Home Broker. Home Broker Real Estate Advisors

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1 Home Broker Home Broker Real Estate Advisors

2 Home Broker Real Estate Advisor individual investment advisor focused on demanding clients needs reliable products and professional service presenting complex effective solutions HOME BROKER ADVISOR REAL ESTATE AGENT

3 Home Broker activities financial portfolio including real estate assets apartment purchase advisory apartment investment advisory land purchase advisory apartment finishing property management development real estates brokerage (selling, buying, letting)

4 Within 3 years we will build the widest net of real estates advisory Home Broker development Offices 130 Real Estate Advisors

5 Warsaw Sady Bemowskie Attractive location 15 min away from the city centre One of the lowest prices in Warsaw at PLN 6,950/sqm gross Pre-market and fixed prices, best units selected for investors Attractive financing system: 10/90

6 Lodz Nowe Polesie Łódź is the fastest growing secondtier city in Poland currently experiencing rapid growth (4.1% per month) Prime location 10 min away from the city centre One of the lowest prices in Łódź at PLN 6,150/sqm (Ł1,116) gross Pre-market and fixed prices, best units selected for investors Development has great transport links, close to huge corporate investment and thousands of new jobs

7 Krynica Gorska ul. Pilsudskiego Perfect location 600 m from skilift Attractive financing system: 20/80 Prices start at PLN gross per sqm High Return on Investment (ROI) Attractive rental market

8 Home Broker Warsaw residential market June 2007

9 Investment attractiveness the highest Voivodship investment attractivness According to the report of Instytut Badań nad Gospodarką Rynkową, mazowieckie voivodship was the second most attractive region in Poland in The level of attractiveness was estimated at 0,75 (maximum 1,00) the lowest

10 Strength of mazowieckie voivodship The highest quality of human resources in Poland significant share of well educated people with high qualifications (61% of Warsaw citizens have secondary or university education and students constitute 16,5% of whole Warsaw population) Very high market absorption low unemployment rate and one of the highest average monthly remunerations Good communication availability favourable geographical position and well organized transport infrastructure

11 Average remuneration (PLN gross) Trójmiasto Poznań Wrocław Łódź [PL N ] Kraków Katowice Warszawa I kw 2005 II kw 2005 III kw 2005 IV kw 2005 I kw 2006 II kw 2006 III kw 2006 IV kw 2006 I kw 2007 Average per annum, 2006r. Source: GUS Warszawa Polska

12 Unemployment rate 20,0% 19,2% 18,0% 18,0% 17,6% 17,6% 17,8% Trójmiasto 5,20% 16,0% 15,9% 15,2% 14,9% 14,4% Poznań 4,60% 14,0% Wrocław 7,40% 12,0% 10,0% Łódź* 11,90% 8,0% 6,0% 6,6% 6,3% 5,9% 5,6% 5,5% 5,2% 4,9% 4,7% 4,4% Kraków Katowice 5,30% 5,30% 4,0% Warszawa 4,40% 2,0% I kw 2005 II kw 2005 III kw 2005 IV kw 2005 I kw 2006 II kw 2006 Warszawa Polska III kw 2006 IV kw 2006 I kw ,00% 5,00% 10,00% 15,00% Average per annum, 2006r. Source: GUS

13 Households structure The smallest one- and two-person households constitute 65% of whole households in Warsaw 12% 4% 38% According to The National Census (2002): thousands of households thousands of units shortage: 109 thousands of units 19% 27% one-person two-person three-person four-person five-person and more Source: GUS

14 Warsaw advantages Huge economic potential 1/8 of average country GDP is produced in Warsaw GDP per capita in Warsaw is 3 times higher than average in Poland 1/3 of science and technical resources is located in the city Concentration of the most important metropolitan functions connected with the control of national and regional economy Increase of international position as a regional financial centre in CEE Very high dynamic of prices in residential real estate market with high acceptance of rising prices by prospectors (attractive payment system for investors ie. 10/90)

