Appreciate the reply Ben. Cheers

Ben, I have just noticed that Rednet are offering a second tranche of 35 units in the platan Complex at a price significantly below that given in the update (5237PLN sqm as against 5778). Please could you ask your researches to explain the discrepancy. NB I know you have said the information is only intended to be a guide but in the two cases where I have been able to find actual data, the PS update appears to have been significantly more than the market price. Naturally this is not doing much for my confidence in the accuracy of the update information. Regards Alan

Hi Alan This is what our researcher managed to dig up on this one: "The price we have is the average given by the developer’s sales manager. Rednet offers a selection of units with prices varying from PLN5700 to PLN6100/ sqm (includ. VAT; without VAT PLN5301-5673/sqm). It is not representative group of units – includes predominantly small apartments." Hope this helps.

Ben Thanks for replying and sorry to go on, butI am keen on getting, as far as possible, a good understanding of the true value of my investments. This feeds into any decision about future purchases (in the present climate I am not willing to go above an overall LTV of 60%. When I first got the update I put in the revised fugures and thought great thats at least 2 more Romanian deals, but after clarifying Pelikan and Plathan I think that for now I will have to stick with the current portfolio. The real point I am making is that it is in PS's interest to make sure that the update figures inspire confidence so people continue to invest. NB Pelikan with still 66 apartments still on sale now at prices around 20% below what was being asked only 2 months ago is particularly worrying. What does this say about the Poznan and possibly wider Polish market. It will be interesting to see Rednet's July market report - wonder where it is? Regards Alan

Hi Alan - the July Rednet report can be found at: http: / /reports .rednetproperty .com/ I am waiting for the August and September ones... (I know you have not asked my opinion on this one but I will take a risk and give it to you...) Re market value of your investment at Pelican/Platan, you can easily find it by yourself. 1) See if the developer is offering a unit similar to your and go and try to buy (i.e. put an offer) or have a friend to put an offer on your behalf (this is to test the market.) this may cost just a couple of hours of your time. 1.1) Note the you will need to put forward a strong intention to buy the property in order to test the price as sometime developers advertises their property cheap just to get people calling them. 2) If there is no similar unit for sale, you will have use you judgement to value the unit (by comparing with yours). This will be no exact science, but I would not outsource this to PS, as it seems you are willing to take a strong decision (i.e. expand your portifolio) based on the result In my opinion the value of the property (and therefore the current LTV) can just be REALLY established when it is either sold or re-mortgaged. Anything else is an approximation (or indication), hence as this is judgment call (i.e. the approximation of the value) I would prefer to have this judgement call myself, rather them having someone else (e.g. PS) doing this for me. (But again this is just my particular approach as investor. It does not mean it is right...) Erico

Hi Erico, I have done the same myself in the past and avoided some potentially expensive mistakes. Here my concern is that even before haggling with the developer prices have been reduced by around 20% below what PS reported (and what they were on sale at in the summer. Also within a couple of months of completion, at least a third of the developemnt is unsold (66 units, out of approx 190, currently on offer on just the Rednet site). Good job I am not planning on selling at completion. Alan

I completely understand where you're coming from and your...scepticism, shall we say? What we provide in these updates is the best data we can. The REAL value is, of course, an actual resale but information of that sort is sadly few and far between. We do have a few examples. I understand one of our member's units in Marina Mokotow was sold at 12,000 PLN / sqm recently. THAT'S real value (and also a HUGE profit). I don't think anyone at PS would say that the data we produce is definitive, but I think it is indicative. And looking at what RedNet are selling units at now, or the developer is selling at now, without considering the big picture is misleading. I must stress, too, that PS has ALWAYS advocated a long term investment. I DO get your point on LTV and here you clearly need as accurate a valuation as you can get. I can only say - pay for one! You need it if you are judging future investments on the back of portfolio-wide LTV. Ideally, that's how we'd get our valuations but cost is prohibitive.

Ben I accept there are limits to what PS can do and that in advance of real sales info anything (including a paid! for valuation) is at best an educated guess. However I think PS should take responsibility for making sure that the guess is educated and that a basic sanity check is carried out before publication. eg if all you have to go on is developers figures, I would hope your agents have an idea of the value of any sales incentives and discounts available and take this into account in assessing the real value of the units. That is the big picture I would like to see. I don't think that is too much to ask especially as overall PS should benefit from investors having a degree of confidence in the update info. Regards Alan

I agree, Alan, and it's something we are working on. I understand Simon Tweddle is writing an article with a fuller explanation of these updated valuations. Hopefully this will help you more.

From rednet for the month of November: Katowice : 5914 pln (average per sqm ) + 2.87% (v October) Krakow : 7504 pln (average per sqm ) -0.03% (v October) Lodz : 6262 pln (average per sqm ) -1.93% (v October) Poznan :7688 pln (average per sqm ) -0.40% (v October) Tri-City: 7361 pln (average per sqm ) -0.94% (v October) Warsaw: 8673 pln (average per sqm ) -0.85% (v October) Wroclaw: 7377 pln (average per sqm ) +1.34% (v October) Change in the market (i.e. greater supply of flats and more choice now for locals) has led to the stabilisation of prices as has been well documented by PS. Regards