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Purchase a Property in Poland

Purchase a Property in Poland

Those who wish to buy property in Poland will be pleased to know that the real estate market in Poland offers a variety of properties available for purchase, both existing houses and apartments as well as new built ones.

Along with the economic growth, creation of the Polish special economic zones by the Government and the increased number of foreigners interested in opening a business herePoland’s property market is also gradually improving. It is estimated that the real-estate market will continue to grow.

 Quick Facts  
Overview on Polish real estate market The real estate market in Poland has maintained a steady state, although it has encountered a slowdown in recent years

Where to search for properties to buy in Poland

Online platforms, newspaper ads, real estate agents, trade shows, etc.

 Legal framework for property purchasing in Poland

The Act on Land Acquisition by Foreigners of March 24, 1920;

The Ordinance of April 24, 2004.

Residence permit required (YES/NO) NO, but non-EEA citizens must obtain a permit to buy a property in Poland
Permit to buy a property in Poland

The permit is used for foreigners who want to purchase a property in Poland;

The application for a permit should include information about the applicant's identity, legal status, the property to be purchased, the seller, the form of the real estate being purchased, and an explanation of the purpose of the property purchase;

Citizens who are not members of the European Economic Area (EEA) or Switzerland must obtain a permit from the Minister of Interior and Administration to purchase any type of property in Poland.

Permit validity

2 years from the date of issue

Necessary documents

Permit (if applicable);

Copies of ID or passports;

Purchase agreements, etc.

Can obtain a resident visa (YES/NO)

NO 

Fees and taxes

VAT or transaction tax, real estate commission, notary fees, land or mortgage registration fees, etc.

Purchase procedure

It is advisable to first conduct due diligence on the property before purchasing it;

Execute a preliminary sale agreement which includes discussing important details about the property and its price;

Sign the final agreement to complete the property sale;

Conduct the transfer of ownership;

Apply to be registered as the owner in the land and mortgage register;

Report the transaction for real estate tax purposes;

Arrange new utility contracts, etc.

Verifying a property in Poland

Conduct due diligence on the property and check the property ownership, review the property documents, verify its conditions, and check if it has necessary permits or approvals if needed;

Our attorneys in Poland can help you with the due diligence process.

Mortgages

When you apply for a mortgage in Poland, lenders usually won't lend you more than 80% of the property's value, but the amount will depend on the size of your down payment;

The lender will also assess your income to make sure you can afford the mortgage payments;

Your other expenses typically must not exceed 35% of your income.

Property types in Poland

Residential, commercial, agricultural, etc.

Assistance for purchasing a property in Poland (YES/NO)

YES, our law firm in Poland offers assistance with property registration and legal matters regarding real estate

Advantages of purchasing a property in Poland

Foreigners can easily buy a property in Poland;

Poland has experienced steady economic growth in recent years, making it an attractive market for property investment;

Property prices in Poland are affordable compared to the rest of Europe;

The purchase process is fast and straight-forward.

Before one starts the process to buy an apartment in Warsaw, or another city, it is advisable to talk to a local ream of experts, such as our own, to find out more about the overall steps and the expected time to finalize the property ownership documents. 

Some of the laws that govern purchase of property for apartments, houses, and for those who buy land in Poland are The Act on Land Acquisition by Foreigners of March 24, 1920, and the Ordinance of April 24, 2004.

Our lawyers in Poland offer expert advice and assistance to local and foreign nationals who wish to buy a house in Poland. What’s more, we can also offer legal representation (via a power of attorney) when the buyer cannot be present in the country for the entire duration of the sale/purchase.

We invite you to watch a short video about the property purchase process:

Steps for buying property in Poland

Once you decide that you wish to purchase a property in Warsaw or another Polich city, there are a number of steps you should be mindful of. Before you start the actual process, there are also a few issues you should take into account:

  • Your budget: property prices vary in Poland on a city-by city basis; it is useful to be informed on the current prices (calculated in square per meter);
  • Your financing: directly related to the point above, you should know if you can purchase the property directly (if you have sufficient funds) or if you need financing from a bank;
  • The legal process: as you can read below, you will need to sign an agreement and perform the formal registration of the property in your name;
  • Post purchase steps: these will depend on the type of real estate you purchase and its intended final use (if you buy a commercial space, or a home for personal use).

Property purchase is always subject to several steps, summarized below by our lawyers:

  1. Property research: analyzing the available offers according to budget and preferences;
  2. Due diligence: verifying the legal status of the property;
  3. Preliminary purchase agreement: which includes the preliminary provisions, the price and the description of the property, and the conditions for both parties;
  4. Final property agreement: this is executed once the parties have fulfilled their obligations (i.e., financing, planning decisions, etc.)
  5. Post-agreement stages: entering the data of the new owner in the Land Register.

Working with a real estate lawyer is not mandatory, however, it is highly advisable in order to streamline the entire property purchase process. Our lawyers in Poland also specialize in conveyancing, which is a term used to refer to the transfer of the real estate title from the seller to the buyer, but it also encompasses other essential steps.

A lawyer will not only assist you with drawing up and verifying the sale/purchase agreements. He can also be present when the notarial deed is drawn up, and he can assist with the negotiations for the real estate price, either directly with the owner of the property, or his/her lawyer, if both parties choose to work with a legal representative.

