Grzegorz Dobrowolski in BIV-News - Beyond our borders

Beyond our borders: Poland

dinsdag 5 januari 2016

Poland. For many of us, this Eastern European country on the Baltic Sea raises a large number of questions. This country, which in surface area is ten times as big as Belgium, has prosperous cities such as Krakow, Warsaw, Gdansk and Poznan and has a great deal to offer in terms of real estate. In fact, Poland is a unique country on many fronts – and especially where the regulations for property brokers are concerned. I spoke about this with Grzegorz Dobrowolski, an experienced property broker-cum-academic. Dobrowolski is a lawyer by training who also lectures in real estate at the University of Gdansk. In addition to his teaching activities, he is also vice chairman of the Polish Real Estate Federation (PREF) and sits on the Board of Directors of the European property association, CEPI.

Dobrowolski operates virtually exclusively as a broker. He sees his role as a real estate broker in Poland as being approximately equivalent to that of a real estate broker in Belgium. Adding properties to his portfolio, gathering information and documentation, negotiating and ensuring that the sale runs smoothly, through to completion at the solicitor’s office and so on. But where Poland does differ significantly from Belgium is in the fact that very recently, in 2014 in fact, the Polish government pushed through a far-ranging set of deregulatory measures. “Between the time the framework regulations were set up in 1998 and the deregulation was implemented in 2014, consumers and brokers alike benefited from the same sort of protection that applies in Belgium,” says Dobrowolski. “Ongoing training, insurance, protection of title, a code of ethics and regulations together with a related disciplinary body, etc. But in 2014, the pro-European government in Warsaw turned all that on its head. Today, real estate brokers have just two obligations: to work with written instructions, and to be insured. Two matters for which no strong legal base even exists.”

"Did you know that we protested in the streets against abolishing the regulations?”

Dobrowolski is not at all keen on deregulation. “We have dismantled a very balanced system until virtually nothing of it is left. What Poland has done is apply Europe’s recommendations far too rigorously. This charm offensive towards Europe has had two effects. First of all, everyone now plays the game according to their own rules, so consumers no longer know what they should or should not expect from a property broker, let alone what they are actually paying for and whether the fees are fair or not. This uncertainty and lack of clarity often leaves consumers feeling disillusioned. Second, there are now absolutely no requirements left for operating as a real estate broker. This means there are people who have no knowledge, no qualifications and no experience coming onto the market. It doesn’t even matter if you have a criminal record or not. Someone just released from prison can drive straight to their office and start working as a broker.”

At the same time, Dobrowolski is quick to point out that the majority of brokers in Poland are well versed in the property market and behave responsibly. “It’s the ones who don’t know what they are doing who are having the greatest impact on consumers – and on the sector as a whole,” he says. “With so much negativity surrounding the profession, the advantage of working with a broker is not sufficiently clear to people. Anyone wanting to sell or lease his home is not obliged to call upon a real estate broker, just like in Belgium. Which means we can miss the rotten apples altogether.”

One obvious question has been on the tip of my tongue for a few minutes: “So, back to the old system?” “Yes,” replies Dobrowolski, “but not totally. We don’t want to go all the way back to the beginning, like in a board game. Because the way the regulations were before was not perfect either, although there is a world of difference compared with now. What we need are some basic requirements that apply across the board. For me, the absolute minimum for entering the real estate business would be a summary of basic requirements for the real estate broker and a prior training course that combines theory and practice. As far as I am concerned, there is no place for self-declared brokers who are not even able to explain sector-specific terms to clients. The old regulations required something of an effort on our behalf, but the system worked well.”

“Did you know that we protested in the streets against abolishing the rules?” Dobrowolski continues somewhat surprisingly. “We also went to speak to the minister in charge, who listened to what we had to say, but did nothing about it. Whatever the government promised, nothing happened. Deregulation has not created any new employment. Deregulation has not resulted in a lowering of fees. Deregulation has not generated growth of the free market. Some of the data that was used to support these arguments also seems to have been manipulated.”

Today, Poles can see the prospect of negotiating with the government about basic requirements, as is the case in most European countries. PREF, the real estate association with which Dobrowolski is involved, is now trying to fill the void left by deregulation by establishing its own rules and by organising training courses with no strings attached. “I am proud that people still want to learn and that they continue to do so – even though there may be someone who doesn’t abide by the rules on the other side of street.”

After this positive note, my Polish interlocutor concluded philosophically: “A life without rules may be simpler, but it’s not safer.” I rest my case.