Czech older property prices surge amid rising demand and accessible mortgages

The Czech real estate market has seen a continued rise in the price of older properties throughout the third quarter of 2024, largely driven by increased demand and improved mortgage availability. Apartment prices climbed by an average of 11% year-on-year and 5% since the previous quarter, with regional areas seeing the highest surges in prices, outpacing traditionally popular locations, according to data from real estate platform Bezrealitky.cz.

The average price of older flats in Prague reached CZK 128,000 per square meter, marking a 1% quarterly increase and a 9% jump from last summer—equivalent to the price of new-build apartments in the capital. In the Central Bohemian Region, flat prices surged 6% from the second quarter and 9% year-on-year, crossing CZK 80,000 per square meter for the first time. Meanwhile, in Brno, prices climbed to around CZK 94,000 per square meter, up 9% quarterly and nearly 16% annually.

Notable regional hikes were recorded, with six areas experiencing double-digit percentage increases. The Ústí nad Labem region saw prices rise by 20%, followed by Liberec at 18% and České Budějovice at 17%. Year-on-year, flats in the Moravian-Silesian and South Bohemian regions have become more than a quarter more expensive. Bezrealitky analysts attribute these surges to pent-up demand from weaker housing activity earlier in the year.

Single-family home values also rose significantly, up by 10% compared to last year and 1% quarter-on-quarter, though some regions saw slight declines. Home prices fell by 2% year-on-year in both the Ústí nad Labem region and Vysočina, while Pardubice and Olomouc saw increases of nearly 33% over 2023, with values in Moravian-Silesian and Plzeň regions up by a quarter.

Rising property values have also put pressure on the rental market, which has seen a marked increase in interest this year. Demand for rentals traditionally cools in summer but remained high, continuing into the start of the fourth quarter without seasonal dips.

“Rental price maps are being completely rewritten,” said Bezrealitky director Martin Ponzer. “Over the past five years, monthly rent for a 65-square-meter apartment has risen by over CZK 6,000 in Prague, CZK 5,000 in Brno, and CZK 4,300 in Central Bohemia. The country is moving toward the Western model, where rent makes up over half of household expenditures.”

Demand in Prague remains high, with about 73 people vying for each rental apartment. The city saw rental prices increase by 5% this quarter, averaging CZK 386 per square meter. In Brno, rental rates rose by 6% to CZK 301 per square meter, with 35 applicants per unit, while Central Bohemia saw a 5% increase, reaching CZK 271 per square meter.

Source: CTK