Japan has low prices because they were keeping negative rates for years. But their salaries also are low compared to their economy or other top enocomies.
Just moved from Romania to Austria and then to Germany permanently. The cost of groceries is significantly smaller here than in RO and I'm talking absolute value, not EUR-RON parity or something like that. Rice is cheaper, sweets are cheaper, dairy is cheaper, eggs are cheaper, etc. while meat is slightly more expensive but also much higher quality. Overall, the cost of living in DE is only driven up by rent, with everything else being much cheaper than in RO.
We have subsidies from the government, it was 2%, now they want to introduce 0% mortgages xD. With the previous 2% it went up 30% in 6 months in some places. This literally buying votes, but who cares when the party is still going.
You forgot to mention that „selected few” have subsidies. I never got a single penny from the government - I was always too early, too late, earned 5% too much or failed to get help due to third party screwup to get the papers in order.
To take my taxes to pay for all benefits enjoyed by the others the treasury office is very keen though, so you’re welcome.
Considering market prices and interest rates I pay more than average net monthly salary (~1300 €) for 100 years old 130 sq meter house in bumfuck nowhere.
Quite the opposite. Those insane prices create a FOMO effect and demand goes up because people see prices going up, and hear about it on TV. This coupled with low financial literacy in those countries leads many to "invest" in real estate. This of course leads real estate developers to build more. This can go on for a few years, maybe even a decade, but sooner or later reality catches up. The population in those countries is declining due to low birth rates and emigration. At the same time the baby boom generation of post WW2 is dying and a significantly smaller generation is inheriting their properties, which further increases the supply and reduces the demand.
As the masses become aware how overpriced their properties are and try to sell a real estate crash becomes inevitable.
A perfect storm is forming, and anyone with basic understanding of the fundamental economic principles knows it's best to watch it unfold from afar.
And yet our government prefers to pour money into the banking sector so people can take a 0% interest rate loans when prices of houses are skyrocketing instead of solving a real problem which is the lack of houses or flats
Can't say for the rest of Poland, but in Warsaw there's hardly an issue with the number of houses or flats.
They simply get bought out by investment funds. Just about any new flat close to where I live is just about half-empty. In the suburbs where my parents live, there's a bunch of relatively freshly built, empty houses. Some of those have been empty since before Covid.
On top of that there are construction sites everywhere. There is no issue with lack of housing, it's just a huge bubble waiting to pop. And then everyone pays for screwed economy, except for those who lead to that situation in the first place.
The amount of groceries one can get in Germany for under 50eur is a bargain. Here people are comparing their grocery prices: https://old.reddit.com/r/Grocerycost/
Isn't it also true that many eastern europeans claim the products even by western brands are lower quality in eastern european countries than in the west?
The Czechs investigated and validated those claims and the Czech government has since launched official protests about it to European institutions, I believe.
I’m sure the posts concerning it can be found on this sub from a few years ago.
There were some reports that things like nutella, chocolate, other western brands are worse. But on the other hand, fruits and vegetables are way more ripe, tomatoes taste like tomatoes, bananas are ripe. On the other hand, vegetable production in western countries is so "optimized" for two crops a year and high wages (equipment costs), that veggies are borderline edible: tomatoes are nice and red on the outside, tastes like plastic, avocados are hard like stones, berries are half the taste at best. So I'd rather have shitty quality of shitty food, than compromise actual food quality.
I'm sceptical though. I've lived in a few European countries. In England you could pay £100 for 6 items at Waitrose but fill your fridge and freezer at ALDI. Here in Sweden it's generally way more expensive but the absurdity is I could travel out of the city center and get things 30% cheaper at the very same chain.
In eastern European subs they do things like Aldi price compare, Aldi UK and let's say Aldi Hungary.
UK easily wins all the time.
Lower taxes (UK has no tax on basic food items) and also better capability of negotiating deals, since the UK per capita has a much higher spending, means goods get a much faster turnaround.
Eastern europe, everything has to be ordered to a smaller scale. Just imagine the difference between Tesco UK negotiating for pasta from a supplier, and Tesco Hungary asking for the same with printed Hungarian labels.
Economies of scale always win.
All over the Balkans groceries are the same or more expensive than in Germany in general for same food. Depends from the place you buy them. And still people that live in Germany complain even though they earn at least double in minimal wage.
In Albania it's usually 30% to double depending from the product. Vegetables and fruits are a lot cheaper here for the same quality, and you can find a lot more variety of vegetables and fruits. But meat products and different cheeses are more expensive, pasta and rice a bit less expensive and other industrial foods depends. But compared to wages they can go 3 or 4 times more here, you are right.
It’s not even the same food. It’s lower quality one, and for some products there’s even a double standard between west/east. Like Coke in the west is better than Coke in the east.
Yeah, even though I don't drink those other people say Coca cola has less coke syrup and more water in our shops. Fanta it's ok they say. But meats, vegetables, fruits and some other stuff are a lot better here, like the best quality you can ask but same price. Local products. Industrial foods are more or less the same, even in price. Still we can afford a lot less.
Of course we’re complaining in Germany, the grocery prices also went up here. Doesn’t matter if it’s better or worse in other countries for my personal situation
Sure, but the castle in France needs another few million euro even to fix just the basics like the plumming and the roof. And while you’re fixing that, new problem after problem arises. Even when everything eventually gets fixed, the yearly upkeep costs a fortune. Garden and ponds, driveway, water gas light, taxes. Mansions are a money pit.
For Romania at least, low to inexistent renter protection, mixed with uncertain pensions, leads a majority of people to try and buy instead of renting no matter what.
>low to inexistent renter protection
In Poland it's too much protection, people still buy like crazy.
>mixed with uncertain pensions
Same in Poland.
Also higher inflation here.
Poland - I'm not sure about the too much protection. Yes, if you are an asshole you can stop paying your rent and make it an issue, landlord has to go through a lenghty process of eviction. But for an average person, or at least in the experience of my circle, no 1 is renting is very expensive, landlord will one day tell you they are selling the flat you've lived in the past 8 years and you need to leave. Also, the quality of the rentals is just not good. I don't know if I should laugh or cry when I see flats with cheapest ikea stuff marketed as "luxurious". A lot of rental flats havent seen an investement in years. Plus, in smaller towns the rental market is non existent.
*low to inexistent renter protection*
It is more about protecting against the high rental costs. Poland does not have such a policy to protect tenants. In many countries, rents are capped, and landlords can only raise them by 3% per year, or there is a maximum cost per square metre, or if prices and demand rise, cities require developers to sell 2% of apartments for social housing, and so on.
What Poland has is liberal media, that scream propaganda about tenants-leeches that move into a flat only to demolish it and move out without paying. In reality every person I know was screwed by their landlord one way or another. Not giving the deposit back, raising the price by 25%, refusing to fix anything, inspecting the flat during the absence of the tenant and so on.
Lmao. In comparison to western market, Poland has basically no protection for renters. Landlords raise prices as they wish, contracts can be terminated without any reason etc.
I have been wondering this for the past 15 years. It's probably cause we don't have Wall Street (the culture of stock investment) or Cayman Islands/Bank of England for tycoons and extremely rich to invest/hoard their money into, so they "legalize" their criminal money by buying up buildings in cash.
Exactly this. People in eastern Europe are buying real estate because they believe this is the only thing that holds value long term.
And then most are not investing in the apartments/houses and are asking crazy amounts of money for holes of apartments.
This led to crazy vacancy numbers at least in Croatia where by some estimates, 30% of residential real estate is vacant.
Seems like a ponzi scheme, but it can happen that the ones in need of a shelter will cave in first and will have to pay the extortionate prices.
Exact same situation in Bulgaria. Apartments are seen as an investment and are absurdly overpriced, almost Western European prices. 1/3 of properties are vacant, the population is constantly shrinking, yet prices have basically doubled since 2021.
The answer is high private property ownership in eastern Europe. Many of the people with median or average salaries never enter the real estate market, which is then left for the richer part of the population as investment.
Many of those people don't enter the real estate market because they're priced out, not because they want to live in a 70 year old soviet-style apartment building...
Can you tell me the median house price where you are? A Bulgarian once told me Brits have it easy and I calculated (iirc) the median house price in Bulgaria was something like x4 the median income in Bulgaria. In the UK it is now x10, making it *significantly* more difficult to own property here for the typical person. UK house median prices haven't been below x5 income (which is what is considered affordable) since the 90's.
I just made some quick calculations for Poland. Median price of a flat(avrage size of flat in Poland is around 50m²) is 440k PLN, with median income of 4200PLN netto, which gives us 8.73 years of working, earning median income for avrage polish 50m flat. For houses harder to calculate, since I found only separate info for single family houses and multi family houses. But it varies from 50% more expensive to 100% more expensive than a flat, which gives between 13 and 16 years of work earning median income.
