"If the minimum required level of own contribution from clients will be increased from 10 percent to say 20-30 percent of the price of real estate, then the sales of flats will drop by as much as 70 percent," said CEO of Polnord, Wojciech Ciurzyński to Puls Biznesu.

This has prompted analysts to believe that problems with obtaining a mortgage will lead to more people renting, causing rent prices to rise.

With Bank Millennium now requiring customers for a 35 percent down payment of the investment if they borrow in foreign currency, and 20 percent when borrowing in Polish złoty, analysts told Dziennik they predict a "huge boom" in the rental market.

"The need for flats is not dropping. New generations continue to enter the market, immigrants are returning from the UK and each year there's a growing army of several hundred thousand students who cannot find accommodation in dorms," said Robert Chojnacki of redNet Consulting to Dziennik. He added that the tightened mortgage requirements are going to force these people to rent, resulting in demand being higher than supply leading to an increase in rent prices.

Last year, a bachelor apartment in Warsaw cost around zł.1,500 per month, today it's zł.1,800. Meanwhile a two room apartment was zł.1,700 and today it is above zł.2,000. (AO)

Sources: Puls Biznesu, Dziennik