Housing construction in Slovakia declines sharply, raising concerns over market stability

Slovakia recorded a significant slowdown in housing construction in the first quarter of 2025, with the number of completed apartments falling to its lowest level in nine years. The decline is raising concerns among real estate professionals and policymakers about the future availability and affordability of housing.

According to data from the Statistical Office of the Slovak Republic, 3,119 apartments were completed between January and March 2025, a year-on-year decrease of 24%. Compared to the ten-year average for the same period, completions dropped by 25%, marking the lowest quarterly figure since 2017.

Family houses continued to dominate the market, accounting for 72% of completed dwellings. The lack of larger residential projects suggests a slower pace of apartment building, particularly in urban areas where demand remains high.

Regional trends revealed uneven development. Six out of Slovakia’s eight regions recorded a double-digit decline in completions. Bratislava, traditionally the country’s most active construction market, saw only 540 apartments completed—more than 50% below the ten-year average. Significant decreases were also reported in the Nitra and Žilina regions. Only Banská Bystrica and Košice showed year-on-year growth, though in Banská Bystrica the increase was largely due to comparison with a low base from the previous year.

The number of new housing starts also declined. In the first quarter, 3,198 apartments began construction, the lowest number for a first quarter in 12 years. This represents a 16.7% year-on-year decrease and a 27% drop compared to the ten-year average. Family houses made up 56% of new starts.

While some regions, such as Košice and Bratislava, recorded increases in new housing starts, analysts point out that these gains were largely due to a low base effect rather than a true market recovery. Even in Bratislava, new starts remained 21% below the long-term average.

Experts warn that the slowdown in both completions and new starts may further constrain housing supply in the coming years. Jana Morháčová, spokeswoman for the Statistical Office, noted that the current trend could lead to deeper shortages in the housing market, particularly in urban areas where demand remains strong.

At the end of March, 77,000 housing units were under construction across Slovakia, a 2.9% decrease year-on-year. The limited supply of new housing is expected to exert upward pressure on prices, while increased interest in existing apartments may also push prices higher for second-hand properties.

The slowdown reflects broader structural challenges in the construction sector, including high material costs, labour shortages, and lengthy permitting processes. According to analysts, these factors, combined with elevated mortgage rates, are contributing to reduced construction activity.

Despite these challenges, there are expectations that recent interest rate cuts by the European Central Bank could ease financing conditions and support the recovery of construction activity. Improvements to administrative procedures under the new construction law, effective from April, may also help accelerate project approvals.

Demand remains steady, particularly for smaller and more affordable units. Buyers are focusing on two- and three-room apartments in suburban areas or smaller towns where prices are more accessible. Family houses on the outskirts of cities are also attracting interest due to their relatively lower prices and good transport links.

However, experts warn that without more substantial policy measures, including support for rental housing and streamlined planning procedures, the supply of new housing will continue to lag behind demand, leading to further affordability challenges.

“The state has the potential to support rental housing development, which could contribute to stabilizing the market. If current trends continue, a more balanced supply could begin to emerge within the next two years, gradually moderating the pace of price increases,” said Tomáš Bohuček, an analyst at 365.bank.

Source: Trend.sk

Average wage in the Czech Republic rises to CZK 46,924 in the first quarter, real growth at 3.9%

The average gross monthly wage in the Czech Republic increased by 6.7% year-on-year to CZK 46,924 in the first quarter of 2025, according to data released by the Czech Statistical Office (CZSO). After adjusting for inflation of 2.7%, real wages rose by 3.9%. The median wage also grew, reaching CZK 38,385, with men earning a median of CZK 41,677 and women CZK 35,226.

Wages between CZK 21,136 and CZK 73,611 were reported for 80% of employees. Real gross wages, however, have not yet returned to pre-pandemic levels, analysts noted, also pointing to widening income disparities.

