Real estate market analysts have been maintaining for many years that housing market proves to be a good measure of the overall economic situation and empirical observations confirm this allegation. After few years of economic recession, Polish economy manifests the explicit symptoms of economic growth. In 2003 GDP increased by 3.7% in relation to its level in 2002 and amounted to 804.7 billion Polish Zloty. Whereas in 2002 it increased in relation to the previous year by mere 1,4%1. The economic situation in 2003 improved, not only in terms of GDP increase, despite the overwhelming pessimistic public feelings. Among others, the availability of mortgages for housing investments explicitly improved. Many private buyers were encouraged to use this source of financing owing to lower interest rate. The supply of new dwellings was constantly increasing between 1998 ñ 2001 and reached its peak level of completed housing units in 2001. In consequence, housing market noted oversupply of new dwellings.