How to buy an apartment in Poland? Stages, taxes, pitfalls

What kind of property can a foreigner buy in Poland?

Citizens of foreign countries can purchase housing in Poland with a passport and the necessary amount. But there is an important condition. If the property is commercial or "connected to land", the foreigner will need to obtain a special permit from the Ministry of Internal Affairs for such a transaction. Which objects fall under this restriction? First of all, land plots, commercial buildings and premises, individual houses on their own plot. Sometimes it turns out that, say, a part of the road, which qualifies as a "connection with the land", also belongs to a townhouse designed as an apartment according to the documents.

Is a deal possible in this case? Most often, yes, but it will be necessary, first of all, to prove its "connection with Poland". The legislation does not specify clear criteria for what is proof and what is not. As a rule, people refer to their Polish roots. A valid reason will be the Polish residence permit already received. The argument may also be that a foreigner has opened a business in the country, pays taxes. Secondly, it will take quite a long time to wait for the decision of the Ministry of Internal Affairs, from 2-4 months to a year. And all this time, the real estate seller is waiting for the verdict of the authorities together with you, having received a deposit from you. In practice, few owners are willing to block the sale of their real estate for such a long time. The market in Poland is active, and it is easier to find a buyer from among citizens than to waste time on a foreigner, especially since it happens that the Ministry of Internal Affairs does not give the go-ahead for a deal.   

Of course, it is easier to choose housing that is available for purchase without special permits. But if, nevertheless, a foreigner really wants some object that has a connection with the land, for example, a person prefers to live in a house rather than in an apartment, or a businessman wants to buy commercial premises for his company, there are alternative ways to solve this issue. For example, you can register real estate for your company registered in Poland. It is also beneficial from the point of view of paying taxes. In the future, you can slowly re-register the object for yourself as an individual, or leave it on the balance sheet of the enterprise.

Can citizens of post-Soviet countries buy an apartment in Poland?

There are no restrictions on buying real estate in Poland for people with passports of Russia, Belarus, Ukraine, Kazakhstan, and other states of the former USSR. Those wishing to purchase an apartment need to open an account in a Polish bank and deposit funds to it. Russians and Belarusians have certain difficulties with money transfer, but they are solvable. 

Stages of purchase

Defining goals and locations

As in other countries, the purchase of housing in Poland begins with determining the location, purpose and type of object. The options for moving and for investing will be different. So, when choosing a property to generate income, the realtor filters out offers that are easily rented out, more profitable. The key question is also whether a purchase is expected on the primary or secondary market. In the latter case, a 2% tax is paid (if a person does not buy the first house).

Signing a contract with a real estate company

There is a civilized market in Poland, and realtors rarely agree to work without a contract. The agency's service is paid by the buyer of the apartment according to the results of the transaction and amounts to 2-5% of the amount. A good brokerage company undertakes: selection of objects, verification of their legal purity, full legal support at all stages of the transaction, interaction with a notary translator, support of settlements, acceptance of real estate, after-sale service.

Real estate selection

Based on the client's request, the realtor is looking for suitable apartments and houses. All serious licensed agencies are integrated into multi-listing systems. By contacting one company, you can get information from all brokers in Poland, which is convenient for the buyer.

By the way, there is no mandatory licensing of real estate activity in Poland, but self-respecting agents prefer to get a license by passing a difficult exam.

Checking the object

The realtor conducts a thorough check of the selected apartment for legal purity. Exclusive offers of a particular agency do not require this stage, since they have already been checked in advance.

Signing the reservation agreement

At this stage, a preliminary agreement or reservation agreement is signed between the seller and the buyer. It specifies the terms of the transaction, terms, price. The buyer pays a deposit of 5 to 10% of the total amount. 

Signing of a notarial act and transfer of ownership

After the full package of documents has been prepared, the day of the transaction is appointed. The key stage is the signing of a notarial act, this is an analogue of a contract of sale. The seller, the buyer, the notary, as well as the notary translator should put their signatures on it, if the buyer does not speak Polish.

