Poland's subsidised mortgage programme has mixed results says report

A state subsidised mortgage programme aimed at first-time buyers offers some benefits to those who qualify for it but at the same time has led to an increase in house prices and made it harder for other buyers, according to a report by AMRON-SARFiN, a housing financing researcher affiliated with banking lobby ZBP.

Under the programme, which was introduced by the government in July, first-time buyers under the age of 45 can get access to subsidised mortgages with interest rates set at 2 percent plus the bank's margin for the first 10 years of the loan's lifespan.

The state budget will compensate banks for the difference between the 2 percent and the market.

"[I]t's another programme that proves that such government actions, theoretically improving the creditworthiness of Poles, result mostly in increased demand for housing," the report said. "That phenomenon is being used by sellers to raise offering prices.

"The positive aspect of the programme will be felt only by those who take advantage of the subsidised mortgages, while for the remaining majority portion of buyers the possibility of buying their own apartment becomes more distant."

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