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So far, the increasingly stringent requirements for the energy efficiency of buildings have only applied to newly built properties, but the newest EU law will also affect existing buildings. The main objectives of the revision of the Energy Performance of Buildings Directive (EPBD), known as ‘Buildings Directive’ are to substantially reduce greenhouse gas emissions and energy consumption in the EU building sector by renovation of all existing buildings (both residential and public). The draft amendment to EPBD is currently in trilogue negotiations (between the EU Parliament, the EU Council and the European Commission), the publication of the final shape of this directive is expected in the first half of 2024, and its entry into force will take place in 2026.

According to EPBD, in the near future every building in Poland will have its own energy performance class, similarly as in case of household appliances and electronics. The energy class of building will be determined by how much energy the building consumes during the year (for heating, ventilation, hot water preparation, cooling and lighting) and how much it costs. The EPBD introduces energy classes of residential buildings from the best A+ to the worst G, which will correspond to the 15% worst-performing buildings in the national building stock (the so-called ‘energy vampires’). The Ministry of Economic Development and Technology plans to introduce such a building division system already in 2024.

PICTURE 1. ENERGY PERFORMANCE CLASSES OF BUILDINGS PROPOSED BY THE POLISH NATIONAL ENERGY CONSERVATION AGENCY FOR SINGLE-FAMILY AND MULTI-FAMILY BUILDINGS (BY EP INDICATOR IN kWh/SQM YEARLY)

source: Summary of the annual conference of the Renovation Wave 2023 on energy classes and one-stop-shops (https://falarenowacji.pl/)

The introduction of the energy classification of buildings will provide a number of benefits for houses and dwellings owners. First of all, it will allow to know the actual energy condition of buildings and plan renovations that will translate into a better quality of life, energy savings and lower property maintenance costs. In accordance with the revision of the EPBD, the energy performance class of the building will be provided in each advertisement for sale or rent, thanks to which the potential buyer or tenant will be aware of the monthly energy bills and the costs of possible renovation in the future. The cost of heating a building with an energy class A may be even 6 times lower in comparison to a building with an energy class F or G, so knowing the energy class will have a significant impact on the transaction prices of properties or rents and on exposure time of properties on the market. In addition, in case of the highest energy classes, it will be possible to obtain a lower mortgage interest rate. The system of energy performance classes is already successfully operating in most European countries, e.g. in Belgium, the Netherlands, Ireland, France, Germany, Norway, Denmark, Italy and the UK.

However, the aim of the amendment to EPBD is not to introduce the energy performance classes of buildings, but to systematically improve them until the elimination of buildings with the worst energy efficiency. Therefore, the EPBD requires non-residential and public buildings to achieve at least energy efficiency class E by 2027 and class D by 2030. Residential buildings would have to achieve the same classes by 2030 and 2033 respectively. Next years, buildings should achieve higher and higher classes and by 2050 the entire national building stock should be transformed into zero-emission and climate-neutral, that in practice means the need to renovate almost all existing buildings in this perspective (except for those that already meet the highest standards).

EU countries may decide to exclude certain groups of buildings from the new rules, e.g. monuments and other protected buildings, buildings with a floor area less than 50 sqm, residential buildings used for less than four months a year or public social housing, where renovations would lead to rent increases that cannot be compensated by saving on energy bills. Despite this, several million Poles are awaiting forced renovations.

Moreover, buildings would have to meet the minimum energy performance standards set out in EPBD at the time of their sale or rent, so houses and dwellings in multi-family buildings from the lowest classes will not be able to be sold or rented without having previously upgraded them in terms of energy. Over the next 10 years, this will apply to buildings from class E, F and D. The owner planning to sell or rent such a property will have two options: sale before the date of entry into force of the amendment to the EU directive or investment raising the energy class of the building, e.g. thermal modernization.

Buildings built in the 21st century have relatively high energy efficiency, but older buildings are characterized by very high energy demand indicators and require thermal modernization. In particular, this applies to single-family houses, where solid fuel boilers are the primary source of heat. Currently, about 70% of the 6.870 million Polish residential buildings (single-family houses and multi-family buildings) require modernization, and about 16% of them, i.e. 1.1 million (with over 2 million apartments), are the so-called ‘energy vampires’ qualifying for the lowest energy performance classes, which are responsible for the consumption of one third of the total energy used in all Polish buildings. Owners of these properties will not be able to sale or rent them, if they are not upgraded to a higher energy class earlier.

TABLE 1. AGE STRUCTURE OF HOUSING STOCK IN POLAND BUILT BEFORE 2002 AND THEIR ENERGY DEMAND INDICATORS

Years of construction of the building	Number of buildings [thousands]	Number of flats [millions]	EP indicator [kWh/(m2 x year)]
Before 1918	404.7	1.18	> 350
1918 – 1944	803.9	1.45	300 – 350
1945 – 1970	1 363.9	3.11	250 – 300
1971 – 1978	659.8	2.07	210 – 250
1979 – 1988	754.0	2.15	160 – 210
1989 – 2002	670.9	1.52	140 – 180

source: Inhabited Buildings. National Census of Population and Housing 2011, Statistics Poland 2013

The proposed revision of the EPBD raises a lot of controversy in the European Union, mainly because of the scale of the project. The implementation of EU requirements will require the mobilization of huge financial resources, both private and public. According to the assumptions of the ‘Long-term building renovation strategy’, investment expenditures for the renovation of buildings in Poland until 2050 (thermal modernization and replacement of heat sources) will amount to approximately PLN 1.5 trillion. On the other hand, there are benefits in lower maintenance costs of properties and an increase in their value, as well as improve in air quality and better health of residents. At the same time, the entire Polish economy will benefit, because according to the estimates of the Renovation Wave association, the implementation of the renovation programme may contribute to the creation of approximately 100 thousand new jobs in the construction sector and 200 thousand jobs in sectors that provide materials and services for construction sector. So plans are very ambitious, but they seem to be right.

Agnieszka Pilcicka
Senior Real Estate Market Analyst

Beginning of the 21. century is a time when the actual scale of the impact of industrial civilization and consumerism on the environment and its potential influence on the planet slowly began to reach the awareness of the societies. The threat of a climate catastrophe caused by greenhouse gas emissions, the imbalance of ecosystems, overproduction of waste and the perspective of depleting fossil fuel resources have prompted not only scientists, but also politicians and professionals from various fields to search for some new solutions.

Construction sector is one of those areas of human activity that to a greater extent contribute to the degradation of the environment. It is estimated that nearly 40% of global greenhouse gas emissions are the result of its activity. Only in 2020 it was responsible for emitting approximately 20 billion tons of carbon dioxide into the atmosphere, and this figure includes both emissions related to the use of buildings, as well as emissions related to the construction process including production and transportation of building materials.

