There is an established buying process in Poland and so long as you make sure all the steps are completed correctly buying a property in Poland can be relatively easy and trouble free.
There are already a number of property buying guides available, we will review them and also provide our own.
1. Property Investment, Holiday Retreat or New Home?
Decide What You Want!
You probably already have a good idea of what you are looking for.
Property Investment for Rental Income. If you simply want to invest in a property for rental income, start with finding a good trustworthy property agent with whom you can establish a good rapport if only over the phone. You must take into account property management fees, these can be in the region of 5% to 20% and if you get a poor agent you can end up spending more on refurbishments, repairs and management than you end up getting in rental income!
If you are looking for a holiday retreat which will also be available for rental, then start with identifying location, see this list of holiday destinations in Poland, once you know where you want to be you can start looking for property via the Polish property portals.
2. Find a Property or Find an Agent?
Whether you start from selecting a property or an agent will depend upon your situation. It’s certainly worth establishing a good relationship with a property agent, an agent you have a good honest relationship with will be able to save you a lot of time and money, however, that’s no good if the property you are looking for is in a different place, Poland is a big country!
3. Visit the Property
If you really do have an excellent agent, they will be able to advise on the best type of property for rental and will be able to advise on a selection of properties, it’s possible to sort out all the formalities remotely. However, we suggest it’s definately worth coming over to take a look round yourself and compare different properties to get an idea on price and standards.
The estate agents market in Poland can be very competitive, agents will often refuse to provide sufficient detail about properties until they have signed a contract with you which guarantees their commission. This is because in Poland, property buyers will often try to come to an agreement directly with the property owners, bypassing the agent to save on commission costs (generally around 1% to 4%). Our advice is to find a good agent and stick with them.
Property Taxes in Poland
As a non resident you will be taxed in Poland on income coming from Polish sources and there are a number of property related taxes including transfer fees, Polish VAT, rental income tax, corporate income tax and capital gains tax.. Visit Property Tax International for an excellent review of the taxes and tax filing services for non resident property owners in the Polish real estate market. PTI are registered Tax Agents with HMRC and Revenue allowing clients to combine both their Polish and UK or Irish tax returns using the one accountancy firm. PTI is part of the multinational organisation The Taxback Group, founded in 1996 which filed over 130,000 income tax returns in 2010.
Property Abroad have a good section on Polish property and overseas property, featuring thousands of properties for sale worldwide direct from estate agents, developers and private sellers alike. Buyers guides, country guides and much more useful information on buying overseas property abroad.
Real Estate in Kraków, an excellent blog about the property market in Kraków.
Interesting post on land ownership, apparently any property you buy, the land remains the ownership of the local council which can take the land if it’s required for local infrastructure projects etc. Need to check this out.