Buying Property in Poland Basics
The Permit System
The Polish know only too well the massive boom in property prices that would occur if it was left to the free EU market - with farms for sale for as little as 10,000 GBP how many would you buy? As such there are a number of restrictions on what a non-Polish citizen can buy. These are gradually being phased out for those with EU citizenship and will be completely removed by 2016. Their purpose was to stop property and land becoming unaffordable to the local population which could in turn have caused high inflation.
Some web sites will tell you that you are restricted to buying so many square metres of land or x number of properties. This is infact not true. As long as you can keep getting permits you can keep on buying so if you want to buy more, keep applying until your first rejection!
You might also want to consider applying for Polish nationality which would mean you could purchase without a permit. This is possible, but not guaranteed, if you have a parent or grandparent who was Polish and is an avenue well worth exploring. Contact the Polish Embassy in your country for details on eligability or speak to an English speaking solicitor based in Poland.
Who Needs a Permit
The Act on the Aquisition of Immovable Properities by Foreign Persons 1920 begins by saying, "Acquisition of immovable properties by a foreign person shall require a permit" and then goes on to list a number of exceptions. Perhaps the best summary is in the Polish Information and Foreign Investment Agencies book How to do business - Investors Guide to Poland. Below are the key extracts
So in summary if you are from the EU you do not need a permit unless you are buying farmland or woodland. For farmland or woodland you don't need a permit if you can prove long term "Bonds with the Republic of Poland". This may be, for example, that you have been renting farmland and using the land in question for agricultural purposes for several years. In other words you are an active person in Poland!
For those without EU citizenship permits are required for all property types.
For the exact restrictions visit www.paiz.pl, click the Union Jack, select Polish Law from the menu across the top and then 'Purchase of Real Estate by Foreigners' from the menu on the left hand side. Note however that there are a number of ways around the permit system such as setting up a company. More details on this are in the book Buying Property in Poland available to buy online or via Amazon.
You should also check the Acquisition of Real Estate by Foreigners Act 1920 at www.mswia.gov.pl/portal/en where you will also find translated forms that you need to complete in order to get a permit. You can also ask the advice of an English speaking solicitor based in Poland
How Long does it take to get a Permit?
The law requires that the Ministry of Internal Affairs and Administration makes a decision on an application for a permit within two months
Please note the costs below are approximate and will vary depending on the exchange rate and the area in which you buy or the solicitor/agent that you use. You can also use the online Buying Costs Calculator to give you an idea of costs for a particular property or purchase price.
Agency Fees are charged to both the seller and the buyer. As a buyer you will usually pay about 3 percent of the purchase price (+22% VAT) but this varies so check with the agent first
Solicitor Fees - about 150 pounds or 1 percent on transactions over 9,000 pounds. You will also need to pay VAT (22 percent) on these fees. Taxes - 2 percent of the sale price
Court Fee - for registering the property in your name, approx 500 PLN.
Resale Tax - Be aware that there is a 10 percent tax on a property that is resold within five years unless the proceeds are invested in another Polish property
Buying to Let
The landlord is expected to pay for common costs (maintenance, security, etc.), insurance, the management agents fee and local property taxes. Rent collected must be declared as income and is liable for income tax although the percentage can be reduced by purchasing the property as a company.
If you are looking at Poland for the first time you might want to take advantage of Mamdom's 'Visit Poland' programmes. You give us an outline of what you are after, we will organise for you to see the most appropriate properties while you are here. Accommodation can be booked at local hotels by us if needed. Its a great way to get a feel for the Polish market and what is on offer.
After SalesOnce you have bought we can introduce you to letting or selling agents, builders, architects or other service providers who will be able to help you make the most of your purchase or we can fit properties out for you with Interior Fit.
Crossing the Language Barrier
We provide a translation service and many of the agents and builders who list their properties with us speak perfectly good English. Those that are able to talk to you directly state 'English' as a language spoken on the property details and display a Union Jack on the property search results. If you decide to buy we can also give you details of English speaking solicitors