One could say that given the economic conditions at hand, this year has not been bad. Banks continued to lend, even though both caution (more advanced creditworthiness assessment process), higher margins to cover for risk (higher loan fees), as well as reduction of loans offered in foreign currencies or indexed against foreign currencies caused the resulting reduction in number of loans granted in comparison to previous (particularly dynamic) years. Mortgage portfolios have increased for approximately 40,000 new loans made in 2009, 25% of which have been part of the Family on Their Own project. It has been one of few projects influencing both demand (many borrowers interested in receiving a return of about 20% of the interest throughout the first eight years of paying off loans), as well as supply – getting the prices and structure adjusted by developers. The project in question leads to creating, to some extend, the expected level of price flexibility for supply and demand. It is essential for it to influence affordability of housing even more in the future, both in the primary and secondary market.

The National Housing Fund – the only government project to support social rental housing construction – was closed down. No other project has been announced, causing a lot of uncertainty in social housing community, and particularly among local governments. Preferential loans from the NHF used to make it possible to solve substantial housing issues in many Polish cities. Due to this fact, this year has been difficult from the social point of view, since
– based on the listed housing demand in this sector – one could state that about 20,000 families could have been interested in joining the closed-down project. And there is no information what the new one will be like.

Bolesław Meluch
Vice-President of the Board of European Property Institute
Source: Property Jornal Polska Giełda Nieruchomości 12-01/10