Real estate market stagnates

Real estate prices in Slovakia have not risen since 2010. Recent information detailing the decreasing average prices of flats and houses proves this phenomenon, according to the recent analysis published by the National Bank of Slovakia (NBS), the country’s central bank,

Real estate prices in Slovakia have not risen since 2010. Recent information detailing the decreasing average prices of flats and houses proves this phenomenon, according to the recent analysis published by the National Bank of Slovakia (NBS), the country’s central bank,

The average price of real estate in Slovakia reached €1,230 per square metre in the second quarter of 2013. Compared to the previous quarter, that is a drop of €10 per square metre, i.e. 0.2 percent, according to the NBS analysis.

Moreover, in the past years housing prices have lagged behind the average reported in 2010, and are likely to gradually decrease, the analysis states.

The current economic situation in Slovakia and the high unemployment rate indicate that there will not be a more significant increase in real estate prices, but nor do they foresee a significant decrease, said Poštová Banka analyst Eva Sadovská, as reported by SITA.

The NBS data also showed that people from Bratislava and its surroundings, where one square metre costs €1,670 on average, have spent the most when purchasing real estate in the second quarter of 2013. On the other hand, the cheapest housing is in Nitra Region, where the average price of flats and houses stands at €588 per square metre.

There are also differences in the average prices of flats and houses. At the moment, flats are more expensive than houses by as much as 14 percent, the analysis showed. During the boom of the real estate market in the third quarter of 2008, the average price of flats was 28 percent higher than the average prices of houses, as reported by SITA.

“The decreasing prices of housing negatively correlate with increasing volumes of new loans on housing,” NBS stated in the analysis, as reported by SITA, adding that people borrow money mostly for reconstructions, or re-financing of less advantageous loans. This is why the high number of loans has not affected the prices of real estate yet, NBS explained.

When it comes to accessibility of housing, the NBS analysis showed that it is improving in all regions in Slovakia, SITA wrote.

Source: SITA

Compiled by Radka Minarechová from press reports

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