So called operational carbon footprint (associated with the use of buildings) is about 2/3 of the entire carbon footprint of a building, and its size results from the demand for energy used primarily for heating, ventilation, air conditioning and lighting. The embedded carbon footprint (derived from the building process and used materials) makes up remaining 30-40% of the building’s total carbon footprint. While the energy efficiency of buildings continues to improve, overall building-related emissions continue to rise. In case of operational carbon footprint, this is due to the constant increase in demand for new facilities, while in case of the built-in carbon footprint, it is mainly due to the fact that new facilities are equipped with more and more advanced technologies and devices, which production is highly emission-intensive. If we take into account the forecasts, according to which the world’s building stock may double by 2050, the scale of the problem seems giant. It is optimistic however, that the decarbonisation of the construction sector is considered by experts as one of the most promising and potentially effective methods of slowing down and mitigating the upcoming climate change. Reducing the carbon footprint of a building can be achieved even by relatively simple methods, such as:

• optimisation of the design, including, above all, the size of the planned building (mainly in case of single-family housing);
• choosing proper building materials and optimising their use – materials with a low carbon footprint are natural, such as wood (provided they come from sources that guarantee responsible forest management), stone, as well as recycled and recyclable materials. On the other hand, materials with a high carbon footprint are cement, which production is responsible for 8% of global CO2 emissions, as well as steel or aluminium;
• limiting the transport of building materials – using locally available materials and appropriate logistics planning;
• using the energy from renewable sources both in the production of building materials and in the construction process.

The Paris Agreement of 2015, signed also by Poland, obliges us to achieve net zero global greenhouse gas emissions in 2050. The goal set for the construction sector for 2050 is a zero operational carbon footprint for all buildings. For new and modernised buildings, it is to be a zero net carbon footprint throughout the life cycle, i.e. a zero balance of both built-in and operational carbon footprints. Starting from 2030, the calculation of the carbon footprint throughout the life cycle of all newly constructed buildings is to be the responsibility of architects. From 2027, however, this obligation will apply to buildings with floor area exceeding 2 000 sqm. Upcoming years may therefore bring a certain revolution in architecture and construction.

An example of such a revolutionary project is the “Stockholm Wood City” being currently developed on an area of 25 ha in the Stockholm district of Sickla. It is intended to be the world’s first modern complex of buildings, including apartment buildings, service outlets and office space built of wood. The building material itself is produced in a modern technology called Mass Timber that is a material of exceptional strength, fireproof and, obviously, with a much lower carbon footprint than concrete and steel. The originator and investor of the project is the development company Atrium Ljungberg. The assumption is that all buildings are to be energy self-sufficient, thanks to the systems of obtaining, storing and releasing energy. The project involves construction of buildings with large glazing, especially on the south side, to ensure natural light and the possibility of heat recovery from sunlight during the winter months. The roofs are to be covered with dense, varied greenery as part of regulating the temperature inside and restoring ecosystems, largely degraded by construction in general.

source: Atrium Ljungberg (https://www.al.se/en/sickla)

In terms of urban planning, the estate will fit into the assumptions of the so-called “five-minute city”, according to which residents will be able to reach home, work or numerous service outlets, including cafes and restaurants, on foot or by bike, within five minutes.

It is certainly difficult to expect a direct transfer of similar patterns to Poland. What we can use, however, is primarily experience in the areas of legislation and organisation of construction decarbonisation in countries, where this process is already more advanced, especially considering that the time for its implementation is getting shorter and shorter. One of the most important issues, however, still seems to be the building awareness among all the participants of the construction process – investors, architects, contractors, as well as manufacturers of building materials and property managers, as well as, perhaps most importantly – final recipients, i.e. buyers and tenants of buildings.

Jerzy Ptaszyński
Research and Market Service Director

The process of population ageing, which means an increase in the number of older people within a population, is one of the biggest issues in the 21. century. According to the Statistics Poland projection, the share of people aged 60 and more in Poland will equal 29.9% in 2030 (whereas in 2021 it was 25.7%). Moreover, in 2050, 40.4% of the entire population will be older people. For that reason, the problem of ensuring adequate retirement pensions due to the growth in the number of pensioners will become noticeable in the future. The financial situation of Polish pensioners has been steadily worsening, not to mention the fact that many of them are lonely without any support from the loved ones. In this context, these people are looking for opportunities to obtain additional financial resources. One of such solutions available for homeowners might be reverse mortgage that is extremely popular in the US and UK.

How reverse mortgage works

Reverse mortgages are classified as equity release services (ERS) that allow you to unlock the cash tied up in your property to produce an income stream. ERS are dedicated to older people and seniors and as mentioned in Study on Equity Release Schemes in the EU they must:

• be a financial service,
• be a source of liquidity for the future,
• contain a strong entitlement to remain in occupation of the property,
• base the repayments solely on the market value of the property.

There are two forms of ERS schemes: the loan model and the sale model.

The loan model, which is also known as “lifetime mortgage”, enables homeowners to borrow money against the value of their property. The borrower remains the owner of the property until the end of his life, and after his death, the bank takes over ownership and therefore it can sell the property. In this case, the amount lent is repaid by the sale proceeds of the property. The loan model is mostly offered by financial institutions.

The sale model involves the sale of the property at the moment of signing the agreement, which means the immediate loss of ownership title to the estate. The seller retains only his right to live in the property and receives extra payouts until the end of his life. The sale model is offered by mortgage funds.

These models can impose different legal consequences, so it is very important to understand how they differ from each other.

Reverse mortgage pros and cons

The main advantage of reverse mortgage is extra steady stream of income that can be an addition to the pension. The borrower can freely dispose of this extra income, for example, it can be used to cover rising costs of healthcare or generally to improve the quality of life on retirement. Moreover, it may be a great solution for people with no family or friends that could inherit their estate. Extra payouts that supplement homeowner’s income can be treated as a return of the money spent on the property. Unlike traditional mortgage loans, where eligibility is based on creditworthiness, reverse mortgages are much more accessible to older people (who often have a poor credit rating). Furthermore, the borrower remains in occupation of the property, and additionally, in the loan model, he is also the owner of it until the end of his life.

In spite of many benefits offered by the reverse mortgage to borrowers, this instrument has some drawbacks. Not anyone can take out a reverse mortgage loan because it is only available for people who are homeowners. Another disadvantage is that the reverse mortgage loan amount is estimated by financial institution and it can be differ from homeowner’s expectations (total loan amount is usually between 30% to 60% of the property’s appraised value). Reverse mortgage also complicates things for the borrower’s future heirs. If they want to keep the home, they will need to pay the full loan balance.

Reverse mortgage in Poland

In Poland, the legal basis of the loan model is the Reverse Mortgage Act of October 23, 2014 (uniform text – Journal of Laws, 2023, item 152, as amended). In practice, this model does not exist on the Polish market nowadays. The Act regulates only basic rules and therefore both borrowers and lenders must deal with many issues on their own. In this case, this situation discourages them because of many risks associated with it.

The sale model is offered on the Polish market, but there is no separate act, so it is based on life annuity contract regulated by civil law that consists of the transfer of the right to the property to the buyer while establishing for the seller the right to live in the property. Nevertheless, among the Polish population the sale model is not trusted and popular.

Therefore, even the fact that the number of older people in Poland is increasing, the majority of financial institutions are not interested in offering this product because of the high risk and what is more, life annuity contracts are still mostly concluded through natural persons.

Summary

As a result of growing demographic problems and the fact that the social insurance pensions may be insufficient for dignified life in the future, more and more people have been thinking about taking out a reverse mortgage, which enables to obtain additional financial resources. In spite of many benefits, it also carries many risks. The existing Polish Reverse Mortgage Act regulates only basic rules, so the loan model does not exist there. The sale model is offered in Poland, but is only regulated by civil law and that makes it hard to control, so finally this model is not widely trusted by clients. For these reasons, the Polish reverse mortgage market is not as big and popular as the US and the UK ones.