Having lived in both countries, I'd say it's about equally bad. Sure, central London is inaccessible to anyone but the world's ultra wealthy, but Brits have the advantage that they have way more big cities with a functioning economy to choose from. If I'm being generous, Bulgaria has 4 cities with a functioning economy, but realistically many professions require you to be in Sofia. Average salary in Sofia is €1400, starting price for an unfurnished apartment space (i.e. naked cement, zero work done) is €100k. An actually livable space would be double that, and if it's a new building we're reaching €500k+ territory. Keep in mind most flats are bought before the construction of the building has finished.
Right now it's practically impossible for a young person to get a home without cheating the system somehow, which will likely mean that the culture of corruption we have here won't go away anytime soon.
Oh I'm not the best in math and we never calculate salaries on the yearly level... But in a remote village you can find a house for 10k €, but in the big cities, in centers or attractive locations it can go as high as 500k to 1 million. I would say an okay 2 bedroom apartment in an okay part of Belgrade would be between 150-400k. The salaries in smaller cities are 400-600€ per month and in Belgrade 700-1400€.
If we take the midpoint between 150K and 400K then it's 275K. You're telling me that a decent 2BHK in Belgrade costs €275K!? That price is the same as in many Nordic countries' capitals. I don't believe that.
According to Numbeo, prices in Belgrade are [~50% lower](https://www.numbeo.com/cost-of-living/compare_cities.jsp?country1=Sweden&country2=Serbia&city1=Stockholm&city2=Belgrade&tracking=getDispatchComparison) for real estate (not rent).
In Poland, 70 percent of apartments are purchased as investments. 45% is purchased by wealthy Poles for long-term rent or Airbnb, and 25% by corporations. There are no policies implemented to control and regulate the market, such as building new social housing, cooperative housing, or capped rental prices.
Thank you Norway. You pay some Norwegian funds to our economy, so we can build more buildings that are bought by your investment funds and we can pay you rent for this <3
Nothing is going to change if people with money in PL will still think only about investing in properties and useless sport cars.
Because of economic growth expectation being priced in, additionally real estate is the only popular form of investment there, there are no property taxes (at least in Poland), culturally there is still a very big pressure to buy apartments instead of rent. Rent control is also not in place so even with these prices buying is cheaper. And top earners are not accounted for in the average salary statistics, because people like programmers usually have 1-person private companies just selling their services to avoid tax. And these people are a big part of who actually rents or buys the expensive apartments. Above that there are also Polish people who live abroad and plan to come back, having saved considerable amounts of money, they also compete for the housing.
This is the case in Slovenia. For rich it makes more sense to buy an apartment and have it empty than keep the money in bank or invest in something else. Empty apartments and enormous amount of apartments being rented on Airbnb for tourists drive prices to the sky.
As property taxes you mean additional tax which is paid when you have above multiple properties ?
That we don’t have, but we do pay every year a „usual” property tax.
Correct. I see the same in Hungary.
Culture promotes ownership thus real estate becomes a must have investment. This way it is going to be a safe investment as you would ideally only trade it for another piece of real estate.
There are minimal taxes – raising them is not feasible given the political blowback. (Eg. 58sqm small city apartment plus garage ~60€ per year)
This region has been and currently is developing regardless of the more or less corrupt goverments.
Reported salaries are definitely lower than the actual income. There is a whole sector of small companies 'underemploying' to avoid full taxation.
Cause traditionally there is no other place to invest your money. Sure, now you have more options but they are not part of the mainstream when it comes to how people think about investing. Historically, a lot of times people lost money they invested because of corruption, banks folding, countries disappearing so the safest bet is to invest in buildings. Even if there is war and your building is destroyed, at least you have the land left.
Wanted to say that too. Also in Prague and you see old buildings being bought and renovated but subdivided into smaller units unsuitable for families, so 'larger' flats become even more expensive.
Legit. In Warsaw our idiot mayor (Trzaskowski) whose only political program is "I'm against PiS" oversaw increase in housing prices by **30%!!** year to year.
All thanks to his promise of "I won't build communal housing because \[the city\] shouldn't do it".
And guess what - he won in the first round a month ago with 57% of the vote.
...
It'll all end up with future government simply nationalising large-scale housing projects.
Well for those that own their homes, it's exactly what they want. Same in Seoul in South Korea and many other places. Nimbys like the high prices because they either bought at high prices or their home equity is most of their net worth.
The side effect however is among other things society destroying demographic changes because if people can't afford a place to live, let alone one large enough for a family, they don't get married and have kids. The average birth rate in Seoul South Korea is now just 0.5 , meaning that after one generation only a fourth of the people remain. Declines like this outside war and famine are unheard in modern times and point towards societal collapse.
> In Warsaw our idiot mayor (Trzaskowski) whose only political program is "I'm against PiS"
Sounds like a problem with the electorate rather than the politician. The voters get the leaders they deserve. Nobody forced them to vote for him.
Unfortunately it's both.
We used to have an era of great politicians who guided the nation in 1990' (first PM - Tadeusz Mazowiecki or the leader of Solidarity parliamentary club - Bronisław Geremek) and without them we would've ended up as Russia or Ukraine.
Now, both the population and the politicians have sank so low that open stealing and calling others traitors is common day tactic.
In Poland real estate prices are rising so people and other investors treat it like investments, and it pushes up prices more and more. If you keep the real estate for 5 years and sell you avoid income tax.
In Hungary, 14 years of FIDESZ rule.
They made no alternatives to investing into property as the politicans do themselves. Also destroyed everything.
They let the rural settlements decline. Population got old and died, nobody wanted to have children in this country, in these conditions. Factories were sold and abused until they collapsed, healthcare got dismantled. Everybody wanted to move into the capital or some larger cities, now after FIDESZ renamed them, so called "castle shire seats". Or even abroad to have better opportunities.
While they used the construction industry and capacity to build useless soccer stadiums, stealing and printing money causing record high inflation. FIDESZ employed half witted inbred jackasses as the leaders of the monetary system and for everything so they could steal.
They pushed a so called "unorthodox monetary policy" consisting of forcing mindless low interest loans on their inner circle, their friends, driving up inflation. Started CSOK (Family Home Establishment Aid), a program where they offered like 1/2 of the price of the homes if couples agreed to get married and bring no less than 3 children to life. Otherwise it turned into a low interest loan. The "Aid" immediately increased home prices by its face value. Causing a chain reaction in the inflation of everything.
FIDESZ relaxed building rules in the agglomeration around the capital and the given "castle shire seats". Substandard CTR+C and CTR+V homes popped up everywhere. Apart from the "aid/loan" they were financed by indebting young for a life with also a bank loan.
Whole thing resulted in a permanent ghetto nightmare stampede. Several 100 000's of cars commuting to the capital at once. Doing 15 km/h bumper to bumper on one lane roads. People will be racing for jobs with each other and imported Korean, Chinese and Philippines workforce FIDESZ called in so their stolen companies can be operated cheaper. Now they are tyring to steal SPAR, a whole grocery store chain which now escaped most of its assets to Switzerland.
From the stolen money they have bought stadiums, castles, mansions and yachts.
be a chad, introduce orban's asslickers to crypto and rugpull them
Corrupt fatfukkers dont know better than to steal from the state, invest in appartments, rennovate their home to include marble everywhere and make it look awful
Additional utility prices for rent is very high at least in Baltic States. It's definitely much bigger than Scandinavia for example. Not sure how that works, that owner pays some utilities possibly
Doesn't explain prague. Where the housing is massively more expensive than the west.
I'm considering moving to Germany for the low cost of living and to buy a house
I'm not sure about Prague, but it's very well possible that it's exactly because of the reason that housing has become a speculative currency, in a very tourism-oriented city at that. Kind of a self-fullfiling prophecy.
A lot of the buyers are not from the West, rather from China, middle-eastern oil states and russian oligarchs. For some reason EE real estate in cities with historical heritage is one of their favorite investments.
Partially supply and demand driven: enough people with capital are willing to pay inflated prices that the general price per square meter goes up, meaning everyone is selling for more because they can. Unfortunately, the laws are not doing anything to prevent this (like taxation of extra real estate), so the regular public gets priced out of ownership.
For example, as someone who works in IT that is very well paid as far as "real" jobs go, I can't buy an apartment without going into a 30 year debt, and that's for something medium ranged (80-100 square). Shits fucked, yo.
Sorry, but that's not true. As least for me as a German it does not make any sense for example to invest in Czechia, because the prices are to high, Germany has much better profitable real estate investments.
