To be able to describe the investment possibilities in the region of Central Europe and especially Slovakia, it is necessary to understand the historical and economic background of the former socialist countries. The people were generally poor in respect of income but private ownership of real estate was very common. The socialist era guaranteed living and work or at least small income to everybody. The conditions were set to maintain the wealth of folk in general at the same level. There was a level of close friend of the regime which had the restricted access to the commonly owned properties. The possibilities, interpersonal relationships (good friends) together with knowledge of publicly owned factories and business formed the great advantage in the process of implementation of the West European economy model in Slovakia.
Based on the historical development of the economy in the socialist block formed by Russia, the high-tech industry was concentrated in more west located countries. In case of Slovakia the processing of raw material imported from Soviet union was introduced in Slovakia and sent to Czech republic for final completion including more advanced technology incorporation. As a result here were different type of business and different level of development reached in both of the regions of one common state.
The rapid development of the Slovak economy could start after the external capital and high-tech technology was imported or combined with domestic knowledge and skills of workforce with relatively low personal costs. Natural economic growth in combination with increased domestic consumption and market were able to speed up the economic growth again and again in a round. The demand of real estate followed the higher income regions as it was more attractive for the labor force. The capitol city – Bratislava with it’s unemployment rate at the level of natural unemployment reached the highest prices in Slovakia and as the circle of living round Bratislava extends, as the incoming people accept the time of travel because of higher salary compensation. The known proverb – Buy real estate ( locally called nehnutelnosti or reality in Bratislava ) near growing city, was a very successful strategy in Slovakia. The local nehnutelnosti increased in prices and brought large profit margin for the investors in the past. The growing curve of the real estate prices started to be monitored first by the local real estate magazine and real estate server – TRH Nehnutelnosti – Real estate market. The main Growth rate started in 1998 and continued till the year 2009 when the prices stood at maximum but the more luxury market turn-over absolutely vanished and the only traded real estate – nehnutelnosti were small flats, necessary for own living.
The disappeared market turn-over returned back and continuing trend of real estate ( reality ) prices growth slowly started after the year 2013 with massive lending campaigns of the local banks. The belief in the stability of the real estate as value keeper returned in the mind of people. The situation started to be attractive for the investors keeping the capital and have an easy access to the bank finance in the same time. The created profit gave positive feedback to the investors and enabled a large construction wave of housing premises as well as administration premises – mostly open space offices.
The reasons for investing in Real Estate in Slovakia
There are many reasons for investment in Real estate and nehnutelnosti ( reality ) in Slovakia are one of the most ideal mean. The following factors represent only a small overview:
- The table trend of real estate prices rise in Slovakia;
- Growing Slovak economy together with the inflow of foreign capital due to the skilled labor force and low costs;
- safety in Slovakia – both physical as well as legal. Low level of crime contribute to the stable environment;
- Finally, the prices have large potential to increase dua to the above mentioned factors.
Everybody interested, owning a bit of capital should learn the words for real estate in Slovakia – nehnutelnosti and reality, because where else would you invest?
Real estate portal TRH.sk – Invest in real estate - reality
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