Private Dormitory vs Buy-to-Let Apartment — A Comparison of Returns (NBP Q3 2024)
NBP reports an apartment ROE of 3.3% in Warsaw paid in cash, -1.3% at LTV=50%, and -14.9% at LTV=80%. PBSA — Savills 2025: ~100% occupancy. The full comparison.
You are buying a property to let. The classic question: an apartment, or something else? For years this was a rhetorical matter — everyone bought apartments. But the market has changed. Property prices have risen dramatically, returns on residential lettings are falling, and alternative asset classes — such as private dormitories — are gaining importance.
In this article we compare the two investment models rigorously: official NBP figures, Savills data, mechanics, risks.
Returns on an apartment investment — official NBP data
Let us start with what is known. The National Bank of Poland (NBP) publishes a quarterly report, "Informacja o cenach mieszkań i sytuacji na rynku nieruchomości mieszkaniowych i komercyjnych w Polsce" (Report on Housing Prices and the Situation in the Residential and Commercial Real-Estate Markets in Poland). The data for Q3 2024 are specific — and not optimistic for apartment investors.
Return on equity (ROE) — buy-to-let apartment with own funds (LTV=0%):
| Location | ROE (LTV=0%) |
|---|---|
| Warsaw | 3.3% |
| 6 largest cities | 3.2% |
| 7 other voivodeship cities | 3.1% |
With financial leverage — the situation worsens dramatically:
| Location | ROE (LTV=50%) | ROE (LTV=80%) |
|---|---|---|
| Warsaw | -1.3% | -14.9% |
| 6 cities | -1.4% | -15.3% |
| 7 cities | -1.6% | -15.6% |
In other words: if you buy a buy-to-let apartment entirely in cash, you earn about 3% a year. If you draw on a mortgage of 50%+ — you lose money. The NBP uses official interest rates and average rental prices.
On top of this come costs that are often overlooked:
- Gaps between tenants (1-2 months a year with no income)
- The cost of renovations and refreshes between lets
- The time and energy of management: finding tenants, accounting, repairs
- The risk of a difficult tenant (late payments, damage)
Returns on a private dormitory investment — the structural model
The PBSA model works on different principles.
Occupancy. The key difference. Modern private dormitories reach an occupancy rate of up to 100% during the academic year, whereas university halls record occupancy below 72% (Savills 2025). When letting an apartment on the open market, gaps between tenants are the norm.
Impact on revenue. 100% occupancy over 10 months (the academic year) vs 85% occupancy over 12 months in an apartment — these are very different figures at year-end, even though the annual average looks similar. PBSA also delivers predictability.
Rent rates. In private dormitories these are set by the market — with no rent controls. Poland is particularly attractive in this respect: the market is free and demand is structurally high.
The hands-off model. A professional operator runs the property — from tenant recruitment to technical service. The investor is not involved operationally. This eliminates the hidden costs of time and energy that, with an apartment let, are real but hard to quantify.
Side-by-side comparison
| Metric | Buy-to-let apartment | PBSA |
|---|---|---|
| ROE (own capital, no leverage) | 3.3% (Warsaw, NBP Q3 2024) | Higher at full occupancy |
| ROE (LTV=50%) | -1.3% (Warsaw) | — |
| ROE (LTV=80%) | -14.9% (Warsaw) | — |
| Occupancy | Variable, gaps of 1-2 months/year | ~100% during the academic year (Savills) |
| Management | Self-managed or paid agency | Built-in operator |
| Vacancy risk | Real | Minimal amid a chronic shortage |
| Rent controls | None in Poland | None in Poland |
| Scalability | Each apartment separately | Option of a property portfolio |
| Liquidity | Relatively good | Secondary market only just developing |
What do the European figures say?
Poland is part of a wider trend. According to Savills reports:
- Poland is the 5th-largest student market in the EU
- The volume of investment in the PBSA sector in Poland by the end of 2024 amounted to EUR 310 million cumulatively
- In 2024 only one transaction worth EUR 30 million was recorded — a year of low activity
- 2025 forecast (optimistic scenario): EUR 200 million — it could be a record year
- +9,000 new beds planned by 2028 (Savills)
Poland is attractive to institutional capital: a market with no rent controls, a structural shortage, rising demand.
Honest caveats
Liquidity. The secondary real-estate market in the PBSA sector in Poland is only just developing. Selling a unit in a private dormitory may be harder than selling an apartment — although institutional transactions (such as the sale of Basecamp in Wrocław) show that investment demand is real.
Currency risk. For foreign investors: rents are settled in złoty. For Polish investors — this risk does not exist.
A less familiar model. PBSA is still a niche segment in Poland. An investor entering this market must understand the specifics of operator agreements, verify the terms, and choose operators carefully.
Summary
The comparison of the figures is unequivocal: investing in a buy-to-let apartment at current property prices and interest rates generates low returns, and with financial leverage — negative ones (official NBP Q3 2024 data).
A private dormitory, built on structural shortage and high occupancy, offers a different return profile — with a built-in operator and no need to manage the property yourself.
This does not mean PBSA is risk-free. But the risk-to-potential-return ratio is today clearly more favourable than in a classic buy-to-let apartment.
Sources
- NBP — Informacja o cenach mieszkań i sytuacji na rynku nieruchomości mieszkaniowych i komercyjnych w Polsce w III kwartale 2024 r. (Report on Housing Prices and the Situation in the Residential and Commercial Real-Estate Markets in Poland in Q3 2024)
- Savills Polska — Rynek PBSA w Polsce 2025 (The PBSA Market in Poland 2025)
Full citations in data/sources.md.
