Since the beginning of economic transition responsibility of satisfying housing needs of local communities was transferred to local governments. To fulfill their duties polish municipalities maintain and manage housing stock which includes dwellings for low income households, social dwellings, replacement dwellings and temporary living quarters. In many European countries a process of municipal withdrawing from housing sector can be observed. Local governments consider privatization as an additional source of income and the way of improving the effectiveness of their housing stock management. However this direction in polish conditions not only did fail to stimulate private rental housing but also evoked the sense of social injustice. Modified concept of privatization based on national and local housing strategies need to be developed.