Developer Creditas Real Estate plans to invest CZK 27 billion in the construction of apartments over ten years. Representatives of the company said at yesterday’s press conference that 1,000 of the 5,500 flats will be used for rental housing. One of such projects will be the U Milosrdných house in Prague’s Old Town, formerly known as the Marshmallow.
Creditas Real Estate’s first rental housing project is the currently opened LOOX Prosek in Prague with 85 apartments. Next June, the company plans to complete the U Milosrdných building with 27 flats and 143 flats will be built by 2025 as part of the fourth phase of Jinonický dvůr. In the Západní brána project in Brno, the company plans to allocate about 300 of more than 890 new apartments for rent.
“We want long-term leases and to build on flexibility, which means offering people rental housing throughout their lives. A young couple will start in a smaller flat, gradually move to a bigger one and then a smaller flat will be enough for old age. This is common in the world and we would like to do it here,” Creditas Real Estate CEO Jiří Vajner told reporters.
The company, like other developers, is starting to focus more on rental housing, as inflation, expensive mortgages and rising prices make it difficult to live in new apartments of one’s own. “There is a renaissance in rental housing,” said Petr Dufek, chief economist at Bank Creditas.
In the Czech Republic, 21.7 percent of people lived in rented accommodation in 2021, according to Eurostat data. Dufek estimated that if the Czechs get rid of the stigma of having to own a flat, the potential is for 30 percent of people in the Czech Republic to live in rented accommodation. Given the prices and the standard of living, people will probably have no choice, Dufek said.
According to a survey carried out by Ipsos for Creditas Real Estate at the beginning of the year among 1,500 people living in a rented house or apartment, rent levels grew slowly last year, with 36 percent of respondents not renting at all. For a quarter of those surveyed, rent costs up to 20 per cent of net income and 37 per cent up to 30 per cent of income. The cheapest in this respect are the Pilsen and Zlín regions, while the most expensive is Prague, where half of the people pay over 30 percent of their income for rent. The largest representation of rental housing is in Brno, where about 35 per cent of people live there. The survey also showed that 82 percent of people prefer long-term renting, but this varies across the country. In Pardubice, for example, people want to stay in a lease, while in Hradec Králové they want their own.
Creditas Real Estate’s 1,000 rental apartments are to have a total area of 40,000 sqm. There will be 4,500 apartments for sale with a total area of 245,000 sqm. “The rental sector is logically pushing for less living space, but the apartments will be equipped, you just need to bring your stuff,” Vajner said.
Among the apartments for sale, the company’s projects include Jinonický dvůr, Nové Boroviny in Kladno and Nová Valcha in Plzeň, where up to 1,100 apartments and family houses are to be built in 11 stages.
Source: Creditas Real Estate and CTK
