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This may make interesting reading for people who have invested in Poland
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hythorn
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Re: This may make interesting reading for peopel who have invested in POland
Wages are indeed growing in Poland. However if you are 18 to 35 living in a small village it is far easier for you to up sticks and get a job in the UK than it ever would be to move to Warsaw and do the same.
Many Polish people believe that it is better to be a dish washer in a London hotel than be an entry level stiff working in a Polish corporation.
It is starting to look as though the first wave of Polish emigrants are returning home having made their money in the UK. Having said that Poland has the highest level of unemployment in the 18 to 25 age category in Europe. It was 44% in 2004 according to Newsweek. In addition, the Polish educational system puts a very high emphasis on teaching English. The high school graduation exam (Matura) dictates that students must be able to communicate in Polish and English and English language ability has now taken precedence over maths. If you do not pass your Matura you cannot officially graduate high school and will not be able to go to university and will find it very difficult to avoid national service if you are male.
Also the type of Polish candidate is changing, it is no longer minimum wage cannon-fodder. In Aberdeen for example, the Poles who live there are either fish gutters and cleaners or doctors, dentists, Lloyd's certified welders or top banana computer programmers. so they either command the low end or the high end of the job market, over time there will be more Poles in semi-skilled and admin positions.
it is becoming more difficult for Poles who do not speak English to find work in the UK but the network is already well established. Every family will either have telephone numbers to someone who has worked in the UK or Ireland or knows someone who can offer advice.
as in my post about two Germanies, there are two Polands. in fact the Polish advertising people refer to anywhere east of Warsaw as Poland B.
as you near the Russian/Ukranian/Bialorussian border many houses in the countryside have a shadoof (Egyptian water crane thingy) and a well and an outside lav. They all have a TV so it looks like more brains are getting washed than anything else
the poverty is absolutely grinding. things ain't going to get better there in a hurry, oh Lordy no.
so things are going to have to get an awful lot better in the whole of Poland and a lot worse in Ireland and the UK to stop the migration westward.
Wages are indeed growing in Poland. However if you are 18 to 35 living in a small village it is far easier for you to up sticks and get a job in the UK than it ever would be to move to Warsaw and do the same.
Many Polish people believe that it is better to be a dish washer in a London hotel than be an entry level stiff working in a Polish corporation.
It is starting to look as though the first wave of Polish emigrants are returning home having made their money in the UK. Having said that Poland has the highest level of unemployment in the 18 to 25 age category in Europe. It was 44% in 2004 according to Newsweek. In addition, the Polish educational system puts a very high emphasis on teaching English. The high school graduation exam (Matura) dictates that students must be able to communicate in Polish and English and English language ability has now taken precedence over maths. If you do not pass your Matura you cannot officially graduate high school and will not be able to go to university and will find it very difficult to avoid national service if you are male.
Also the type of Polish candidate is changing, it is no longer minimum wage cannon-fodder. In Aberdeen for example, the Poles who live there are either fish gutters and cleaners or doctors, dentists, Lloyd's certified welders or top banana computer programmers. so they either command the low end or the high end of the job market, over time there will be more Poles in semi-skilled and admin positions.
it is becoming more difficult for Poles who do not speak English to find work in the UK but the network is already well established. Every family will either have telephone numbers to someone who has worked in the UK or Ireland or knows someone who can offer advice.
as in my post about two Germanies, there are two Polands. in fact the Polish advertising people refer to anywhere east of Warsaw as Poland B.
as you near the Russian/Ukranian/Bialorussian border many houses in the countryside have a shadoof (Egyptian water crane thingy) and a well and an outside lav. They all have a TV so it looks like more brains are getting washed than anything else
the poverty is absolutely grinding. things ain't going to get better there in a hurry, oh Lordy no.
so things are going to have to get an awful lot better in the whole of Poland and a lot worse in Ireland and the UK to stop the migration westward.
Re: This may make interesting reading for peopel who have invested in POland
Interesting views hythorn. Whats your views on the central parts of those cities in Poland B? I have someone looking for sites in krakow and in wroclaw for me with a view to doing some high rise luxury apts. Warsaw land values are too high thus why im looking elsewhere.
