Radoslaw Trojanek

Poznań University of Economics and Business,

Poznań, Poland

E-mail: radoslaw.trojanek@ue.poznan.pl

ORCID 0000-0002-8614-9484 

Discovering the determinants of house prices dynamics in poland using bayesian model averaging

Michal Gluszak

Cracow University of Economics,

Krakow, Poland

E-mail: 

gluszakm@uek.krakow.pl

ORCID 0000-0001-7614-229X

Pawel Kufel

WSB Merito University in Torun, 

Torun, Poland

E-mail: 

pawel.kufel@wsb.torun.pl 

ORCID 0000-0003-4769-8066

Maria Trojanek

Calisia University,

Kalisz, Poland

E-mail: 

m.trojanek@akademiakaliska.edu.pl

ORCID 0000-0002-6237-4281

Abstract. We examine the price drivers in 18 capital housing markets in Poland from 2004 to 2021. Using the Bayesian Model Averaging method, we discovered that some financial elements explain house price changes more consistently than conventional economic and demographic variables. The dynamics of house prices in most cities were defined explicitly by financial factors – mortgage market activity, mortgage interest rate, and terms and conditions of granting mortgages. Additionally, the stock market played a vital role in house price movement in selected cities. Economic (regional GDP, salaries, unemployment) and demographic (migration) factors were significant predictors of housing price dynamics only for particular cities. Our study closes the knowledge gap on factors influencing home price dynamics in Poland and other developing nations that have gone through systemic change. In the case of Eastern European countries, we have limited knowledge of those linkages.

Received: January, 2023

1st Revision: September, 2023

Accepted: December, 2023

DOI: 10.14254/2071-789X.2023/16-4/4

JEL Classification: E31, E64, J11

Keywords: housing prices, BMA, Poland