Why selling your property now is the way to go?
Even if you get an above average salary, buying your own space in Prague is not at all easy. On a standard apartment of 50-60 square meters, Prague residents needed roughly €190,000 for closing a deal. More expensive housing than the average salary in the city in Europe is true for only the residents of London and Paris.
This results from an analysis of the Institute for Strategic Investments from the Faculty of Finance and Accounting of the University of Economics, which is based on the Deloitte Property Index for 2017. The analysis compares the cost of buying old and new flats with salaries in fourteen European capitals.
The average bid price for an apartment in Prague’s new building is now at around CZK 95,000 per square meter due to a lack of housing in the market. Even this year, demand is outpacing supply, and prices will continue to rise.
Below CZK 50,000, purchasing is not possible
The price of older apartment blocks, which are among the least popular, ranges from 50 to 55 thousand Czech crowns per square meter. In better locations, this can exceed to CZK 60,000.
Apartments in brick houses are sold at a minimum price of around 70,000 in outcrowns per square meter. But it is much more common in the case of brick flats, according to our brokers, the price is between 80,000 and 90,000.
This year, we do not expect significant growth and it seems that now is the ideal time to sell, as flats start from 50,000 Czech crowns per square meter on the outskirt areas and reaching to the inner parts so to say 'the sky is the limit'.
Compared to the Western European cities, however, prices in Prague are still about a half, sometimes even a third of the comparable prices. Eg. in Milan, prices in the historic center range from €10,000 to €70,000 per square meter (250-430 thousand crowns).
The capital of the Czech Republic is slowly reaching the metropolis, which has an impact on the availability of housing in Prague. As of the banking sector, the problem is mortgages are low on interest (about 2-2,5 %) and the current situation is due to a lack of supply and a high demand for the acquisition of own or investment dwellings.
Prague attracts investors
It is a fact that Prague is more attractive than most European capitals in terms of return on investment. Despite rising prices, Prague apartments are an interesting investment opportunity. Especially for foreigners in whose country the return on property is lower. Such an example is London, which is worse off Prague. Average rents in Prague are two to three times lower than in London. However, the return on Prague rents is twice as high as in the British capital.
This is why Prague has become an interesting investment opportunity for the British, and British investments play an increasingly important role in the city. While in 2013 the British invested €89 million (2.26 billion crowns) in the Czech and Central European real estate market alltogether, in 2016 the same figures were €144 million.
If you are looking for a new property for personal use or investment purpose
in Prague, don’t hesitate to contact us.
Mobil: +420 773 651 336
Tel: +420 222 233 233