The polish bank BZWBK (part owned by AIB) produce a monthly news letter on the polish econmy and financial markets. This is interesting reading for Polish Property investors. It is a free service. Log on to the BZWBK website,
http: / /english .bzwbk .pl , click on Economic service on Left hand side and download monthly MACROscope


House supply steadily growing

The number of house completions has been growing, which is
a yield of real estate investments launched in the last two years.
In March, house completions increased 28%YoY, and the sum
of completed buildings in the last 12 months amounted to
142,000 units.

It seems realistic that in the next two-three years the annual
house supply may increase to ca. 200,000 units. Stronger gains
seem not very likely, especially that a pace of growth in building
permits and new home starts started decelerating in recent
months.

One should remember that even amid such scale of rebound
on the supply side, the shortage of the number of flats in relation
to number of households will persist for at least the next ten
years

Price-to-income ratio slowly improving

Thanks to stabilisation or even a slight decline in house prices
amid simultaneous improvement of situation on the labour
market and rising households’ revenues, flats’ affordability
started bottoming out. In March, for an equivalent of 12 average
salaries in Warsaw, Kraków or Poznań, one could afford to buy
15-17% bigger living space than six months earlier, while in
Wrocław the improvement was 7%.

Demand for flats still remains subdued as potential clients are
postponing purchases, hoping for a deeper price correction.
However, it is likely that delayed demand is likely to show up
eventually, and thus a scope for price drop is limited. Especially
that rents in big cities have been growing, which implies that
delaying house purchase is getting increasingly costly.

I think the statement "the shortage of the number of flats in relation
to number of households will persist for at least the next ten
years" suggests that although Poland is going through a stagnant period improved sales and capital increase are not far off.
All the best, SID