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Analysis: Slovak Real Estate Market Will Crystallise in 2010
Monday 23 November 2009 Zoom in | Print page
Bratislava, November 23 (TASR) - The supply of houses and apartments in Slovakia will still outstrip demand in the near future, says an analysis of the Slovak Central Bank's (NBS) specialist journal Biatec on Monday.
As a result, following the significant drop this year, real estate prices are expected to stagnate in 2010. The analysis expects 2010 to be a year of fundamental crystallisation of the Slovak real property market.
In the past two years, the property market has been hit by the turbulence on financial markets in the wake of the global economic crisis. With some time delay, the market has suffered stagnation, and has even ground to a halt in certain segments – leading to a sharp year-on-year drop in average housing prices.
The average price per square metre reached €1,322 in 3Q09, which was a reversion to price levels of 3Q07. "Average prices declined by 1.5 percent q-o-q in the third quarter of 2009 and by 14.3 percent y-o-y," according to the analysis.
According to NBS, a mild drop in prices should continue until the end of 2009. "If developers pursue the finishing of investments by December 31, 2009 there can be an even more significant q-o-q drop of average prices in 4Q09," says the analysis, adding that prices could drop by 11 percent for 2009 as a whole.
The reasons behind this are mainly the high instability caused by the global economic crisis and the housing supply surpassing demand on the real estate market.
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