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April 06 Newsletter & Zilina Deal Update
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Sunday, 30 April 2006
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The Slovak Economy – Current News
Interest Rates and GDP - In February the Slovak central bank (NBS) board decided to hike the key policy rate to 3.5% and was seen in the light of the very strong growth in the Slovak economy (GDP growth in Q4 was 7.5% y/y).
Since then NBS has kept interest rates unchanged due to better than expected inflation figures however a tighter monetary policy could arise next month to maintain Slovakia’s inflation target of 2.8% set for this year and 2.0% set for 2007. If Slovakia wants to adopt the euro in 2009 these targets must be met.
Source: SARIO
The Elections and Tax - The 19% flat tax rate imposed by the Government a few years ago has proven such an effective magnet for foreign investment and therefore the outstanding growth of the country, that all political parties have this at the top of their agenda. The opposition party believes that income tax for higher earning individuals should be increased, but at least both parties seem to agree that the flat 19% tax rate for companies should remain the same – and this is what is important for the continued growth rate of the country.
Opening a bank Account in Slovakia
In order to obtain and service a mortgage in Slovakia you will of course have to have a bank account here. Opening an account is very easily done in Slovakia and the level of bank charges and maintenance charges are relatively low for Central and Eastern Europe.
You will not require a bank account straight away, only when you are ready to start applying for a mortgage you should start thinking about taking action. If you don’t plan to take out a mortgage you will require a bank account here to receive your rent anyway and with the Slovak Koruna appreciating against the Euro by 4% per annum you might just like to hold all your money in here in SKK!
We would recommend one of the larger banks like VUB or Tatrabank as their level of service and fees are the best and both offer good internet banking services. We now have a good contact at VUB who will assist all our clients open bank accounts and they have English speaking people in the branch that we deal with. In fact, we can assist you to do this from abroad - we would only need you to fax passport copies to the branch and they will post documents to you to sign at your home address.
Here is a link to VUB current account info and a link to VUB current account fees.
Please let us know if and when you would like us to assist you with this, and we will liase with our friends at VUB.
Koliba Villas - Latest Site Photographs
Those investors who reserved an apartment at Koliba Villas last year will be pleased to hear that we revisited the site last week and it really is progressing better than we could have hoped for.
The views are stunning, the workmanship and build quality are very good and the timescales all look on track.
You can view the progress and photographs by clicking on the following link: Koliba Photographs
Zilina, A Few Good Units Left
Last month we launched this fantastic deal and there are now only a few good units remaining in this new residential development of 63 luxury apartments in the heart of the regional capital, Zilina.
Slovak Investments has exclusivity on these remaining good units for a very limited time before they are handed back to the developer's waiting list.
We summarise the key points of this investment below:
Zilina is home to the largest foreign investment in the country in the form of Korean car manufacturer Kia’s first European manufacturing base.
The 1,1bn Euro Kia investment will create more than 10 000 new jobs in Zilina over the next 2 years.
Almost two thrids of the development has already sold out, mainly to locals and demand is extremely high for the remaining units that we have exclusivity on.
Only 800m from the pedestrian zone and 500m to the city centre – these are the best value new properties available in the city.
Funding the construction of the Sasvarka Apartments is provided by one of the largest banks in Slovakia, Tatra Bank.
Tatra bank have also agreed to offer mortgages to our foreign investors upon completion (subject to status).
One of the biggest advantages on this deal is that there are no stage payments required.
To see the current availability follow this link and login using your email address as usual: Zilina Deal
Please contact us asap if you would like to reserve a unit in Zilina - once we hand these back to the developer they will sell in days to the local market.
Hopefully this newsletter has been informative and we look forward to speaking to investors in the coming days about the Zilina deal and to answer any questions you might have regarding property investment in Slovakia.
Kind Regards
The Slovak Investments Team
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