The recovery in the real estate market is finally a positive reality. As reported by the real estate portal Sreality.cz, demand for new residential units in Prague and other Czech cities is constantly rising. According to Sreality.cz data, apartments ranging from 20 to 39 square meters are the most attractive for investors, as they rent faster and offer a quicker return on investment. These smaller units have the best returns in Prague.
There is increased demand for real estate in Prague, not only among investors but also among end customers looking for their own homes. Development companies such as JRD recorded a significant increase in sales in the first quarter of 2024. Interest in new apartments in Prague rose by 80% compared to the end of 2023. This trend can also be observed in other Czech cities, such as Brno, where sales of new apartments have doubled.
Real estate prices and trends
Prices of new apartments in Prague have remained virtually unchanged, but at the same time, growing demand means that development companies have less room to offer marketing bonuses and discounts. This may lead to a slight increase in prices, averaging a few percent. In the first quarter of 2024, the average asking price for new apartments in Prague was CZK 152,644 per square meter.
According to the real estate portal Sreality.cz, Prague is the most expensive location for purchasing real estate, with the highest purchase prices in the entire Czech Republic. However, investors still see Prague as an attractive location for investment.
Mortgage situation and impact on the market
The stabilization of inflation and the expected reduction in mortgage interest rates are contributing to the market recovery. According to ČBA Hypomonitor, the rate on new mortgages fell to 5.19% per annum in March 2024, indicating a downward trend. This situation affects not only the volume of real estate sales but also prices.
Trends in rental housing
Rents in Prague and other Czech cities are seeing a slight increase. Smaller apartments are being rented out the fastest, especially in city centers. For example, the average rent for a 60 to 79 square meter apartment in Prague is CZK 23,214 per month. Larger apartments with an area of over 120 square meters have longer advertising periods and higher rents.
Source: Hospodářské noviny
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