We may be used to the fact that many people rent accommodation in the UK, but there are huge variations in percentages across countries in Europe. Here are some figures we’ve collected for 2020 – 2022, including the number of households living in rented accommodation in Poland.
Home Ownership UK and Poland Compared
In Poland, the vast majority of households 87.2% live in owner occupied properties, indeed Poland ranks among the top countries in the European Union in terms of home ownership. The EU average is 69.1%, while in Germany, which is at the bottom of the list, it is only 46.7%.
Meanwhile, in the UK, the number of owner occupied households is 64%, a little less than the European average.
Households in Rented Accommodation in Poland and the UK Compared
A mere 12.8% of households in Poland lived in rented properties in 2022, marking one of the lowest rates among European Union countries, where the average is 30.9%. The lowest percentage of households living in rented properties was in Romania at 5.2%, while the highest was in Germany at 53.3%. Source CiekaweLiczby.pl
In the UK 36% of households rent accommodation, 19% private rental and 17% in the social sector. Source English House Survey.
Profitability of the Buy to Let Market in Poland
While the data above indicates that Poland may not be a great place for the buy to let business, the profitability of buying accommodation for rental purposes depends on multiple factors beyond the homeownership and rental rates alone. Several key elements contribute to the profitability of buy to let:
Market Dynamics & Property Values
The property market conditions, including supply and demand, can significantly impact the profitability of rental properties. In some regions, high demand for rental properties may result in favorable rental yields.
The cost of purchasing property and the potential for appreciation play a crucial role. In some cases, higher property values might require more substantial upfront investments, affecting the overall return on investment.
Rental Yields
Rental yields, which represent the annual rental income as a percentage of the property’s value, provide insights into potential returns. In the UK, rental yields generally range between 3% and 6%, meanwhile, rental yields for rented accommodation in Poland are reported as being over 6% source GlobalPropertyGuide.com and PolandInvest.land
Regulatory Environment & Tax
Local regulations and tax policies regarding property ownership and rental income can impact profitability. Understanding these regulations is crucial for accurate financial projections.
Property Management Costs
The costs associated with property management, maintenance, and potential vacancies should be considered. I’d suggest these are generally way lower for rented accommodation in Poland than in the UK, but of course every property and every location is different.
While the higher proportion of renters in the UK suggests a robust rental market, rental yields seem to be higher in Poland and the rental yield that you will get from your property if you decide to invest, will depend on your particular circumstances.