15 Scale of construction - number of building permits and units completed in Warsaw and Warsaw agglomeration building permits units completed building permits units completed building permits units completed building permits units completed building permits units completed building permits units completed building permits units completed Warsaw Warsaw agglomeration (without Warsaw) Source: GUS

16 Number of building permits in Warsaw/Poland ,19% ,38% 0,83% 1,83% ,05% 0,62% 5,75% ,35% Warszawa Łódź Poznań Trójmiasto Katowice Kraków Wrocław pozostałe miasta Source: GUS

17 Units completed in Warsaw/Poland ,59% 11,76% ,03% 2,37% ,33% 0,38% 5,74% ,80% Warszawa Łódź Poznań Trójmiasto Katowice Kraków Wrocław pozostałe miasta Source: GUS

18 Number of units per people in Warszawa Łódź Poznań Trójmiasto Katowice Kraków Wrocław Polska średnia dla UE

19 Number of units completed per people in ,7 8 7,98 7 6, ,8 4, , ,6 1,4 0 Warszawa Łódź Poznań Trójmiasto Katowice Kraków Wrocław Polska średnia dla UE

20 Covering of zoning plans in Warsaw Current zoning plans cover approx. 17% of the city area Source: Studium Uwarunkowań i Kierunków Zagospodarowania Przestrzennego miasta Warszawy

21 Covering of zoning plans in Warsaw districts 60,0% 56,5% 50,0% 40,0% 38,5% 30,0% 24,0% 21,0% 20,0% 14,7% 10,0% 8,5% 6,5% 3,5% 10,0% 4,0% 2,0% 2,5% 4,5% 1,0% 0,0% Bemow o Białołęka Bielany Mokotów Praga Południe Rembertów Śródmieście Targówek Ursynów Wawer Wesoła Wilanów Włochy śoliborz Source: Studium Uwarunkowań i Kierunków Zagospodarowania Przestrzennego miasta Warszawy

22 Level of average prices per 1m2 of flat between zł zł zł zł zł zł zł zł zł zł zł zł zł I KWARTAŁ 2004 II KWARTAŁ 2004 III KWARTAŁ 2004 IV KWARTAŁ 2004 I KWARTAŁ 2005 II KWARTAŁ 2005 III KWARTAŁ 2005 IV KWARTAŁ 2005 I KWARTAŁ 2006 II KWARTAŁ 2006 III KWARTAŁ 2006 IV kw 2006 I kw 2007r. Warszaw a Łódź Poznań Trójmiasto Katow ice Kraków Wrocław Source: GUS Source: tabelaofert.pl

23 Average monthly remuneration - company sector February 2007 PLN Warsaw (3 633,94 PLN) Mazowieckie Voivodship (3 388,79 PLN) Poland (2 687,48 PLN) 0 Building sector Service for real estate and companies Industry (incl. CDE) Trade and repair Community, socialprivate and other services, Transportation telecomunication, storage services, Hotels and restaurants Source: GUS

24 Purchasing power of Warsaw citizens Average employee of company sector in Warsaw could afford monthly less than 0,5m 2 of flat in 2006, having in mind that average price of 1m 2 was PLN In 2006, it would take 9,5 years (!) for average employee of company sector in Warsaw to earn enough to buy 54,7m 2 flat costing PLN, assuming that whole income would be dedicated for flat purchase Taking into account the level of average monthly remuneration, the minimum mortgage period for the flat described above is 35 years

25 Purchasing power of Warsaw citizens 1,00 0,90 Amount of sqm of unit for average renumeration 0,87 0,80 0,70 0,60 0,50 0,45 0,47 0,51 0,53 0,43 0,49 0,54 0,40 0,35 0,34 0,30 0,20 0,10 0,00 Warszawa Łódź Poznań Olsztyn Trójmiasto Bydgoszcz Lublin Katowice Kraków Wroclaw

26 Warsaw districts śoliborz i Śródmieście: bus terminal; apartment area at Rydygiera St. New estates in districts Post-industrial area of Praga Płd. Miasteczko Wilanów

