The wealth of households in individual European countries varies, with the 2021 net wealth median ranging from €31,300 in Latvia up to €717,700 in Luxembourg, and Slovakia, with its €97,000 median, ranks approximately in the middle of the chart, together with Portugal, the Czech Republic and Greece, analysts of the Slovak Central Bank (NBS) commented on the Household Finance and Consumption Survey released by the European Central Bank.
Countries of Central and Eastern Europe, including Slovakia, have wealth concentrated in real estate to a significant extent. In Slovakia, almost every second young household owns its home via mortgage, quantified the NBS analysts. This level of home ownership at about 90 percent is second only to Romania in the EU.
"Ownership of real estates is a standard choice for households in Slovakia, whether out of historical, institutional or behavioral reasons. On the other hand, the high rate of home ownership goes hand-in-hand with lower amount of liquid assets in relation to gross annual household income," warned the analysts, pointing out that it is adequate financial reserves that play an important role in the face of unexpected economic shocks.
Thus, Slovak households belong among the medium wealth class within the eurozone, although in terms of income they're actually ranking rather low. At the same time, Slovakia belongs among the countries with the smallest economic inequality, owing, again, to the fact of its high rate of home ownership.
In overall wealth comparison, the highest inequalities were measured in Germany, Estonia and Austria.
"On the other hand, the lowest wealth inequality was measured in Slovakia, and it has even decreased since the previous surveys. Real estate makes up the lion’s share of net wealth and the high rate of Slovak home ownership means that only categories of less valuable assets have an effect on wealth inequality," expounded the NBS analysts.
(TASR)