Karolina Sawczuk
Junior Specialist in Research and Market Service

Noise is one of the biggest nuisances of living in a big city. According to the World Health Organization, noise pollution is the second largest civilization cause of ill health after smog. When buying or renting a property, it is worth examining acoustic conditions in the property and its surroundings. It is also good to read the planning documents to find out if there are any troublesome investments planned near the place we are interested in that will have a bad impact on our well-being and health in the future.

NOISE – A NUISANCE OR A REAL THREAT?

Noise is a term for excessive sound influence, which in the long term negatively affects human and animal activities. Long-term noise is one of the environmental pollutions, among others like waste, sewage, air and water pollution and light pollution. Not only it is a nuisance that decreases life comfort, but also seriously affects biodiversity, concentration at work, cognitive development of children, physical and mental health, and even human life expectancy. In contrast with easily detectable pollutants such as smog or waste, noise is an invisible enemy, and its constant impact accumulates like radiation and affects the whole body. There are three main categories of man-made noise: roadway, industrial and noise inside buildings. The first two are called environmental noise and they are matters of special interest to such agencies as WHO, EU and municipal offices. As defined in Directive 2002/49/EC of the European Parliament and of the Council of June 25, 2002 relating to the assessment and management of environmental noise, environmental noise shall mean ‘unwanted or harmful outdoor sound created by human activities, including noise emitted by means of transport, road traffic, rail traffic, air traffic, and from sites of industrial activity’. However, in scientists’ eyes, noise inside buildings can be even greater burden on the body due to its duration, as we spend most of our time in confined spaces.

We are exposed to this noise in buildings such as shopping centres, supermarkets and other public buildings, as well as in means of transport – especially on board aircraft and in the subway. Unfortunately, it can also occurs in places where people spend many hours every day – in schools, open space offices, and even in residential buildings.

IMPACT OF NOISE POLLUTION

There are many effects of noise pollution. Firstly, the well-being of wild nature is deteriorating. Secondly, it has a significant effect on human mood and health. We are so accustomed to many types of long-term and less intense noise that we tolerate or even ignore it.

Stress, anxiety, nervousness, depression, reduced productivity and efficiency, Chronic Fatigue Syndrome, as well as memory and concentration loss are common effects of prolonged exposure to noise experienced by most city dwellers. The most commonplace serious and irreversible health problem is hearing loss (NIHL). Other typical health problems include hypertension, heart disease, insomnia, digestive disorders, metabolic problems, memory impairment, neurosis, vision disorders and diabetes.

Children are particularly vulnerable to the health effects of prolonged noise that causes their mental development disorders. It has been shown that children living near noisy airports or streets suffer from stress and memory impairment in particular. Another group of the particularly vulnerable are young adults – often renting apartments on busy streets.

In addition, people who work in open space offices, schools, shopping malls, on the construction site, in industry and in means of transport are also especially vulnerable. The group of increased risk also includes the elderly, the sick and pregnant women. Noise has an extremely negative effect on the development of the fetus by increasing the level of stress in the pregnant woman. According to the European Environment Agency’s report Noise in Europe, one in four Europeans is exposed to road noise levels above the EU limit of 55 dB Lden on a daily basis. According to the same report, noise causes sleep disturbances in more than 13 million EU citizens, 72 000 hospitalisations and 16 600 premature deaths in Europe each year.

NOISE METERS

The noise level is measured in decibels [dB]. This unit objectively determines how loudly it is in the environment. The subjective perception of sound depends on both the actual noise level and the sound intensity compared to other ambient sounds. Depending on the prevailing conditions, the human ear increases or decreases its sensitivity. For example, during an evening rest at home, there may be a nagging sound that would not disturb during the day. At night, even too loud noise of the refrigerator, ventilation or elevator disturbs healthy sleep. Therefore, the legislation sets different permissible levels of noise in the environment for the time of day and night. Directive 2002/49/EC of the European Parliament and of the Council of 25 June 2002 relating to the assessment and management of environmental noise introduced the term of noise indicator. It means ‘a physical scale for the description of environmental noise, which has a relationship with a harmful effect, where harmful effects shall mean ‘negative effects on human health’. The directive lists four indicators. Lden is the noise indicator for overall annoyance, adjusted for different sensitivities in the morning, afternoon and night. Lday defines annoyance during the day, Levening – in the evening, Lnight – at night. The European Union defines the level of long-term exposure to noise as high if it reaches 55 dB according to the Lden index and 50 dB according to the Lnight index, so we could say the noise pollution starts from these values. In Polish law, the Ldwn and Ln indicators apply to the control of long-term average sound levels. According to the Act of 27 April 2001 Environmental Protection Law, they are used to compile strategic noise maps and environmental noise protection programs. Ldwn takes into account all days of a year and all parts of a day (24 hours). It is used to determine the general annoyance of noise. The Ln indicator takes into account all nights of a year (night time is from 22.00 to 6.00). This indicator is used to determine sleep disorder.

To determine and control the conditions of using the environment in relation to single day, the Act distinguished LAeq and LAeq N indicators – that mean an equivalent sound level for the time of day (in this case from 6.00 to 22.00) and for the time of night respectively.

The level of sound intensity at which we begin to feel discomfort is considered to be 55 dB, and long-term noise at the level of over 75 dB is absolutely harmful to health. For comparison, the rustle of leaves is a sound at the level of 15 dB, ordinary conversation – 40 dB, motorcycle engine – 80 dB, low-flying passenger plane – 85 dB, electric lawn mower and subway train – 90 dB, drill – 100 dB, loud concert – 110-120 dB, thunder and jet take-off – 120 dB, alarm siren – 140 dB, and firecracker explosion – 160 dB.

In addition to the noise sources located outside the building, against which the external partitions are to protect, an important issue is also air and impact noise generated by building dwellers and installation noise (pumps, furnaces, elevators, ventilation, etc.). The impact noise in poorly designed buildings is felt far from the source – vibrations are transmitted through the structure even at a distance of many floors. The permissible level of noise in rooms where people stay, generated by technical equipment devices and caused by the operation of service premises is regulated by the PN-B-02151 standard (part 2) – it sets the permissible values of the equivalent and reference maximum noise level in buildings, incl. residential buildings, hotels, schools and hospitals. The standard also regulates the requirements for sound insulation in buildings. According to WHO guidelines, there should be less than 30 dB in the bedroom at night to ensure good sleep quality, and less than 35 dB in classrooms to ensure good teaching and learning conditions.

SOLUTIONS

The level of noise pollution depends largely on the actions of the city. The solutions introduced by the municipal authorities include, among others, the installation of acoustic screens on roads and railway lines, although this solution has many opponents due to the destruction of the city’s landscape. Today, well-judged strategic actions and reducing the noise sources are more valued.

Such activities include investing in modern urban infrastructure like electric and hybrid vehicles, low-noise asphalt or green tram tracks. Strategic actions also include appropriate spatial planning adapted to the different acoustic sensitivity of individual areas, preserving quiet areas, development of bicycle networks, Park & Ride car parks, carpooling, limiting vehicle traffic in the centre, reducing truck thoroughfares, lowering the permissible movement speed and introducing quiet hours at airports. Solutions for buildings include acoustic insulation of buildings, for example using special acoustic screens, green walls, soundproof windows, as well as the use of mechanical ventilation.

