The capital city of Poland, as well as the country's largest city, Warsaw is situated on the River Vistula in east-central Poland. Warsaw is often overlooked by tourists who prefer to explore sunnier climes. However, the city still has a lot to offer. Warsaw is a combination of older and more modern history, with the city's architecture tracing Poland's anachronistic journey.

Warsaw's Palace of Culture and Science nods to the city under socialism following the end of the Second World War. On the other end of the spectrum, royal parklands at Wilanów and the 'Palace on the Isle' presents Warsaw's centuries-old history as the royal capital of Poland. The River Vistula – where Warsaw is located – is also the longest river in Poland.

For house prices and rental yields, Warsaw's figures for 2022 have been mixed. During the year to Q1 2022 – when adjusted for inflation – house prices declined by 4.2%, down from the previous year’s 8.9% price surge. In relation to house prices, Warsaw lags significantly behind Poland's other major cities. However, the buy-to-let market is robust, with rental yields of approximately 6%.

  • Warsaw's Old Town is an UNESCO-registered heritage site.
  • Despite being the capital city of Poland, the city is often overlooked by tourists.
  • Real house price figures during the year to Q1 2022 have decreased by 4.2%.

The following image depicts the disparity between nominal house prices and real house prices. Real house prices are inflation-adjusted and more accurately depict the price of the property for sale. Since 2022 – and the sharp rise of global inflationary pressures – it is clear that the gulf between the two figures has grown dramatically in Poland as a whole.

House Prices:

Rental Yields

Gross rental yields, in the centre of Warsaw, range from approximately 5.23% to 6.86% for apartments. Indeed, a two-bedroom apartment costs around EUR 1,673 per month to rent. Overall, Warsaw rental yields are between 4.37% to 10.13% with an average of 6.66%. For investors looking to speculate on the buy-to-let market, these are good yields.

Despite positive rental yields, specific amounts are dependent on location. However, all areas in Warsaw offer similar ranges of yields – although amounts do vary depending on the district and borough. However, areas such as Mokotow – a densely populated area within the city – can offer yields as high as 10.13% for a three-bedroom apartment.

Investors tempted to explore the buy-to-let market will benefit from purchasing property in the right area. Rental price per month is most lucrative in Mokotow and Downtown Warsaw. Rent for a four-bedroom apartment in Mokotow will cost tenants 3,555 euros, while a four-bedroom house in Downtown will on average cost approximately 3,375 euros.

Overall, most districts and boroughs in Warsaw offer similar investment opportunities for property speculators. Rental yields are not too dissimilar when comparing property sizes – particularly apartments – and locations. However, areas like Mokotów and Praga PoÅ‚udnie offer rental yields as high as 10.13% and 9.90% for a three-bedroom apartment.

Conclusion

Despite falling house prices in Poland more generally, Warsaw has the highest house prices in the country. Average transaction prices for existing homes was as high as €2,391 in Q1 2022, according to NBP. Apartments in more expensive parts of Warsaw like Mokotow can cost €583,166 for a four-bedroom property, while a studio can cost investors €119,889 on average.

Rental yields are consistent across Warsaw's numerous districts and boroughs. However, for property investors willing to offer a larger initial investment, certain districts – such as Mokogow and Praga Poludnie – can offer above average ROI for a good quality three-bedroom apartment. The buy-to-let market in some parts of Warsaw is a promising sign for Poland's housing market.