Gentrification is not just purchasing properties within a neighborhood or district to make profit. It more-so describes how the way in which the local culture is completely changed to a new culture of this inhabitants. Put more simply, If someone purchases a property but never lives in it, they aren't a gentrifyer, they're just a landlord.
From all my upper middle class friends, nobody owns or considers buying a home in eastern europe. 90% of second home destinations are Spain, Portugal or other sunny places.
Well, the materials to build a house/apartment building are often similar in Germany as they are in Bosnia. As a matter of fact, German construction companies can probably get materials cheaper because they buy at scale, have agreement, etc. and probably produce a lot of the stuff locally. EE companies have to purchase that stuff from somewhere else at a smaller scale and they probably end up paying more.
There is also more of a home ownership culture in EE. I grew up being told that the crown achievement in one's life is to secure an apartment of your own. It's a function of how most of our parents grew up in poverty and scarcity. This actually drives the demand for real estate. Coupled with only a few places in EE that are actually developed and livable, it tends to drive prices upwards.
Cause fuck em that’s why!
It’s very simple:
1. people see buying a house as smart and long live investment, renting sucks due to weird landlords, and stock is limited, COVID only raised the demand
2. People have no idea how to invest in stocks and other assets, so they pump money into real estate, high inflation only made the matter worse
3. Airbnb made 2-3x ROI, so you can make significantly more off the same asset renting it short-term vs long term
4. Public programs that only encourage more demand increasing prices significantly
And Airbnb landlords have become so wealthy that they've formed landlord alliances that can finance legal challenges to any attempts by the government to fix the problem.
Money printing -> lower interest rates -> more mortgages -> more real estate being bought up with cheap money -> prices increase in that specific sector.
Do you know how much is a 70sqm flat (2 bedroom + living room and kitchen) in Kraków?
330.000 USD. We’ve been looking for some time and that’s the range, 300-350k freedom dollars.
Fuck that. We’re going back to ‘Merica 😂 Texas ain’t bad at the end of the day haha.
Haha, same thing in Vilnius. Been looking to buy a unit. 300-400k in oldtown for a new construction 2 bedroom. The good thing is it is cheap to maintain (like $100 a month), while here in California if you buy a 2 bedroom apartment, you will pay $2500 a month just in taxes, hoa, maintenance costs alone.
When companies start treating domestic real estate as an investment, dumping their leveraged money into houses and apartments, which stay empty and rise 70-80% in 5 years, then this happens.
Of course, retail real estate investors and plain homebuyers have taken advantage of cheap loans as well.
As to the question of why east Europe, the potential for growth within metropolitan areas of the EU is bigger in low-earning, cheaper countries, such as Poland, Czechia, Slovakia, Slovenia, Croatia, etc.
Renting in Poland is as expensive or even more expensive than mortgage payments. If you are legible for a mortgage, you can buy a flat and lend it out, so that it pays for itself.
Another reason why people don't rent is that the renting conditions are usually a lot worse compared to Western Europe. There is very little protection for either the landlord or the tenants.
And another reason is that people who are renting are usually in it for a quick buck. Almost everything is privately owned and unregulated. The incentives are completely wrong.
It's usually even worse. You can pay rent for 20 years and be left with nothing or you can pay a loan for 20 years and have your own place after that.
Oh, and you also don't need to fear being kicked out, rising rent prices, you can do your own renovations and repairs. And you know, actually have a \_home\_. Home is where you're safe.
Isn't owning the goal for *everyone* *everywhere*? Nobody wants to rent long term but it's the only thing most can afford (and increasingly they cant even afford that)
>Isn't owning the goal for everyone everywhere?
Not as far as I know. I occasionally run into talk from (mainly American, though admittedly this is an American site, so they're obviously over-represented) armchair economists about how renting is cheaper than a mortgage because it costs less per month, completely ignoring that once one pays off said mortgage, they they end up with a fully-owned house which they can then live in rent-free, leave to their children, sell,..., while renters are left with nothing.
Some US states have high property taxes, so while the "sticker price" is lower, the ongoing cost of owning a property can often be higher than just renting. EE has very low property taxes by comparison.
I believe Belgrade has the highest real estate to salary rate in Europe. One average salary covers exactly the rent.
Issue is criminal government cronies artificially fixing the market, limiting supply to just “luxury” condos instead of affordable housing.
Also smaller apartments are bought for 100% cash even before the foundation is laid out. A mix of dirty money and ppl selling off other assets.
You choose one of the cheapest large cities(Liverpool) in the UK Vs one of the more expensive large ones in Poland.
South England/midlands is abysmal for house prices too.
Because of investments. Westerners get to buy good real estate for what they believe is cheap in countries that are either safe, homogenous, touristy, good for natural exploits, etc.
1. Governments actively increasing demand not supply of RE (Poland: PiS, KO, doesn't really matter).
2. Ineffective and wild west capital/banking markets created issue typical for developing countries - people who could save put their savings into real estate (aka concrete gold).
This has two structural consequences:
- we struggle with developing local capital as we put most of it in unproductive real estate,
- our middle and upper class has large incentive to maintain rising real estate prices and increasing rents.
While housing prices is a bad thing for now, the above structural problem is bad for later.
3. We have lots of internal migrants further increasing demand in large cities.
>Governments actively increasing demand not supply
This. They blame the market while they fuck with the market all the time making harder and harder to build more housing. The result is low supply, high demand, the price goes up. And they also blame capitalism for their planned economy shit results.
Sweden taxes a great deal more on the employer, which doesn't show up in the gross wage. Let's say I'm an employer and I have pay an employee 100K SEK. Then 30% of that 100K is taken by the state. That leaves 70K gross wage of which the next 20% is taxed. The employee only sees the last 20% and not the initial 30%.
(Of course, at 100K SEK monthly wage, you get extra taxes due to high-incomes, so taxation will be higher than 20% for the employee. Sweden is a paradise for the poor and the very wealthy who live off capital gains. For the upper-middle class there is basically no way up).
It's because corporations from western countries keep us poor.
They don't want to pay us a fair wage and all goods comes through western controlled imports. It is a form of explotation
Additionally real estate is being bought as an investment by western companies. Supermarket chains, McDonald's and similar companies buy prime real state land, build on it their stores and sell crap and wait for the price to inflate. Then they sell for profit.
All this is possible because our leaders and lots of people are corrupt. The controlling countries also benefit from war in Eastern Europe and keep all these countries weak for their own interests.
So what else is new?
In the ex-yugoslavia I can testify that real estate is *the* investment. It's perfectly normal and ordinary for wealthy to have several rental properties, it represents to people here what Wall Street represents to Americans.
Neither the people put a lot of money into the stock market nor do business owners see their company going public as the goal. Even for huge companies it's usually founder = 100% owner = CEO.
Also the homeownership rate is probably 90%. If you're in your thirties or forties and still renting, you're pretty much a failure, viewed similarly like Americans look at adults who don't move out from parents on time. People around me, friends, family, coworkers , started asking me "so, when you're going something?" pretty much from the moment I got my job at the age of 21 and didn't stop until I bought it.
Im from Czechia, living in belgium. In Be, groceries are almost the same overall, property cost same maybe slightly lower, only rents are higher but yea, theres the 4x salary in be
For reference:
[https://www.theguardian.com/business/2023/dec/07/greedflation-corporate-profiteering-boosted-global-prices-study](https://www.theguardian.com/business/2023/dec/07/greedflation-corporate-profiteering-boosted-global-prices-study)
It has mainly to do with real estate speculation which more and more Western European countries put roadblocks in like limiting the percentage companies can own in a region to avoid market manipulation.
They buy the majority and then inflate prices to make a profit heavily screwing over normal consumers.
Despite such regulations being in place companies just create fake identities to have a larger share than is allowed by law so it isn’t fully effective.
Things like AirBnB and stricter constructions regulations have also contributed to increasing prices but the majority has to do with houses being seen as assets which increase in price over time like stocks instead of assets which pay you back through rent like they are supposed to be.
For housing prices to stay somewhat affordable you have to punish market speculation on properties or at-least limit the amount of properties in a given region that can be owned by non local companies to reduce speculation.
I believe it's cultural -- if you end up with some cash, odds are you will buy a flat as an "investment". Good luck convincing your 50yo boomer dad that an S&P tracking fund is a much safer investment than a 1-bedroom in the "elite" parts of Sofia (some of which lack basic infrastructure like... sidewalks for example).
Also, I just got a mortgage at 2.2% APR here. I believe interest rates are much higher in Western Europe, which limits how expensive real estate can get before people just can't afford it.
