In Poland, the threat of a housing crisis

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In Poland, the threat of a housing crisis

The social-liberal weekly Policy is interested this week in the situation of Poles who hold a mortgage and must pay much higher monthly payments than at the start.

On the cover, a couple tries desperately to resist the vice of the apartment which is literally closing in on them. “Beset by their credit”, title of the post. “The nightmare of several million people: their mortgage” : “hard to get one; even more difficult to pay it back”, warns Policy on his one.

The title pages explore two related topics: “tsunami” which sweeps away borrowers on the one hand, the monetary policy of the national-conservatives of the PiS on the other hand, while a faithful of the ruling party has been reappointed to the presidency of the Polish National Bank (NBP).

Too heavy a load

“The monthly installment of our loan has recently increased by 1,000 zlotys [215 euros]. In all, this brings the costs to nearly 4,000 zlotys monthly [860 euros]. It’s more than my wife’s take-home pay,” testifies a father quoted in the first article. This man and his partner decided to sell the apartment they owned on credit in order to free themselves from a burden that had become too heavy. The couple, employed in the media, no longer has a CDD since the pandemic. “We will leave nothing to our children, but […] we will make up for visits to the doctor”, he concludes.

In Poland, variable rate mortgages are currently strangling their holders as the NBP continues to raise its key rate – it rose from 0.5% in April 2020 to 5.5% in May 2022 in order to counter peak inflation. at 12.3%. Result: the monthly payments of these borrowers have increased dramatically, sometimes by 90% in a few months.

Enough to give rise to the beginnings of a housing crisis, while 2 million apartments are missing on the market: the installation of at least 1.5 million refugees since the war in Ukraine has caused rent prices to soar – from 25 to 70% – in the big cities of Poland, reports Policy.

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