Already Expensive Flats Are Getting Even More Expensive. Why?

“The increase in the price of tens or even hundreds of percent of building materials is already starting to show in the prices of new apartments in current offers,” said Renata Vildomcová, spokesperson for Skanska Reality.

“In projects where residential units have not yet entered the construction phase, it is impossible to pass on the extra costs to the client who has already purchased the apartment. It will be a matter of negotiation at the level of suppliers and investors who will eventually pay these extra costs,” he added.

According to Ekospol’s CEO Evžen Korec, the prices of building materials, together with the rising cost of construction work and craftsmanship, are one of the factors behind the increase in prices of new apartments. He said that prices are also driven up by the shortage of building land caused by the exhausted zoning plan and especially the absurdly complex construction legislation.

The pandemic has dampened production globally and the market is now feeling the effects. There is a shortage of wood, plastics, metals and insulation materials. Gone are the days when building materials were in stock. Instead of waiting weeks for delivery, it is months. The prices of materials are rising sharply and it is estimated that this will be the case throughout this year,” added Michaela Tomášková, Executive Director of Central Group.

“Few new housing approvals, high demand for housing in times of uncertainty and cheap mortgages, a shortage of workers and rising material prices. This can and probably will continue to increase property prices,” she further said.