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Investment

Poland is a recent newcomer to the EU and the property market for overseas investors. Previous to Poland’s accession to the EU in mid 2004 it is likely that the country would have been overlooked by would be property investors. This is no longer the case as the Polish economy looks set to boom which theoretically should lead to increased property pricing. Last year Poland posted a GDP growth rate of 5.8% and property prices increased by 10-20%.

Many of the highest property increases are currently occuring in the Gdansk region situated on the North Sea coast. Gdansk is built around a port and is reminiscent of Amsterdam with their narrow canals and canal side properties. Investment potential in Gdansk is high due to low cost airlines introducing routes into Gdansk. It is possible to fly to Gdansk from the UK in less than 3 hours and pay as little as £5 one way including taxes. Similarly, there are low cost airlines targeting the Lodz area which is approximately 75 miles from the Polish capital Warsaw. Again, this could be highlighted as an area for investment potential.

Poland is due to receive a large subsidy ($13.5 billion) from the EU in order to improve the countries intrastructure and foreign investors are being actively encouraged to invest in Polish property. Incentives include a lack of Capital Gains Tax if a property is held for more than 5 years. A surge in property investment is expected in Poland because it has been announced that the standard VAT on property of 7% will be increased to 22% in January 2008. This will likely mean many shrewd investors will attempt to complete their purchases prior to this date and the local economy will receive a large short term boost.

Prices for house purchases in the three strongest candidates for property investment in Poland are as follows:

Warsaw

€105,000 for a 2 bedroom property
€163,000 for a 3 bedroom property
€215,000 for a 4 bedroom property

Krakow

€133,000 for a 2 bedroom property
€155,000 for a 3 bedroom property
€192,000 for a 4 bedroom property

Gdansk

€78,000 for a 2 bedroom property
€126,000 for a 3 bedroom property
€153,000 for a 4 bedroom property

Prices for apartment purchases in the three strongest candidates for property investment in Poland are as follows:

Warsaw

€67,000 for a 1 bedroom property
€99,000 for a 2 bedroom property
€203,000 for a 3 bedroom property,

Krakow

€67,000 for a 1 bedroom property
€129,000 for a 2 bedroom property
€153,500 for a 3 bedroom property

Gdansk

€45,000 for a 1 bedroom property
€62,000 for a 2 bedroom property
€107,000 for a 3 bedroom property

Prices for weekly property letting in the three strongest candidates for property investment in Poland are as follows:

Warsaw

€430 for a 1 bedroom property
€640 for a 2 bedroom property
€918 for a 3 bedroom property

Krakow

€450 for a 1 bedroom property
€535 for a 2 bedroom property
€600 for a 3 bedroom property

Gdansk

€300 for a 1 bedroom property
€375 for a 2 bedroom property
€515 for a 3 bedroom property

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