According to Jitka Erhartová, Head of the Labour Statistics Department at the CZSO, the smallest year-on-year wage increases were recorded in mining and energy distribution, though wages in these sectors remain well above the national average. The average wage in mining was CZK 49,455, and CZK 61,594 in electricity, gas, and heat supply.

The highest wage growth was recorded in real estate activities, where average earnings rose by 12.4% to CZK 47,411. Wages also increased by approximately 11% in professional, scientific, and technical activities. In construction, wages rose by 10% year-on-year.

The information and communication sector reported the highest average wage, increasing by 8.8% to CZK 92,888, followed by the financial and insurance sector at CZK 84,069. At the other end, accommodation and food services reported the lowest average wage at CZK 27,953.

Regionally, Prague had the highest average wage at CZK 62,472, while the Karlovy Vary Region recorded the lowest at CZK 39,642. Across all regions, wages grew between 5% and 7.6% year-on-year, with Prague seeing the highest increase and the Liberec Region the lowest.

The number of employees increased by 0.4% year-on-year to 4.025 million.

Although real wages have been rising year-on-year since early 2024, they remain below pre-pandemic levels in gross terms. Net wages, however, have surpassed pre-pandemic levels due to changes in the tax system, including the abolition of the super-gross wage tax.

David Marek, Chief Economist at Deloitte, noted that while wages have risen faster than prices for two consecutive years, purchasing power remains below 2019 levels. Petr Dufek, Chief Economist at Creditas Bank, suggested that pre-pandemic real wage levels may be reached next year. Vít Hradil, Chief Economist at Investika, emphasized that while gross wages lag behind, net incomes have already exceeded pre-pandemic figures.

Analysts also pointed out that median wage growth continues to lag behind average wage growth, indicating slower wage increases among lower- and middle-income earners compared to those with higher incomes.

Miroslav Novák, Chief Analyst at Citfin, highlighted this trend, while Stéphane Nicoletti, CEO of Up Czech Republic, warned that alongside wage increases, other workplace issues such as rising workloads, decreasing motivation, and deteriorating work relationships are becoming more prevalent and require attention.

Source: CTK

New Prague apartment requires 15.5 years of wages, Up from 14.5 six months ago

Purchasing a new 70-square-metre apartment in Prague now requires 15.5 years’ worth of gross wages, up by one year compared to six months ago, and five years more than in 2015. Prague continues to have the least affordable housing market in Central Europe, according to an analysis by Central Group presented to journalists today.

The supply of new apartments in Prague has declined by 1% since the start of the year. Persistent demand exceeding supply has driven the price of new apartments up by 10% year-on-year — the highest rate among major cities in the region.

Although around 150,000 new apartments are at various stages of preparation in Prague, developers are facing delays due to a protracted and complex permitting process. These projects could eventually provide housing for approximately 300,000 people. The largest numbers of new apartments under preparation are located in Prague 9 and Prague 5, with more than 12,500 units in the approval phase in Prague 5 and over 9,000 in Prague 9.

Dušan Kunovský, founder and CEO of Central Group, emphasized the need to accelerate the permitting process. “However, expediting permitting alone is not enough. It is also necessary to make spatial planning more flexible and reduce excessive regulations that increase the cost of housing construction,” he stated.

Comparatively, purchasing a new apartment requires 14.8 years of wages in Bratislava, about 11 years in Munich, 8.5 years in Warsaw, and fewer than eight years in Berlin and Vienna.

According to a joint analysis by Trigema, Central Group, and Skanska Residential, developers sold 2,550 new apartments in Prague in the first quarter of 2025 — an increase of 60% year-on-year and the highest first-quarter figure in the past 15 years. Higher quarterly sales figures were only recorded in the second quarter of 2021. The average asking price for new apartments reached CZK 167,947 per square metre in the first quarter, 10% higher year-on-year and 2.9% higher compared to the previous quarter.

The recent decline in interest rates has been a significant driver of increased demand for new apartments. Additionally, investors are turning to real estate amid volatility in financial markets.