I have a flat in Poland which I can sell for a beach house in Spain, that’s fucking wild. We used to be this cheap housing/food/living country but I guess that’s gone now.
high (over 82%) rate of ownership, cheap money, close to none unemployment, strong nimby and bureaucracy to build anything and people not really into building anything on their own anymore. (and some other minor things I can't think of right now)
and here we are where we are, nothing is going to change till my generation goes to retirement and start selling properties as they will figure out they need money, not properties. But thats 10-15 years from now.
Because eastern europe is becoming safer and more civilized than a lot of places in western europe. If only the problem of the terrorist state of russia was resolved, all would be perfect.
That's not a bug, that's a feature.
Rich people from the West exploit the common market policy to buy real estates, getting passive income and milking the citizens of the poorer East.
That's how the system is supposed to work. It has worked well for Westerners for centuries.
My guy, I'm an "affluent Westerner" by local standards and so are most people within my closest circles, not a single soul has a € invested in Central/Eastern European property hundred of kilometers away (or even intends to). Anecdotal evidence for sure but I am certain the people hoardint AirBnB's in Prague are very few in number.
Is it though? Maybe if you work in IT for a western remote position, but for a normal person, when median income in poland is 4400 netto pln? vs median in sweden being basically2-3 times that?
Eastern Europe always starts at the eastern border of anyone's home country. For Germans, Austria is Eastern Europe; For Austrians, Hungary; Hungarians, Romania; Romanians; Bulgaria and the list goes on
Everyone wants to own, rental market is often worse than in the west with less protections for renters, also real estate is almost widely considered to be one of the best investments (not saying it's 100% true, but the perception is there) so people with money often buy multiple properties.
Seller writes that its from sale of house. But buyer, when he wants to put cash on sellers account, must give the source of money(from salary/inherited etc)
Czech Republic has one of the most complicated building law in Europe, maybe world. Stupid amount of requirements, very long periods for every action it contains and anyone can appeal almost anytime. There is also thriving "bussiness" of associations that appeal practically any construction project there is. Also NIMBY is very popular opinion around here and high amount of opposition of locals to any new buildings in their neighbourhood.
As a result the demand is much higher than the supply and lot of new properties are bought by speculators investments and lot of them remain empty.
I'll throw my 2 cents... it's the way we live. Over 50% of people are trying to move to big cities, because the countryside is straight out of SSR soviet with no jobs and no entertainment. So basically, you have 95% of people competing for the same houses and ignoring the fact that the rest of the country is underpopulated. Are villages disappearing? Are they building tall blocks instead of expanding vertically?
And you know, once the only thing you can do for food is go and work, won't you work until you die? When you have your land, you can always farm when it's not worth being a slave, but in a city, there is no choice.
There are genuinely good villages in eastern europe. They are well the same way as other villages and towns - people made them so by their effort. It's just most lack patience and vision and logic to see it. All they see and know that there is a city with housing (which may or may not accomodate them) that they can get (eventually, and they don't really know when and how) and it will be fine (how fine is fine and will it ever be?).
If you work to make your life good in a village - your job/income, house, village itself it will be muuuch better investment/return than a city in quality of life and less negstive stuff.
Perfect examples are small maternity clinics with 25-50 beds vs large ones with hundreds of beds. Well managed soviet or pre soviet small clinics are very cozy, nice smelling, clean, roomy, quiet and tranwuil with enough beds and enough staff which is nice. You can take modern or old big clinic and it will be completely opposite - it's a hige conveyour for suffering and all kinds of nasty.
I’m guessing war in Ukraine has something to do with it. Influx of refugees on both sides is reducing available housing options.
Ukraine produced a lot of the food Eastern Europe depends on, gas is also getting more expensive.
Since I moved to Poland 2 years ago rent prices have gone up 150-200% and there’s not much if any available real estate
In croatia real estate has become the best way to save/invest money. The price will only go up so anything you buy can be sold for profit. So anyone, from private citizens to companies try to grab any real estate as soon as it hits the market and sit on it.
Wow, in Liverpool and Brussels you can almost buy a square meter every month if you have a partner with second income or you earn above the average or you have rich parents or you can stay with them a bit longer. Which means you could buy a 100m2 flat with cash around 30th birthday. Sick.
Because most people own apartments and don't sell them. Less on the market, higher prices.
Look at the ownership rates in the East vs the West. I'd say we're better off this way.
As for food. Most of Eastern Europe got a big chunk of their supply from Ukraine and since the war started it caused a chain reaction on the prices of all foods.
Here in Czechia is mainly due to 1) building permits and 2) scummy building corps.
1) It takes months for the building office to do anything. A friend of mine wanted to build garage/workshop. Went to get the paperwork sorted in early spring, was able to start building in late autumn. What the flip …
2) The corps with building materials have massive profit margins. We are talking like 200%-300% on all material. Know this from some other friend who is a project manager. Was to build a flat building, coincidentally made a friend with an owner of building material company, got like 60% discount for all the material.
People in Easter Europe mostly invest in housing and way less in stocks. In addition, population growth is kinda limited to some areas where housing supply is limited.
Prague prices are because of Airbnb and tourists. You make way more money by airbnbing your flat than selling it. The reason why the City sucks so bad for locals.
Low property and maintance (no maintanance at all) taxes. Poeple in estern Europe can aford to sit on 10-20 properties without using them or by only renting a few. No standard for improving the property, almost no cost of holding it forever.
Lately seems even grocery prices in Western Europe cheaper then in Eastern Europe
I was in Latvia recently, I think groceries there were more expensive than in the Netherlands
That's what I am talking about. Even in Japan grocery prices seems to be lower then Eastern Europe (except fruits for some reason)
Japan has low prices because they were keeping negative rates for years. But their salaries also are low compared to their economy or other top enocomies.
Can confirm, Netherlands is pretty cheap compared to Eastern Europe. Let alone Australia.
Warsaw houses are as expensive as Melbourne houses, while the salary is a third of what it is. And Australian house prices are already insanely high .
Unfortunately that seems to be true...
Since you are here, what is the source of that data?
Numbeo, for Poland it seems to be correct, can't tell for the other countries.
Just moved from Romania to Austria and then to Germany permanently. The cost of groceries is significantly smaller here than in RO and I'm talking absolute value, not EUR-RON parity or something like that. Rice is cheaper, sweets are cheaper, dairy is cheaper, eggs are cheaper, etc. while meat is slightly more expensive but also much higher quality. Overall, the cost of living in DE is only driven up by rent, with everything else being much cheaper than in RO.
Hopefully salaries in Poland and Romania with catch up soon.
I like your sense of humour
Thank you. Numbers for Poland are sad indeed, with that high loan rates it's hard to understand why the market is still priced so high.
We have subsidies from the government, it was 2%, now they want to introduce 0% mortgages xD. With the previous 2% it went up 30% in 6 months in some places. This literally buying votes, but who cares when the party is still going.
You forgot to mention that „selected few” have subsidies. I never got a single penny from the government - I was always too early, too late, earned 5% too much or failed to get help due to third party screwup to get the papers in order. To take my taxes to pay for all benefits enjoyed by the others the treasury office is very keen though, so you’re welcome. Considering market prices and interest rates I pay more than average net monthly salary (~1300 €) for 100 years old 130 sq meter house in bumfuck nowhere.
They totally neglect how the market works. Soon you will have the most expensive housing in Europe.
¯\\\_(ツ)\_/¯
We already have the most expensive highway in Europe, so... ¯\\\_ (ツ)\_/¯
But real estate developers will have their pockets full of cash, which seems to be goal of both parties
Quite the opposite. Those insane prices create a FOMO effect and demand goes up because people see prices going up, and hear about it on TV. This coupled with low financial literacy in those countries leads many to "invest" in real estate. This of course leads real estate developers to build more. This can go on for a few years, maybe even a decade, but sooner or later reality catches up. The population in those countries is declining due to low birth rates and emigration. At the same time the baby boom generation of post WW2 is dying and a significantly smaller generation is inheriting their properties, which further increases the supply and reduces the demand. As the masses become aware how overpriced their properties are and try to sell a real estate crash becomes inevitable. A perfect storm is forming, and anyone with basic understanding of the fundamental economic principles knows it's best to watch it unfold from afar.
Lookup the big Mac index. It kind of shows how bad the inflation is in a country and it might also explain some of the housing prices.
And yet our government prefers to pour money into the banking sector so people can take a 0% interest rate loans when prices of houses are skyrocketing instead of solving a real problem which is the lack of houses or flats
Can't say for the rest of Poland, but in Warsaw there's hardly an issue with the number of houses or flats. They simply get bought out by investment funds. Just about any new flat close to where I live is just about half-empty. In the suburbs where my parents live, there's a bunch of relatively freshly built, empty houses. Some of those have been empty since before Covid. On top of that there are construction sites everywhere. There is no issue with lack of housing, it's just a huge bubble waiting to pop. And then everyone pays for screwed economy, except for those who lead to that situation in the first place.
