Bezrealitky registers growing interest in old houses stimulated by the launch of discounted loans, demand can start price growth. 15% are on offer, a fifth cheaper than average.
At the end of February, the first building societies announced the launch of discounted loans at half the rate for the purpose of drawing subsidies from the Repair Grandma’s House programme. A total of five billion is earmarked, and the programme is expected to run next year, when the rate will be even lower. The growing interest in older houses is confirmed by the Bezrealitky portal, according to whose data the average number of responses per offer has increased by about 40% year-on-year. Bezrealitky’s offer now includes about 15% of old houses, the average price is around CZK 38,159 per square metre. For a number of houses, whose price has been falling since autumn 2022, a halt in the price decline and possibly a reversal of the price trend can be expected this summer due to increased demand.
A subsidy of up to CZK 1 million, which will cover the cost of insulation, subsidy bonuses and contributions to other energy-saving measures, will now be available for homeowners to combine with a soft loan with a maximum 3.5% APR and a fixation period of up to five years. In addition, this loan can be repaid for up to 25 years. While there were only about 300 applications for the programme last year, this year there are already 1 300. In addition, from May onwards, another wave of applications can be expected – the Association of Czech Building Savings Banks intends to help those interested in applying.
“More than 15% of the old houses are now in the Bezrealitka offer, i.e. approximately one in seven houses in the total offer. The average price per square metre of an old house is CZK 38,159, which is approximately 20% less than the average price of houses in general,” says Martin Ponzer, CEO of Bezrealitka. “Of course, prices vary mainly by region and location – the closer to a regional city, the more expensive it is in general. For example, old houses in the Central Bohemian Region cost an average of CZK 53,804 per square metre and in the South Moravian Region CZK 43,503 per square metre. In the case of grandmother’s houses, these are typically houses from the 1930s to the 1950s.”
Old houses experienced the biggest price drop last year – by an average of 10%, in some cases by as much as 34%. If inflation is added, the real price drop was even greater. The market has seen unprecedented investment opportunities for many households who had been living in rented accommodation with no chance of owning their own home. These households, who had exhausted their savings when they bought their old house, now have the chance to renovate their house thanks to the subsidy. Similarly, homeowners who have been postponing reconstruction for financial reasons or even “sticking it out” gradually now have the opportunity to speed up the process. This is also reflected in the demand for houses.
“While previously owners were happy to have anyone interested, according to Bezrealitka data, interest is now starting to grow. Interestingly, while demand for newer homes has fallen by more than a third year-on-year, demand for older homes has risen by two-fifths,” comments Martin Ponzer. “We expect interest to continue to grow as the summer approaches and by the end of the second quarter we could see a halt to the price decline in a number of areas and, where prices are now stagnant, an increase. An old house is becoming an interesting alternative for those who want to own their own home and buying a flat in a big city is beyond their means.”
How does the subsidy work?
– For economically active owners of a house or cottage who do not own or co-own any other residential property.
– The property is at least 10 years old and they will reside there for at least 10 years.
– The grant will be received in advance and will cover 50% of the costs.
– You can also draw retrospectively if the renovation started after 1 January 2021.
– What the grant doesn’t cover, a soft loan can cover.
How much is available?
Up to CZK 1 million for comprehensive insulation of a family or holiday home and a bonus of CZK 50,000 for each dependent child.
Funding for other energy-saving measures, e.g.:
– installation of photovoltaic panels – up to CZK 200,000,
– installation of a heat pump – up to CZK 140 000,
– a water heating system – up to CZK 60 000,
– a controlled ventilation system – up to CZK 105,000,
– rainwater harvesting – up to CZK 105,000,
– construction of an electromobility station – up to CZK 15 000.
Author: Martin Ponzer, CEO Bezrealitky
