Slovak Housing Market Holds Firm as Supply Shortages Sustain Price Growth

Slovakia’s housing market continues to defy broader economic pressures, with prices remaining elevated despite slower growth and weakened household purchasing power. Data from the National Bank of Slovakia show that while property price increases eased in the second quarter of 2025, the market remains under structural strain due to a shortage of new housing.

The average residential property price reached roughly €2,800 per square metre, maintaining a double-digit increase compared to the previous year. Apartments recorded stronger gains than family houses, particularly in the capital, where new projects continue to command record values. Analysts describe this phase as a cooling period rather than a correction, with prices stabilising at high levels rather than reversing.

The slowdown in price acceleration contrasts with a renewed surge in mortgage demand. Following a year of subdued lending, Slovak banks recorded a significant rebound in new housing loans through the summer months. Average interest rates dipped below 4 percent, encouraging buyers to re-enter the market. Financial advisors report a strong rebound in activity, especially among younger households seeking long-term fixed-rate loans.

Despite this, affordability continues to deteriorate. Wage growth has failed to keep pace with housing costs, and the stock of available apartments remains limited. According to official data, the number of completed dwellings in the first half of 2025 fell by nearly 20 percent compared with the same period last year, the lowest level in more than two decades in Bratislava.

Regional differences are becoming more pronounced. The Bratislava and Trnava regions continue to show moderate price increases, while parts of eastern Slovakia are seeing a mild decline after years of strong growth. Market observers suggest this shift signals a more mature phase of development, in which local economic conditions and infrastructure increasingly shape demand.

The overall outlook for 2026 points to continued stability rather than rapid expansion. While growth in housing prices is expected to remain in the single-digit range, shortages in supply and persistently strong urban demand mean that a significant drop in values appears unlikely. In essence, Slovakia’s housing market is moving into a slower—but still upward—cycle, sustained by limited new construction and the enduring appeal of homeownership.