What we can do in person for our protection is protecting our ears with earplugs or noise-cancelling headphones when being in a noisy place, paying attention to the volume of household appliances and electronics, and making a right choice about place to live. Before choosing a property, it is worth verifying the acoustic standard of the building. Good acoustics are guaranteed by tenement houses, while in prefabricated blocks good acoustic practices are usually not preserved. Unfortunately, also in new construction there are often too thin walls and building materials that do not meet acoustic requirements (e.g. polystyrene instead of mineral wool used to silence ceilings). If we have doubts about the acoustics in the property, it is worth analysing the construction documentation with an expert, and in older apartments you can make construction measurements. Another way which can help with the right choice is to interview potential neighbours, that not only will help us assess the level of noise coming from the street or the acoustics of the building, but also will evaluate the behaviour of other residents. It is worth remembering that even met standards will not protect us from too loud neighbours. Additionally, when planning a purchase or rent, it is worth coming to inspect the property during the hours when we expect noise. You can also use the phone app to measure the noise level. Moreover, it is recommended to pay attention to any sources of noise in the environment and to analyse the available official documents. Strategic noise maps can help to verify the level of noise reaching the apartment from the outside.

If we are already residents of a property and we have encountered a not very annoying noise, simple arrangement procedures such as heavy curtains, fluffy carpet and photo wallpapers are helpful. The more objects scattering and muffling sounds there are in the apartment, the quieter it can be. If the noise is more annoying, only a major renovation can help. It is possible to soundproof the apartment by putting acoustic mats or cork to the floor, making a dropped ceiling, and insulation with mineral wool. It is also good to purchase front door and windows with high Rw coefficient or to enclose the existing doors with upholstery or special sandwich slabs, as well as to put double front door and enclose the balcony with roller blinds or window shutters (in case of the consent of the housing association). Alternatively, you can also set acoustic screens, nevertheless this solution is expensive and reduces the usable area of the apartment by several meters.

NOISE MAPS

According to the Environmental Protection Law of 27 April 2001 and Directive 2002/49/EC of the European Parliament and of the Council of 25 June 2002 relating to the assessment and control of environmental noise levels, there is an obligation to prepare noise maps for:

• agglomerations with more than 100 000 inhabitants,
• major roads which have more than 3 000 000 vehicle passages a year,
• major railway which have more than 30 000 train passages per year,
• major airports which have more than 50 000 movements per year.

The noise map has an informative function and it is the basis for the development of the Noise Protection Programme. It contains information about the level of traffic and usually also industrial noise according to the Ldwn and Ln indicators. It is worth to become acquainted with it if you plan to live in a big city. Usually, cities make it available on their geoportal with the possibility of searching an address. There are examples of projections from noise maps below.

FIGURE 1. STRATEGIC NOISE MAP OF THE CITY OF WARSAW

source: Strategic noise map of the City of Warsaw, mapa.um.warszawa.pl

FIGURE 2. NOISE MAP OF THE CITY OF GDAŃSK

source: Portal of permanent monitoring of traffic noise of the City of Gdansk, mag.bmt.com.pl

Cities often provide both immission and emission maps. To see the volume of sound that reaches a location, after taking into account the terrain and other factors, select the immission map. In addition, there are also sensitivity maps that illustrate noise limit values in different parts of the city.

Weronika Przypaśniak
Junior Specialist in Research and Market Service

Amendment to the Construction Law Act consists of a number of changes announced successively in 2022. The announcement of the Marshal of the Sejm, dated March 10, 2023, on the publication of the unified text of the Act lists 7 acts, the amendments of which will affect this sector of the economy. The new regulations provides for numerous changes, among which the most important are the extension of the catalogue of construction objects that do not require a building permit, as well as modifications to the rules for commissioning construction objects and the regulation of the functioning of IT systems supporting the construction process electronically.

As of January 1, 2022, the construction of a single-family house of covered area up to 70 sqm on one’s own plot requires only a notification. The amendment introduces the possibility of building a single-family house with an area exceeding 70 sqm without a building permit, as long as the aim is to meet one’s own housing needs. Prior to the commencement of the construction of building, it will be required to submit a notification to the architectural and construction administration authority with an architectural design and to notify the construction supervision authority of the planned date of commencement of works. Building a house of more than 70sqm will require the participation of a construction manager, who will confirm readiness for habitation during the acceptance. The updated legislation will put an end to the legal duality that differentiates the formal procedures required for the construction of single-family buildings depending on their covered area. Importantly, the construction of a house without a building permit will concern buildings with a maximum height of two floors.

At the beginning of 2023, a significant change was introduced removing the requirement to obtain the use permit for selected construction objects. Use permit will only be required if the building is to be used before all construction work is completed, and if the investor voluntarily requests it, although the use permit decision is not required. Before using the building, it is necessary to submit a completion of construction notification and enclose, among others: the technical design, protocols of tests and inspections of: connections and installations, ensuring use of the building in accordance with its intended purpose, geodetic documentation including the results of the as-built geodetic inventory and information on compliance of the location of the construction object with the plot or land development plan or deviations from this plan, as well as a copy of the energy performance certificate. It is also planned to introduce the obligation to attach photographic documentation made by the construction manager, which will allow verification of the execution of the building object in accordance with the architectural design. The new regulation is intended to allow investors to use newly constructed buildings earlier.

The Electronic Construction Logbook (EDB) system has been in operation since 27 January 2023, but its use is not mandatory. Currently, the investor has the choice whether to keep a construction log in paper or electronic form via the EDB platform. It is the investor who is responsible for the ongoing investment and making the logbook available to other participants of the construction process. As of January 1, 2030, it will be mandatory to switch to an electronic version of the construction logbook.

As of January 1, 2023, it is also possible to maintain the Digital Construction Object Book (c-KOB). The platform is to be used by property owners or managers to record, among others, information about the construction object, inspections carried out, expert opinions issued, construction disasters, construction works related to the construction object after commissioning, and decisions, resolutions and certificates issued by public administration authorities concerning the construction object. According to the amendment, until December 31, 2023, the owner or manager of a construction object may establish a book of a construction object in paper form. The complete transition to the electronic version of the book is to take place at the beginning of 2027.

The amendment regulates the functioning of the Central Register of Persons Holding Building Qualifications (e-CRUB) operating since August 1, 2022, which replaced the previous register of persons with building licences and penalised for professional liability in the construction industry. Data on new licensed engineers and architects appear in the register after passing the exam. The decision on entry in the database has been automated, eliminating the waiting time for entry in the register by the General Office of Construction Supervision. The purpose of the database is to eliminate the obligation to attach to the construction project and submit documents confirming building qualifications and chamber membership to the office. The new system allows quick verification of the entitlements by both investors and public administration authorities.

Digital, completely free Base of Architectural Designs is planned to launch on the website of the General Office of Construction Supervision. If the investor decides to use the house design from the database, they will not have to include a paper version of the design in their applications, reports or notifications. Each architectural design in the database is to be given an individual number, which will have to be included in the documents. Architectural and construction administration and construction supervision authorities will have access to the design through the database and it will not be necessary to hand on architectural design between these institutions.

Changes that are part of the trend of digitisation progressing with subsequent amendments include the regulation of the already functioning e-Construction platform. Through the portal, investors have access to 26 different applications and notifications needed in the investment and construction process, as well as the possibility to check the status of their application.

However, this is not the end of the changes in the field of construction law. Currently, legislative work is underway on the next amendments of the regulations, so these are certainly not the only changes to the construction law in 2023. Among the planned improvements, the General Office of Construction Supervision works on another IT platform: System for Administrative Proceedings in Construction (SOPAB). This system is intended to be used by architectural and construction administration and construction supervision authorities to conduct administrative proceedings electronically. In addition, the proposed regulations are intended to restore property valuation as an independent technical function in the construction industry. Provision is also made for architectural and construction administration authorities to keep a register of applications and decisions on demolition permits. Furthermore, the new regulations are to introduce penalties for untimely issuing a demolition permit. In addition, another amendment to the law is to expand the catalogue of construction objects and construction works exempt from the obligation to obtain a building permit and just requiring notification.