Based on Central Group data, the average gross monthly wage in Prague is CZK 63,106, while the average price of a new 70-square-metre apartment is CZK 11,756,291. The affordability index uses wage data from the Ministry of Labour and Social Affairs and apartment prices from the developers’ joint analysis. Data from the Czech Statistical Office show the average gross wage in Prague was slightly lower, at CZK 62,472, in the first quarter.

Forbes: Renáta Kellnerová remains the most influential woman in the Czech Republic

Forbes magazine has once again ranked Renáta Kellnerová, owner of PPF Group, as the most influential woman in the Czech Republic. Lenka Bradáčová, recently appointed Supreme Public Prosecutor, retains second place, while PPF’s Chief Financial Officer Kateřina Jirásková has moved into third position.

Forbes published its annual ranking online today, highlighting Kellnerová’s growing involvement in PPF’s activities. Editor-in-chief Zdravko Krstanov noted that Kellnerová continues to direct the group towards more conservative and stable investments, including acquisitions of major Prague hotels such as Hilton and Four Seasons. Beyond business, Kellnerová is active in philanthropic initiatives, particularly through The Kellner Family Foundation, which supports educational scholarships for students.

Bradáčová, who had served as Prague’s Chief Prosecutor until April this year, continues her longstanding presence at the top of the list.

Kateřina Jirásková, who has been with PPF for 25 years, recently assumed the role of co-CEO alongside Didier Stoessel. Together, they oversee the group’s operations following Jiří Šmejc’s departure at the end of his term. Jirásková now shares responsibility for managing one of the largest private financial groups in the region.

Other notable figures in the top ten include Michaela Chaloupková, Director of the ČEZ Administration Division and Board Member at ČEZ; Katarína Kohlmayer, CFO and Board Member at KKCG; Minister of Defence Jana Černochová (ODS); Petra Kutnarová, co-owner of DEK Building Materials; entrepreneur Ivana Tykač; and Simona Kijonková, co-owner of JSK Investments.

Former European Commission Vice-President Věra Jourová, who transitioned to a role as Vice-Rector at Charles University, dropped from third place last year to 78th position. Speaker of the Chamber of Deputies Markéta Pekarová Adamová (TOP 09) also declined in the ranking, falling from seventh to 31st, after announcing she will not seek re-election due to health reasons.

The list also includes Dana Drábová, Chairwoman of the State Office for Nuclear Safety, who ranks 15th, and Eva Pavlová, the President’s wife, at 16th.

Forbes has been publishing the ranking of the 200 most influential women in the Czech Republic for 14 years. The list covers representatives from politics, business, and the non-profit sector, with rankings based on a set of defined evaluation criteria.

Housing prices in Slovakia continue to rise, analyst warns of long-term market shifts

Housing prices in Slovakia rose by 13% year-on-year in the first quarter of 2025, according to data from the Slovak Statistical Office. This marks the first double-digit increase since the third quarter of 2022, suggesting a renewed rise in demand after a brief slowdown.

Matej Horňák, an analyst at Slovenská Sporiteľňa, noted that falling mortgage rates and a strong labor market are contributing to the renewed growth in housing prices. However, he cautioned that these trends are occurring against a backdrop of limited supply, which continues to lag behind the country’s needs.

Horňák emphasized that while current conditions support continued price growth, Slovakia faces significant demographic challenges that could reshape the housing market in the long term. He expects the structure and accessibility of housing to change as a result of these shifts.

New and existing properties both recorded notable price increases, rising by 10% and 14% year-on-year, respectively. Regionally, the Bratislava area saw the most significant growth, with prices rising by 27%. Double-digit increases were also observed in the Nitra, Košice, Žilina, and Prešov regions.

The recovery in the mortgage market is another factor supporting housing demand. In April 2025, the volume of new mortgages exceeded €680 million, the highest since 2022. The average interest rate on new mortgages has fallen to 3.7%, 0.8 percentage points below the previous year’s peak, providing further stimulus to the market.

