Real estate prices up, availability down, cost of providing infrastructure blamed

The availability of newly built flats in Poland has dropped drastically. Two years ago it was possible to buy 0.75 square meters for one month's salary. Last year the same money would buy only 0.5 square meters. Experts are concerned with the constant decrease of family purchasing power. Two years ago there were no signs of such a trend. The rapid increase in the prices of flats in bigger cities is often blamed on the rising demand for apartments caused by the planned scrapping of tax break for construction. According to Jan Kornilowicz from the Housing Institute (IGM) most housing co-operatives work as developers, and can indulge into uncontrolled price inflating. The prices of privately built estates are even higher. Experts say one of the major factors in the high prices is the cost of purchasing land and providing it with utilities. In some cities investors are forced to provide infrastructure and then to hand it over free of charge. This may increase the overall cost of the enterprise by as much as 10%. (Gazeta Wyborcza, page 32) J.K.