New IT systems are a further step in the process of digitisation of the construction industry, which has been ongoing since at least 2020 and aims at the functioning of a purely digital circulation of construction documents in offices. The introduced changes are intended to reduce the burden on investors as well as architectural and construction administrations and construction supervision authorities and to streamline their operation, which consequently will speed up the entire investment and construction process, along with digitisation of public administration authorities’ activities in the field of construction.

Marta Polkowska
Senior Maintenance and Development Specialist
SARFiN System Data Administrator

According to the data of Central Statistical Office, in 2022 tourist accommodation facilities were used by 34.2 million tourists, who were provided with 90.0 million overnight stays. Compared to 2021, it was more by respectively 54.3% and 43.2%. However, these data do not include persons using non-registered accommodations, including private houses and flats rented to tourists for a short time. At the same time, according to data from the National Census 2021, housing stock in Poland amounted to over 15.4 million dwellings. So, how many properties in Poland are used for short-term rental?

This article concerns a growing category of private apartments for short-term tourist rental. The aim is to analyse the market of flats and houses intended for tourists located in the 6 most frequently visited cities in Poland, i.e. Warsaw, Cracow, Gdansk, Wroclaw, Zakopane and Poznan. The main sources of information were Booking.com, Airbnb and AirDNA platforms. These properties constitute a growing part of the dwelling stock in Poland, as well as they became an important part of the accommodation base.

Why short-term rental is so popular?

Short-term rental has gained a lot of popularity in recent years among tourists, as well as people on business trips or travelling for family occasions. This has been influenced by several factors.

The development of tourism over last 20 years has also meant that the mobility of people has increased in both domestic, as well as international terms. Thus, the demand for tourist accommodation has increased as well. The creation of new tourist accommodation facilities, such as hotels, is associated with high costs and high risks. Houses and apartments offered for tourists in short-term rental have partly filled this gap in the market.

In addition, the development of short-term rentals has also been fostered by changing perception of housing, not just as a place to live permanently, but more and more often – as a commodity. Over the past few years, investments in real estate have enjoyed record levels of interest. This was due to the higher profitability compared to other forms of capital investments. In addition, interest rates remained low until 2022 and thus the mortgage loans costs were relatively low. These circumstances led many Poles to buy flats for investment purposes. In all major cities and tourist destinations, flat owners decide to rent their properties in a short-term rental, because in the monthly calculation, this kind of rental very often pays off more than renting a flat for a longer period of time. Thus, some dwellings that could be used by long-term tenants or people who cannot afford their own housing unit, are starting to disappear from the long-term rental market.

Often, short-term rentals require more commitment from the owners and involve more risks, including damage to the property. Therefore, with the development of this type of activity, a sector of companies specialising in the operation and management of flats for short-term rentals has also developed.

The growth in popularity and development of online rental platforms, i.e. booking.com or Airbnb, has also been significant. They enable contact between hosts and tenants, facilitate transactions or provide security of payment for both parties.

Characteristics of offers in short-term rental

Offers of houses and flats for rent for tourists are very diverse. We can find both modest and budget options, as well as those of a high standard, with very extensive equipment and additional attractions such as sauna or jacuzzi. This is why the booking platforms are kit out with expanded filter section is very extensive, by so that everyone can find something for himself.

Approximately 50% of the offers on booking platforms in Poland are concentrated in 6 cities with the highest number of tourists per year. A significant number of tourist apartments can be found in coastal and mountainous counties. Compared to other counties in Poland, an increased number of offers can also be found in the lake districts.

The number of short-term rental apartments is the highest in cities, where the number of tourists staying in accommodation facilities is the highest in the country. At the same time, these are cities with the highest average transaction prices per 1 sqm of a housing unit. The average daily rent rate in selected cities ranges from PLN 283 to PLN 435. However, this amount depends on the rental period or demand for accommodation at a given time and a given location.

TABLE 1. NUMBER OF SHORT-TERM RENTAL PROPERTIES ON BOOKING PLATFORMS WITH AVERAGE DAILY RENT RATE

City	Number of properties listed on Airbnb and vrbo – entire properties	Number of properties listed on booking.com – whole properties	Average daily rate [PLN]	Number of tourists using accommodation in 2020. [thousand persons]	Average transaction prices per 1 sqm of a housing unit in Q4 2022 [PLN]
Warsaw	6 156	1 058	307	1 322,9	11 213
Cracow	4 901	643	303	818,2	9 648
Gdansk	3 435	409	330	639,9	9 382
Wroclaw	2 038	343	317	595,1	8 744
Zakopane	1 277	115	435	Tatra district – 725,2	bd
Poznan	1 036	212	284	402,6	7 733

source: own compilation based on data from AirDNA, booking.com, Statistic Poland and the AMRON Centre data

What kind of dwellings are available in short-term rental?

The types of properties were analysed according to data from Airbnb and Vrbo platforms. The location related to the city centre were analysed basing on data from Booking.com.

The most common property is a 1-bedroom flat or a studio flat. In Warsaw, Wroclaw and Poznan, the structure of properties by number of bedrooms is very similar. In Gdansk and Zakopane, i.e. cities located in holiday areas, there is a higher share of flats with more than 1 bedroom, thus there are more houses and flats of a larger size.

GRAPH 1. STRUCTURE OF SHORT-TERM RENTAL PROPERTIES BY NUMBER OF BEDROOMS IN SELECTED CITIES

source: own compilation based on data from airdna.co

In Poznan, Wroclaw and Cracow, the majority of flats and houses for tourist are located close to the city centre, i.e. near the main attractions of those cities. In Warsaw, due to the size of the city and the biggest number of short-term rental flats on offer, the share of apartments located in the centre is lower. However, when analysing the distribution of the housing units for short-term rent in the capital city related to the housing density (number of units in the 1 km grid according to the National Census 2021), we can see that the location of housing units offered on Airbnb is more correlated with the distance to the city centre and tourist attractions or proximity to fast public transport, than with the number of dwellings in a given area. In Gdansk and Zakopane, the properties are more dispersed, because in these cities the attractions are the sea and the mountains, not only the centre.

TABLE 2. MARKET SHARE OF SHORT-TERM RENTAL PROPERTIES IN RELATION TO DISTANCE TO THE CITI CENTRE

City	distance from the city centre
	Less than 1 km	Less than 3 km	Less than 5 km
Warsaw	23%	59%	78%
Cracow	42%	84%	93%
Gdansk	36%	58%	67%
Wroclaw	43%	80%	89%
Zakopane	37%	85%	99%
Poznan	51%	82%	92%

source: Own compilation based on data from Booking.com

MAP 1. DISTRIBUTION OF THE HOUSING UNITS FOR SHORT-TERM RENT IN WARSAW

source: airDNA.co

MAP 2. NUMBER OF DWELLINGS IN 1-KILOMETRE GRID ACCORDING TO THE NATIONAL CENSUS 2021

source: geo.stat.gov.pl

MAP 3. DISTRIBUTION OF THE HOUSING UNITS FOR SHORT-TERM RENT IN ZAKOPANE

source: airDNA.co

MAP 4. DISTRIBUTION OF THE HOUSING UNITS FOR SHORT-TERM RENT IN GDANSK

source: airDNA.co

Use of dwellings in short-term rentals

The occupancy of housing units offered for short-term rental is diverse, however in all selected cities the impact of the COVID-19 pandemic on rental growth in last 3 years is evident. It is related to restrictions in both rental activity and travelling. In the case of the biggest cities, the quarterly changes caused by the pandemic were more apparent, due to tourism in these locations is focused mostly on cultural facilities that were partially closed. The highest seasonality of tourist rentals can be observed in Gdansk (high increase in Q3). In all analysed cities, the situation is returning to the status before the pandemic.

