Job Discussion Forums

[sharter]

According to a long-term resident of Polska who also happens to be a millionaire businessman, the property market is about to tank. Any evidence of this in 'your' city?

[scottie1113]

There's a similar thread on Poishforums which has been going on for several years. Some prices have gone down a little in Gdansk, most of which have been in newer flats, but nobody here is prediciting a crash.

[PierogiMonster]

I'm no millionaire businessman, but I have bought and sold a flat in Krakow before (2008/2011; bought at the peak and sold at a 5% loss).

With prices already having levelled/dropped slightly over the last few years, the Polish economy holding up rather well and being safely out of the Euro, I don't see why prices should fall at all, let alone tank.

[simon_porter00]

In my humble and totally uneducated opinion the idea that the housing is meant to tank is a load of guff.

It was meant to tank in the first crisis when all the Irish/Spanish/Portuguese property investors were meant to have flooded the market with all the flats and properties they owned to recover monies. It didn't happen then and it hasn't happened in the few years since.

In Warsaw, flat prices seem to be holding steady at a few percent lower then the boom (which is of course when I bought my flat grrrrr). In fact, land prices on the outskirts of Warsaw seem to have picked up a bit.

[maniak]

I thought it was realized long ago that property prices in Poland are not crashing but undergoing a massive form of correction after boom prices, which is entirely normal. Most hit were severely overvalued properties found in crumbling communist blocs, whose only retaining value was being located close to the city center and "prestigious" (not luxurious) flats/houses found in certain districts/neighborhoods/streets. Going with this were owners severely over-inflated opinions on their own properties, which is still seen today, i.e., those flats/houses that haven't been sold for over 2-3 years.

Other properties that are maintaining their value or raising in value are: houses/land located outside of a city center but very well connected, farm land, vacation houses/land (especially those in "historically prestigious" locations).

[scottie1113]

[quote="maniak"] Most hit were severely overvalued properties found in crumbling communist blocs, whose only retaining value was being located close to the city center

And these owners have chosen to sit on their flats-sometimes empty-rather than accept a fair market offer. Sometimes they wait for years until they come to their senses, but more often than not they continue with their stubbornness.

Ah, Poland!

[simon_porter00]

I can't see how holding onto your flat because the market is low is "ah, Poland".

Being on a crammed tram, arriving at a crammed tram stop where 50 people want to get off and on at exactly the same time is "ah, Poland" but having possession of a flat (presumably paying little as they bought it out 15 years ago for 20% of the value or something) and waiting for prices to get better is something I'd consider to be completely normal.

Everyone knows that they're not making flats in certain areas any more and some time in the future, prices will increase.

My flat has lost 5-7% of it's value so I'm not going to sell it as in 5 years time it'll sit between two underground stops on the new line (500 mtrs to both) and hopefully the price will recover. Even if that doesn't work, the rental income will cover the mortgage if not the czynsz.

I'm assuming scottie1113 you tried to buy such a flat and had no luck.

[scottie1113]

[maniak]

I think scottie is in a way correct. I wont consider fixed expenses since theyd probably be quite low, but when you factor in the cost of "lost opportunity" and the risk potential of the flat truly increasing in value enough to cover inflation... but in most cases the place is so overvalued that the seller wont ever see that kind of money. My favorite are the communist semiattached homes located in a nice part of the city that need a full blown renovation that are for sale for over 1.5 million or more.

This is even more pronounced with rental properties, Ive seen some flats and houses for rent which have been empty for months. The math is easy, it'll take someone years if not decades to recoup the money lost not due to not immediately renting it out for a lower price.

Not very financially savvy.

[delphian-domine]

I bought a place not so long ago, and the vast majority of sellers were just utter jokers. It's especially pronounced with those who bought their commie-era flat for peanuts - they seem to think "I think it's worth that and that's that" - and I think it's actually one reason why there's still such a shortage of flats.

I'm also seeing quite a lot of young people who are trying to sell Babcia's flat - instead of taking a lower offer and getting rid of it now, they'll hang on (and pay the czynsz) for months/years instead.

Unsurprisingly, my place was bought from someone who bought it themselve a few years ago.

[sharter]

It's definitely a weird one and there are lots of regional differences. Right now in Portsmouth UK you can buy a two-bedroom house with a lounge and diner...and garden for that matter.... for 500,000Zl....you'd struggle to do that in Poznan.

Eco 101-the cobweb effect-I guess demand is still relatively buoyant....god knows why or how....most of my friends there are flat broke.

[sharter]

I've noticed Polish bond yields have been rising...currently at 5.8-9 %; are they in the shite? Also noticed the Zloty has weakened against Sterling; start of something bigger? Yeah or nay? 2012 waddya reckon?

[delphian-domine]

[sharter]

I hate those flats...really cheap and nasty;actually Poznan is getting slightly cheaper I think.....but the rynek needs a facelift.......except for Borwaria day time and the Lizard late night I think it looks really drab and naff at the mo. It would be nice if someone could restore Harry's to it's mid 90's glory days!! Miss that place. Don't know if you know Newsham (the face) and Lythgow (Cocko Grande).....but they were 2 of the few that are still left from then........

[delphian-domine]