Despite strong demand, the supply of housing remains constrained. While transactions involving existing properties continue, building permit statistics do not indicate a significant increase in new housing construction. In the last quarter of 2024, the number of housing starts declined by 15% year-on-year, and the number of completed units fell by 16%.

Horňák pointed out that Slovakia has the highest average household size in the European Union, with an average of 3.1 people per household compared to the EU average of 2.3. This indicates an ongoing need for more, and more affordable, housing options.

While demand remains strong and borrowing conditions have improved, Horňák warned that the gap between housing prices and household incomes is widening. This could slow the rate of price increases going forward.

Looking ahead, demographic trends such as an ageing population and a potential decline in overall population are expected to alter housing needs. Future demand may shift toward smaller, more accessible, and better-equipped housing units, potentially easing pressure on the market over time.

Source: SITA

Poland’s housing loan inquiries rise 46.4% year-on-year in May 2025

According to the latest data from the BIK Housing Loan Demand Index, the value of housing loan inquiries rose by 46.4% year-on-year in May 2025. This indicates that, on a working day basis, banks and credit unions in Poland submitted housing loan inquiries for amounts significantly higher than in May 2024.

The BIK Housing Loan Demand Index measures changes in the value of housing loans requested by individual clients compared to the same period in the previous year. It serves as a tool for analysts and financial institutions to assess market trends and forecast credit activity in the coming months.

In May 2025, 38,630 individuals applied for housing loans, compared to 26,990 in May 2024, reflecting a year-on-year increase of 43.1%. Compared to April 2025, the number of applicants rose by 8.4%.

The average requested housing loan amount in May 2025 was PLN 467,600, an increase of 7.4% compared to the previous year and 2.1% higher than in April 2025.

According to Dr. Waldemar Rogowski, Chief Analyst at BIK Group, the number of housing loan applicants in May reached its highest level since October 2021, excluding brief periods of increased activity in March 2022—related to anticipated interest rate buffer changes—and the second half of 2023, following the introduction of the Safe Loan 2% Program.

Dr. Rogowski noted that the demand for housing loans is being influenced by the recent interest rate cut, with borrowers responding to expectations of further reductions. High interest rates between mid-2022 and mid-2023 had led to a significant decline in demand. Additional factors contributing to the renewed interest include relatively stable real estate prices and signs of price declines in the secondary market, encouraging property purchases.

The average requested loan amount of PLN 467,600 in May 2025 represents the highest recorded level. Dr. Rogowski anticipates that in the coming months, the BIK Housing Loan Demand Index may continue to rise, driven by both an increase in the number of applicants and higher average loan amounts.

NEPI Rockcastle CEO Rüdiger Dany to step down in March 2026

Rüdiger Dany, CEO of NEPI Rockcastle, has announced that he will leave the company in March 2026. The decision was made in agreement with the company’s Board of Directors.

Dany stated that the early announcement is intended to allow sufficient time for the Board to appoint and transition a new CEO. He will remain in position to complete the 2025 financial year and present the full-year results, reflecting the impact of major acquisitions completed in 2024 and earlier strategic investments.

Since Dany assumed the CEO role in February 2022, NEPI Rockcastle’s net operating income has increased by 58%, from EUR 347 million to EUR 547 million by the end of 2024, excluding energy revenues. Distributable earnings per share grew by 75%, from 34.42 euro cents to 60.17 euro cents. Over the same period, the company raised EUR 1.7 billion, including EUR 1.2 billion in debt and EUR 500 million in equity, notably through a EUR 300 million bookbuild in 2024.

NEPI Rockcastle has made acquisitions totalling EUR 1.2 billion since 2022, with a focus on retail properties in Poland. The company maintained a stable loan-to-value (LTV) ratio of 32.1%, remaining below its 35% target.