GRAPH 2. RENTAL GROWTH IN SPECIFIC QUARTERS IN 6 SELECTED CITIES IN POLAND

Warsaw

Cracow

Gdansk

Wroclaw

Zakopane

Poznan

source: airDNA.co

The highest occupancy rates are recorded in big cities – in Warsaw and Cracow, they have averaged over 70% over the past 12 months. Considering the revenues from short-term rentals compared to the revenues from long-term rentals, it is no wonder that the number of vacation rental properties has still been increasing. However, it is worth pointing out that the occupancy and therefore incomes vary from month to month. The final income is also dependant from rental service charges, such as cleaning charge, or those for maintaining the property, such as administration fees. Short-term rentals consume more time, but with more risk, yield higher profits.

TABLE 3. OCCUPANCY AND SHORT-TERM RENTAL INCOME MEDIAN COMPARED TO THE AVERAGE LONG-TERM RENTAL RATES IN SELECTED CITIES

City	Occupancy rate [%]	Median monthly revenue in the last 12 months [PLN]*	Average monthly rent rates of a housing unit in selected cities [PLN]
Warsaw	74%	4 645	2 226
Cracow	73%	5 010	1 754
Gdansk	58%	4 387	1 997
Wroclaw	58%	4 071	1 908
Zakopane	50%	5 529	bd
Poznan	63%	4 111	1 512

* rate excludes taxes, service charges and surcharges

source: own compilation based on data from AirDNA, booking.com and own AMRON Centre data

Summary

The short-term rental market is developing the most in big cities and tourist areas, mainly due to increased tourist traffic in recent decades, as well as the increasing popularity of booking platforms. 1-bedroom units dominate in the offers. Most of them are located close to the city centre and tourist attractions or in areas with good public transport. Prices, as well as occupancy rates for entire houses and flats depend on the month of rental. The risks associated with short-term rental are greater compared to traditional long-term rental, moreover short-term rental requires more commitment from the landlord, but the higher profitability encourages an increasing number of rental homeowners to choose this type of rental.

Agnieszka Zamkowska
Real Estate Market Analyst

Saving energy is an issue that is being discussed more and more often in our homes. It results not only from the growing awareness of the impact of human activity on the natural environment degradation, but also from desire to achieve an energy freedom. The autonomous home responds to our needs and overcomes this problem. It is 100% self-sufficient. It works for itself, supplies its own electricity, water and sewage. For many, it is a gateway to their dreams for a life away from civilization, among the forests, where the ground is not equipped with technical infrastructure. But is it realistic to build a house that does not need energy from outside? What opportunities do we have in Poland, and what are the barriers?

The alternative of building an autonomous house depends on many factors. There are legal and physical obstacles that we have an obligation to check before making a decision. This is a challenge both difficult in our latitude and very capital-intensive. The costs of such independence are even twice as high as compared to construction in standard technology.

Building and residential electricy

Building a house without electricity is not possible. Basically, from a legal point of view, there is no obligation to use electricity from public network, but without it we will not get a building permit. Therefore, before starting the works, we must make the connection and pay for it. Power generators are used in autonomous conditions. A lot of construction equipment is powered in a three-phase manner, which is associated with a larger investment. Specialists discourage from the decision to build the entire house without the connection to external media. In practice, the use of the aggregate is treated as a complementary solution, because it has many disadvantages and is very cumbersome. The machine requires frequent starting of the engine, in many situations it will work unproductively. Additionally, you have to remember to refuel and take into account the emission of high noise. But from a theoretical point of view, construction with the use of an aggregate is feasible.

The installation of photovoltaic panels helps to become independent from the power grid. Off-grid (island) technology is characterized by complete detachment from external power grids. There are two types of power supply. PV panels provide constant power transmission, and unused for current needs is stored in batteries for later use. This ecological energy is used, for example, in bad weather or after sunset, when the sun’s rays do not provide enough of it.

Heating

There are many ways here. We can use electric, gas heating or a heat pump. Electric heating is very convenient, but relatively expensive. It becomes completely unprofitable for large buildings. There is also the problem of the susceptibility of electricity to price fluctuations. The heat pump works very economically. It is an ecological and economical source of heat. It can be powered by photovoltaic panels, but it is not the cheapest. Another method is gas heating, in case of which you will need to equip yourself with a liquefied gas cylinder and a heating device, e.g. a boiler, heat pump or solar collectors used to support heating utility water.

Household sewage treatment plant

A self-sufficient house must have a private waste water treatment plant or a septic tank, from which waste must be regularly removed. The exploitation of the first solution is cheaper, but its main cost is obviously higher. In addition, it is worth getting acquainted with the arrangements of the local spatial development plan. It may eliminate its implementation in a given area. There is also a problem in areas where sewage networks are already available or are to be built. In this case, we will not get a permit to build an independent reservoir.

Where to get water?

It is necessary to dig your own intake. Currently, the most popular solution is a deep well. However, before we decide to buy a plot of land and start drilling, it is necessary to verify whether the soil has the geological and hydrological conditions for obtaining water. With such a problem, it is best to turn to a geologist or more advanced people can use hydrogeological maps. The well must be equipped with filters to ensure that the water taken from the aquifer is purified. Same as in the case of sewage systems, local plans may exclude the possibility of using such a solution. In a situation where there are water supply networks within the plot, the regulations do not exclude the possibility of drawing one’s own water.

Suitable architectural design

In order for a self-sufficient house to function properly, it is necessary to ensure proper execution of the project. It should take into account solutions guaranteeing the maximization of energy efficiency, which include, among others:

• location of most windows to the south of the world,
• use of windows with the highest tightness class,
• use of recuperation, i.e. mechanical ventilation with heat recovery,
• elimination of thermal bridges,
• use of household appliances and electronics with a high energy efficiency class (preferably A +++).

Summary

Autonomy is gaining more and more popularity in Scandinavia and Western Europe. In Poland, the focus is on passive construction, which is characterized by maximum levels of energy efficiency, but is not 100% independent of external utilities. This is due to the incredible difficulty of construction and high costs. With the advancement of technology, we have an increasing selection of innovative devices. Investors are eager to invest in innovative energy solutions, which indicates a desire for complete autonomy.

Joanna Woźniak
Junior Specialist for Maintenance and Development of AMRON System

Although the subject of “patho-development” (not necessarily under this name) has been presented in the public debate for a very long time, in recent weeks it appeared again due to the conflict surrounding the Bliska Tower, JW Construction investment, also known as the “Warsaw’s Hong Kong”. At the same time, the problem of housing quality was noticed also by the Ministry of Development and Technology – at the press conference held on March 31, 2023 the Ministry’s representatives presented a number of solutions aiming at counteracting this phenomenon.

