mBank – CASE Seminar Proceedings

Is a bubble inflating on Poland’s housing market?

The year 2019 brought double-digit growth in Polish housing prices, for both new and existing homes. In some cities, real prices for residential real estate have reached the highest levels in history, even higher than at the peak of the boom in 2008. As a result, some are saying that there is a growing price bubble. But thus far no research has been produced that would comprehensively verify this hypothesis on the basis of data from 2006-2019. This work aims to fill that gap. This is exceptionally important, because assessing the likelihood that a housing price bubble is emerging is key for the conduct of monetary and macroprudential policy in Poland. Because if we’re really dealing with growth in macroeconomic imbalances, then taking pre-emptive action to limit further price growth and prepare the economy (including the financial sector) for a potential collapse in housing prices is essential for limiting fluctuations in growth.


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