Mortgages and long-term consumer loans in Slovakia are the cheapest among the V4 countries, underlines the Institute for Strategy and Analysis (ISA), an analytical unit of the Office of the Government. The V4 formation also includes Czech Republic, Hungary and Poland. In November 2023, Slovak citizens could take out a mortgage with a fixing period of 1 to 5 years at an average interest rate of 2.9%. The figure stood at 5.2% in the Czech Republic, 7.4% in Hungary and even 9.1% in Poland. Similar differences were true for shorter and longer fixing times. In this aspect "Slovakia benefits from its membership of the euro area, which is better able to withstand inflationary pressures than countries with their own currency. Their central banks are fighting high inflation at the cost of a significant increase in interest rates, which is also reflected in more expensive loans for households," the ISA explained.
The institute also pointed out that despite lower interest rates, Slovakia has the lowest inflation among the V4 countries, since 2020. "At the same time, interest rates on housing are also below average compared to other euro area members, which shows effective competition in the Slovak banking market," ISA added.