Abstract:

The ability of young people to run an independent household is most often limited by the availability of a first, usually small, flat. This is an important starting point that affects the subsequent behaviour of individuals, as well as the situation of society as a whole and the economy. The demand for residential properties in Poland has exhibited a marked increase over the course of several years, with developers facing challenges in meeting the demand for new housing units. The rise in interest rates that ensued the pandemic period did not exert a substantial cooling effect on the demand for flats, and consequently, on the decline in flat prices. Poland's housing market has been grappling with systemic challenges, including a shortage of affordable housing, rapidly escalating property prices, and inadequate public housing infrastructure. The answer to these market challenges was to be found in the government's “First Flat” programme (“Program”), the most important element of which is mortgage interest subsidies.