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Law Market News

Amendment to the Act on KZN will accelerate the implementation of the Mieszkanie+ programme?

The implementation of the Mieszkanie+ programme is to accelerate after the amendment of the Act on the National Property Stock (KZN), Artur Sobon, Deputy Minister of Investment and Development, told PAP.

According to the Deputy Minister, market conditions have changed since the Act was drafted (it entered into force in September 2017). The supply of land has decreased and its prices have increased. Additionally, the prices of materials and labour are much higher. As a result, it proved impossible to implement the programme of cheap flats on the land of KZN.

The Act provided, among other things, for free transfer of land belonging to the State Treasury to the National Property Stock. As a result, a land bank was to be established, where housing estates were to be developed under the Mieszkanie+ programme. KZN was also to organise tenders for companies that built and then managed apartments. According to the Act, the fees paid by tenants cannot exceed the amounts specified in the regulations.

As a result, the land, which was given to KZN for free, was not suitable for housing construction. Moreover, investors did not want to build on the conditions laid down in the Act. Out of about half a million plots of land transferred to the land bank so far, only 500 are suitable for the construction of apartments under the Mieszkanie+ programme.

None of the housing estates completed in Jarocin, Kepno and Biala Podlaska (480 units) was built on the land of KZN. All of them were developed on the land of the Polish Real Estate Development Fund. Deputy Minister Sobon added that by the middle of this year there are to be completed projects for about 50,000 flats. Currently, at various stages of preparation, there are about 28,000 units in Walbrzych, Gdynia, Kepice, Krakow, Wroclaw or Torun.

According to the Deputy Minister’s announcements, a milestone in accelerating the implementation of the Mieszkanie+ programme is to be the amendment of the Act on the National Capital City of Poland. The amendment is currently underway in the Sejm. The changes assume that state agencies or companies that will transfer land to KZN will receive 90% of the market price for it. However, 10% of its value will go to KZN. This is to increase the supply of land suitable for the construction of apartments.

KZN will also be able to create special purpose vehicles, not only with local government units, but also with state-owned companies or investment funds. According to Deputy Minister Sobon, local governments did not enter into partnerships with KZN, because they did not have the money to build affordable flats.

The most important change is to be the abolition of regulated rentals.

The amendment would make it possible for KZN to transfer several hundred plots of land suitable for housing construction within six months after its entry into force. This would be 115 locations, where 63,000 units could be built.

In our latest report, the Construction Sector in Poland in the 1st half of 2019. Market analysis and development forecasts for the years 2019-2024, we forecast that without additional investments under the Mieszkanie+ programme, there is no chance to break the threshold of 200,000 flats delivered annually in Poland. In 2019, the volume of flats delivered should amount to approximately 190,000 units.

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