A notarial act is the main confirmation of ownership of real estate. The original of this document is kept by a notary in the archive, and each participant in the transaction receives a notarized copy (these copies can be issued in any quantity). The notarial act must be registered in the state register, which in Poland is a department of the court. How is the registration of ownership in the registry? An entry is made in a certain electronic cell in which information about this object is stored: all encumbrances, owners, on what basis it was acquired and alienated.

What is important, the registry is freely available. Knowing the KW number (translated as "the book of eternal use") one or another apartment, you can view all the necessary information.

Calculations

Payments for real estate are preferred in Polish zloty. Funds are transferred from the buyer's account to the seller's account. Cash settlement is unpopular in Poland.

As a rule, even at the initial stages of preparing for a transaction, a foreigner opens a bank account. A realtor also helps him in this. Next, the required amount is deposited or transferred to the account. The bank may ask where the buyer got the money from. The client must be ready to confirm the sources of origin of the funds by providing the documents that need to be translated into Polish.

The funds are transferred after the signing of the notarial act. Usually, the deadline for transferring money is spelled out in it. For example, it may be indicated that the buyer undertakes to pay in full for the purchased property by the next day. If the amount has not been credited to the account before the specified date, the transaction is considered invalid.

Remote transactions

In agencies specializing in the sale of real estate to foreigners, the practice of partially or completely remote transactions is common. All stages, except for the signing of the notarial act, can be carried out remotely. Often the client comes only in the final to sign a notarial deed. By and large, even in this you can do without personal presence by issuing a power of attorney to a representative of the agency.

Taking possession

Sometimes the final stage is the most time-consuming for foreigners. It is necessary to renegotiate contracts for gas, electricity, utilities, create personal accounts for account management, connect the Internet. There are cases when foreign buyers do not pay for a communal apartment for several months because they do not know how to do it. In good agencies working with foreigners, there is a department of after-sales service, which takes care of all the hassle. 

Among other things, the new owner of an apartment or house must provide the administrative authorities with a package of documents for calculating the annual land tax. A receipt demanding payment of this tax is sent to the owner by mail at the beginning of each year.

Taxes and additional expenses

All buyers of housing in the secondary market of Poland, both local and foreigners, pay a 2% tax. The exception is the case when a person acquires the first apartment or house in his life. This benefit was introduced in the country recently, in September 2023, in order to support young families.  

It is curious that the law does not stipulate whether the purchase of property in other countries is offset. Realtors advise foreigners who purchase their first home in Poland, but already have real estate in other jurisdictions, to pay this tax.

In the primary market, the tax on the purchase of real estate is 0%.

Additional expenses for the purchase of housing should also include: payment of state duties and notary services – 1% of the transaction amount, as well as payment of real estate services – from 2 to 5% (+VAT) of the transaction amount.

Features of transactions in the primary market

Buying a house in a new building according to the procedure differs from buying a ready-made object from the owner.

If the choice fell on an apartment in a building under construction, at the initial stageit is enough just to sign an equity participation agreement, which is also notarized.

We emphasize that in Poland, the rights of the buyer are protected much better than the rights of the seller, especially with regard to the interaction of the parties in the transaction on the primary market. The money that the buyer deposits at the construction stage does not go directly to the developer, but comes to the target blocked account, and only the bank decides when and how much to allocate funds from this reserve for the implementation of a certain type of work in accordance with the schedule. Accordingly, if the developer does not fulfill his obligations, the money does not arrive to him. In addition, the transactions are insured, and in the event of the company's bankruptcy, the participant in the shared construction receives a refund of the amount paid. (Although in Poland, the bankruptcy of developers is extremely rare).

Payment of funds under the DDA occurs in stages. Often the amount is divided into quarterly payments.

After the house is put into operation, the developer informs the client about it and invites the apartment to be accepted. The buyer looks at whether the apartment corresponds to the project, whether there are any defects, cracks, damages. If everything is in order, he signs the real estate acceptance protocol. If not, the document prescribes a list of shortcomings, and the developer has a month to eliminate them. 

