How to sell real estate in Krakow

Please link to each webpage of Krakow Info website as you wish. We give permission to all hyperlinks and there is no need to ask.

Sell Your Krakow Property and Get Rich

No doubt housing isn't now a seller’s market in Krakow. Nevertheless the demand for apartments has outpaced supply in recent years. Seeing as prices of new flats zoomed up, on an average, by seventy percent in 2006 alone, it’s little wonder that many owners of residential property still think anything goes. Wrong as they are, the fact remains that selling an apartment in Krakow remains rather easy these days as long as the seller proves flexible enough.

Also there is the big demand for houses, and even bigger for advantageously situated building plots.

As regards the Krakow market for commercial property, nothing beats restaurants in the Old Town and Kazimierz historic districts as appetites of would-be restaurateurs for floor space there seems insatiable. Except, prices of retail space at the Old Town’s main streets and the central Rynek Glowny are really exorbitant.

How to sell real estate in Krakow

Potential seller of a real property may try to market it through classified advertisements in local newspapers. But it requires fairly good command of the Polish language, some knowledge of the Polish law, and usually a good deal of time.

On the other hand, one may employ Krakow’s real estate agents. Especially that some of them speak good English. And the realtor’s fee is paid, more often than not, by the buyer. Even as many estate agents in Krakow insist on exclusivity (it’s always advisable to read the small print in their contracts), prospect sellers mostly field their property for sale with several different realtors unless one of them may offer preferential treatment.

Legalities

A licensed real estate agent should take care of all legal matters. Anyway, the transaction needs to be completed with the help of the local notary public; otherwise the contract is null and void. The notary’s office retains the deed (called akt notarialny) for safekeeping while the buyer and the seller are issued certified copies of the document.

Plus the public notary looks after entering changes into the land registry (ksiegi wieczyste).

From January 1, 2009 the seller of any real estate is legally bound to provide an ‘energy certificate’ (swiadectwo energetyczne in Polish) as required by the EU directives (the same applies to landlords who rent out their property). This statement of energy efficiency declares how much power is needed per year to heat, illuminate, and supply in hot water the real property in question whether it’s a flat, a house, an office, an apartment building, a shop, an plant, a warehouse, or any other bricks and mortar. It should be issued by a licensed specialist or architect and it’s valid for ten years.

Costs involved in selling property in Krakow

The notary’s fee is calculated on the worth of transaction. For instance when the property is priced at anything between 60,000 zlotys (PLN) and one million zlotys (PLN) the fee totals PLN 1,010 plus 0.5 percent of the amount above 60,000 PLN. Thus selling an apartment worth 150,000 PLN entails notary’s fee to the tune of 1,460 PLN. What’s more, the fee is subject to 23-percent Value Added Tax (VAT) so the notary would charge 1,795.8 PLN for the said flat. Separately he charges 200 PLN plus 46 PLN (i.e. 23 percent) of Value Added Tax for preparing the application to enter changes into the land register.

The notary also collects the two-percent stamp duty (podatek od czynności cywilnoprawnych) slapped on the value of the sold property and 200 PLN that the district court charges for an entry in the land register.

The law doesn’t specify which party pays the above costs. They may be covered by the buyer or the seller or both can share them. On the strength of the seller’s market the buyer customarily foots the entire bill.

As a rule of thumb, the above applies also to the commissions of real estate agents that range from two to three percent.

Don’t Forget the Tax

The proceeds from selling property in Krakow are subject to Poland’s income tax. It applies both to the Polish nationals and aliens, no matter if they are legal residents or not. The tax is different when one sells a real estate purchased in 2007 or later than in the case of property obtained before January 1, 2007. The income tax should be paid within 14 days after the date of the deed. An exception is residential property owned for at least five full calendar years, i.e. from January 1 to December 31, as income from its sale remains free of tax. For instance, the sale of a real estate purchased in 2008 will be exempt from the income tax if it will take place in 2014 or later.

When you sell a real estate purchased before January 1, 2007 the entire proceeds are taxed at 10 percent. The 10-percent income tax is being waived when the taxpayer declares within 14 days that the proceeds from the sale will finance another home ownership or home improvement in two years or earlier or he/she has used the money to repay mortgage.

When you sell property acquired in 2007 or later only the profit, i.e. the difference between the purchase price and the sale price less the costs of the transaction (see above), is taxed at 19 percent. Except the income from the sale of the official permanent abode (zameldowanie na pobyt staly) for at least 12 preceding months is exempt from the tax.

Guide to real property in Krakow

Krakow's Real Estate

Toolkit for would-be buyers of Krakow property

List of Krakow's Real Estate Agents

Commercial property in Krakow

Residential property in Krakow: flats, condos, and houses

Investing in Krakow

Taxes in Poland

Business in Krakow