I haved read alot over the past year about the Polish property market...mostly very positive stuff but when I browse the forums there is little info...infact every time someone starts a thread about Poland it seems the discussion goes off topic,usually concentrating on other countries which is becoming slightly worrying.

I am flying out to Poland in a month or so to look at some Polish property,with my girlfriend who is originally from Poland.

She has a house that her parents left her which she wants to sell and use as a down payment on an investment property there, I am also thinking of buying a property for investment.

Perhaps some of you who have been there,who know the market,purchaced or looked into perchasing could offer some advice...

where should we buy,why?

what should we buy,why?

is there money to be made buying and renovating an older city property?

how easy is it to obtain finance?

what should i be wary of,what are the pitfalls?

with so many options,and so many new huge new build apartment blocks being built where is the best rental and capital growth?

is parking essential in citys?

any decent estate agents you know of?

i know its alot but neither myself or my girlfriend can afford to mess this on up so your advice is appreciated.

It is often wise to invest in countries where you have inside connections, ie via your gf.

I consider places like this to have similarities with the UK market of 25 years ago.
Use your common sense and invest in an area that is likely to be attractive in terms of transport, schools and tone.

Id probably not go new build as this may be overdone and with newbuild you find a flood of property will become available seeking tenants all at once. In my E German property adventures I discovered that old period property was much in demand and has limited supply.

Think back to London after the early nieties crash. The leafy, period areas were the first to benefit from HPI.

Talk to professional (and I do stress professional) letting agents to get a feel for things.

Another tip is to use more expensive Lawyers with several partners, do not use one man band lawyers who find it a lot easier to run off with your money (this happened a lot in the UK in times past).

An interesting programme on BBC Radio 4 the other day regarding Poland. There is a huge emigration issue to the extent that basic medical services and the like will no longer be viable soon.
Those who had come to Britain with a view to saving to return showed little sign of wanting to do so once here. The worry is that property prices are low because the general infrastructure is on the verge of disintegration.
House prices are just the obvious manifestation of a system needing a huge shot in the arm.

Where should you buy ?

The hotspots are currently Warsaw and Krakow with possibly the Tri-city area coming in 3rd place.

Why should you buy there?

Well, of course you don't HAVE to and hotspots can move around or cool off if they become over-saturated.

Warsaw is the capital and benefits from all the things that being a capital city brings i.e. higher wages, more jobs, higher levels of foreign investment etc. As Poles become more and more educated (already at a pretty high standard) they will start moving away from the small towns and rural areas and start moving into the cities.

Krakow-The Old Town of Krakow was considered the second best area in the EU to make the most money over the next 10 years...........say said the beautiful Amanda Lamb from last year's Place in the Sun European Top 20 programme. Krakow enjoys the benefits of being a beautiful tourist destination that is becoming even more popular due to the increase in budget airlines flying to the city. With a vibrant student population there won't be a shortage of prospective tenants.

Tri-City-One of the unsung areas of Poland when it comes to property investment which is surprising as prices per square metre are often higher than Warsaw (a few years back they were even higher than Manhatten !) Again, considered a tourist area (although mainly for the Poles and Germans). I was recently drooling over the new planned development in Gdynia called Sea Towers but sadly it was too expensive for me

What should you buy ?

Buy anything except apartments in Communist style blocks..........some were constructed with asbestos slabs ! Aside from that, if you choose the right location then you shouldn't have anything to fear. Buy land and build a house on it; buy an apartment in a great location but in an old period building; buy off plan in a new development; or simply buy land and hope a developer comes knocking on your door in a few years time.

Is there money to be made buying and renovating an older city property?

Absolutely ! The Irish have already cottoned onto this and have been purchasing blocks on the Rynek Glowny in Krakow. To purchase a block or Kamienice requires more money obviously than just buying an apartment. It depends how much money you have.

How easy is it to obtain finance ?

I'm a bit vague on this. I know Polish banks will lend to Poles upto about 80% of a property's value. There may be some banks that specialise in foreign mortgages......in fact I am sure they exist,you just need to look around.

What are the pitfalls ?

Well, prices anywhere can go down or stagnate. Political upheavals are rarely predictable and can be catastrophic and the Kaczynski twins don't inspire me with much confidence ! Having said that, Poland is now in the EU and should start benefitting from some cash injections.

Best rental and capital growth ?

See above i.e. "where you should buy and why"
Poland is still a fairly immature property market and statistics are few and far between. Here in the UK we are used to getting facts and figures rammed down our throats for example, house inflation rose 2.6% in the month of April etc In Poland the marker isn't that transparent so you may struggle to get a definitive answer to your question. And of course if you ask an estate agent they will tell you what you want to hear !