A few months after putting the house into operation, the developer invites the buyer to the notary office to sign a document on the transfer of ownership of the purchased apartment. Next comes the stage of registration of contracts for utilities, Internet connection, and so on.

Can a foreigner take out a mortgage in Poland?

Foreign citizens who have a permanent or temporary residence permit in Poland, upon fulfillment of certain requirements, have the right to apply for a mortgage loan. The main thing is that at the time of obtaining a mortgage, at least a year remains until the end of the validity period of the residence permit. 

Of course, the applicant's creditworthiness is important. Only income officially received in Poland, salary or, say, profit from entrepreneurial activity is accepted for consideration. In the latter case, you will need to provide an annual, and in some banks, a two-year, income statement to the company's account.

When considering an application, banks take into account how stable the income of the applicant for a loan is, how many people he has dependents. All this affects how much of the mortgage will be approved. 

In Poland, there is an intermediate link between banks and people who want to take out a loan - a mortgage consultant. This is a specialist who has a financial license and knows all the current offers of banks. It helps to assess a person's creditworthiness and, based on his conditions and wishes, offers 3-4 optimal options from different banks. The client chooses the best one from them and applies to a real estate agency. The realtor, taking into account the amount that can presumably be approved, selects the object. Next, a package of documents is collected for the apartment, as well as for the applicant, and already with all this "luggage" the person goes to the bank. Often, a credit consultant and a realtor work together to speed up the process and make it smoother for the client.  

Consideration of the application in the bank lasts up to four months. First, the banking specialist evaluates the client as a borrower, that is, the financial component. Then the expert examines the real estate object and, at the end, the entire case in its entirety.

There are not so many mortgage refusals precisely because the mortgage consultant helps the client to prepare properly and come to the bank fully armed. By the way, the services of such consultants are paid not by the client, but by the bank.

Is the purchase of real estate the basis for a residence permit?

Buying a home in Poland is not considered a basis for obtaining a residence permit or permanent residence. The maximum that ownership of square meters gives is the opportunity to apply for a long-term visa in order to come and monitor your property.

In order to become a resident of Poland, there are other ways to study, work, open a business in the country, and so on.

Pitfalls

Each market has its own specifics, and sometimes ignorance of legal nuances can result in financial and time losses.

Sometimes foreigners show excessive arrogance, unlike the Poles themselves, who will consult with several lawyers before taking this or that step. Despite the fact that the locals, of course, understand the legislative subtleties of their country much better.

Realtors shared two stories of people who turned to them after they ran into these "pitfalls".

A foreigner, already having a residence permit in Poland, decided to buy an apartment with a mortgage. He turned directly to the developer and chose an apartment. The parties signed a notarial deed, and the man paid a deposit of 20%. However, when he began to apply to one bank, the second one was refused because of low incomes, and the third bank did not consider his application at all. As a result, the buyer lost his money, because in the notarial act, which he rashly signed, it was indicated that the deposit was irrevocable. At the same time, the credit consultant, to whom the hero of this story initially addressed, pointed out to him his low creditworthiness and recommended taking measures to improve it. Of course, if he had turned to a realtor right away, this would not have happened.       

The second situation is also related to a buyer from abroad. The client turned directly to the developer and bought an apartment and a parking space in the parking lot, paying in full the cost of both. The developer probably did not have much experience in transactions with foreigners and documented everything, as in a normal sale. However, when it came time to transfer ownership rights, the notary refused to execute this transaction. The reason is that due to the specifics of the design of this particular parking lot, a foreign citizen did not have the right to buy a parking space in it. As a result, the man had to urgently resell this property.

To protect yourself from trouble, we recommend contacting agencies that have been working on the Polish market for a long time and know the legal and market aspects.  

Usually, transactions go smoothly for buyers. The realtor on the seller's side and the realtor on the buyer's side act as two lawyers who organize the transaction process among themselves so that it is as comfortable as possible for their clients.

Thank you for your help in preparing the material:

Natalia Zaitseva, expert Etalon Estate Group

Photos used: depositphotos.com