Sales prices of new flats in Prague at the end of last year rose by 2.2 percent year on year to CZK 107,877 per sqm (EUR 4,148 sqm). The rate of rise fell from 3.2 percent at the end of September. The number of flats sold rose by 3.6 percent to 5,800, the most since 2016. In the last quarter, developers sold 2,050, which is the strongest sales quarter in ten years. This follows from the data of the development companies Trigema, Skanska Reality and Central Group, which they published at an online conference today.
“The selling price of new flats in Prague has almost doubled in the last five years. The reason is the continuing high demand and at the same time very limited supply of new flats due to their slow permitting. The prices of construction work and land also rose sharply. This trend will continue and in the next year or two we therefore expect prices to stagnate, “said the head of Central Group Dušan Kunovský. Compared to the end of the third quarter, prices of new apartments fell by two percent. Since mid-2015, they have fallen only three times quarter-on-quarter.
The Chairman of the Board of Directors of Skanska Reality, Petr Michálek, added that last year was the third strongest in the last ten years in terms of apartments sold. “Sales culminated significantly, especially in the last quarter. Given last year’s events, this may come as a surprise, but there is confirmation of huge interest in new housing in Prague. investors about rental housing, and this trend will continue, “said Michálek.
According to the categories, the most sold flats were two-room (43 percent) and one-room (25 percent). Less than two-fifths of sales were financed by a mortgage. Of the individual city districts, developers sold the most flats in Prague 5 (25.8 percent), Prague 9 (17.3 percent) and Prague 4 (13.6 percent). On the contrary, in Prague 1 it was only 0.3 percent. Michálek expects a higher number of purchases by institutional investors this year. Last year, for example, the real estate fund of the Czech financier Robert Schönfeld bought the Norská apartment residence in Prague 10. The estimated price of the building is CZK 220 million.
The offer of vacant new flats stagnated year-on-year at 4,950. According to Marcel Soural, Chairman of the Board of Trigema, it was the lowest in the last two years due to the interest of buyers. “Flats remain a commodity in which it is worth investing. But less pleasing is the fact that the process of approving new projects is still not being simplified and accelerated. This may cause another shortage of flats on the market in the next period,” Soural added.
According to the statistics of Trigema, Skanska Reality and Central Group, an apartment with a issued zoning decision and a minimum reservation fee of CZK 50,000 is considered a sold apartment. According to data from rival Ekospol, which uses a different methodology, prices rose by 4.4 percent year on year to CZK 108,753 per sqm.
Source: CZK
