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The scarcity of apartment rentals in major Polish cities has pushed prices up by 20%
ABOVE: Refugees from Ukraine wait in the ticket hall of the railwlay station in Przemysl, eastern Poland, which has become a hub for refugees from Ukraine fleeing their country due to Russia’s aggression (7 April 2022)
From Le Monde. Republished with permission.
6 May 2022 – Facebook in Poland is bristling with help pages for Ukrainian refugees. But while urgent appeals for accommodation in the big cities are multiplying, solutions offered by Internet users seem to be dwindling. Among the 3 million Ukrainians who have transited through Poland since the beginning of the Russian offensive, more than half of them – sometimes extended families, but mostly women with children – have hunkered down in their asylum country.
Warsaw’s population has increased by 15 % since February 24, and further west, two other large Polish cities, Krakow and Wroclaw, are also particularly in demand by those who have fled the bombing of Ukraine; to the extent that the rental market is almost at saturation point. “The supply is very limited. And rental prices have increased by 20 %. Before the war, you could find a two-room apartment in Warsaw for about 2,000 zlotys [426 euros]. Now, it’s more like 3,000 zlotys [639 euros]”, said Beata Karwowska, a Warsaw real estate agent for the Bracia Strzelczyk agency, one of the market leaders in Poland.
“And although the preference is for two rooms, apartments of every kind are disappearing. The demand is far greater than the supply,” Ms. Karwowska added. This was confirmed by Metrohouse, another network of Polish real estate agencies. “Apartments are being snapped up the day they appear,” said its marketing director Marcin Janczuk. “This is the first time that Poland has had to cope with such a rush on the market and prices are rising accordingly.”
The new build market impacted
Another factor contributing to the rapid drying-up of rented accommodation is that the rental market is mainly driven by people who own one or two apartments. According to a 2020 Eurostat study, 85.6% of the Polish population are property owners. “Real estate is considered a safe investment, sometimes even more so than gold! City dwellers want to make provisions for their retirement, as they believe they will eventually need the extra income,” said Cezary Grabowski, sales and marketing director at Bouygues Immobilier Poland.
“As Poland is a post-communist country, there is no tradition of investment funds owning entire buildings for rent. Moreover, there was already an estimated shortage of 2 million apartments on the market in Poland, Which explains why, after just a few days, there was hardly a property left to rent and prices soared,” said Mr. Janczuk, who also suggested that rents could continue to rise even when the conflict in Ukraine ended.
“Some Ukrainians are likely to remain in Poland,” he said. “But their hosts can’t continue to accommodate them free of charge for much longer.” Finding an apartment has always been particularly easy in Polish cities. However, some property owners are now asking for proof of income, which is still an uncommon practice. The war is also having an impact on the new build market. In the construction industry, the cost of raw materials has risen sharply, as have land prices .
The valuable Ukrainian workforce, which predominated in the building sector in Poland, has returned to Ukraine, or has not been able to leave the country. “Sale prices in major cities increased by 15 % to 20 % in 2021, and are expected to increase by 10 % in 2022. Also with the cost of materials on the rise, especially steel, I don’t see how they can go down,” said Mr. Grabowski. And an added economic factor came into play at the beginning of April, when the Polish central bank raised its key interest rate to 4.5 % making credit much less accessible to the general populace.