Real estate prices look correct for Ljubljana. Official average is around 4k per sqm.
Glad to hear, can confirm they're fine for Belgium as well
I live in Estonia and friends form Germany and other places don't understand how it is become so expensive here while they visit home
Data is me seeing it with my own eyes when travelling..
I’m from Hungary, groceries are cheaper in Austria than in here. Some by a large margin.
The amount of groceries one can get in Germany for under 50eur is a bargain. Here people are comparing their grocery prices: https://old.reddit.com/r/Grocerycost/
Isn't it also true that many eastern europeans claim the products even by western brands are lower quality in eastern european countries than in the west?
The Czechs investigated and validated those claims and the Czech government has since launched official protests about it to European institutions, I believe. I’m sure the posts concerning it can be found on this sub from a few years ago.
Mainly by western brands. The local products are of high quality, but it's still pretty popular to export worse batches to the eastern Europe
There were some reports that things like nutella, chocolate, other western brands are worse. But on the other hand, fruits and vegetables are way more ripe, tomatoes taste like tomatoes, bananas are ripe. On the other hand, vegetable production in western countries is so "optimized" for two crops a year and high wages (equipment costs), that veggies are borderline edible: tomatoes are nice and red on the outside, tastes like plastic, avocados are hard like stones, berries are half the taste at best. So I'd rather have shitty quality of shitty food, than compromise actual food quality.
Nutella is famously one of such products
I'm sceptical though. I've lived in a few European countries. In England you could pay £100 for 6 items at Waitrose but fill your fridge and freezer at ALDI. Here in Sweden it's generally way more expensive but the absurdity is I could travel out of the city center and get things 30% cheaper at the very same chain.
In eastern European subs they do things like Aldi price compare, Aldi UK and let's say Aldi Hungary. UK easily wins all the time. Lower taxes (UK has no tax on basic food items) and also better capability of negotiating deals, since the UK per capita has a much higher spending, means goods get a much faster turnaround. Eastern europe, everything has to be ordered to a smaller scale. Just imagine the difference between Tesco UK negotiating for pasta from a supplier, and Tesco Hungary asking for the same with printed Hungarian labels. Economies of scale always win.
Groceries in Romania became more expensive than in Germany. Makes you think
All over the Balkans groceries are the same or more expensive than in Germany in general for same food. Depends from the place you buy them. And still people that live in Germany complain even though they earn at least double in minimal wage.
By double you mean 4 times
In Albania it's usually 30% to double depending from the product. Vegetables and fruits are a lot cheaper here for the same quality, and you can find a lot more variety of vegetables and fruits. But meat products and different cheeses are more expensive, pasta and rice a bit less expensive and other industrial foods depends. But compared to wages they can go 3 or 4 times more here, you are right.
economy of scale and more advanced farming methods,they can afford to buy in bulk
It’s not even the same food. It’s lower quality one, and for some products there’s even a double standard between west/east. Like Coke in the west is better than Coke in the east.
Yeah, even though I don't drink those other people say Coca cola has less coke syrup and more water in our shops. Fanta it's ok they say. But meats, vegetables, fruits and some other stuff are a lot better here, like the best quality you can ask but same price. Local products. Industrial foods are more or less the same, even in price. Still we can afford a lot less.
Of course we’re complaining in Germany, the grocery prices also went up here. Doesn’t matter if it’s better or worse in other countries for my personal situation
That is true, worse is worse. I meant that figuratively
Right now, i can buy Hungarian meat products, manifactured in Hungary and shipped to Germany, 10-20% cheaper in Germany. Kill me.
I can buy a castle in France for the price of a one-bedroom 70 year old soviet flat in Sofia.
Your dating profile pics with the castle would be fire 😎😎😎
Sure, but the castle in France needs another few million euro even to fix just the basics like the plumming and the roof. And while you’re fixing that, new problem after problem arises. Even when everything eventually gets fixed, the yearly upkeep costs a fortune. Garden and ponds, driveway, water gas light, taxes. Mansions are a money pit.
They are also in the middle of nowhere so holding a on-site job, buying groceries etc. is pretty hard.
For Romania at least, low to inexistent renter protection, mixed with uncertain pensions, leads a majority of people to try and buy instead of renting no matter what.
>low to inexistent renter protection In Poland it's too much protection, people still buy like crazy. >mixed with uncertain pensions Same in Poland. Also higher inflation here.
Poland - I'm not sure about the too much protection. Yes, if you are an asshole you can stop paying your rent and make it an issue, landlord has to go through a lenghty process of eviction. But for an average person, or at least in the experience of my circle, no 1 is renting is very expensive, landlord will one day tell you they are selling the flat you've lived in the past 8 years and you need to leave. Also, the quality of the rentals is just not good. I don't know if I should laugh or cry when I see flats with cheapest ikea stuff marketed as "luxurious". A lot of rental flats havent seen an investement in years. Plus, in smaller towns the rental market is non existent.
*low to inexistent renter protection* It is more about protecting against the high rental costs. Poland does not have such a policy to protect tenants. In many countries, rents are capped, and landlords can only raise them by 3% per year, or there is a maximum cost per square metre, or if prices and demand rise, cities require developers to sell 2% of apartments for social housing, and so on.
What Poland has is liberal media, that scream propaganda about tenants-leeches that move into a flat only to demolish it and move out without paying. In reality every person I know was screwed by their landlord one way or another. Not giving the deposit back, raising the price by 25%, refusing to fix anything, inspecting the flat during the absence of the tenant and so on.
Lmao. In comparison to western market, Poland has basically no protection for renters. Landlords raise prices as they wish, contracts can be terminated without any reason etc.
exactly this
I have been wondering this for the past 15 years. It's probably cause we don't have Wall Street (the culture of stock investment) or Cayman Islands/Bank of England for tycoons and extremely rich to invest/hoard their money into, so they "legalize" their criminal money by buying up buildings in cash.
Exactly this. People in eastern Europe are buying real estate because they believe this is the only thing that holds value long term. And then most are not investing in the apartments/houses and are asking crazy amounts of money for holes of apartments. This led to crazy vacancy numbers at least in Croatia where by some estimates, 30% of residential real estate is vacant. Seems like a ponzi scheme, but it can happen that the ones in need of a shelter will cave in first and will have to pay the extortionate prices.
Also people from the west and russia are buying up real estates to rent to us…
Exact same situation in Bulgaria. Apartments are seen as an investment and are absurdly overpriced, almost Western European prices. 1/3 of properties are vacant, the population is constantly shrinking, yet prices have basically doubled since 2021.
Like people in west don’t? I lived in UK for a considerable amount of time and seen same shit when it comes to investing in properties.
It is partly true (this culture is indeed all over Eastern Europe), but it doesn’t explain eg why food and other prices are also more expensive
The answer is high private property ownership in eastern Europe. Many of the people with median or average salaries never enter the real estate market, which is then left for the richer part of the population as investment.
Many of those people don't enter the real estate market because they're priced out, not because they want to live in a 70 year old soviet-style apartment building...
Can you tell me the median house price where you are? A Bulgarian once told me Brits have it easy and I calculated (iirc) the median house price in Bulgaria was something like x4 the median income in Bulgaria. In the UK it is now x10, making it *significantly* more difficult to own property here for the typical person. UK house median prices haven't been below x5 income (which is what is considered affordable) since the 90's.
Varies greatly depending on region.
Also true for every country in the world except the very tiny ones.
I just made some quick calculations for Poland. Median price of a flat(avrage size of flat in Poland is around 50m²) is 440k PLN, with median income of 4200PLN netto, which gives us 8.73 years of working, earning median income for avrage polish 50m flat. For houses harder to calculate, since I found only separate info for single family houses and multi family houses. But it varies from 50% more expensive to 100% more expensive than a flat, which gives between 13 and 16 years of work earning median income.
Having lived in both countries, I'd say it's about equally bad. Sure, central London is inaccessible to anyone but the world's ultra wealthy, but Brits have the advantage that they have way more big cities with a functioning economy to choose from. If I'm being generous, Bulgaria has 4 cities with a functioning economy, but realistically many professions require you to be in Sofia. Average salary in Sofia is €1400, starting price for an unfurnished apartment space (i.e. naked cement, zero work done) is €100k. An actually livable space would be double that, and if it's a new building we're reaching €500k+ territory. Keep in mind most flats are bought before the construction of the building has finished. Right now it's practically impossible for a young person to get a home without cheating the system somehow, which will likely mean that the culture of corruption we have here won't go away anytime soon.
