The Polish Real Estate Guide 2007

According to official statistics published by the Ministry of Infrastructure, Poland faces a shortage of housing units estimated at approximately 1.5 million apartments. Unofficial statistics estimate this number at 2.5 million. Of this figure, approximately 5 – 10% relates to Warsaw, which accounts for about 100,000 up to 200,000 apartments necessary to satisfy the needs. This large shortfall in housing inventory combined with improving wealth and better
access to home loans has caused a widening gap between demand and supply. The supply of new stock is limited due to the lack of master plans and the time–consuming procedures for receiving a building permit. In 2005, the total new supply in Poland amounted to some 114,000 housing units, about 10% of which was delivered in the city of Warsaw. After eleven months of 2006 the overall new supply of dwellings in Poland was at almost the same level as in the previous year. High demand stimulated by increasing accessibility of morgages and a significant housing deficit has resulted in price growth of approximately 20% p.a. for the country on average. In 2006 the strongest price growth was recorded in Wrocław and Gdańsk (70 to 80% p.a.).

According to official statistics published by the Ministry of Infrastructure, Poland faces a shortage of housing units estimated at approximately 1.5 million apartments. Unofficial statistics estimate this number at 2.5 million. Of this figure, approximately 5 – 10% relates to Warsaw, which accounts for about 100,000 up to 200,000 apartments necessary to satisfy the needs. This large shortfall in housing inventory combined with improving wealth and better
access to home loans has caused a widening gap between demand and supply. The supply of new stock is limited due to the lack of master plans and the time–consuming procedures for receiving a building permit. In 2005, the total new supply in Poland amounted to some 114,000 housing units, about 10% of which was delivered in the city of Warsaw. After eleven months of 2006 the overall new supply of dwellings in Poland was at almost the same level as in the previous year. High demand stimulated by increasing accessibility of morgages and a significant housing deficit has resulted in price growth of approximately 20% p.a. for the country on average. In 2006 the strongest price growth was recorded in Wrocław and Gdańsk (70 to 80% p.a.).

Although the market in general is dominated by developments representing
the popular–priced segment, since Poland’s accession to the EU in May 2004,
the luxury market has entered a period of strong growth. In part, this is due
to the growing interest of foreign investors mainly from Ireland, Spain and
the UK and in part by the fast growing group of relatively affluent Poles.
Foreign financial equity investors attracted by high returns, typically buy
multiple apartments as investments, counting on value apprection over time.
However, this segment of the residential market is developing mostly in two
types of locations: big cities (with predominance of Warsaw) and summer
resorts at the seaside.

Focus on Warsaw

The city of Warsaw has the most developed residential market in Poland,
strongly dominated by multifamily housing. The share of housing units in
single–family developments built in Warsaw remains under the 5% threshold.
Employment and education possibilities in Warsaw are a magnet for the strong
influx of young people from other regions of Poland. Migrations combined
with the highest level of income and the lowest unemployment rate, generate
a very strong demand for housing in Warsaw, which is reflected by a high level of
presales in case of the most reputable investors and the best locations.

As of the end of 2006, the average transaction price for an apartment in Warsaw
on the secondary market was at the level of approximately 8,500 PLN /m2.
On the primary market, the average price amounted to some PLN 7,400 /m2.
Over 2006 the market witnessed an unprecedented price growth with average
price surging by over 60%. The supply of popular priced apartments
concentrates in districts located further from the city center, such as Weso��a,
Rembertów, Wawer and Bia��o����ka. As of December 2006, average prices of
new dwellings in these locations rauged from PLN 3,600 to PLN 5,800 /m2.
The most prestigious residential projects are usually built in ��ródmie��cie,
Mokotów, Wilanów and ��oliborz, where prices usually exceed PLN 9,000 /m2
and reach PLN 20,000 /m2 in case of the most expensive projects. The most
prestigious project in Warsaw – Z��ota Tower planned by Orco Property Group
and designed by Daniel Liebeskind, is priced at EUR 7,000 /m2 on average.