Flat prices went down for the first time since 2013 in Czechia in the last quarter of 2022, according to the index of Hypoteční banka, a daughter company of ČSOB bank. The index suggests that the cost of an average flat fell by 0.7 percent in quarter-to-quarter terms. However, real price decline may actually be far higher than the statistics indicate.
According to Martin Vašek, the chairman of the board at Hypoteční banka, the last quarter price decline was indicative of a deeper trend noticeable since the middle of 2022. This was caused by a combination of high interest rates, the low availability of housing and the overall economic situation.
Robin Petrásek is the CEO of Expats Finance, a mortgage advisory firm aimed at foreigners living in the country. He says this decline in prices will likely continue for some time.
“I think that we will be seeing this for a while. It’s not going to be a huge down trend, but I don’t see it changing direction. The main driving factor are the high interest rates. I think it’s safe to assume that when the rates get better, for example 3 or 4 percent which might take two or three years perhaps, then demand will most likely increase because it won’t be as expensive to borrow money and people will be motivated to buy again.”
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Author: Thomas McEnchroe