The Role of Economic Factors and Government Policies in the Development of the Polish Housing Market
Abstract
Objective
The objective of this study is to empirically examine the combined effects of macroeconomic demand-side determinants and policy interventions within a unified analytical framework, focusing on the housing markets of Warsaw, Kraków and Wrocław.
Methodology
The analysis employs a quantitative research design based on a fixed-effects panel data regression model using quarterly data from 2014Q1 to 2024Q4. Housing prices on the secondary market serve as the dependent variable, while income, interest rates, unemployment and policy implementation are included as explanatory variables. Data are sourced from the National Bank of Poland (NBP) and the Central Statistical Office (GUS). Model diagnostics address multicollinearity, serial correlation and cross-sectional dependence, with Driscoll–Kraay standard errors applied to ensure robustness.
Findings
The results indicate that income is the primary driver of housing prices in major Polish cities, confirming the importance of demand-side economic fundamentals. Unemployment also exhibits a statistically significant positive relationship with housing prices, reflecting atypical market dynamics during periods of economic shocks, including the COVID-19 pandemic and geopolitical events in Eastern Europe. Interest rates do not show a statistically significant effect. Contrary to initial expectations, the introduction of government housing policies is associated with a short-term decline in housing prices, suggesting delayed or indirect policy effects rather than immediate price inflation.
Value Added
This study contributes to the literature by integrating economic determinants and housing policy variables in a unified empirical model for the Polish housing market in the post-2014 period. It extends prior research by focusing on recent data and large urban agglomerations, providing updated evidence on price formation mechanisms under conditions of economic disruption and active policy intervention.
Recommendations
The findings suggest that housing price dynamics in Poland are driven primarily by economic fundamentals rather than short-term policy measures. Policymakers should therefore account for income growth and labour market conditions when designing housing interventions. Future housing policies may benefit from improved timing, clearer targeting and alignment with prevailing market prices to enhance effectiveness and reduce unintended short-term distortions.
© 2026 Ewa Werpachowska, Tetiana Paientko, published by SAN University
This work is licensed under the Creative Commons Attribution-ShareAlike 4.0 License.