During his tenure, Dany also oversaw the establishment of NEPI Rockcastle’s renewable energy business, which is aimed at supplying electricity to its properties and tenants. The initial investment of EUR 34 million in Romania between 2022 and 2023 generated EUR 9 million in revenue by 2024. The company expects the renewable energy initiative to achieve returns higher than those of traditional retail developments.

George Aase, Chairman of NEPI Rockcastle, thanked Dany for his contributions and confirmed that a search process for the next CEO has begun. The Board has engaged an executive search firm to evaluate internal and external candidates. Further updates will be provided once the appointment is made.

NEPI Rockcastle is active across Central and Eastern Europe, operating a portfolio of shopping centres and maintaining a strong presence in retail real estate markets.

EU sustainable development report highlights areas of progress and concern

Eurostat has released its 2025 edition of the “Sustainable Development in the European Union — Monitoring Report on Progress Towards the SDGs,” offering a comprehensive statistical overview of the European Union’s journey toward achieving the United Nations’ Sustainable Development Goals (SDGs).

The report, now in its ninth edition, assesses the EU’s progress across all 17 SDGs over the past five years, drawing on official data from EU member states and institutions. Significant strides were made in key areas such as reducing inequalities (SDG 10), promoting decent work and economic growth (SDG 8), and enhancing quality education (SDG 4). These domains have seen consistent improvements, reflecting the Union’s commitment to fostering inclusive and sustainable development.

Moderate progress was noted in several other areas, including gender equality (SDG 5), responsible consumption and production (SDG 12), industry, innovation and infrastructure (SDG 9), and zero hunger (SDG 2). However, the pace of progress was slower than in previous reporting periods, indicating room for further action.

The report also highlights areas where advancement has stalled or regressed. No significant progress was recorded for life below water (SDG 14), largely due to the limited expansion of marine protected areas and deteriorating ocean health. Moreover, setbacks were observed in clean water and sanitation (SDG 6) and life on land (SDG 15), with challenges such as water stress, land degradation, and biodiversity loss impacting these goals.

Valdis Dombrovskis, European Commissioner for Economy and Productivity, emphasized the importance of maintaining focus on sustainability despite ongoing geopolitical tensions and economic uncertainties. He reaffirmed that the SDGs remain integral to the European Commission’s strategies and that continued efforts are necessary to meet environmental targets under the European Green Deal.

In a first for the series, this year’s report also examines regional disparities in SDG progress, providing insights into the uneven development across different parts of Europe. It underscores the principle of “leaving no one behind” by analyzing key sustainability indicators at the regional level.

Mariana Kotzeva, Director-General of Eurostat, noted that while the EU has made notable progress, the path to achieving the 2030 Agenda remains complex. She emphasized that the report serves as an important resource for policymakers, researchers, and citizens alike, offering a clear picture of achievements and highlighting areas that demand further action.

The monitoring report is accompanied by a dedicated communication package, including the new SDG EU Progress Tracker and country-specific overviews, available through Eurostat’s website. These tools aim to enhance transparency and facilitate a broader understanding of the EU’s sustainability performance as the 2030 deadline approaches.

Wages in Slovakia rise by 4.9% in early 2025, real growth slowed by inflation

Average wages in Slovakia increased at the beginning of 2025, although rising inflation limited the real growth. According to data from the Statistical Office of the Slovak Republic, the average nominal monthly wage in the first quarter reached EUR 1,518, up 4.9% compared to the same period last year. This represents an average increase of EUR 71.

While the pace of nominal wage growth slightly accelerated compared to the previous quarter, inflation slowed real wage growth to 1%, the slowest since late 2023. After seasonal adjustment, the average wage increased by 1.6% compared to the fourth quarter of 2024.

