Impact of inflation on residential property prices in the V4 countries

This study investigates the relationship between inflation and residential property prices in the Visegrad Four countries – the Czech Republic, Poland, Slovakia, and Hungary. Using quarterly data from 2008 to 2023, the authors analyse how closely housing markets move together with inflation, measured by the consumer price index.

Through correlation analysis and linear regression, the paper tests two main hypotheses: whether a strong positive link exists between inflation and residential property prices, and whether inflation on its own can explain movements in housing prices. The results confirm a positive and statistically significant relationship in all V4 countries, indicating that periods of higher inflation are associated with higher residential property prices.

At the same time, the findings show that inflation alone is not enough to build a statistically robust predictive model for housing prices. The authors highlight the importance of additional macroeconomic variables and point to the need for more comprehensive models that combine inflation with factors such as interest rates, income growth or labour market conditions. The study thus provides a solid analytical baseline for further research and for practical use by lenders, investors, and regulators monitoring housing market stability.