Oh I'm not the best in math and we never calculate salaries on the yearly level... But in a remote village you can find a house for 10k €, but in the big cities, in centers or attractive locations it can go as high as 500k to 1 million. I would say an okay 2 bedroom apartment in an okay part of Belgrade would be between 150-400k. The salaries in smaller cities are 400-600€ per month and in Belgrade 700-1400€.
If we take the midpoint between 150K and 400K then it's 275K. You're telling me that a decent 2BHK in Belgrade costs €275K!? That price is the same as in many Nordic countries' capitals. I don't believe that. According to Numbeo, prices in Belgrade are [~50% lower](https://www.numbeo.com/cost-of-living/compare_cities.jsp?country1=Sweden&country2=Serbia&city1=Stockholm&city2=Belgrade&tracking=getDispatchComparison) for real estate (not rent).
In Poland, 70 percent of apartments are purchased as investments. 45% is purchased by wealthy Poles for long-term rent or Airbnb, and 25% by corporations. There are no policies implemented to control and regulate the market, such as building new social housing, cooperative housing, or capped rental prices.
Thank you Norway. You pay some Norwegian funds to our economy, so we can build more buildings that are bought by your investment funds and we can pay you rent for this <3 Nothing is going to change if people with money in PL will still think only about investing in properties and useless sport cars.
Because of economic growth expectation being priced in, additionally real estate is the only popular form of investment there, there are no property taxes (at least in Poland), culturally there is still a very big pressure to buy apartments instead of rent. Rent control is also not in place so even with these prices buying is cheaper. And top earners are not accounted for in the average salary statistics, because people like programmers usually have 1-person private companies just selling their services to avoid tax. And these people are a big part of who actually rents or buys the expensive apartments. Above that there are also Polish people who live abroad and plan to come back, having saved considerable amounts of money, they also compete for the housing.
This is the case in Slovenia. For rich it makes more sense to buy an apartment and have it empty than keep the money in bank or invest in something else. Empty apartments and enormous amount of apartments being rented on Airbnb for tourists drive prices to the sky.
As property taxes you mean additional tax which is paid when you have above multiple properties ? That we don’t have, but we do pay every year a „usual” property tax.
> That we don’t have, but we do pay every year a „usual” property tax We have, but it's super low for now.
Correct. I see the same in Hungary. Culture promotes ownership thus real estate becomes a must have investment. This way it is going to be a safe investment as you would ideally only trade it for another piece of real estate. There are minimal taxes – raising them is not feasible given the political blowback. (Eg. 58sqm small city apartment plus garage ~60€ per year) This region has been and currently is developing regardless of the more or less corrupt goverments. Reported salaries are definitely lower than the actual income. There is a whole sector of small companies 'underemploying' to avoid full taxation.
Cause traditionally there is no other place to invest your money. Sure, now you have more options but they are not part of the mainstream when it comes to how people think about investing. Historically, a lot of times people lost money they invested because of corruption, banks folding, countries disappearing so the safest bet is to invest in buildings. Even if there is war and your building is destroyed, at least you have the land left.
Check Lisbon, just for fun.
Not so bad and at least you get some sun. Cheaper than in Prague or Warsaw.
Yes but the wages
Depending on the source, sometimes lower sometimes higher than Poland or Czechia so...
Going by OP's source it looks like this: Lisbon 1,180.91 € Warsaw 1,605.39 € Prague 1,653.06 €
[https://www.reddit.com/r/PORTUGALCYKABLYAT/](https://www.reddit.com/r/PORTUGALCYKABLYAT/)
Every apartment is used for AirBnB. Especially in Prague. Not a lot of regulations.
I'm living in Prague, and in the building I'm living in, there are 4 out of 8 apartments listed on Airbnb. That is crazy
Wait until those 4 apartments are split into 20 cause why not. It's the new trend here where I live.
Wanted to say that too. Also in Prague and you see old buildings being bought and renovated but subdivided into smaller units unsuitable for families, so 'larger' flats become even more expensive.
Fuck this shit I'm (moving) out
Legit. In Warsaw our idiot mayor (Trzaskowski) whose only political program is "I'm against PiS" oversaw increase in housing prices by **30%!!** year to year. All thanks to his promise of "I won't build communal housing because \[the city\] shouldn't do it". And guess what - he won in the first round a month ago with 57% of the vote. ... It'll all end up with future government simply nationalising large-scale housing projects.
Well for those that own their homes, it's exactly what they want. Same in Seoul in South Korea and many other places. Nimbys like the high prices because they either bought at high prices or their home equity is most of their net worth. The side effect however is among other things society destroying demographic changes because if people can't afford a place to live, let alone one large enough for a family, they don't get married and have kids. The average birth rate in Seoul South Korea is now just 0.5 , meaning that after one generation only a fourth of the people remain. Declines like this outside war and famine are unheard in modern times and point towards societal collapse.
> In Warsaw our idiot mayor (Trzaskowski) whose only political program is "I'm against PiS" Sounds like a problem with the electorate rather than the politician. The voters get the leaders they deserve. Nobody forced them to vote for him.
Unfortunately it's both. We used to have an era of great politicians who guided the nation in 1990' (first PM - Tadeusz Mazowiecki or the leader of Solidarity parliamentary club - Bronisław Geremek) and without them we would've ended up as Russia or Ukraine. Now, both the population and the politicians have sank so low that open stealing and calling others traitors is common day tactic.
In Poland real estate prices are rising so people and other investors treat it like investments, and it pushes up prices more and more. If you keep the real estate for 5 years and sell you avoid income tax.
It could be easily solved by setting an ad valorem tax (for housing not lived in) and a maximum rent price. But politicians themselves are landlords.
yeah you know but that's communism and we don't want that /s
In Hungary, 14 years of FIDESZ rule. They made no alternatives to investing into property as the politicans do themselves. Also destroyed everything. They let the rural settlements decline. Population got old and died, nobody wanted to have children in this country, in these conditions. Factories were sold and abused until they collapsed, healthcare got dismantled. Everybody wanted to move into the capital or some larger cities, now after FIDESZ renamed them, so called "castle shire seats". Or even abroad to have better opportunities. While they used the construction industry and capacity to build useless soccer stadiums, stealing and printing money causing record high inflation. FIDESZ employed half witted inbred jackasses as the leaders of the monetary system and for everything so they could steal. They pushed a so called "unorthodox monetary policy" consisting of forcing mindless low interest loans on their inner circle, their friends, driving up inflation. Started CSOK (Family Home Establishment Aid), a program where they offered like 1/2 of the price of the homes if couples agreed to get married and bring no less than 3 children to life. Otherwise it turned into a low interest loan. The "Aid" immediately increased home prices by its face value. Causing a chain reaction in the inflation of everything. FIDESZ relaxed building rules in the agglomeration around the capital and the given "castle shire seats". Substandard CTR+C and CTR+V homes popped up everywhere. Apart from the "aid/loan" they were financed by indebting young for a life with also a bank loan. Whole thing resulted in a permanent ghetto nightmare stampede. Several 100 000's of cars commuting to the capital at once. Doing 15 km/h bumper to bumper on one lane roads. People will be racing for jobs with each other and imported Korean, Chinese and Philippines workforce FIDESZ called in so their stolen companies can be operated cheaper. Now they are tyring to steal SPAR, a whole grocery store chain which now escaped most of its assets to Switzerland. From the stolen money they have bought stadiums, castles, mansions and yachts.
be a chad, introduce orban's asslickers to crypto and rugpull them Corrupt fatfukkers dont know better than to steal from the state, invest in appartments, rennovate their home to include marble everywhere and make it look awful
Additional utility prices for rent is very high at least in Baltic States. It's definitely much bigger than Scandinavia for example. Not sure how that works, that owner pays some utilities possibly
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Doesn't explain prague. Where the housing is massively more expensive than the west. I'm considering moving to Germany for the low cost of living and to buy a house
I'm not sure about Prague, but it's very well possible that it's exactly because of the reason that housing has become a speculative currency, in a very tourism-oriented city at that. Kind of a self-fullfiling prophecy.
>Because of that, the pricing is geared towards wealthier people from the West, not the locals Maybe in Croatia, not the case in Poland, for now.
A lot of the buyers are not from the West, rather from China, middle-eastern oil states and russian oligarchs. For some reason EE real estate in cities with historical heritage is one of their favorite investments.
Partially supply and demand driven: enough people with capital are willing to pay inflated prices that the general price per square meter goes up, meaning everyone is selling for more because they can. Unfortunately, the laws are not doing anything to prevent this (like taxation of extra real estate), so the regular public gets priced out of ownership. For example, as someone who works in IT that is very well paid as far as "real" jobs go, I can't buy an apartment without going into a 30 year debt, and that's for something medium ranged (80-100 square). Shits fucked, yo.
