The new Jaguar Land Rover plant in Nitra (source: Sme)
After the British carmaker Jaguar Land Lover (JLR) announced its plan to build a brand new plant in Nitra, local real estate prices skyrocketed. Now the situation seems to be calming down. This is because the central bank has tightened conditions for taking out mortgages as well as developers announcing projects for the construction of new apartments.
In the years 2016 and 2017 real estate prices in Nitra and its vicinity increased by 20-30 percent. Rudolf Pauke from the real estate agency RE/MAX Family does not see this as natural growth caused by an increase in employment, labour productivity or wages. Real estate prices were mainly affected by the behaviour of people, the TASR newswire reported.
After the announcement of the investment, real estate prices began to increase. Because of this many sellers withdrew their offers from the market with the aim of waiting for higher prices. On the other hand, there was a high demand from people who wanted to buy residential real estate with a view to later renting it or selling it on for a higher price. This resulted in a drop in offers and an increase in demand, causing a significant increase in prices.
The price of one-room apartments and studios grew the most. While before JLR’s arrival a studio in Nitra went for about €29,000, at the time of the biggest boom in prices one could expect to pay as much as €54,000. The price of a one-room apartment went from €35,000 to almost €70,000. At this level they could no longer be sold, so the price cap was about €65,000, said Matias Fest from Fest Garant Invest, as cited by TASR.
The price increase in land was even higher due to a shortage. Before the arrival of the carmaker, land cost €30-€50 per square metre. Now it is €80-€120 per square metre, said Fest.
