A new directive from the Bank of Poland, which applies as from the beginning of this month, is likely to have a dampening effect on domestic mortgage lending in the country.

Like any other property market, the Polish one is driven by a combination of perception and reality.

The perception is that if you can afford to buy, do it NOW, before the opportunity passes by because of rapidly rising prices, and the reality - it is still generally cheaper to buy than rent.

However, the domestic Polish mortgage market, while fuelled by LTVs of 100%+ and the availability of low, low interest rates, has been somewhat held back by a population that has 1) a generally ill-formed credit history (caused by a combination of the new, fairly wealthy, the black market and poor credit checking criteria), and 2) a general, but falling, distrust of the concept of borrowing large amounts of money.

This second factor is changing rapidly.