Average Pole can only afford 27 sq. m. flat, significantly less than 3 years ago
Housing market experts have assessed the purchasing power of individuals earning an average salary, revealing a significant decline in the size of flats they can afford. Over a brief period, the square metre area of affordable properties has sharply decreased.
Over the past three years, the amount of living space the average Pole can afford has shrunk dramatically. According to calculations by Rynek Pierwotny, the surface area of a new flat within reach for an average-earning individual has significantly decreased. A loan with a 10 per cent down payment and a 25-year repayment term, based on the average salary as of June 2024 (as reported by Statistics Poland), would now only cover 27 square metres in a city with a population exceeding 300,000. In 2021, the same person could have afforded 44 square metres.
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Housing prices are rising much faster than wages
Commenting on these findings, Business Insider Poland described the situation as a "confluence of unfavourable factors." The article attributes this decline to high interest rates and the soaring price per square metre of housing. It has previously been reported that Poland has the highest interest rates in the European Union. Meanwhile, the cost of housing, particularly in major cities, has escalated at an alarming pace, fuelled in part by the "Safe Credit 2%" programme introduced by the Law and Justice party during the last parliamentary term.
As Business Insider notes, the situation would be even more dire were it not for the steady rise in the average salary within the business sector, upon which these calculations are based. According to the latest data from Statistics Poland (GUS), the average gross salary in June 2024 was PLN 8,144.83. Without this increase, the affordable space for the 'average single man or woman' would be even smaller.
Decline in housing loan uptake
The housing loan market has experienced a significant slowdown. According to the Credit Information Bureau (BIK), the value of mortgage enquiries in July 2024 decreased by 31.7% compared to the same period last year. This indicates that BIK received enquiries for home loans amounting to 31.7% less than the previous year despite an increase in individual loan values due to rising housing prices.
On the social media platform X, discussions about the purchasing power of the average Pole reveal anecdotal evidence of dramatic increases in housing prices. Comments include: "The flat we live in now was purchased five years ago for a quarter of its current market value. It's absurd," and "I can hardly believe that for the same amount I paid for a flat less than a year ago, I could now only afford a property 20 square metres smaller and in a worse location."
Source: businessinsider.com.pl