So-called “patho-development” is a term referring to (according to Wikipedia) “all the activities of construction developers, which, due to the actions towards clients and the way of designing facilities, are in contradiction with good practises”. Admittedly, this definition seems quite imprecise, but the term itself is very capacious and describes all disfunctions of the Polish housing market, ranging from the consequences of the lack of housing policy or the inefficiency of the spatial planning system in Poland, i.e. issues significantly exceeding the scope of developers responsibility, to actual, individual cases of breaking the law, low-quality projects and their implementation, or even disgraceful lack of respect for architectural monuments or nature devastation.

The plan to improve the situation on the housing market presented by the Ministry of Development and Technology provides for changes in the law regulations, including the Regulation on technical conditions of buildings, the Act on spatial planning and development, and implementation of a number of new solutions aimed, among others, at improving access to information on the housing market. The largest part of the proposed solutions are changes to the Regulation on technical conditions, i.e.:

• increasing the distance between buildings on neighbouring plots – change aims on increasing the minimum distance of a multi-family building with a height of more than 4 above-ground storeys from the plot border from 3 to 5 meters, excluding situations when the neighbouring plot, according to the local spatial development plan, is not intended for development;
• increasing the minimum distance between production and storage facilities and residential buildings to 30 m – this provision is intended to apply to buildings with a built-up area exceeding 1 000 sqm;
• changes in the requirements for parking spaces for the disabled – according to the new regulations, the number of parking places for disabled persons located close to the windows of buildings is to be reduced to a maximum of 6% of all parking places built as part of a single investment;
• fight against “concrete disease” – the project assumes the need to provide at least 20% of the biologically active area in public squares exceeding 1 000 sqm;
• friendly playgrounds and places for recreation for people with special needs – the project assumes the introduction of new requirements regarding the size and equipment of playgrounds for children, depending on the size of the investment;
• introduction of a limit of 25 sqm area of commercial premises, aimed at eliminating from the market the so-called “micro-apartments” sold as commercial premises. Commercial premises with a smaller area will be allowed to be built only on the ground or first floor of the building, provided that access to them is ensured from the outside of the building;
• introducing regulations ensuring privacy on balconies, better sound insulation of apartments, consideration in the design requirement of special rooms for bicycles and prams, as well as accessible adult change facilities (only in public buildings).

As regards the amendments to the Act on spatial planning and development, it is assumed that the method of determining the intensity of development will be changed by calculating the floor area along the outline of external walls, without balconies and terraces.

In addition, the Ministry plans to improve the situation on the housing market by limiting the flipping phenomenon by banning the assignment of reservation agreements and limiting the possibility of assigning development agreements, but also improving access to information on real estate prices by introducing the obligation for developers to publish real estate prices on websites, in prospectuses and catalogues, as well as launching a nationwide, free online service with transaction prices. The list of Ministry’s planned initiatives include also limiting wholesale purchases of real estate and increasing the availability of apartments by exempting from the tax on civil law transactions on the purchase of the first apartment.

The presented package of proposed solutions can be assessed as rather disappointing, giving the impression of not systemic solution, but of a simple catalogue of actions, being a response to the Internet lists of “patho-development” cases. It is difficult to resist the impression that we are dealing with a hastily prepared, PR, pre-election response of the government to a problem that is at the moment popular in the media. Nevertheless, some of the presented solutions are ideas that must be assessed as good and expected. They definitely include the solutions preventing the “concrete disease” (although the question remains whether 20% of the biologically active area is enough), putting in order the issue of car parks and places for the disabled, regulations on maintaining the sound insulation standard or even exemption from the tax on civil law transactions for people purchasing the first apartment. Some of the proposals may be surprising, such as launching of a website with transaction data from the real estate market, despite the fact that such services, both free and paid, have been operating on the market for a long time. Most of the proposed changes, however, are at least debatable solutions. In conditions of the Polish housing market, new limits on the area, distance or number of apartments that an investor can buy are potential sources of creativity and potentially further pathologies. It is also hard to believe that these measures will significantly change or organize the situation on the market. The basic problem of the housing market in Poland and the source of most pathologies is still the lack of state housing policy and the inefficient spatial planning system. As long as developers build on expensive, unprepared, sometimes even accidental plots of land, on the basis of discretionary planning decisions, while trying to adapt to sometimes questionable legal requirements (do we really need mandatory playgrounds for children in every housing estate?), we will keep on dealing with the “patho-development” phenomenon. Or maybe it’s time to seriously consider that the issue of the quality of space and housing in Poland is indeed a significant civilizational challenge, which is at least as important as the construction of the Central Communication Port, for the implementation of which the state didn’t hesitate to make a number of bold and unpopular decisions.

Jerzy Ptaszyński
Research and Market Service Director

Until now, restrictive regulations have de facto prevented building of new onshore wind farms in Poland. In 2016, the so-called ‘wind turbine act’ (Wind Farm Investments Act) was adopted, which introduced the ‘10H rule’, meaning that new wind turbines had to be separated from the nearest residential buildings by the distance of at least 10 times the turbine height. In practice it was about 1.5-2 km and the same rule also applied to the construction of new wind turbines near, among others, national parks, landscape parks, reserves and Natura 2000 areas, so over 99% of Poland’s territory was excluded from the possibility of wind turbine development. At the same time, all areas provided for wind farms in local spatial development plans (LSDP) have become unusable.

The end of the ‘10H rule’

Since the beginning of 2023, the government has been debating on a new version of the Wind Farm Investments Act, which originally provided for significant liberalisation of provisions and greater freedom in the construction of wind turbines in Poland. Turbines were to be built at a distance of at least 500 m from residential buildings, and the Senate’ amendment provided that this distance may be even shorter if the commune council allowed such a possibility after consultation with the inhabitants. However, at the end, despite the criticism of many specialists and the appeal of corporations operating in Poland, on 9 March this year the Sejm has approved a stricter version of the law, which increased the distance to 700 m.

It might seem that this small change increasing the minimum distance from 500 to 700 m is irrelevant, but in practice it limits the potential of Polish wind energy. According to British consulting company Ember, maintaining a minimum distance of 700 m from residential buildings means approximately 4 GW of new wind capacity will be built in Poland by 2030, whereas 500 m would increase land availability by 25 times (in comparison to the 10H rule) and allow 10 GW.

MAP 1. THE DIFFERENCE BETWEEN THE ASSUMPTIONS OF THE ‘WIND TURBINE ACT’ – 500M VS. 700M DISTANCE FROM RESIDENTIAL BUILDINGS

source: Distance Act: 700 m, 500 m or even less? – WysokieNapiecie.pl (https://wysokienapiecie.pl/83337-ustawa-odleglosciowa-500-jeszcze-mniej/)

Moreover, according to the Act, wind farms may only be located on the basis of a local plan. However, the analysis made by Urban Consulting showed that as many as 84% of the areas intended for the construction of wind turbines in accordance with the currently applicable LSDP, taking into account the distance requirements, have no reason to exist. As a result, Mazowieckie, Małopolskie, Śląskie and Kujawsko-Pomorskie voivodships have been completely excluded from the possibility of constructing wind farms for at least next 3-4 years (this is the time needed to adopt new LSDP together with the necessary analyses as part of the strategic environmental impact assessment).

MAP 2. THE POSSIBILITY OF USING THE CURRENTLY APPLICABLE LSDP (LOCAL SPATIAL DEVELOPMENT PLAN) FOR THE LOCATION OF WIND FARMS TAKING INTO ACCOUNT THE DISTANCE REQUIREMENTS

source: As much as 84% of the LSDP may be trashed by Suski’s amendment! – Urban Consulting (https://urbanconsulting.pl/mpzp-do-kosza/)

What else does the amendment to the Act change?

