Lodz low-key property boom gathers momentum

Country:  Poland

3 March 2008

Poland’s property market has emerged as a property investment hotspot in recent years. But while properties in Warsaw and Krakow have attracted the lion’s share of investors’ attention, property prices in the lesser-known Polish industrial city of Lodz - the country’s second largest city - have been booming.

Located in central Poland, Lodz suffered from the downturn in the textile sector during the 1990s. However, in more recent years, a number of IT firms and maufacturers have moved into the city, creating new jobs, and driving demand for residential property. There is also strong demand from locals across the city wanting to move out of their old Soviet-style apartments and into some of the new-build properties being constructed.

Louis Mann of Validus reports that strong demand for residential property in Lodz forced average property prices in the city up by around 35% last year. Mann expects property prices to continue to appreciate over the coming years, albeit at a slower rate of growth.

Louis Mann of Validus told Homes Overseas Online: “Although Lodz is not an affluent area, its low property entry costs have proved extremely appealing to investors. There is momentum for further capital growth in the city, and we expect average property prices in Lodz to appreciate by 10 to 15% over the coming years.”

Property investors will be interested to learn that plans are in place to build two  motorways. The A1 will span the country from north to south, while the A2 will run from east to west, intersecting to the north-east of Lodz. When these motorways are completed around 2010, the advantages due to the city's central location will increase even further.

Construction work is also underway to upgrade the rail connection to Warsaw, which will eventually cut the journey time from 2 hours to 75 minutes.

Mann states that Brits buying property in Poland, can currently get a Polish mortgage on tenure of up to 45 years. It is also possible to obtain a mortgage in Swiss Francs, with borrowing rates starting from 3.19%.