Overpopulation, nesting and expensive loans. These are the problems of our housing. And what are the positives?

The following analysis by experts from the RynekPierwotny.pl portal draws attention to the still existing problem of overpopulation of houses and premises. It is worth taking a closer look at the issue of overpopulation, additionally analyzing the issue of living with parents (“nesting”) and the housing debt of Poles. Contrary to appearances, not all presented statistics are clearly negative.

Overpopulation – a problem for years, but it is decreasing

The national media have often reported that Polish apartments and houses are overcrowded compared to the EU. There is indeed quite a lot of talk about the overpopulation rate reported by Eurostat, but few people analyze exactly how the mentioned institution defines overpopulation.

The experts of the RynekPierwotny.pl portal decided to explain that, according to the Eurostat definition, an apartment (house or premises) will be overcrowded if it does not meet all of the following minimum conditions:

a separate room for each household,
one room for each couple in the household,
one room for each single person aged at least 18,
one room for two people of the same sex aged 12 – 17,
one room for a person aged 12 – 17 (if he or she cannot live with a person of the same sex),
one room for two children up to 12 years old.

Our overpopulation rate calculated according to the above definition is one of the highest in the EU and amounts to as much as 33.7%. The situation is worse only in Romania, Bulgaria and Latvia. However, it is also worth noting that in Poland the same indicator is systematically decreasing. His decline was over 20 percentage points since 2005 (change from 54.1% to 33.7%).

However, in many Western European countries (including Belgium, the Netherlands, Germany and Sweden), the percentage of people living in overcrowded apartments has increased significantly over the past 20 years. For example, in Sweden the overpopulation rate increased from 10.7% (2005) to 16.7% (2024). This includes: the result of a large influx of arrivals from other countries.

“Nesting” is still our problem

When describing Polish problems, it is impossible not to mention the housing prospects of young people. Everywhere in Europe they are not particularly optimistic. However, our country has one of the highest percentages of nesters in the EU. This is the name given to young adults who, despite graduating from school or university and finding a job, still live under one roof with their parents.

The latest Eurostat statistics indicate that in 2024, 53.8% of people aged 25-34 lived with their parents.

The Polish result was therefore well above the EU average, which is 29.7%. – says Marek Wielgo, expert of the RynekPierwotny.pl portal.

He points out that only 2019 brought a slight improvement in the situation. The percentage of “nest nesters” then dropped to less than 44%, which may have been the result of good availability of loans and a longer period of good economic conditions.

In the following years, however, it only got worse. Due to the increase in loan interest rates and housing prices, as well as rent rates, the percentage of “nest nesters” has increased by as much as 5 percentage points over the last three years.

However, not only our country is struggling with this problem. The latest Eurostat data show that the percentage of nesters is higher in Croatia, Greece and Slovakia than in Poland. However, it should be noted that in the first two countries, Eurostat recorded an improvement in the situation of young people. In 2023, Poland was overtaken by Italy and Portugal.

For years, the countries where young people leave the family nest the fastest have been Finland, Denmark and Sweden, although the percentage of nesters increased there last year.

Poles have not gone into excessive housing debt

The last twenty years have also brought unprecedented development of the Polish housing loan market. In 2005, the total value of “mortgages” still unpaid by Poles was approximately PLN 50 billion. Today, the corresponding result is nearly PLN 500 billion.

Let us remember, however, that gross domestic product has also grown significantly over 20 years. Thanks to this, at the end of 2024, the ratio of Poles’ housing debt to GDP was approximately 14%, which was low – he explains Andrzej Prajsnar, expert of the RynekPierwotny.pl portal.

Analyzing last year’s data, we see a decline compared to the situation in 2016 (21% of GDP). Polish “mortgages” are worth less in relation to GDP, not only compared to the EU average (38%), but also compared to the results from the Czech Republic and Slovakia (21% and 31%, respectively). If we compare housing debt in banks to the disposable income of families, the situation also looks positive for Poland.

An interesting table shows that in 2024, the value of outstanding housing loans accounted for 23% of annual disposable income of households. To put it differently: in order to repay all housing loans at once, it would be necessary to spend 23% of the total annual income that Polish households had at their disposal in 2024. The result of the Czech Republic and Slovakia last year was 41% and 51%, respectively. Hungarians and Romanians had little credit burden (12%). A completely different situation concerned the inhabitants of Denmark (150%), the Netherlands (160%) and Sweden (173%).

The “Franc bomb” has been defused, but installments are still high

The positive image of Poland created by the above credit statistics is, unfortunately, spoiled by the high interest rates on housing loans in the EU – we are talking not only about the situation from 2022-2025, but also earlier.1 However, the “disarming” of the problem of loans settled in CHF seems to be an advantage. They are no longer an issue that generates quite a large risk not only for the budgets of borrowers, but also for the entire economy2.

However, Andrzej Prajsnar, an expert at RynekPierwotny.pl, points out that the disarmament of the “Franc bomb” was mainly the result of debt repayments, settlements and lawsuits, because the state’s previous legislative initiatives failed. Twenty years ago, the same state unfortunately failed as a credit market regulator.

Summary

The information presented above shows both positive and negative aspects. A positive is undoubtedly a significant decrease in the percentage of Polish residents living in overcrowded housing. But was this a decline that met expectations and needs? It seems not. It is certainly difficult to talk about positive aspects in the case of nesters.

When it comes to credit issues, we also see differences – on the one hand, low mortgage debt of compatriots, and on the other, high interest rates on “mortgages”. – It is the relatively low overall level of credit debt that creates hope for improving the housing situation of a large group of people who will not be able to take advantage of the offer of social housing – sums up Andrzej Prajsnar, an expert at the RynekPierwotny.pl portal.

Authors: Andrzej Prajsnar and Marek Wielgo, experts of the RynekPierwotny.pl portal

1 Read more: https://forsal.pl/zdrowieosci/aktualnosci/artykuly/9649342,dlaczej-kredyty-mieszkaniowe-w-polsce-sa-najdrozsze-w-ue.html

2 Read more: https://forsal.pl/biznes/bankowosc/artykuly/9477491,kredyty-frankowe-w-polsce-czy-ich-liczba-spada.html