Missing Prague construction regulations will increase apartment prices, claim developers
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Eight out of ten development companies engaged in residential construction claim in the study that the current invalidity of Prague's building regulations is causing them significant complications and will lead to a slowdown in preparation for new construction.
"The confusion surrounding the PSP creates uncertainty regarding project planning. Such ambiguity can significantly delay newly prepared projects," says Tomáš Pardubický, CEO of Finep. A similar opinion is shared by Vladimír Dvořák, director and partner at YIT Stavo. "The invalidity of Prague's building regulations will certainly have a negative impact on the development market," warns Dvořák. According to Dušan Kunovský, chairman of the Central Group, the unclear future of this regulation is completely destructive for the functioning of the market.
These changes could also have a specific impact on the rise in apartment prices, developers agree. "There will undoubtedly be delays in some projects, which will consequently increase their costs due to financing and the need for adjustments. The differences in regulations mainly relate to the physical solutions of the projects, so with changes in regulations from one day to the next, they more or less return to the starting point. Ultimately, this will be reflected in higher apartment prices," declared Jan Ludvík, CEO of Karlín Group.
According to Václav Černý from Passerinvest Group, the missing PSP will cause million-dollar losses for developers. "They will have to revise the documentation for their projects again," noted Černý, who believes developers need clear rules and predictability for their work. The current ambiguities surrounding the PSP will significantly increase the costs of building new apartments, according to Jiří Procházka, CEO of Metrostav Development.
However, Marcel Soural, chairman of Trigema's board, pointed out that the general technical requirements for construction in Prague will still apply for at least two more years. "The problem is that Prague's building authorities are used to approving constructions under a special regulation for Prague, which is now invalid. However, the valid nationwide regulations cannot approve constructions in flood zones, in protected areas, nor can they assess traffic in quiet areas served by the metro, among others. In combination with the newly adopted amendment to the EIA law and the delays in discussing amendments to the building law, this could be a deadly cocktail for the continuation of investment construction in Prague," warns Soural.
Prague's building regulations, which are an implementing regulation of the building law, were canceled this January by the Ministry of Regional Development due to several objections. The Prague City Hall then began preparing two amendments. Deputy Mayor Matěj Stropnický informed today that these will also need to be notified to the European Commission.
The English translation is powered by AI tool. Switch to Czech to view the original text source.
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