Real estate market in corona times

Cottages and houses out of the city centre - these were the most wanted properties last year when corona crisis came. Despite some predictions, however, prices did not go down.

In the first three quarters of this year, average apartment prices in the Czech Republic rose by up to 12 percent. However, already at the beginning, due to the coronavirus pandemic, the sale and purchase of flats and houses practically stopped for the first time in history. No one preferred to sell or buy anything for few weeks.

However, after few weeks people realized they needed home not only for living but also for working. According to real-estate agents, people were extremely interested in buying their new properties especially in June and July. A significant driver of the market was the record low mortgage interest rates and the abolition of the real-estate acquisition tax, as well.

Preferences have changed

In 2019, there was a huge interest in apartments in city centers (ideal opportunities as investments - rentals, Airbnb) and office space. Recently, people have been more interested in apartments outside of the city centres and cottages. More and more buyers also want to have a balcony or a terrace to spend their leisure time in their home but outdoors.

Most holiday cabins and cottages that people wanted to buy were in the Central Bohemian region. Moreover, people still prefer buying properties as investments which was supported by the low mortgage interest rates. With no tourists, owners aim at long-term tenants instead of Airbnb services.

Prices have not dropped

However, according to Marcel Soural, head of the development company Trigema, real-estate sales prices are still affected by the same effects. "On the one hand, the high demand is largely due to investor intentions. On the other hand, it is a limited offer that is constantly hampered by inflexible permitting processes. In addition, the long-term quarantine of building authorities has contributed to this year.”