For buyers looking for solid returns and capital growth plus low entry costs, Louise Reynolds, director of Property Venture, which helps buyers invest in property across continental Europe, suggests Poland – specifically Krakow.
A one-bedroom apartment in the city centre would cost around £130,000 to £150,000, and would have great potential for short lets. “Lots of people go there for weekend breaks,” she says. She estimates buyers could expect to earn a gross yield of 7-9pc. Net yields, less running costs, would, of course be less.
A complication with investing in Polish real estate is that it is really only an option for cash buyers. “Cash is king in Poland, particularly since we left the EU,” Reynolds adds. “It is very, very difficult for a Brit to get a mortgage in Poland.”
Wherever they invest, British buyers will need to get their heads around the local tax system, since rental incomes tend to be taxed locally. But Poland is one of the countries which has “double taxation” treaty with the UK. It means any tax paid there can be offset against tax payments back home.
Reynolds practices what she preaches. She bought a one bedroom rental in the city back in 2007 for £56,000. Today it is worth around £120,000 to £130,000. “It is steady, sustainable growth,” she says. “And Krakow is a good choice for short lets because it is a city and so there is demand all year around.”