Real Estate Property Investment Series

>> Tuesday, December 29, 2009


Poland has achieved a successful transitional economic state which has been boosted in terms of its stability since Poland joined the EU in 2004 and was able to export high volumes of produce to the likes of neighbouring Germany. Poland has also gone a long way to reducing its once very high unemployment levels and boosting low GDP figures and as a result today it is a nation politically and economically strong and greatly in favour with the EU and the US for example.

Poland holds the record for being one of the most successful nations at attracting and retaining foreign direct investment commitment and as a result of all of these positive factors an investor might well be drawn closer into looking at the property investment potential in this European country, which many say will be significant in 2007 and for at least the medium term.


Importance of the "Execution Date" on a Real Estate Contract


The majority of investment activity will be centred on the residential property market and an investor has a number of approaches to take for profit from either capital growth and/or rental yield. Firstly looking at local demand - it is intense at the moment for rental stock in the main employment centres such as Krakow and Warsaw.

Basically Polish cities where employment opportunities abound are being targeted by high levels of migration from local citizens who are moving from outer lying areas into the cities and suburbs. Rental stock is in demand and yields achievable are expanding meaning an investor has a very real and growing audience to target for buy to let income.

This audience will in time become a potential customer base for resale stock as well. Currently the levels of home ownership in Poland are low compared to countries such as the UK or US for example and this is as a result of affordability issues.


Stratagem in Real Estate Marketing


However, as the Polish government is committed to further reducing unemployment, boosting GDP and improving the living standards for Polish people, more locals are in a position to buy property and the desire is great among most Poles to become homeowners. Add to this the fact that mortgage finance is available in abundance in Poland and has been little requested meaning lenders are hungry to lend and you have a situation where in the near future the residential resale market will grow.

In addition to domestic demand there is a fledgling tourism demand and also a strong requirement for rental accommodation from students especially in Northern Poland. In the Tricity which is made up of Gdansk, Gdynia and Sopot on the Northern coast, both of these markets are chasing real estate and have created a situation where demand is outstripping supply which is pushing up underlying costs and meaning that rental yields are up to 18% for short term lets.


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All indications are that this area will continue to be a great location for investment as money is going into improving the appeal of the area and accessibility is getting better all the time with an airport expansion planned and more cheap flight operators from across Europe arriving in 2007.

In conclusion there is much to support Poland's continued positive economic development, and going hand in hand with this development is the expansion of the property market for investors. 2007 will be a good year for market entry with profits being returned in the form of rental income immediately with medium term prospects for strong capital appreciation.
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