Polish housing loan subsidies will not contribute to housing availability

The solutions proposed in the draft law on state aid to housing savings only support the demand side of the real estate market, and thus would not noticeably contribute to increasing the availability of housing in Poland, but only to increasing prices, according to the National Bank of Poland (NBP).

Yesterday, the government passed a bill to introduce 2% housing loans and accounts. The maximum subsidized loan for a single-person household would be PLN 500,000, and for a family - PLN 600,000. The loan subsidies are to cover a 10-year period.

"The solutions proposed in the bill only support the demand side of the real estate market, and thus would not make a noticeable contribution to increasing the availability of housing in Poland. Due to the fact that the '2% safe loan' instrument would only support the demand side of the real estate market, its introduction would have an impact in the direction of an increase in housing prices," NBP Deputy Governor Adam Lipinski stressed.

According to the central bank, higher housing prices would further limit their overall availability to a part of the population that would not be eligible for the facility.

"The project's impact assessment indicates that one of the expected effects of its introduction is to maintain a high level of new housing investment, but in the NBP's view, this goal could be achieved more effectively through measures aimed at increasing the supply of housing, rather than stimulating demand," the opinion further reads.

Source: NBP and ISBnews