Real estate purchases boom as buyers seek to beat possible tax increases

The Polish real estate market has suddenly come to life, due to recent propo sals made by the government to withdraw tax allowances and increase VAT rate s on construction materials early next year. However, analysts argue that th is is a very short-term boom and market stagnation is likely to follow. "In recent years during this time of year interest in purchasing apartments alwa ys rose. However, this year it's incomparably larger," said representatives of J.W. Construction. The most popular form of real estate among Polish buye rs are small apartments of sizes from 30 to 50 square meters. Demand for bui lding plots has also grown recently. However, the government yesterday did not agree to a bill which would increase the VAT tax rate on construction ma terials from 7% to 22%. According to Finance Minister Marek Belka, some aspe cts of the bill were not agreed upon. The proposal is to be voted on during the next meeting of the Sejm. (Prawo i Gospodarka, p.1; Gazeta Wyborcza, p. 22) A.K.