The financial stronghold of Poles. We concentrate our assets in one asset

When it comes to Poles’ wealth, the answer has remained almost unchanged for years. The largest part of it is real estate – primarily apartments and houses. They are the foundation of the financial security of many families, much ahead of cars, valuables or financial assets.

Expert analyzes of the RynekPierwotny.pl website show that the share of real estate in household assets in Poland is one of the highest in Europe. However, this is not the case. In a country where housing ownership has been considered one of the most important life goals for decades, real estate has naturally become the main way of accumulating capital.

However, before we move on to international comparisons, it is worth paying attention to the source of the data. Experts remind that the most important information on the structure of household wealth comes from the Household Finance and Consumption Survey (HFCS), carried out in European countries.

Poland dropped out of an important study

The problem is that the latest comparisons do not include our country. Poland did not participate in the fourth edition of the HFCS study, conducted at the beginning of this decade.

This means that analysts must rely on data collected in 2016–2019. Fortunately, the structure of wealth does not change as quickly as housing prices or the inflation level, so previous results still allow us to draw important conclusions.

All euro zone countries, as well as the Czech Republic, Hungary and Croatia participated in the next version of the project. This time Poland was excluded from the study, which makes it difficult to track changes taking place compared to other countries.

Real estate accounts for more than three-quarters of wealth

OECD data show that real estate accounted for approximately 76 percent. gross wealth of Polish households. This result is higher than the average for the analyzed countries, which was 71%. The greatest role is played by real estate used for own needs, i.e. primarily apartments and houses occupied by owners.

– Relating the value of real estate to the gross wealth of households means that assets are taken into account without reducing them by the value of liabilities (including housing loans). This variant was adopted by the Organization for Economic Co-operation and Development (OECD), from which the asset data comes from – explains Andrzej Prajsnar, an expert at the RynekPierwotny.pl portal.

Only individual countries were higher than Poland in the ranking, including: Latvia, Lithuania, Greece and Italy. This shows how deeply rooted real estate is in the way residents of Central and Eastern Europe build wealth.

The less rent, the greater the role of apartments

Experts from the RynekPierwotny.pl website point out that the high share of real estate in assets is not accidental. In countries where most people live in their own homes, housing naturally becomes the main asset of households.

– If we take into account the total share of all properties in the wealth, the correlation coefficient with the popularity of residential property is similar to before (about 0.5) and shows a moderate relationship. It is difficult to assume that there is an apparent correlation in the analyzed situation. The popularity of living in a property actually affects the structure of household assets, says Prajsnar.

However, this is not the only explanation. As the expert notes, in Poland and other countries in the region, financial assets constitute a relatively small part of wealth. The reason is simple – the societies of Central and Eastern Europe built investment capital in a much shorter time than the inhabitants of the richest Western countries.

As a result, for many families, an apartment remains not only a place to live, but also the most important financial security for the future. And everything indicates that nothing will change in this matter for a long time.