Czech banks are cutting their valuations on real estate on fears over the future course of the economy and the impact of the pandemic on employment. Veronika Hegrova from the mortgage news portal Hyponamiru.cz warned that the value banks were willing to use as the basis for loans was dramatically lower. In part, they are following the lead set earlier this fall when the Czech National Bank revealed that it thought Czech real estate was overvalued by 17 percent. “The first wave of the coronavirus should have resulted in a change in the trend and begin the decline of prices for real estate,” Hegrova told Hospodarske noviny. “But according to the Hypotecni bank index, there was no break in the trend. In the second quarter of the year, real estate prices continued to rise, even though the pace slowed down. Now, the Czech Republic is fighting with a second wave of the pandemic and the price of flats, family homes and land continue to rise.” The operations director of Century 21 Tomas Jelinek told HN that prices for older flats that are in good physical condition are rising across the country, but that it’s going faster in larger cities.