Is parking essential in cities ?
As in the UK, if you have a centrally located apartment then you really need somewhere to park the car safely. New developments normally offer a guarded or underground parking option as an extra (I think averaging about 11,000 PLN). However, I am sure new developments will still provide adequate parking spaces for those who choose not to pay the extra.

Any decent estate agents ?

I can't personally recommend any but I will tell you this. As you have a Polish girlfriend then ask her nicely to search the internet for Polish language, estate agent websites. If you find an English/Irish website offering you help or information in investing in Poland then they will inevitably charge you a finder's fee and/or inflate the prices for foreign buyers.

With all due respect to Cakehead I disagree with his or Radio 4's assertion that house prices are low in Poland because the infrastructure is on the verge of disintergration.

Prices are low in Poland (although not that low in the hotspots already mentioned) because Poland is a relatively new democracy.....re-born 1989 I think. During the Communist regime peeople were discouraged from owning their pwn property so the market in relative terms is very very young.

Property prices are low because they have historically been low. To suggest they are low due to emigration is nonsense. Emigration has only increased in the last 18 months but prices instead of dropping in this period have continued to rocket.

If anything, emigration could lead to HIGHER prices as Poles working abroad send money back to their families and gradulally become more affluent.

I have posted before on this forum about the idea of a "property co-operative" for Polish investors. In other words, a group of like minded investors sharing their resources to invest in the Polish market. If you want more info then you're welcome to email me at info@spiritusagency.com

To be fair neither I nor the programme suggested prices were cheap owing to emigration. The show suggested that Polish professionals, doctors, lawyers and so on were leaving in their droves because of the massive difference in wages.
The outlook they (the Poles themselves) painted was extremely bleak and there were no plans in place to correct the brain drain.

That being the case (my logic here) the better houses the middle classes buy were unlikely to be in demand and inward housing investment can only prop up an economy so far. This isn't an anti-Poland or Polish rant, from what I know it's an interesting country and those I meet in the UK seem mostly intelligent and hard working.
The issue is with the longer term stability of a nation without plans for a home-grown aspirational network who can deliver a higher standard of living overall.

The bottom line is, If you're scared you shouldn't be doing it. Learn more, wait a while and if it still scares you, don't do it.
Never, ever, ever, enter into something you don't fully understand and/or leaves you with a feeling of unease or you may get your fingers burnt badly. This is as relevent in Walthamstow as it is in Warsaw, Don't leave your brains at Gatwick.

Cakehead,

Point taken and I didn't mean to accuse you of making inaccurate statements.

I do honestly think this problem is being overplayed though. I am heavily involved in the Polish community, my parents are Polish and I've been there many times.

There has been a large number of emigrants, this is true but from my experience most of the people who come to work in England intend to go back to Poland once they have saved enough money. In fact, it's not unusual for the man of the house to work abroad for several periods of his working life. I've had Polish friends who worked in the Czech Republic and in Russia and this was DURING Communist times.

In Poland, the young have a different mindset to workers in the UK. If they see an opportunity of a job in a different country then they up sticks and move to where the work is. Whereas here in the UK we have a more comfortable time of it. I hesitate to look for work that is more than a 30 minute commute from my house-I may be a lazy bugger but if I am then I'm not alone !!!

I prefer to use the term "economic migrants" as emigrants suggests they are moving permanently and many of them want to return home one day.

I can kind of see your point about a "brain drain" but I think the majority of Poles working here tend to be at the lower end of the "qualification ladder" and end up working on building sites or in supermarkets etc.

Although some of the younger professionals might be leaving the older doctors, lawyers etc are content to stay as their salaries are well above the Polish national average. Also, the older ones tend not to speak English at all, or at best they speak very poor English so emigration isn't an option for them.

There may well be a shortage of dentists in the future in Poland but then that would put it in a par with the dentist shortage in the UK.

Back to the main point of this thread which is the housing market. In Poland the market has been extremely buoyant the last few years and of course that doesn't mean you can buy a property anywhere and it will increase in value. But in the Old Towns of some major Polish cities where location is at a premium and prices are still just about affordable for many UK investors then it's still a very good investment IMHO.

By the way Cakehead, I really urge you to visit Poland for a holiday. Cheap flights there, food and beer are cheap, cheap transportation, long hot summers, beautful women and Krakow is a delightful place to visit.

Hi Antfarmer

I have sent you an e-mail asking for more info re investing in Polish property.

Guys,thank you so much for the honest advice...I am sorry not to have replied to you on an individual basis, but have been absorbing the info provided and doing my own research.

I

Guys,thank you so much for the honest advice...I am sorry not to have replied to you on an individual basis, but have been absorbing the info provided and doing my own research...and it seems that the old town districts are indeed the best investment.

I am off to Poland in a few days to spend two weks looking at property, so I will keep you all posted

Feel free to offer any additional thoughts, and please excuse my previous lack of responce...

good luck

Are you buying a new development ?

