Falling interest rates are drawing Czechs back to the real estate market, pushing property prices upward after last year’s decline. Despite subdued demand for family homes, their prices have increased by 4.7% compared to last year, according to the latest ČSOB Housing Index.
“The real estate market has definitively turned towards growth,” says Martin Vašek, CEO of ČSOB Mortgage Bank, predicting further price increases in the coming year. For perspective, the average price of a family home reached 5.5 million Czech crowns in September, according to Dataligence monitoring.
The largest real estate listing website, Sreality, reported an even more significant 8% year-on-year increase in the third quarter. Current prices are approaching the peak levels seen in 2022, before high interest rates and less accessible mortgages caused a market downturn.
Several factors are driving the price increase, including stricter technical requirements leading to higher construction costs. Additionally, the trend of Czechs seeking homes outside major cities, particularly around Prague and Brno, is influencing average prices in these suburban areas.
Since 2010, family homes have seen a remarkable price increase of nearly 117%, while apartments have risen by 120%. However, land plots have emerged as the real estate market champion, with prices tripling over the past 14 years.