Foreign nationals who wish to buy property in Poland do not need to travel to the country, or, in any case, they are not obliged to spend time in the country for the entire duration of the purchase. A lawyer in Poland from our team will be able to act as a legal representative (through the aforementioned power of attorney) and will assist during the purchase. Essentially, what the power of attorney will allow our lawyer to do is to be able to sign the purchase agreements in your name.

Property purchase through an appointed representative can be used by natural and legal persons alike. If you would like to know more about this option, please do not hesitate to reach out to us so we can arrange the details in a timely manner.

Taxes related to property purchase in Poland

The tax implications for property purchase in Poland are summarized below by our team:

  • Value added tax: applicable in some cases, most notably when the seller executed the transaction as a VAT payer; the VAT value is either 23% or 8% for estates of up to a certain size;
  • Transaction tax: this can apply when the property purchase is not subject to value-added tax; this has a value of 2% of the transaction and it is payable by the buyer;
  • Property tax: varies according to rates imposed by local authorities; it is calculated according to the usable area, on every 1m2 of the building; our accountants in Poland can also assist you with information about the applicable local taxes;
  • Land Register fee: 200 PLN in most cases (approx. EUR 45).

Please keep in mind that the information above is issued for general purposes only. Your particular situation can be analyzed by one of our lawyers in Warsaw for more information. 

In addition to the formal taxes listed above (i.e., those imposed by the authorities), home buyers in Poland should also keep in mind that they will need to include the notary and real estate agent fees in their overall budget. When working with an attorney, such as one from our law firm in Poland, you should also include his fees. Upon request, our team will give you details on our tariffs.

The permit needed to buy property in Poland

A permit is an administrative decision issued as a response to a foreigner’s application. This application should contain data about the applicant’s identity, his legal status, the property to be purchased, the seller, the form of the purchased real estate and must also explain the purpose of the property purchase.

Buying an apartment of a house in Poland is not subject to special licensing in case of most foreignersThe applicable rule is that a foreign national of the EEA or the Swiss Confederation is not required to obtain a permit for real estate acquisitions.  Non-EU/EEA natural and legal persons may require such as permit, however, in most cases this will not be needed for apartment purchases.

For the purpose of buying a house, or for those who wish to buy an apartment in Krakow or another city, a foreign national is a natural person without Polish citizenship, or a legal person based abroad. The term also extends to legal persons and non-corporate commercial companies based in Poland but controlled either directly or indirectly by foreign persons or companies.

A permit can still required for the purchase of agricultural or forest real estate, and for those foreign investors who wish to buy land in Poland, our team can offer a comprehensive case-by-case analysis of their options. 

Our specialized Polish law firm can provide assistance during the permit application phase, as well as guide applicants through the mandatory requirements set forth by the Ministry of Internal Affairs.

Property due diligence with the help of our Polish lawyers

Due diligence is a comprehensive evaluation of the property intended for purchase. This careful evaluation, led by one of our lawyers specializing in real estate matters, is important in order to ensure that the buyer avoids any potential risks.

The due diligence for those who buy a house in Poland, as well as those who buy an apartment, includes an analysis of the following:

  • the property’s legal title;
  • any mortgages on the property or the rights of use by other parties, either natural or legal persons;
  • any existing agreements with third parties; if you want to buy an apartment in Krakow or in another city, checking for existing leasing agreements is an important step;
  • construction compliance for the property;
  • planning and zoning issues.

If you are ready to buy an apartment in Warsaw, or in another Polish city, as well as if you are interested in buying a house or investing in commercial properties, please feel free to reach out to our team for more information.

For investors interested in company formation in Poland, the property purchase step can be an important one, if the house or apartment will be used as the company’s registered office. You can contact us as soon as you decide to buy property in Poland as a legal person.

Our lawyers can also give you more detailed information regarding the procedures and regulations for purchasing a company in Poland.

The housing market in Poland

Natural and legal persons interested in buying a property in Poland make this decision based on a set of factors, among which the most important one can be considered their available budget. For this purpose, the average house prices in the country are a relevant topic, and our team highlights some statistical data below:

  • in the Q4 2022, the average house price per square meter in Warsaw was PLN 9,631 (or approx. EUR 2,207);
  • during the same period, the city with the second most expensive houses was Gdansk, with PLN 8,557 per square meter (or about EUR 1,961);
  • in terms of average price per square meter, Wroclaw and Krakow followed them, with PLN 8,414 (or about EUR 1,928), and PLN 8,318 (approx. EUR 1,906), respectively.

According to Eurostat, the housing index in Poland increased in the second quarter of the year, compared to the first one:

  • in Q2 2023 the housing index has 175 points;
  • in Q1 2023 the value was 169.52;
  • the average index value was 117.53 points from 2010 thru 2023;
  • this index is used to measure the prices on the residential property market and it reflects the price changes.

Investments in real estate are not only important for individuals and families who are ready to make this important step, but they are also seen as a valuable and safe form of investment (for entrepreneurs who plan on deriving rental income, for example).

Contact our law firm in Poland if you would like to know more about buying a property in Warsaw or in another city, as well as to find out more about our services for real estate purposes.