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Real Estate Prices to Fall, Market to Bottom Out Towards End of 2010
Friday 18 December 2009 Zoom in | Print page
Bratislava, December 18 (TASR) - The real estate market in Slovakia hasn't reached its nadir yet, TASR was told by UniCredit Bank analyst David Derenik on Friday.
"Prices of apartments continue to fall, but more slowly," said Derenik, adding that prices are down 15 percent compared to their highest level – and they have decreased the most in eastern Slovakia. Prices are dropping most rapidly in Presov region now due to the fast rising unemployment there.
Real estate prices are now on the level from 3Q07 and they will continue falling, said Derenik. The final burst of the price bubble is yet to come.
The turning point should be reached first in Bratislava region, where prices should start stagnating or slowly rising towards the end of 2010. "The development of salaries, unemployment and other macroeconomic indicators don't, however, indicate that prices could start growing in a more significant way. They should rather stagnate in the coming years. A steep apartment prices' increase as we have witnessed in the recent past is not very probable," said Derenik.
As for the types of apartments, the price bottom is now being reached by older apartments. He says these apartments should be pretty much bottomed out now, especially those in blocks of flats located on the peripheries.
"In the calculation vis-a-vis square metres, the cheapest remain two-bedroom apartments, while their advantageous price difference compared to smaller apartments is not so significant as before the crisis," said the analyst.
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