Staff shortages at building authorities slow down apartment approvals in Prague

The Czech Statistical Office reported today that 2,856 apartments were approved in Prague during the first quarter of this year, including 2,297 units in apartment buildings. This marks an increase of approximately 63% compared to the same period last year. Despite this positive result, experts caution that the trend may not continue in the coming months.

The recent approvals largely reflect projects that were submitted and processed many months ago, under the previous version of the Building Act. According to developers and industry representatives, the current situation for projects awaiting approval is more challenging. The introduction of the new Building Act and the launch of a digital permitting system, which was rolled out without sufficient testing, have led to operational disruptions. Many staff members at building authorities have left their posts, resulting in significant staffing shortages.

Developers report that the permitting process has become slower than under the previous system. This has forced some companies to delay or revise plans for large residential projects, raising concerns about a decline in new housing supply. A prolonged slowdown could contribute to renewed upward pressure on housing prices if demand continues to outpace new construction.

Authorities have outlined plans to overhaul the digital permitting system by 2028, but improvements are needed sooner to address the backlog. Increasing staffing at building offices would help process applications more efficiently, but recruitment efforts have faced challenges.

One proposed solution is to consolidate smaller building authorities, many of which operate with minimal staff. Similar consolidation efforts were carried out previously in other sectors, such as postal services. Officials and experts suggest that a unified permitting system could allow applications to be redirected from overburdened offices to those with greater capacity, potentially improving processing times without relying solely on new hires.

Until structural solutions are implemented, developers warn that continued delays in permitting may affect the pace of new housing development and limit progress in addressing Prague’s housing needs.

Source: Central Group