Maximizing Returns: How One Investor Achieved a 17% Annual Profit with a Dual-Use Property Investment in Gdynia

Introduction:

At Invepro, we specialize in helping investors find profitable real estate opportunities in Poland. In this case study, we’ll explore the successful investment of one of our clients from Warsaw, who purchased a property in Gdynia. By combining business, leisure, and short-term rentals, this client achieved an impressive 17% annual return on investment.

Table of Contents:

1. The Investor’s Background

2. Property Details and Purchase Decision

3. Financial Benefits Breakdown

4. Short-Term Rental Success

5. Property Appreciation and Long-Term Gains

6. Conclusion: Why This Investment Strategy Works
   
   

1. The Investor’s Background

Our client, an experienced investor from Warsaw, frequently travels to Gdynia for both business and leisure. To make the most of these trips, he decided to purchase a second home that could serve both personal and rental purposes. This case illustrates how savvy real estate decisions can maximize both utility and returns.

2. Property Details and Purchase Decision

The investor purchased a 64 m², 3-bedroom apartment located in the heart of Gdynia Centrum on St. Peter’s Street for 1,965,000 PLN. The apartment was selected for its prime location and dual-purpose potential: as a second home and a high-demand short-term rental property due to its proximity to the business district and tourist attractions.

3. Financial Benefits Breakdown

By purchasing this property through Invepro, the investor was able to save 2% on the PCC tax, resulting in an immediate savings of 39,300 PLN.

Additionally, by using the apartment for both business and personal stays, the investor saved approximately 9,000 PLN per month in hotel costs, accumulating to 54,000 PLN in savings over six months of the year.

4. Short-Term Rental Success

When not using the apartment, the investor rented it out as a short-term rental property. Over the course of six months, this strategy generated 50,000 PLN in rental income. Gdynia’s thriving tourism and business sectors have made it a prime location for such rentals, offering a reliable and profitable source of passive income.

5. Property Appreciation and Long-Term Gains

Beyond the immediate income and savings, the property’s value increased by an average of 12% per year, resulting in an additional 235,000 PLN in appreciation. This steady increase highlights the strong demand for high-quality real estate in Gdynia.

In total, the investor’s annual return amounted to:

• 54,000 PLN (hotel savings)

• 50,000 PLN (rental income)

• 235,000 PLN (property appreciation)

This brought the total return to 339,000 PLN annually, equating to a 17% return on investment.

6. Conclusion: Why This Investment Strategy Works

This case study exemplifies the benefits of a well-thought-out real estate investment strategy that combines personal use and short-term rentals. Gdynia’s strong real estate market, combined with the investor’s smart tax savings and rental income, resulted in a significant annual return. With plans to sell the apartment in five years, the investor stands to further increase these gains.

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