First keys programme poised to boost social housing and institutional investment in Poland
The First Keys programme, designed to promote social housing and support financing for participation in Social Housing Associations (TBS) and Social Housing Initiatives (SIM), is expected to play a significant role in addressing housing accessibility in Poland. Its impact on the broader housing market will depend on the scale of institutional investment mobilised through TBS and SIM structures. Development companies anticipate that these initiatives could lead to a substantial increase in housing stock targeted at lower-income groups, thereby helping to ease pressure on the private rental and ownership markets. Insights into the potential scale of these investments and their expected influence on the sector are outlined in a survey conducted by real estate platform dompress.pl.
Tomasz Kaleta, Managing Director for Sales and Marketing at Develia
We predict that the First Keys programme will not have a significant impact on the market, partly due to the assumed limits on the price per square metre, which significantly reduce the pool of available flats, especially in the largest cities. Furthermore, the exclusion of the primary market from the programme means that its beneficiaries will be deprived of access to modern investments characterised, among other things, by higher energy efficiency.
As regards the possibility of TBSs and SIMs conducting development and flat sales activities, at this stage it is difficult to clearly assess the potential scale and impact of this solution on the market. The legislative details, project implementation criteria and rules of competition with the private sector will be key.
Mateusz Bromboszcz, Vice-President of the Management Board of Atal
The state's housing policy should take into account various forms of construction, including non-commercial construction, i.e. municipal or social housing. This is because different groups of recipients have different expectations in this area. Some of them strive for full ownership, which is facilitated by subsidy programmes, while others, on the contrary, do not want to commit themselves to any long-term credit obligations, preferring renting or other forms of housing rights.
The current situation, in which housing construction rests largely on the shoulders of private developers and individual investors (houses), is not optimal. The polarisation and radicalisation of public opinion on housing issues will not make housing cheaper or more accessible, given the constantly rising costs of construction and, above all, land prices. Nor will imposing further burdens, requirements or mandatory solutions on the industry contribute to this.
Without a doubt, developers in Poland have the most experience in housing construction. We operate in accordance with the principles of economic calculation. It is difficult to assess whether the investment process in social housing would be more effective, as we do not know the detailed assumptions or the long-term development plan for this sector in Poland. Without this, forecasting the scale of social housing and its potential impact on the market is fraught with risk.
Damian Tomasik, President of the Management Board of Alter Investment
The First Keys programme has the potential to significantly influence the development of the housing market, but the details of its implementation and the mechanisms for distributing funds will be crucial. The very idea of supporting housing affordability, both through financing contributions to TBSs and SIMs and promoting social housing, is necessary. However, the commercial market, including developers and investors such as Alter Investment, will closely monitor whether market competition is distorted.
The idea of allowing TBS and SIM to engage in development activities with a margin of up to 25% is causing the most excitement and questions. This is, in effect, the entry of public institutions into the private market segment, with the advantage of access to cheap financing and public land. If there are no clear rules, this could lead to unhealthy competition, with private investors who bear the full market risk and cost of capital being squeezed out of key locations.
On the other hand, if the rules are clear and transparent, and the activities of these institutions are limited to specific, socially justified cases, the programme could complement the market rather than dominate it. A well-designed system of public-private partnerships (PPPs), where TBSs and SIMs cooperate with private investors in the implementation of investments, could bring real benefits to both parties and residents.
In terms of scale, in large cities where land is expensive and investment is fraught with risk and bureaucracy, the scope for action by SIMs and TBSs will be limited without cooperation with the market. However, in regional markets and smaller towns, where the housing shortage is equally serious but investments are less profitable for the private sector, the programme could play an important role.
In summary, the initiative has potential, but from an investor's perspective, it will be crucial to ensure a level playing field, transparent rules and openness to public-private cooperation. Otherwise, we risk distorting the market instead of supporting it.
Andrzej Gutowski, Sales Director at Ronson Development
We believe that any initiative aimed at developing the housing market, whether it concerns the development, social or rental sector, can have a positive impact on its condition.
However, from our point of view, it is crucial that market development is based on a balanced approach covering all segments, both commercial and social. Consumers should have a real choice between buying a flat from a developer or taking advantage of social housing offers. This should be their individual decision, based on their needs and possibilities. That is why we support all solutions that increase the availability of different forms of housing.
As regards the legislative proposal, it is difficult at this stage to clearly assess the scale and impact of such a solution on the market. Practice will show whether and to what extent these assumptions will translate into real changes in the structure of housing supply. In our opinion, any well-planned and implemented initiative that responds to real housing needs can bring measurable benefits to the entire market.
Joanna Chojecka, Sales and Marketing Director for Warsaw and Wrocław at the Robyg Group
The First Keys programme introduces significant changes to the Polish housing system, particularly in the context of social housing and the activities of Social Housing Associations (TBS) and Social Housing Initiatives (SIM). Enabling these entities to engage in property development and sell flats with a margin of up to 25% may have an impact on the housing market. It may be a step towards increasing the availability of flats for people with average incomes. However, it will be crucial to ensure transparency in the buyer selection process and to monitor the fulfilment of social investors' commitments. It will also be important to ensure adequate supervision of the quality of the investments.
It is estimated that under the First Keys programme, it will be possible to build around 15,000 municipal flats and implement investments by TBS and SIM. The scale of these investments will depend on the availability of land, the implementation capacity of TBS and SIM, and the interest of potential buyers. However, we do not believe that the programme will have an impact on the activities of developers in Poland, especially those with a strong, established position, as their offer will be targeted at a slightly different audience.
The First Keys programme aims to support people who cannot afford to buy a flat on the commercial market, mainly in the lower and middle price segments. Developers operating in the residential segment will not be directly exposed to competition from TBS and SIM. Developers with a strong position do not need to fear the direct effects of the programme's introduction, but may be interested in other forms of cooperation with the public sector or in attracting customers who are looking for flats with slightly different criteria.
Anita Makowska, Senior Business Analyst at Archicom
The extension of the First Keys programme to include a component supporting participation in TBS and SIM may have a positive impact on the availability of housing for people with average incomes who are currently not eligible for municipal housing and at the same time have limited access to mortgage loans. Support for social housing can relieve pressure on the commercial market, but only if there is adequate financing and real implementation capacity on the part of investors.
Simplifying procedures, land availability and the involvement of local authorities will be key. The role of the state and local government in housing policy should be much greater in Poland. Today, it is primarily the private sector that is responsible for new investments. The possibility of TBSs and SIMs engaging in development activities with a margin of up to 25% seems controversial. Without a clear framework, this could lead to the commercialisation of the social sector. It will therefore be important to precisely define the conditions for such activities in order to maintain their complementarity with the private market.
Photo: ROBYG - Modern City