Interesting views hythorn. Whats your views on the central parts of those cities in Poland B? I have someone looking for sites in krakow and in wroclaw for me with a view to doing some high rise luxury apts. Warsaw land values are too high thus why im looking elsewhere.
Re: This may make interesting reading for peopel who have invested in POland
Anecdotal evidence from a Polish acquaintance indicates that wages in Poland have risen to the pooint that many Poles are going home/not emigrating. Large building projects, such as for European Football championships. Also, many are moving to London to work on building in preparation for Olympic games.
Noticed ahuge amount of non-nationals at the Community Welfare Offices this morning. Building trade here is slowing right down.
Slim
Anecdotal evidence from a Polish acquaintance indicates that wages in Poland have risen to the pooint that many Poles are going home/not emigrating. Large building projects, such as for European Football championships. Also, many are moving to London to work on building in preparation for Olympic games.
Noticed ahuge amount of non-nationals at the Community Welfare Offices this morning. Building trade here is slowing right down.
Slim
The weakness of Sterling against the Euro is another poing to consider in the UK. I believe Poland have no current plans to adopt it, but are under pressure to do so. The EU will not allow acsesssion co's to opt out. Better for them to be paid in Euro in that case-Irelands advantage? Maybe, if construction picks up again!
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hythorn
Guest
Re: This may make interesting reading for peopel who have invested in POland
there are not that many cities in Poland B. There is Lublin (which is due a face lift), Bialystock and Rzeszow in the South East. In the North East, the cities of Elk and Suwalki are very impoverished.
the East of Poland was annexed by the Russians in the 19th century and country disappeared off the map. The problem was that the pesky Russians did not invest in infrastructure and carted away anything of value. there are no raw materials there excluding timber and oil in the South East so it is a bit of a backwater. As is often the way with peripheral places it will take a lot of time for it to catch up with the rest of the country. Nice place though.
There are a couple of new developments in Bialystok on sale and one in Rzeszow and quite a few in Lublin. However I do not know if I would like to buy there. There are better places left to invest in. If I have a moment I will have a look at the secondary market in those towns to see what they are yielding.
good comment about the Sterling rate. It has gone into freefall against the zloty recently. It is not too bad for Poles living in the UK over the last two years as many of them did not trust the banking system and as a result they were taking money home rather than transferring it. Anecdotal as it may be, but try finding a fifty quid note in the UK? there aren't any. It is far easier to take in a grand's worth of £50s than a bucketfull of one pound coins.
My point being is if you had your money in a UK bank over the last two years you would be hurting now due to the pound falling against the zloty. However as many people were sending their hard earned sterling home on a regular but ad-hoc basis, they were not as vulnerable to sterling plummeting.
the article talks about the salaries rising in Poland and it is true, they have risen but if you were an unemployed bus driver in 2004, chances are you will still be unemployed now or working in the UK. For many people there is not much choice but to leave Poland. The reason that the salaries rose in the first place is because of the number of people who left Poland over the last three and a half years decreasing competition for jobs.
there are not that many cities in Poland B. There is Lublin (which is due a face lift), Bialystock and Rzeszow in the South East. In the North East, the cities of Elk and Suwalki are very impoverished.
the East of Poland was annexed by the Russians in the 19th century and country disappeared off the map. The problem was that the pesky Russians did not invest in infrastructure and carted away anything of value. there are no raw materials there excluding timber and oil in the South East so it is a bit of a backwater. As is often the way with peripheral places it will take a lot of time for it to catch up with the rest of the country. Nice place though.
There are a couple of new developments in Bialystok on sale and one in Rzeszow and quite a few in Lublin. However I do not know if I would like to buy there. There are better places left to invest in. If I have a moment I will have a look at the secondary market in those towns to see what they are yielding.
good comment about the Sterling rate. It has gone into freefall against the zloty recently. It is not too bad for Poles living in the UK over the last two years as many of them did not trust the banking system and as a result they were taking money home rather than transferring it. Anecdotal as it may be, but try finding a fifty quid note in the UK? there aren't any. It is far easier to take in a grand's worth of £50s than a bucketfull of one pound coins.
