Investment in an apartment for rent. We checked how Poles do it
Kasia and Milena bought their first investment apartments a few years ago, when prices were still much lower than today. From the beginning, however, they did not treat these properties as a simple way to achieve a high rate of return. They also did not have spectacular starting capital. Both of them assumed from the beginning that they would use a loan.
— It was a well-thought-out decision – says Kasia.
— We wanted him to pay the rent, and in the future, the place was given to children – explains Milena.
Today, women tell us about financial issues and cooperation with tenants.
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Kasia Sowa bought her first investment apartment in 2017. She paid approx. PLN 7,200 per sq m for a studio apartment with an area of 31 sq m. In addition, the finishing cost was approx. PLN 30,000. zloty.
A few years ago, Kasia invested about PLN 30,000 in finishing an apartment for rent. zloty
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Kasia Sowa (private archive)
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— It was a well-thought-out decision. We didn't have much capital, so we used a loan. We assumed that the lease would cover the installment — and that's exactly what happened, he says.
The apartment was rented almost immediately. Since then, three tenants have moved through, which means a change every 3-4 years on average. As the owner emphasizes, turnover is low and tenants are hassle-free.
— We always found very neat tenants, often with dogs. We have never had any complaints from neighbors. We even left them a telephone number to contact in case of problems, but no one ever had to use it, he adds.
The apartment management model is simple: no regular inspections, interventions only when necessary and full trust in tenants. The owners appear at the premises occasionally – e.g. for technical inspections or major repairs.
The costs of maintaining an apartment are relatively low. So far, only minor renovations and replacement of household appliances were necessary.
– We do this after each tenant professional cleaning. This is the basis for maintaining the standard and quickly finding another person, he emphasizes.
Today, after deducting all costs – loan installment, administrative rent, utility fees and flat-rate tax – approximately PLN 1,000 per month remains.
— It's not a lot of money, but the most important thing is that the loan practically pays itself off. Ultimately, we will have an apartment without much financial effort, he says.
And he adds: – We do not treat this as an investment for quick sale. It is security for the future – for children or as a permanent source of income.
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Investment on credit. “We wanted peace, not maximum profit”
A similar strategy was adopted by Milena, who also bought an apartment in 2017 – this time larger, 46 sq m. The price was approx. PLN 6,800 per sq m, and the package also included a garage and a storage room.
— We already had one apartment bought for cash, so we decided to invest in a loan. We wanted them to the lease paid off the installment, and in the future the premises went to the children – he explains.
Location was key — near the planned metro line. This, as it turned out, was a bull's-eye.
— After the ad was placed, the phones were ringing every few minutes. The apartment was rented on the same day and we still have the same tenant – says.
The rental rate was set at PLN 3,150 plus fees, which gives a total of approximately PLN 3,650 per month..
— We didn't want to exaggerate the price. We cared about stability and a peaceful tenant, not profit maximization – he emphasizes.
Also in this case the rent covers the loan installment, and the small surplus is spent on taxes.
Finishing the apartment took much longer than Kasia's – about a year. The owners decided to do the work themselves to reduce costs.
— We wanted to do it on a budget, without expensive carpentry. We assumed that the apartment should be functional and durable, not luxurious – he explains.
The estimated cost of finishing was 60-70 thousand. zloty.
Apartment rental: there are risks, but they are controlled
While both stories are positive, that doesn't mean there are no challenges. Milena recalls a situation that showed that Even with a good tenant, surprises can ariseand.
— At first it turned out that there was a dog in the apartment, although it was not confirmed. We reacted decisively – we signed a new contract and introduced an additional security deposit – says.
However, this is the only major incident. Besides, both in her and Kasia's case, the rental is hassle-free.
There is also a common denominator full legality — both owners settle the rent as a lump sum and pay taxes.
Apartment for rent: long-term strategy
Kasia and Milena's stories reflect this well changing the approach to investing in real estate in Poland. This is no longer only the domain of large players, but increasingly a decision of the middle class.
Key takeaways from their experiences:
- the investment does not require huge start-up capital if it is supported by a loan,
- the lease may cover the installment and maintenance costs,
- the real monthly profit is small but stable,
- the greatest value is wealth that grows over time.
— For me it definitely is a better option than keeping money on deposit or in cash – Kasia sums up.
Both interlocutors they do not plan to sell apartments. At the same time, they emphasize that it is a safeguard against crisis situations.
And although they “have enough left over for cotton pads” each month, in the long run their decisions may turn out to be one of the most important financial steps in their lives.
