In the last quarter of last year, apartment prices in the largest cities in the Czech Republic rose by more than a tenth year on year. Flats in Ostrava rose the most, by almost a fifth, and the least in Prague, by 10.2 percent. The most expensive apartments were in Prague with an average price of CZK 102,812 per square meter, the cheapest in Ústí nad Labem with a price of CZK 22,728 per square meter. This follows from the analysis of FérMakléři.cz. She compared the prices of flats in the eight largest cities out of nine, data for Liberec are not available.
“In the year-on-year comparison of the fourth quarter, we can observe that apartment prices in the largest Czech cities have risen without exception. In Ostrava, prices have long been one of the lowest, so there is the greatest potential for growth in the future,” said FérMakléři CEO Jan Boruta.
After Ostrava, prices rose the most in Ústí nad Labem (by 17.3 percent) and Hradec Králové (by 16.3 percent). On the other hand, after Prague, they rose the least in Olomouc (by 10.9 percent) and Brno (by 12.8 percent).
“The increase in prices in the whole country was accompanied by a decrease in the number of offers of flats and also realized sales in all monitored cities except Prague, where the offer increased by 1.6 percent year-on-year in the fourth quarter,” added Boruta. The supply fell the most in Ústí nad Labem (by 17 percent), in Ostrava and Olomouc (both by 14 percent).
“The whole real estate market is waiting for development in the coming months, when the further economic effects of the pandemic may come. I estimate that the crisis related to covid-19 will be reflected in the real estate market this year, specifically for prefabricated flats in suburbs. It is precisely those interested in these apartments that will be most burdened by the financial situation, “said Boruta.
On the other hand, the price drop in flats in new buildings and flats in city centers with 2 + kk or 2 + 1 layouts, which have been in short supply for a long time and which are of great interest to investors, is unlikely, according to him.
The relatively significant rise in apartment prices in large cities is also confirmed by data from the consulting company Deloitte. According to them, prices in Prague and regional cities rose by an average of 15.8 percent year on year in the third quarter last year to 70,300 crowns per square meter. The growth rate was the highest since March 2018. Since 2014, prices in the Czech Republic have increased by an average of 84 percent.
According to experts, one of the main reasons for high prices is low supply. Other reasons for rising prices are rising prices for land, construction work and materials, high tax burdens or unnecessarily strict technical regulations.
Source: Tyden.cz by www.tyden.cz.
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