Across the economy, 18 out of 19 monitored sectors recorded a year-on-year increase in nominal wages. In two-thirds of the sectors, wage growth exceeded the national average. Increases ranged from 1% in education to nearly 14% in real estate activities and mining and quarrying. After adjusting for inflation, 16 sectors registered real wage growth, while three sectors—energy supply (electricity, gas, steam), education, and public administration—recorded a decrease in real terms. Employees in mining and quarrying, real estate, and water supply reported the highest real wage growth.

Among sectors with high employment levels, trade outperformed industry for the first time in over a year. Nominal wages in trade rose by 6.2% to EUR 1,453, with real growth of 2.2%, exceeding the national average. Industry, the largest employer, saw nominal wage growth of 4.3%, with the average wage reaching EUR 1,624 and real growth of just 0.4%.

The highest average monthly wage was recorded in financial and insurance activities, exceeding EUR 3,100. Employees in information and communication and in electricity, gas, and steam supply also earned over EUR 2,600 per month. However, in 11 of the 19 monitored sectors, gross wages remained below the national average. The lowest wages were found in accommodation and food services (EUR 908) and in other activities (EUR 964).

Regionally, Bratislavský kraj was the only region with above-average wages, averaging EUR 1,901. In other regions, wages ranged from EUR 1,179 in Prešovský kraj to EUR 1,417 in Trenčiansky kraj. Nominal wages increased year-on-year in all regions, with the most notable rise of 8.2% recorded in Nitriansky kraj. Real wage growth was observed in five regions, with Nitriansky and Trenčiansky kraj seeing increases of more than 2%. Wages decreased in real terms in Bratislavský and Žilinský kraj, while remaining unchanged in Banskobystrický kraj compared to the previous year.

Apartment transactions in Romania fall 9% in early 2025

The number of apartment transactions in Romania declined by nearly 9% in the first four months of 2025 compared to the same period in 2024, according to data from Colliers. In Bucharest, the decrease was more pronounced at 12%. Tighter access to financing, economic uncertainty, and rising construction costs contributed to the slower activity in the residential market.

Several factors have combined to impact buyer confidence and purchasing power. According to Gabriel Blăniță, Associate Director for Valuation & Advisory Services at Colliers Romania, a slowdown in the labor market, moderate wage growth, political uncertainties tied to the electoral cycle, and continued increases in housing prices have created difficult conditions for transactions. Access to mortgage financing has become more limited due to persistent inflation and economic instability. The removal of certain tax incentives at the start of 2025 has raised labor costs for developers, further increasing housing prices. Additionally, a shortage of construction workers, exacerbated by ongoing infrastructure projects, is becoming more evident.

After a 20% drop in housing deliveries in Bucharest during 2024, 2025 has not shown clear signs of recovery. Although construction activity rose by 9% in the first quarter, the volume of housing completions is not expected to return to previous levels in the near term.

Despite these challenges, interest in homeownership remains high. Surveys by Eurostat indicate that demand for housing is approaching record levels. However, purchasing a home has become more complex, especially for buyers reliant on credit. Inflation, elevated financing costs, and potential fiscal measures aimed at reducing the budget deficit are affecting affordability.

Colliers consultants anticipate that inflation will stay high in the medium term, which could limit the central bank’s ability to ease monetary policy. Fiscal adjustments to address the budget deficit may also indirectly affect the housing market. As a result, 2025 is expected to remain challenging for buyers.

High financing costs are influencing not only demand but also developers’ willingness to launch new projects, particularly in the mid-market segment. In this environment, the rental market is gaining importance. In Bucharest, about 15% of residents live in rental housing, a figure that could rise as renting becomes a more accessible option for those unable to secure mortgage financing. Although this percentage remains below the European average, affordability pressures and a shortage of new supply in central areas are likely to drive further growth in rental demand.

Looking ahead, Colliers notes that the residential market’s performance will depend on monetary and fiscal policies, labor market conditions, and how developers adapt to changing cost structures and demand patterns. While transaction volumes are adjusting, interest in urban housing remains steady, suggesting that market activity will continue at a more moderate pace with increased attention to efficiency and affordability.

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