East European Regional   

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Housing Sector Assistance Project   

It would be useful, therefore, for Poland to develop several types of estimates of the

demand for housing and residential credit.  For each of these constructs there is a

macroeconomic and microeconomic approach.  On one hand, aggregate demand

nationwide is a function of overall macroeconomic factors.  Similarly, the aggregate

demand for residential credit is a related macroeconomic concept.  On the other hand,

from a microeconomic perspective, the more detailed factors underlying the decision

making of individual households are of great  interest.  Thus, we would like more

information on (a) the determinants of the demand for housing of individual households;

(b) the probability that a household will move (in order to become a homeowner); (c) the

probability that a household with given characteristics will seek to obtain mortgage credit;

and (d) if the household does apply for credit, the factors that determine the amount

requested.  Corollary functions are (e) whether the application is accepted; (f) if yes, the

amount of credit that is offered; (g) the loan to value ratio (LTV); and (h) the potential for

credit risk to the lender: the probability of late payment and/or default.

To date, no major quantitative models of either the demand for housing or the

demand for credit have been estimated on a nationwide basis in Poland.  We should take

a moment, however, to distinguish what we mean by studies of demand, models of

demand, and estimates of the need for housing in Poland.  A demand forecasting study,

prepared by Jacek 

aszek, developed various estimates of the demand for residential

construction between 1996 and 2010.  In this study, an assumption was made regarding

the income elasticity of demand for housing (at 1.4) and then various assumptions were

made about the growth in gross domestic product (GDP), the growth in household income,

and the use of mortgage credit to produce estimates of units demanded over a series of

five year periods.

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A number of descriptive studies of demand have also been undertaken. The

Housing Research Institute and the Central Office of Statistics (GUS) continue to monitor

and study housing issues through various surveys, and their micro data and analyses are

very useful for descriptive analyses.  In addition, a number of individual gminas have

addressed housing demand and preference issues locally.

Finally, a number of studies of the  need  for housing have been undertaken, where

need is defined by the gap between the number of households (now and in the future) and

the number of housing units.  This issue is discussed at some length in the UIC report

 Public Sector Housing Finance Policy Strategies for Poland.   However, while this

definition of need is illustrative of Poland's housing problem, it does not constitute the

actual demand for housing that is, the amount of housing that households can now

afford.

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See Jacek 

aszek,  Global Housing Demand and Variants of Housing Construction,  in 

Housing

Problems

, November 1996, Housing Research Institute.