My point being is if you had your money in a UK bank over the last two years you would be hurting now due to the pound falling against the zloty. However as many people were sending their hard earned sterling home on a regular but ad-hoc basis, they were not as vulnerable to sterling plummeting.
the article talks about the salaries rising in Poland and it is true, they have risen but if you were an unemployed bus driver in 2004, chances are you will still be unemployed now or working in the UK. For many people there is not much choice but to leave Poland. The reason that the salaries rose in the first place is because of the number of people who left Poland over the last three and a half years decreasing competition for jobs.
eamonn123456
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So where are all these 50 notes believed to be? Stashed under mattresses in Poland? Or circulating there as currency? Either way, whoever is holding them is probably hurting just as much as those holding GBP in a bank account.
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hythorn
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not if you go to a kantor (bureau de change) and change them into zloty which is what everybody does.
eamonn123456
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Re: This may make interesting reading for peopel who have invested in POland
There is no scope for development of anything other than basic new developments in Eastern Poland and even then, I wouldn't be sure of selling that easily. Cities like Bialystok have little to no wealth. Wages are low and unemployment is high. The main street is just one big row of panel housing. This region of Poland is a million miles away from Warsaw and the other cities in the centre/West of the country.
There is no scope for development of anything other than basic new developments in Eastern Poland and even then, I wouldn't be sure of selling that easily. Cities like Bialystok have little to no wealth. Wages are low and unemployment is high. The main street is just one big row of panel housing. This region of Poland is a million miles away from Warsaw and the other cities in the centre/West of the country.
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hythorn
Guest
I'd leave Krakow well alone. They do not make anything, they don't sell anything. It is a city full of unemployable intellectuals. The communist authorities built a steel mill there in spite of the fact that neither iron ore nor coal exist locally and have to be carted in 150km from Silesia. The hope was that the steel workers would go into town on a Friday night and batter the art fags. However it didn't happen.
The prices near the old town are supersonic and are higher than in Warsaw. As soon as you have locals completely priced off the local market, you are in bubble territory big time.
As for Wroclaw, I am not sure but at least it is a town where there is industry and they are quite close to Germany. RedNet who exist in order to try and offload property to international investors have Wroclaw pegged as being past its prime. their latest report should be appearing on askaboutproperty soon.
Having said that I expect a period of stabilisation in Poland but do not see a major crash. Unless of course it is caused by UK and Irish investors having to pull out as their situation at home becomes untenable. If so, expect prices in Krakow to be worst affected.
Poles were not able to get BTL mortgages, self-declaration mortgages and even if you owned substantial numbers of properties, the banks were only interested in whether you could make the monthly repayments on your latest acquisition. Hence no Polish sub-prime market.
The prices near the old town are supersonic and are higher than in Warsaw. As soon as you have locals completely priced off the local market, you are in bubble territory big time.
As for Wroclaw, I am not sure but at least it is a town where there is industry and they are quite close to Germany. RedNet who exist in order to try and offload property to international investors have Wroclaw pegged as being past its prime. their latest report should be appearing on askaboutproperty soon.
Having said that I expect a period of stabilisation in Poland but do not see a major crash. Unless of course it is caused by UK and Irish investors having to pull out as their situation at home becomes untenable. If so, expect prices in Krakow to be worst affected.
Poles were not able to get BTL mortgages, self-declaration mortgages and even if you owned substantial numbers of properties, the banks were only interested in whether you could make the monthly repayments on your latest acquisition. Hence no Polish sub-prime market.
polish_bloke
Registered User
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As a matter of fact a lot of these 50£ notes are stashed under mattresses in PL ... Please note:
- Poland haven't had a double taxation agreement with UK before 2007 and all earnings were subject to a double taxation.
- Poles have to pay 40% tax on top of the tax already paid in UK ...