27 The dynamic of prices in Warsaw Śródmie dmieście zł zł zł zł zł zł zł zł zł zł zł zł zł I Q 2004 II Q 2004 III Q 2004 IV Q 2004 I Q 2005 II Q 2005 III Q 2005 IvQ 2005r. I Q II Q 2006 III Q 2006 IV Q 2006 I Q 2007 Source: tabelaofert.pl

28 The dynamic of prices in Warsaw Wola zł zł zł zł zł zł zł zł zł zł zł zł zł I Q 2004 II Q 2004 III Q 2004 IV Q 2004 I Q 2005 II Q 2005 III Q 2005 IvQ 2005r. I Q II Q 2006 III Q 2006 IV Q 2006 I Q 2007 Source: tabelaofert.pl

29 The dynamic of prices in Warsaw Targówek zł zł zł zł zł zł zł zł zł zł zł zł zł I Q 2004 II Q 2004 III Q 2004 IV Q 2004 I Q 2005 II Q 2005 III Q 2005 IvQ 2005r. I Q II Q 2006 III Q 2006 IV Q 2006 I Q 2007 Source: tabelaofert.pl

30 The dynamic of prices in Warsaw Praga Północ zł zł zł zł zł zł zł zł zł zł zł zł I Q 2004 II Q 2004 III Q 2004 IV Q 2004 I Q 2005 II Q 2005 III Q 2005 IvQ 2005r. I Q II Q 2006 III Q 2006 IV Q 2006 I Q 2007 Source: tabelaofert.pl

31 The dynamic of prices in Warsaw Wawer zł zł zł zł zł zł zł zł zł zł zł zł zł I Q 2004 II Q 2004 III Q 2004 IV Q 2004 I Q 2005 II Q 2005 III Q 2005 IvQ 2005r. I Q II Q 2006 III Q 2006 IV Q 2006 I Q 2007 Source: tabelaofert.pl

32 The dynamic of prices in Warsaw Wilanów zł zł zł zł zł zł zł zł zł zł zł zł zł I Q 2004 II Q 2004 III Q 2004 IV Q 2004 I Q 2005 II Q 2005 III Q 2005 IvQ 2005r. I Q II Q 2006 III Q 2006 IV Q 2006 I Q 2007 Source: tabelaofert.pl

33 Market trends Higher standard of finishing reflected by using good quality materials and the newest technology Increasing number of offers ready-to-move-in Tendency to offer some additional services for residents Increasing of construction costs (materials and labour costs) caused by: boom on the construction market lack of both qualified and unqualified construction workers due to emigration to EU

34 Market trends changes of construction prices rises (+) and decreases (-) of prices 55,00% 57,80% 54,00% 45,00% 35,00% 25,00% 24,10% 23,50% 15,00% 5,00% 0,10% 4,00% 2,00% -5,00% est ,30%- building materials labour costs Source: Instytut Budownictwa PW

35 Market trends The dynamic growth of prices causes: Increasing interest in cheaper units outside Warsaw located within 45 min. drive distance from the city centre Houses outside Warsaw become attractive alternative in comparison with apartments located in the most expensive districts Increasing interest in developing post-industrial areas (loft projects) The most attractive loft locations: Praga Północ Praga Południe Wola Powiśle

36 Market trends Increasing competitiveness of secondary market where prices have stabilized within last months achieving the level of prices comparable to prices of primary market in similar locations Appearance of new secondary market

37 Conclusions EURO 2012 is one of the indicators that will cause the further increase of building materials prices and labour costs Some of infrastructural investments planned in the city modernization of Stadion X-lecia II route of underground 2 new bridges completion of planned ringroads

38 Planned infrastructure investments Source: Stowarzyszenie Integracji Stołecznej Komunikacji

39 Conclusions It is expected that in 2007 the dynamic of prices compared to 2006 will be much lower with annual price increase at the level of ca. 15% The next years with the scale of construction expected to be much higher should bring stabilization of prices The definition of social building presented by the government in April 2007 defines social using the criteria of size. In the case of flats the limit is 120 m 2, while for houses this is 220 m 2. These limits should allow about 90% of new properties to fall within the 7% bracket. Each 1 m 2 above the limit will be taxed 22% VAT