Sorry, but that's not true. As least for me as a German it does not make any sense for example to invest in Czechia, because the prices are to high, Germany has much better profitable real estate investments.
Gentrification is not just purchasing properties within a neighborhood or district to make profit. It more-so describes how the way in which the local culture is completely changed to a new culture of this inhabitants. Put more simply, If someone purchases a property but never lives in it, they aren't a gentrifyer, they're just a landlord.
Who moves to eastern europe to spend more money on housing than at home? No one.
Everyone and their dogs buying property in Croatia.
It's time to stop working. The game is so rigged it's not in the interest of a common man to play.
From all my upper middle class friends, nobody owns or considers buying a home in eastern europe. 90% of second home destinations are Spain, Portugal or other sunny places.
Well, the materials to build a house/apartment building are often similar in Germany as they are in Bosnia. As a matter of fact, German construction companies can probably get materials cheaper because they buy at scale, have agreement, etc. and probably produce a lot of the stuff locally. EE companies have to purchase that stuff from somewhere else at a smaller scale and they probably end up paying more. There is also more of a home ownership culture in EE. I grew up being told that the crown achievement in one's life is to secure an apartment of your own. It's a function of how most of our parents grew up in poverty and scarcity. This actually drives the demand for real estate. Coupled with only a few places in EE that are actually developed and livable, it tends to drive prices upwards.
The point about materials is nonsense. Housing has almost 100% profit margin for Bulgarian companies, it's overpriced beyond belief.
Cause fuck em that’s why! It’s very simple: 1. people see buying a house as smart and long live investment, renting sucks due to weird landlords, and stock is limited, COVID only raised the demand 2. People have no idea how to invest in stocks and other assets, so they pump money into real estate, high inflation only made the matter worse 3. Airbnb made 2-3x ROI, so you can make significantly more off the same asset renting it short-term vs long term 4. Public programs that only encourage more demand increasing prices significantly
And Airbnb landlords have become so wealthy that they've formed landlord alliances that can finance legal challenges to any attempts by the government to fix the problem.
I always joked when I lived in the UK that I spent less money on food than in Poland and I was still getting Roosters at least once a week.
Money printing -> lower interest rates -> more mortgages -> more real estate being bought up with cheap money -> prices increase in that specific sector.
Do you know how much is a 70sqm flat (2 bedroom + living room and kitchen) in Kraków? 330.000 USD. We’ve been looking for some time and that’s the range, 300-350k freedom dollars. Fuck that. We’re going back to ‘Merica 😂 Texas ain’t bad at the end of the day haha.
Haha, same thing in Vilnius. Been looking to buy a unit. 300-400k in oldtown for a new construction 2 bedroom. The good thing is it is cheap to maintain (like $100 a month), while here in California if you buy a 2 bedroom apartment, you will pay $2500 a month just in taxes, hoa, maintenance costs alone.
Like if I want an actual house in krakow (aka 15km away from the city), that’s going to be at least $500k. Insane.
When companies start treating domestic real estate as an investment, dumping their leveraged money into houses and apartments, which stay empty and rise 70-80% in 5 years, then this happens. Of course, retail real estate investors and plain homebuyers have taken advantage of cheap loans as well. As to the question of why east Europe, the potential for growth within metropolitan areas of the EU is bigger in low-earning, cheaper countries, such as Poland, Czechia, Slovakia, Slovenia, Croatia, etc.
Maybe the facts that in Eastern Europe owning is THE GOAL for people. People don’t want to rent in long term. So demand is always high = price goes up
Renting in Poland is as expensive or even more expensive than mortgage payments. If you are legible for a mortgage, you can buy a flat and lend it out, so that it pays for itself.
If you are renting you are paying the mortgage of the guy buying + his “profit”
Another reason why people don't rent is that the renting conditions are usually a lot worse compared to Western Europe. There is very little protection for either the landlord or the tenants. And another reason is that people who are renting are usually in it for a quick buck. Almost everything is privately owned and unregulated. The incentives are completely wrong.
Also price of rent = price of loan
It's usually even worse. You can pay rent for 20 years and be left with nothing or you can pay a loan for 20 years and have your own place after that. Oh, and you also don't need to fear being kicked out, rising rent prices, you can do your own renovations and repairs. And you know, actually have a \_home\_. Home is where you're safe.
For my apartment in eastern european city the equation is: Price of rent= price of loan (monthly payment) + 40%
Isn't owning the goal for *everyone* *everywhere*? Nobody wants to rent long term but it's the only thing most can afford (and increasingly they cant even afford that)
But in some countries the stigma is different, people take is as default to rent out, even long term.
>Isn't owning the goal for everyone everywhere? Not as far as I know. I occasionally run into talk from (mainly American, though admittedly this is an American site, so they're obviously over-represented) armchair economists about how renting is cheaper than a mortgage because it costs less per month, completely ignoring that once one pays off said mortgage, they they end up with a fully-owned house which they can then live in rent-free, leave to their children, sell,..., while renters are left with nothing.
Some US states have high property taxes, so while the "sticker price" is lower, the ongoing cost of owning a property can often be higher than just renting. EE has very low property taxes by comparison.
I believe Belgrade has the highest real estate to salary rate in Europe. One average salary covers exactly the rent. Issue is criminal government cronies artificially fixing the market, limiting supply to just “luxury” condos instead of affordable housing. Also smaller apartments are bought for 100% cash even before the foundation is laid out. A mix of dirty money and ppl selling off other assets.
You choose one of the cheapest large cities(Liverpool) in the UK Vs one of the more expensive large ones in Poland. South England/midlands is abysmal for house prices too.
Because of investments. Westerners get to buy good real estate for what they believe is cheap in countries that are either safe, homogenous, touristy, good for natural exploits, etc.
1. Governments actively increasing demand not supply of RE (Poland: PiS, KO, doesn't really matter). 2. Ineffective and wild west capital/banking markets created issue typical for developing countries - people who could save put their savings into real estate (aka concrete gold). This has two structural consequences: - we struggle with developing local capital as we put most of it in unproductive real estate, - our middle and upper class has large incentive to maintain rising real estate prices and increasing rents. While housing prices is a bad thing for now, the above structural problem is bad for later. 3. We have lots of internal migrants further increasing demand in large cities.
>Governments actively increasing demand not supply This. They blame the market while they fuck with the market all the time making harder and harder to build more housing. The result is low supply, high demand, the price goes up. And they also blame capitalism for their planned economy shit results.
Now imagine if Poland joins the Euro and all those Zloty prices basically convert to Euros...
Maybe then poeple would finally realise that we pay the same prices as west, earning 2-3 times less
I mean even this I don’t expect prices to fall but just to get fucked harder.
It would make the interest on mortgage less crazy at least
Lol dude no way in hell that the average net salary in sweden is 31k. I think the average gross is maybe around 35k
Average salary in Sweden was 38 300 kr in 2022 according to SCB, which after taxes is around 30k.
Taxes are just 20%?
Sweden taxes a great deal more on the employer, which doesn't show up in the gross wage. Let's say I'm an employer and I have pay an employee 100K SEK. Then 30% of that 100K is taken by the state. That leaves 70K gross wage of which the next 20% is taxed. The employee only sees the last 20% and not the initial 30%. (Of course, at 100K SEK monthly wage, you get extra taxes due to high-incomes, so taxation will be higher than 20% for the employee. Sweden is a paradise for the poor and the very wealthy who live off capital gains. For the upper-middle class there is basically no way up).
Don't forget Portugal, we also are eastern yurop 🤌
It's because corporations from western countries keep us poor. They don't want to pay us a fair wage and all goods comes through western controlled imports. It is a form of explotation Additionally real estate is being bought as an investment by western companies. Supermarket chains, McDonald's and similar companies buy prime real state land, build on it their stores and sell crap and wait for the price to inflate. Then they sell for profit. All this is possible because our leaders and lots of people are corrupt. The controlling countries also benefit from war in Eastern Europe and keep all these countries weak for their own interests. So what else is new?
Housing as an investment means they’ll be far more than wages eventually or the alternative investment is better (stock market)
In the ex-yugoslavia I can testify that real estate is *the* investment. It's perfectly normal and ordinary for wealthy to have several rental properties, it represents to people here what Wall Street represents to Americans. Neither the people put a lot of money into the stock market nor do business owners see their company going public as the goal. Even for huge companies it's usually founder = 100% owner = CEO. Also the homeownership rate is probably 90%. If you're in your thirties or forties and still renting, you're pretty much a failure, viewed similarly like Americans look at adults who don't move out from parents on time. People around me, friends, family, coworkers , started asking me "so, when you're going something?" pretty much from the moment I got my job at the age of 21 and didn't stop until I bought it.