- Polish revenue has the power to x-ray private bank accounts;
- all property purchases go through the revenue;
- UK/Irish taxman has tender personality in comparison with his Polish fellow;
- disobeying the tax law in Poland is a matter of honour
IMHO Property boom in cities like Krakow has been created mostly by foreigners and Poles from Ireland.
I'm afraid there is nothing in PL apart from peoples' naive beliefs to fuel the boom any longer. Consecutive governments are not working and the population is shrinking. No "second Ireland" on the horison whatsoever ...
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hythorn
Guest
good points Polish bloke. I have bitter experience of the power of the Polish tax gestapo, fortunately I was working for someone else at the time. In the UK, if you are late with your corporate tax return by over a year you get a £100 fine. if you a few days late in Poland the tax people will just freeze your corporate account and the fines are supersonic. You are effectively kept from trading as a company until you settle up
I do not share your pessimism for the future of Poland though. A real acid test will be to see how they get on with Euro 2012 football tournament.
if they are ready with the building program it will be a big boost for the country's reputation, however it is more likely that Poland will be stripped of the right to host the games sometime in early 2011 when the organisers realise they will not be ready on time.
I do not share your pessimism for the future of Poland though. A real acid test will be to see how they get on with Euro 2012 football tournament.
if they are ready with the building program it will be a big boost for the country's reputation, however it is more likely that Poland will be stripped of the right to host the games sometime in early 2011 when the organisers realise they will not be ready on time.
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Jacek
Guest
hello,
as a Krakow’er myself I don't necessarily agree with your opinion.
(1) there's a dedicated FDI economic zone in and around Krakow (called Krakow Technology Park), which attracted the investors like Coca-cola, MAN, Delphi and good few smaller ones.
(2) also note that due to ia. a broad availability of well qualified staff Krakow has been chosen as a spot for outsourcing & shared-services centres of the companies like Shell, Lufthansa, IBM, Cap Gemini Ernst & Young, as well as R&D centres of eg. Google, Motorola.
Ad. 1 & 2) see eg.:
* Krakow’s official site [http://www.krakow.pl/en/gospodarka/?id=for_investors.html] for impressions of those who have already decided to invest there.
or also
* Polish Information & Foreign Investment Agency [http://www.paiz.gov.pl/index/?id=14491b756b3a51daac41c24863285549] where some info on Krakow could be found as well
(3) apart from the mentioned steel plant (today member of Arcelor Mittal group), there is also a tobacco producer Philipp Morris, a pharmaceutical company Pliva Krakow and many others that I’m probably not aware of.
(4) needless to say that tourist services play a significant role in the city cash in-flows.
...and (5) last but not least, as at 31/12/07 the unemployment rate in Krakow was 3.8%, compared to 3.0% in Warsaw, 4.7% in Wroclaw and 11.4% for entire Poland [source: Central Statistical Office in PL].
well, the question may then arise, if it’s so wonderful down in Krakow so why I’m here in Ireland
. but that’s a bit different story ...Jacek
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z101
Guest
Great thread - very informative with some good expert opinion.
A polish man I met through work made a couple of points to me in conversation. He explained that polish people dont like to rent and would rather live in a hut and own it, rather than rent an apartment from someone else. Secondly that the level of political corruption at every level has to to experienced to be believed.
I have no idea or experience on either but maybe some of the better informed and more experienced on this may know more.
A polish man I met through work made a couple of points to me in conversation. He explained that polish people dont like to rent and would rather live in a hut and own it, rather than rent an apartment from someone else. Secondly that the level of political corruption at every level has to to experienced to be believed.
I have no idea or experience on either but maybe some of the better informed and more experienced on this may know more.
