The coronavirus crisis is only into its second month but there are already signs that it’s unleashed a crisis in the residential sector. The people in the most trouble are those that bought flats in order to lease them out on a short-term basis to tourists through Airbnb-type platforms. Some owners are looking for long-term tenants instead, which is pushing down rents for flats in the center, while others simply want to sell their apartments in order to create financial reserves. Their fears that prices are likely to drop as the economy falls into recession are being echoed by real estate agents. “We can expect the percentage drop in prices to be in the single digits,” says Haha Kořínková of Sreality.cz. “How long this takes depends not just on the real estate market but on the overall economy. Homes in interesting locations will hold their price but in less attractive locations there could be a mild fall in prices.”
“Assuming a similar scenario as in 2008 and 2009, then we expect a fall in the price of real estate,” said Vladimír Zuzak of Maxima Reality. “Prices will probably fall for a year or two. For the time being, we estimate a fall of 15 percent compared to today’s prices, but the fall could be even deeper.” Flats will fall the furthest, followed by houses and then land.