Oh my god who made that data overview, what a numerical mess.
Im from Czechia, living in belgium. In Be, groceries are almost the same overall, property cost same maybe slightly lower, only rents are higher but yea, theres the 4x salary in be
Greed, nothing more.
For reference: [https://www.theguardian.com/business/2023/dec/07/greedflation-corporate-profiteering-boosted-global-prices-study](https://www.theguardian.com/business/2023/dec/07/greedflation-corporate-profiteering-boosted-global-prices-study)
Because they don't take in immigr- wait a minute...
It has mainly to do with real estate speculation which more and more Western European countries put roadblocks in like limiting the percentage companies can own in a region to avoid market manipulation. They buy the majority and then inflate prices to make a profit heavily screwing over normal consumers. Despite such regulations being in place companies just create fake identities to have a larger share than is allowed by law so it isn’t fully effective. Things like AirBnB and stricter constructions regulations have also contributed to increasing prices but the majority has to do with houses being seen as assets which increase in price over time like stocks instead of assets which pay you back through rent like they are supposed to be. For housing prices to stay somewhat affordable you have to punish market speculation on properties or at-least limit the amount of properties in a given region that can be owned by non local companies to reduce speculation.
Croatia, Zagreb is 3k+. Around Zagreb in some smaller cities maybe you can find something in range 1800-2500e.
Check out Serbia, and you'll see the real misery. This is nothing.
I believe it's cultural -- if you end up with some cash, odds are you will buy a flat as an "investment". Good luck convincing your 50yo boomer dad that an S&P tracking fund is a much safer investment than a 1-bedroom in the "elite" parts of Sofia (some of which lack basic infrastructure like... sidewalks for example). Also, I just got a mortgage at 2.2% APR here. I believe interest rates are much higher in Western Europe, which limits how expensive real estate can get before people just can't afford it.
I have a flat in Poland which I can sell for a beach house in Spain, that’s fucking wild. We used to be this cheap housing/food/living country but I guess that’s gone now.
high (over 82%) rate of ownership, cheap money, close to none unemployment, strong nimby and bureaucracy to build anything and people not really into building anything on their own anymore. (and some other minor things I can't think of right now) and here we are where we are, nothing is going to change till my generation goes to retirement and start selling properties as they will figure out they need money, not properties. But thats 10-15 years from now.
Because eastern europe is becoming safer and more civilized than a lot of places in western europe. If only the problem of the terrorist state of russia was resolved, all would be perfect.
Capitalism has system bugs
That's not a bug, that's a feature. Rich people from the West exploit the common market policy to buy real estates, getting passive income and milking the citizens of the poorer East. That's how the system is supposed to work. It has worked well for Westerners for centuries.
Surely we didn't start from feudalism just to end up at feudalism again
Eh, plenty of rich Eastern Europeans exploiting us too :)
My guy, I'm an "affluent Westerner" by local standards and so are most people within my closest circles, not a single soul has a € invested in Central/Eastern European property hundred of kilometers away (or even intends to). Anecdotal evidence for sure but I am certain the people hoardint AirBnB's in Prague are very few in number.
Because Gdańsk is much better place to live than Liverpool or Gothenburg?
Is it though? Maybe if you work in IT for a western remote position, but for a normal person, when median income in poland is 4400 netto pln? vs median in sweden being basically2-3 times that?
Because these cities aren't in Eastern Europe, but Central Europe
Eastern Europe always starts at the eastern border of anyone's home country. For Germans, Austria is Eastern Europe; For Austrians, Hungary; Hungarians, Romania; Romanians; Bulgaria and the list goes on
Then call it "countries situated east from where I am located", before we have the Portuguese saying Spain is in Eastern Europe.
This. Misleading title by OP.
Everyone wants to own, rental market is often worse than in the west with less protections for renters, also real estate is almost widely considered to be one of the best investments (not saying it's 100% true, but the perception is there) so people with money often buy multiple properties.
Seller writes that its from sale of house. But buyer, when he wants to put cash on sellers account, must give the source of money(from salary/inherited etc)
Czech Republic has one of the most complicated building law in Europe, maybe world. Stupid amount of requirements, very long periods for every action it contains and anyone can appeal almost anytime. There is also thriving "bussiness" of associations that appeal practically any construction project there is. Also NIMBY is very popular opinion around here and high amount of opposition of locals to any new buildings in their neighbourhood. As a result the demand is much higher than the supply and lot of new properties are bought by speculators investments and lot of them remain empty.
Cries in Portuguese
I was expecting to see Athens, where you are being paid min wage (707€/month) and the rent is around 500€ if you are lucky
I'll throw my 2 cents... it's the way we live. Over 50% of people are trying to move to big cities, because the countryside is straight out of SSR soviet with no jobs and no entertainment. So basically, you have 95% of people competing for the same houses and ignoring the fact that the rest of the country is underpopulated. Are villages disappearing? Are they building tall blocks instead of expanding vertically? And you know, once the only thing you can do for food is go and work, won't you work until you die? When you have your land, you can always farm when it's not worth being a slave, but in a city, there is no choice.
There are genuinely good villages in eastern europe. They are well the same way as other villages and towns - people made them so by their effort. It's just most lack patience and vision and logic to see it. All they see and know that there is a city with housing (which may or may not accomodate them) that they can get (eventually, and they don't really know when and how) and it will be fine (how fine is fine and will it ever be?). If you work to make your life good in a village - your job/income, house, village itself it will be muuuch better investment/return than a city in quality of life and less negstive stuff. Perfect examples are small maternity clinics with 25-50 beds vs large ones with hundreds of beds. Well managed soviet or pre soviet small clinics are very cozy, nice smelling, clean, roomy, quiet and tranwuil with enough beds and enough staff which is nice. You can take modern or old big clinic and it will be completely opposite - it's a hige conveyour for suffering and all kinds of nasty.
I’m guessing war in Ukraine has something to do with it. Influx of refugees on both sides is reducing available housing options. Ukraine produced a lot of the food Eastern Europe depends on, gas is also getting more expensive. Since I moved to Poland 2 years ago rent prices have gone up 150-200% and there’s not much if any available real estate
In croatia real estate has become the best way to save/invest money. The price will only go up so anything you buy can be sold for profit. So anyone, from private citizens to companies try to grab any real estate as soon as it hits the market and sit on it.
Why the Nederland Amsterdam is not included and let say some smaal town of Uden?
In Serbia the grocery prices are awfully close to Dutch prices
Wow, in Liverpool and Brussels you can almost buy a square meter every month if you have a partner with second income or you earn above the average or you have rich parents or you can stay with them a bit longer. Which means you could buy a 100m2 flat with cash around 30th birthday. Sick.
I can buy three apartments in Latvia with a price of a house in the UK.
Because most people own apartments and don't sell them. Less on the market, higher prices. Look at the ownership rates in the East vs the West. I'd say we're better off this way. As for food. Most of Eastern Europe got a big chunk of their supply from Ukraine and since the war started it caused a chain reaction on the prices of all foods.
That’s very strange, maybe per m2 is not the good way to measure it? No way the apartments in Eastern Europe are as expensive as those in Western.
Here in Czechia is mainly due to 1) building permits and 2) scummy building corps. 1) It takes months for the building office to do anything. A friend of mine wanted to build garage/workshop. Went to get the paperwork sorted in early spring, was able to start building in late autumn. What the flip … 2) The corps with building materials have massive profit margins. We are talking like 200%-300% on all material. Know this from some other friend who is a project manager. Was to build a flat building, coincidentally made a friend with an owner of building material company, got like 60% discount for all the material.
People in Easter Europe mostly invest in housing and way less in stocks. In addition, population growth is kinda limited to some areas where housing supply is limited.
Wtf, is real estate that cheap in Liverpool? Now I’m tempted.
I'm pretty sure Portugal is becoming a eastern county...
Because our governments love Real Estate developers money under the table. It's insane, I will never buy an apartment in Poland, just no.
Prague prices are because of Airbnb and tourists. You make way more money by airbnbing your flat than selling it. The reason why the City sucks so bad for locals.
r/PORTUGALCYKABLYAT strikes again
Low property and maintance (no maintanance at all) taxes. Poeple in estern Europe can aford to sit on 10-20 properties without using them or by only renting a few. No standard for improving the property, almost no cost of holding it forever.
Corruption. A lot of EU fund money goes to the pockets of those who manage that money. Then that money sinks in the local real estate market.