The Bratislava market with new buildings is the largest market for developers. However, in the capital, as well as in the whole of Slovakia, there has been a significant shortage of new flats for several years. The pandemic over the past year has not reduced interest in buying new real estate. On the anothher hand, good credit conditions last year supported the interest in real estate, not only for their own housing, but also increased people's interest in buying investment apartments. And the same trend is expected by real estate experts this year as well, as the banking sector believes in new real estate projects. The low supply of new buildings and higher interest will support a further increase in the prices of new buildings.
Last year, there were still few new buildings
Throughout 2020, the situation on the Bratislava new buildings market was the same. Demand from future owners was still higher than supply from construction companies and developers. This trend has been known on the Bratislava market for several years. "However, we can evaluate positively the end of the last year, when the last quarter brought the most of the new apartments compared to other periods in 2020, despite the ongoing pandemic," says Filip Žoldák, founding partner of real estate agency HERRYS, which monitors developments in the new construction market in the capital.
Less flats than last year, were added in the last period only in 2018 and before that in 2012. The small supply of new flats is a long-term condition on the market and an average of two and a half thousand new properties will be added annually. The situation thus does not reflect the real need on the part of the people.
If we look in detail at the last quarter of last year, there were 200 more dwellings than a year ago, and the same amount of real estate was the supply. In total, almost 2,000 flats were vacant in Bratislava at the end of last year. The most vacant new buildings were in Ružinov.
The declining trend in supply is unlikely to stop this year either, and the proportion of completed dwellings in new buildings will remain at an all-time low.
There are still enough applicants
Throughout the past year, demand has copied supply. In addition to new projects on the market, the sale of real estate was also supported by positive market prospects, as well as the lack of a sufficient alternative in the form of an offer of older flats. "If we look at residential projects, the sale of which began in the last quarter of last year, today almost 40 percent of apartments have been sold out," says Filip Žoldák. Despite the positive change, however, the market recorded a year-on-year decline in sold apartments by almost 35 percent. Fewer flats than in 2020 were sold last in 2012.
Prices have risen and will continue to rise
Despite the fact, that the growth of prices slowed down, the prices of new real estate in Bratislava increased by more than 11 percent throughout the year. "The price per square meter in the new building last year increased by more than 300 euros without value added tax. We can expect that the growth of prices will continue this year, "says Filip Žoldák.
In the last quarter of 2020 alone, the price per square meter in Bratislava's new buildings increased from 2,876 to 2,913 euros excluding VAT. The new applicants paid the most in the Old Town (3,648 EUR / m2 without VAT) and in Ružinov (3,019 m2 without VAT). High prices in these parts of the city are mainly due to the location and expanded offer.
Those who are still hesitating to buy a new property are waiting for the same news this year as in the last period. New projects in attractive parts of Bratislava will cause a further increase in the average price. In particular, it is the new center of the capital around the future bus station, where hundreds of new flats were added to existing projects at the end of the year. The new Metropolis project has announced the start of construction, and another residential and administrative project on the corner of Košická and Landererová streets is awaiting the decision of the authorities.
Rising prices in Slovakia, together with affordable and advantageous financing, support people's interest in new buildings. And not only for their own housing, but it can be assumed that in the following period the number of investment apartments will also increase. "We see in the market that banks still believe in residential projects and we assume that they will continue to do so, which will positively support the market with new buildings," concludes Filip Žoldák.
