The prices of apartments have found a bottom and will stagnate this year

In Central Park Prague, out of a total of 547 apartments, 250 have been sold.

Prague - Apartment prices, after a three-year decline, have likely found their bottom and will rather stagnate this year. At the same time, it is possible to expect that the apartment market will slow down this year.
    "From the data tracking sales of more than 30 development projects that our company offers, it is apparent that after a three-year period of decline, prices have reached the expected bottom and, supported by an administrative increase in VAT, will only grow very hesitantly," stated Lexxus director Peter Višňovský.
    According to Višňovský, the market as a whole will slow down due to the increase in the lower VAT rate and the overall economic situation. "Those who planned to purchase a new property and wanted to avoid the first VAT increase made their purchases last year. It is precisely these clients that we will miss in 2012," noted Višňovský.
    Most apartments increased in price due to the VAT rate hike right from the New Year, major builders reported. However, some announced promotional discounts at least for the first month of this year. Especially smaller developers opted for a wait-and-see approach. "We will keep all three residential projects in Prague and Brno at the price level of last year until at least the end of January 2012. Only at the beginning of the main real estate season will we consider whether to factor in the VAT increase into their prices," said Bemett's marketing manager Jan Koubík to ČTK.
    The price increase did not affect apartments that are already built but are struggling to find buyers. "For completed projects with a larger number of unsold apartments, it was not possible to raise the price - you cannot sell a stale unit by increasing its price," added Višňovský.
    Today, one of the projects that has long struggled with weak demand in Prague announced a general price reduction for new apartments. Central Park Prague has been in Žižkov since 2009, with 250 out of 547 apartments sold. The CEO of CP Praha Radomír Němeček is pleased with the sales given the project's scope. According to the new price list, the cheapest apartments in the project can be purchased for 55,000 crowns per square meter, while the previously valid price list had the cheapest apartment at 74,000 crowns per square meter.
    However, an increase in the listed prices of apartments does not yet mean that the developer will not agree on a lower price with the buyer, argues David Raiser, the managing director of Solo Praha. "The prices of new constructions may have changed compared to the end of last year in the official price lists of real estate agencies or development companies, but in reality, nothing has changed. It is unthinkable that a developer, currently fighting for every customer and attacking from all sides with various discounts or incentives, would deter potential customers by increasing the purchase price," he told ČTK.
    The number of apartments that started construction, according to the latest figures from the Czech Statistical Office, fell by 10.8 percent year-on-year last November, while the number of completed apartments decreased by 34.2 percent.