in what manner - does the city hall pay for any serious upkeep? you seen it? - renovations? by the council? outside the representative areas? - so in what manner do the youth pay for the babcias lodgings?

It's not only the massive social transfers in the early 90's which the youth paid for then, but also the current day social transfers. No-one seriously believes that ZUS is using yesterday's money to pay for today's pensions, right?

and what is the solution to that? where are you going to evict these people to? and why when they are able to pay their monthly rents? raise the rents? sure - then where do you move the people? physically. (is there enough places to move them into? - there's gonna thousands upon thousands) - would you like to do that personally? a little bit of babcia evicting is what you dream about at night?

Honestly, the solution to the problem would have been grant the "main" occupiers (no children, no nephews, no-one else) living rights to the flat. Babcia wouldn't be able to pass the place on - and you wouldn't have the issue where people in their 50's are now standing to inherit some very good flats that no-one has really worked for. But the problem also existed under Communism - many new flats were sold for what was really nothing compared to the actual value of the materials/labour used to construct them.

The whole situation is a diabolical mess - while eviction wasn't a good idea, these flats should have stayed in State hands unless the purchaser was willing to pay market value for them.

Have a look at this - the UK has exactly the same problem - en.wikipedia.org/wiki/Right_to_buy_scheme

The same situation also caused a shocking housing shortage - if they were State owned, Babcia could be relocated into more suitable accomodation for her needs (ie, no big 4 room flats in city centre locations) while young families who need the room could get it.

It's somewhat socialist, but at the same time - if the State is paying, then it should be according to need, not according to luck or connections.

(and I think the lack of social housing in Poland while Babcia sits in a massive flat is also an utter disgrace)
gumishu 11 | 5,696
17 Jan 2012 #324
It's not only the massive social transfers in the early 90's which the youth paid for then, but also the current day social transfers. No-one seriously believes that ZUS is using yesterday's money to pay for today's pensions, right?

so what is the solution - euthanasia? - don't we just have to live with it?

(and I think the lack of social housing in Poland while Babcia sits in a massive flat is also an utter disgrace)

you must really have mean neighbours delphi :P

or you are quite quick to judge people
f stop 25 | 2,513
17 Jan 2012 #325
There is always the other side of the coin, for example:
20 year olds buying real estate looks like trouble to me
Babcia retiring in a piece of real estate she worked for all her life might seem pretty fair when you start getting old.
JonnyM 11 | 2,620
17 Jan 2012 #326
and you wouldn't have the issue where people in their 50's are now standing to inherit some very good flats that no-one has really worked for.

That's only part of the story. Flats built and paid for by the people, for the people were obtained virtually free by private individuals and inherited by relatives who often let them for profit.

20 year olds buying real estate looks like trouble to me

Millennium bank were giving credit to kids on minimum wage. Sometimes for second flats. And the credit was in foreign currency - a recipe for disaster.

Babcia retiring in a piece of real estate she worked for all her life might seem pretty fair when you start getting old.

Very fair. But when it was built as social housing with public money, it should remain social housing for the next person who has worked all their life, rather than going to a nephew or niece.
delphiandomine 88 | 18,455
17 Jan 2012 #327
That's only part of the story. Flats built and paid for by the people, for the people were obtained virtually free by private individuals and inherited by relatives who often let them for profit.

Indeed. I have numerous friends living in rented accommodation - all of which is let with a wink and a nod and no money being declared to the taxman at all. All the flats were inherited and then rented out - and many of them are in very good locations. The current owners have done absolutely nothing - and these flats were never built as part of a "spoƂdzielna" (spelling?), but rather plain old council housing.

Babcia retiring in a piece of real estate she worked for all her life might seem pretty fair when you start getting old.

The problem is that Babcia often didn't work for it all her life - she often got it through being in the right place/right time and often retired early from some quasi-military non-job. It's especially true when it comes to flats built in the 50's/60's - many of them in very good locations were given to loyal Party members.

Very fair. But when it was built as social housing with public money, it should remain social housing for the next person who has worked all their life, rather than going to a nephew or niece.

Exactly. As it stands - the nephew can give Babcia a small amount of cash, she can buy the flat - and the nephew can sell it for a handsome profit once Babcia dies. An utter joke in every sense of the word - especially with young people struggling to buy accommodation.

I have no issue with Babcia staying there, but when she goes, the flat should return to the State - and - crucially - be awarded not only on the basis of need, but also the basis of deserving.
f stop 25 | 2,513
17 Jan 2012 #328
doesn't that trample on the inheritance rights?
Harry
17 Jan 2012 #329
" doesn't that trample on the inheritance rights?"
Just give them back what the aged relative paid for the flat, plus interest.
delphiandomine 88 | 18,455
17 Jan 2012 #330
doesn't that trample on the inheritance rights?

It wouldn't have done if it was done properly from the beginning - the flats in question were owned by the municipality, and could easily have had conditions attached to the occupancy of the property.

Now of course, it's a different story - but there should be no "inheritance" of socially owned flats and they certainly shouldn't be bought these days.


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