Sales prices of new flats in Prague at the end of March rose by an average of 5.5 percent year on year to CZK 112,233 per square meter. The rate of increase rose from 2.2 percent at the end of last year. The number of flats sold rose by about three-fifths to 2,100, the most in the last ten years. The number of flats offered by developers fell by more than a tenth year-on-year to 4,200, which is the least in the last three years according to developers Trigema, Skanska Reality and Central Group.
“The hunger for the purchase of a new apartment continues, and this is reflected in average sales prices. Whether it is an apartment for own living or for investment. Insufficient supply, caused by lengthy permits for new construction, combined with growing inputs, is pushing prices up. In addition, more expensive and large flats have found their new owners in recent months, often waiting longer for their buyers, ”said Petr Michálek, Chairman of the Board of Skanska Reality. Compared to the end of last year, the prices of new buildings in the capital increased by four percent. Since mid-2015, when price developments began to break sharply, prices for new flats in Prague have risen by 102 percent.
According to the categories, developers sold the most two-room flats, 44 percent. This was followed by one-room (23 percent), three-room (22 percent) and four-room (11 percent). Of the individual city districts, developers sold the most flats in Prague 5 (23 percent), Prague 9 (18 percent) and Prague 4 (16 percent). On the contrary, in Prague 1 and 2 it was only three percent.
“Currently, we are experiencing a record high demand for new housing on the market. The highest in the last ten years. We also expect great interest in the next period. However, the situation is still complicated by the lack of new residential construction, which is not enough to respond to the needs of the public in a timely and flexible manner. The reason is still the same, namely the complicated and lengthy approval of new projects, “added Marcel Soural, Chairman of the Board of Trigema.
Prague 5 and Prague 4 accounted for the largest number of flats in the developers’ offer, together with about two-fifths. Compared to previous years, the share of Prague 9 decreased. It used to be about one-fifth, this year in the first quarter about one-tenth. With 28 flats, Prague 1 accounted for 0.7 percent.
“The situation is becoming critical. The new supply is absolutely not able to cover the increased demand, which is why there are now the fewest flats on the market in the last three years, which is why the prices of new flats continue to rise. If the situation with the permitting of new flats does not change and the resistance of local governments to new construction does not unblock, the current situation will not improve, ”said the owner of Central Group Dušan Kunovský.
According to the CEO of Finep, Tomáš Pardubický, the importance of cooperative and rental housing will increase. “We still want to continue cooperation in this area with housing funds, which, thanks to the form of their operations, can offer a very interesting approach to rental housing,” added Pardubický.
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 2.1 percent year on year to CZK 108,976 per square meter.
Source: CTK, Trigema, Skanska Reality and Central Group.