Hi bubbleberry

Did your recent trip to investigate Polish property reveal things you want to share... where did you go...?

When buying you must consider the restitution rights in many Places.

Good point coco

Claims Conference - http://www.claimscon.org taken 21 September 2OO6

POLAND

» Private Property
There is no legislation governing the restitution of private property.

In March 2001 the Polish parliament approved a law for the restitution of private property, restricting the right to file a claim to persons having Polish citizenship as of December 31, 1999. The Polish president vetoed the law.

Certain steps are being taken and pressure from the Jewish world is continuing, but currently there is no claims process for private property restitution.

For further information on this effort and the on-going work of the Holocaust Restitution Committee and others, consult their website


http://www.claimscon.org/compensation_guide.asp

See also

http://www.claimscon.org/?url=poland

Hi Guys,

Well as you know I spent a few weeks in Poland looking at Property and getting to know my girlfriends family.

The Polish people really are a great bunch...

But the rule of thumb when it comes to business is that if you know someone,a friend of a friend,someone that you have established communication with, then they will really go out of their way to help you...I had the luck of being at a wedding while I was there,and made so many contact and friends that my property search became so much easier
I am in the process of buying a small farm.It is just under a acre in size, has an old log house and a large block shed,the land runs down to a large lake and has about 4oomtrs of lake frontage.

The total price for this should be about 16k once fees etc are taken into account.

I also struck really lucky when as my Girlfriends cousin is dating a guy who is regional director of one of the large banks there, and he is putting together a package that will make the purchace of property much easier,and less expenive.I will keep you posted and let you know how to contact him if it works out.

There is ALOT of bulding in and around Krakow and Warsaw,and while prices seem to be low compared to the uk i was worried about longterm supply and demand.

Rental potential is great, and if you buy within 5 miles of a university you cannot go wrong.My girlfriends parents bought an apartment 5 years ago which her brother uses while at university,it is a shabby ,small, i bed apartment but he is still able to rent out the living room,two two girls...both still at university.This is the norm, my girlfriend tells me that while she was at uni, she and four friends rented a small two bed apartment,using matresses on the floor as beds.

The key is that education is 100% free in Poland so they have a huge amount of kids leaving rural areas and going to uni,but they come from familys that earn their money in these rural areas and so money is tight...hence they share a cheap apartment with friends.

The problem is that the Polish goverment is so lax in their reforms that most of the kids will move to the uk,france,germany etc when they have completed their degrees.

There is alot of building going on all around the country,even in rural areas, and it seems that when those who have lived in the uk etc have saved enough they will move back tyo their familys and build or renovate a house.

Few will move to the citys where they studied as it will be too expensive.

Also I saw various properties advertised by different agents for different prices.The seller and the buyer pays on the sale of property,so the best thing is to try and make contact with the owners directly.

I went to a company called tni properties,who profess to be Irish, but they seemed to be really expensive,and while I hate to be negative the Polish guy who worked there tried to convince me he was from Australia....it is I believe owned by an Irish guy,but they seemed no better than the polish companys.

It is not like buying here,things take time,noone is in a hurry to sell and customer serviceis non existant,,,,

One agent took us to see an old house in the mountains,and as they all communicate with each other and splitt commissions,he explained he had no keys,.This we did not mind as the house was to be knocked down,it was the location we were intrested in.We agreed a price and went back later that evening to have a look on our own only to meet the old man who lived there....the agent had shown us the wrong house!

I have ammased a wealth of info and experience these past 6 months regarding Poland so if you have specific questions about different properties,agents markets etc please let me know and I will do my best to get the info for you.

bub

Bubble,

I am going to visit Wroclaw in a couple of weeks with a view to buying a property to rent out.

Do you have any info on the rental income I could expect?

Also would I be best going through an agent (do you know any in Wroclaw) or trying to deal direct with a developer?

Wrocman

Not sure what type of property you want to buy, and hence which rental market you will be looking at, but these might help:

http://wroclaw.gumtree.pl/wroclaw/wroclaw-wynajem-pokoje_1876_1.html

http://www.nieruchomosciwroclaw.pl/

http://www.bnfasada.pl/

http://www.kruk.net.pl/

The following might help but most will have English translation...

nieruchomosci - estate agent

wynajem - rent

sprzedaz - sale

pokoje - room

domy - house

mieszkania - flat

dzialki - land

Anyone who speaks Polish better than me is welcome to correct...

Thanks Priotrek,

I am looking to purchase close to a uni so probably be renting to students or young professionals. Getting in at the lower end of the market to start with.

Has anyone out there bought in Wroclaw?

I am visiting for first time in a few weeks so any info welcome.

Channel Four tonight is a special edition of Place in the Sun where they list the top 20 countries in Europe where property is predicted to rise the most.

Poland comes in at second place.