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hythorn
Guest
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Jacek
Guest
hi Ceatharlach,
as for me, I'm not too experienced in PL's property market but I could just share some opinion on that.
indeed we’re much committed to the ‘ownership’ institution and having own personal nest seems to be priority for many of us. but I think it can be sometimes a long way from willing to actual possession. many ppl are not in a position to get a mortgage, so as soon as they want to live on their own (eg. young families) there's not much choice for them but renting. and I'd say in Warsaw and the biggest cities there’s influx of migrant workers + college/ university students, so those would be another groups of renters...
yes, no doubt that corruption (not only political) is a problem in PL. I think though there are certain areas that would be vulnerable to corruption all over the world, like lobbying for favourable decisions for some groups of interest, state contracts/ tenders, sale of attractive municipal sites, etc. the thing is how much transparency and control/ supervision is given there.
the new Polish government are saying much about increased transparency and focussing on the cause rather than fighting with outcomes (ie. simplifying procedures, modifying some decision making processes to minimise possibility of individual decisions by civil servants, etc.) but I haven’t come across any significant achievement made so far. well, I know they’re still quite fresh in their posts (since Nov 07) so look forward to their actions, not only re corruption
.I’d say a good thing is that in general Polish media have built up a strong position and have important controlling role (eg. investigating shady relations between politics and business), which has come up in a number of cases already. of course, I cannot be 100% sure about their independence though as their editors/ owners may do some politics, but maybe I’d better drop this conspiracy line
...hello hythorn,
I didn’t say it is. I just argued against your opinion that it’s a commercial/ business desert.
you’re right, it’s not located near to raw materials but I’d say this argument is valid for many steelworks in Europe. however, it doesn’t seem to bother the major shareholder (Arcelor Mittal) as they eg. invested ca. $380m. there in a new hot strip mill (opened in 2007). according to their info there’s been no larger investment in European steel industry for 20 years. so I presume they well assessed pros & cons before deciding on a deeper engagement in the steelwork.
Jacek
I just spoke with an old friend from warsaw who bought in krakow 4 years ago. Her apartment has trebled, it was one of only 4 3 bedroom in the complex so she was lucky.
From Warsaw and having worked in Ireland for the past 5 years she is looking forward to heading back to Krakow where she is confident things are on the up.
I myself was in Krakow looking around 2 years ago but unlike a lot of paddies over at the time for a weekend of partying and an apartment purchase on the side, i didnt come home with one Great city and Im sure there will be plenty of opportunities for more upside
From Warsaw and having worked in Ireland for the past 5 years she is looking forward to heading back to Krakow where she is confident things are on the up.
I myself was in Krakow looking around 2 years ago but unlike a lot of paddies over at the time for a weekend of partying and an apartment purchase on the side, i didnt come home with one Great city and Im sure there will be plenty of opportunities for more upside
I must admit this is the first time I've seen any degree of doubt as to whether Poland will be ready for Euro 2012, and certainly the first time I've even been given food for thought that they may even loose it! I'm just wondering how firm a belief that is?? Anyone else share it?
polish_bloke
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Guys, a couple of points that come to my mind from the combined topics above:
1. There are trouble with preparation for Euro 2012 but to be honest I do not see any real reason why would a couple of thousand short-time visitors in 2012 fuel the Polish property market. If the prices go up - you won't be able to resell to Poles after 2012.
2. Poles are not German. Every Pole has a will to own an apartment (better house) on their own. Talking about rental perspectives - talk about students and very young professionals. In this case, with it's 100k student population and international companies, Krakow seems a reasonable destination for your money.
3. Poles are already overstretched with their mortgage repayments. Prices in cities are currently to high for Poles - so be cautious re resale market.
4. Smaller cities are catching up so I think that after a short while the prices should go up again in Warsaw/Krakow.
5. Krakow was voted the best city to live in by Polish citizens (followed by Gdansk).
1. There are trouble with preparation for Euro 2012 but to be honest I do not see any real reason why would a couple of thousand short-time visitors in 2012 fuel the Polish property market. If the prices go up - you won't be able to resell to Poles after 2012.
2. Poles are not German. Every Pole has a will to own an apartment (better house) on their own. Talking about rental perspectives - talk about students and very young professionals. In this case, with it's 100k student population and international companies, Krakow seems a reasonable destination for your money.
3. Poles are already overstretched with their mortgage repayments. Prices in cities are currently to high for Poles - so be cautious re resale market.
4. Smaller cities are catching up so I think that after a short while the prices should go up again in Warsaw/Krakow.
5. Krakow was voted the best city to live in by Polish citizens (followed by Gdansk).