The present research concerned the following elements of the residential market in the city of Cracow: the supply, the demand and the prices. In Cracow the need for flats is regarded as very large because it is a basic necessity; however, as a result of many factors this need is not transformed into demand. According to the authors of the present report, the housing market is a very important market, requiring research and analyses as well as a search for optimal solutions for its functioning. Research of the residential market is most often carried out on request of companies and it provides information exclusively for internal use so it is not published. The present study has an exclusively scientific character and as such it is an objective source of information. The research consisted of two parts: a survey amongst potential customers and one amongst the representatives of property companies. The purpose of the research was a comparison of the supply represented by developers with the demand and expectations of customers. The work can also be of help for entrepreneurs conducting property activity since it contains the information concerning the preferences of customers, thus indicating which direction housing investment should take so as to answer the needs of customers. Research methods: in examining the demand, the method of the direct and online questionnaire form was applied. In examining the supply, the method of the direct questionnaire form and the e-mail questionnaire form were applied.