The ‘10H rule’ will continue to apply for the distance of a wind farms from national parks, while for nature reserves it will be 500 m. Minimum distances from other forms of nature protection will be determined by the environmental decision for the specific investment. The amendment also upholds the ban on the construction of wind turbines in national parks, nature reserves, landscape parks and Natura 2000 areas.

The law also specifies the minimum distances of wind turbines from electricity lines and at the same time unlocks the possibility of housing construction next to existing wind farms. The amendment also introduces safety standards for turbines.

The amendment to the ‘wind turbine act’ guarantees construction of wind farms in harmony with the local community, giving them a decisive voice and ensuring that full information about the planned investment is to be provided to the inhabitants of the nearby area. Moreover, the investor of a wind farm will offer at least 10% of the installed capacity of the wind farm to the residents of the municipality, who will use electricity as a virtual prosumer for 15 years. This means that residents will be able to buy shares in the investment, which will reduce their electricity bills (although the level of these savings will be difficult to estimate). So it can be assumed that this will encourage municipalities to build wind turbines.

What will change?

Do the changes mean that the number of wind turbines in Poland will increase significantly? Of course not. The amendment of the Act is only the first step towards the development of wind farms in our country. First of all, those projects that were already under preparation before 2016 but then frozen as a result of ‘10H rule’ introduction will come to the market first. Now, an update of environmental decisions and possibly change of LSDP is sufficient, but even in case of these projects, turbines will be installed in 2-3 years.

Investing in wind energy is a time-consuming process, but also it is the cheapest way of generating energy in Poland (even 4-5 times cheaper than coal or gas sources). In addition, the development of wind energy in Poland is necessary to reduce CO2 emission and meets climate commitments resulting from EU regulations. Therefore, Poland cannot afford to block the development of wind energy. It is a pity that the amendment to the ‘wind turbine law’, which politicians called a ‘compromise’, only slightly liberalises the law from 2016, causing the potential of domestic wind energy to remain untapped.

Agnieszka Pilcicka
Senior Real Estate Market Analyst

The obligations of the parties to the real estate sale transaction are affected, among others, by its legal status and other factual circumstances linked to it. Two of the public law obligations closely related to real estate transactions are often confused with each other, even though they have been functioning in the Polish legal system for many years. Their imposition is most often a significant financial burden for property owners. We are talking about betterment levy and planning fee. In this article you will find the answer to when these fees may be imposed, who sets them and what can be done to mitigate the risk of them being incurred.

At the beginning, it is worth noting that the planning fee results from the introduction of the Local Spatial Development Plan or its amendment, which is connected with the fact that the owners or perpetual users of the property most often learn about the obligation to pay it when the property is to be sold, while the betterment levy is imposed as a result of actions taken by the owner or perpetual user of the property.

What is an betterment levy?

The betterment levy is regulated in the Act of 21 August 1997 on Real Estate Management. It is defined as a public law fee imposed on real estate owners and perpetual user in relation to the increase in value of real estate caused by the construction of technical infrastructure facilities with the participation of the State Treasury, local government units, funds from the budget of the European Union or non-refundable foreign sources, or a fee established in connection with real estate consolidation and division, as well as division of real estate. If the value of the real property increases due to the above, the head of the commune, mayor or town mayor may fix the fee for that reason.

The amount of the rate is determined by a resolution by the municipal council. According to the Act, the amount of the betterment levy may not exceed 30% of the difference in the value of the property in the event of its division. Persons who have received new properties separated as a result of the merger and division are obliged to pay to the municipality betterment levy of up to 50% of the increase in the value of these properties in relation to the value of the properties previously owned. In the case of the construction of technical infrastructure facilities on the property with funds from the State Treasury or local government units for properties located in the Special Revitalisation Zone, the amount of the betterment levy may be up to 75% of the increase in its value. The authority that decides on the imposition of the fee is the mayor of the municipality, although the imposition of the fee is possible only if the municipality determines its percentage rate. In addition, when adopting a resolution on real estate consolidation and division, the municipality should include in it information on the date, manner of payment and amount of the betterment levy. The initiation of proceedings to establish the betterment levy may take place within 3 years from the date on which the decision approving the division of real property became final or the decision on the division became final. It is possible to pay the betterment levy in instalments, however, the payment period may not be longer than 10 years.

The question is: who will be obliged to pay the betterment levy in the event of sale of the real estate? In such a situation, the date on which the decision to charge the fee became final will be decisive – if the decision became final before the date of the transaction, then the seller of the real estate will be under the obligation. When buying a property, it is worthwhile for the buyer to analyse the legal situation of the property, so as not to be surprised later by unexpected fees. Avoiding or reducing this fee is not the easiest thing to do, although it is possible, e.g. if an error is made by an official or a property valuer. Verification of the correctness of the fee imposition should start with checking whether the local government’s resolution on betterment levies was in force at the time of putting the constructed technical infrastructure into use (if the case concerns the increase in the value of the real property caused by the construction of technical infrastructure facilities). It should also be remembered that the office can impose a fee for up to 3 years. As a next step, it is also worth analysing the correctness of the appraisal report (preferably with a specialist). In case of mistakes, it is possible to challenge the fee decision at the Local Government Appeal Court and the administrative court.

What is a planning fee?

Under the Act on Planning and Spatial Development, a planning fee is imposed if, in connection with the adoption of the local plan or its amendment, the value of the real property increases and the owner or perpetual user sells the real property. In such a case, the head of the commune, mayor or town mayor collects a one-off fee established in the plan, set as a percentage of the increase in the property value. This fee is the municipality’s own income. The amount of the fee cannot exceed 30% of the increase in the value of the property. For example, there may be a situation in which a plot of land, which so far has been defined in the local plan as agricultural land, after its change is reclassified as a building plot, which results in increase in its value. If the owner sells the plot, the authority may then charge the owner a planning fee. When a party applies for an extract from the local plan for its property, the municipality is obliged to specify the amount of the planning fee of the area covered by the extract from the plan. It is worth remembering that the fee can be imposed up to five years from the date the plan was adopted or amended and is charged to the seller. Therefore, one way to avoid the fee is to wait – the seller will not be obliged to pay the fee if he sells the property later than 5 years from the date of the change/introduction of the Local Development Plan. Another way is to conclude a pre-contract, because it does not transfer ownership rights and therefore does not impose the obligation to pay the fee, and only after the expiry of 5 years from the change/introduction of the Local Development Plan to sign a proper contract. In the case of a donation agreement, the fee will not be charged either, because the land disposal should be paid until the fee is imposed. In order to avoid the fee, it is also possible to appeal to the Self-Government Board of Appeals or the administrative court, challenging the appraisal report and the relationship between the increase in the value of the property and statements in the local plan.

Summary

In summary, both the betterment levy and the planning fee are related to the increase in the value of the real property. The main difference between the two is the moment, at which the obligation to pay it is imposed – in the case of the planning rent, the obligation is imposed when the real estate is being sold, whereas the betterment levy should be paid regardless. Another difference is the reason – in the case of the betterment levy, it may result from the action of the owner or perpetual user of the real property (e.g. division of the real property, merger and subdivision) or the state/ local government units (e.g. construction of utility networks, roads), while the planning rent arises from the introduction or amendment of the Local Development Plan.

Karol Kacprzak
Analysis and Development Specialist