Deloitte: New apartments in Prague increased in price by 8.4% to CZK 125,400/m² at the end of April

Prague – The average asking price of available new apartments in Prague at the end of April increased by 8.4 percent year-on-year to 125,400 crowns per square meter. The pace of price growth has been roughly the same over the last two years. The number of available apartments in the developers’ offerings at the end of April decreased by 16.7 percent year-on-year to 4,489. This is according to data from the consulting company Deloitte, which is available to ČTK.

According to BH Securities analyst Štěpán Křeček, the current price per square meter makes it impossible for the middle class to buy new apartments in Prague. As he stated, these apartments will only be available to the wealthiest part of the population, which could create social tension in the future.

"The increase in apartment prices is a consequence of the mismatch between rising demand and lagging supply. Demand may not only be supported by accessible mortgages, but also by expectations of further price increases or rising credit costs due to the anticipated rate hikes by ČNB. The Czech real estate market has also become an attractive opportunity for foreign investors during these times of cheap liquidity, which further pushes domestic demand upwards," said ČTK analyst Petr Dufek from ČSOB.

Given that due to rising construction material costs, construction expenses are increasing, he believes it is necessary to anticipate further growth in property prices. "Of course, it will always depend on the location and quality of the project," Dufek pointed out.

New projects brought 1,525 apartments in 25 projects directly to the market in Prague in March and April. The number of apartments increased year-on-year by almost three-fifths.

The most expensive district in Prague remains Prague 1, with an average price of 193,000 crowns per square meter of living area. This is followed by Prague 2 with an average price of 175,500 crowns. The cheapest are Prague 9 with an average of 110,400 crowns per square meter and Prague 10 with an average price of 115,900 crowns.

Year-on-year, prices increased the most in Prague 2, by nearly 30 percent, and in Prague 7 by about two-fifths. Conversely, in Prague 3, new apartments decreased in price by 1.7 percent year-on-year. Prices also fell in Prague 1, by 0.6 percent.

Compared to the situation at the end of February, prices in the capital rose on average by 1.6 percent. The largest increase was in Prague 7 (by 13.6 percent) and Prague 3 (by 4.9 percent). Prices fell in three city parts: in Prague 1 (by 5.2 percent), Prague 6 (by 4.5 percent), and Prague 10 (by 1.2 percent).

Nearly two-fifths of the apartments in the developers’ offerings belonged to the 2+KK category. This was followed by 3+KK apartments (26 percent), 1+KK (21 percent), and 4+KK (11 percent).

In March and April, developers sold 1,645 new apartments in Prague, almost four times more year-on-year. The most apartments were sold by Finep (264). This was followed by Central Group (146), Skanska (146), YIT (91), and Penta (70).

"March and April of this year brought an above-average supply of new apartments to the Prague residential market. Most developers introduced new apartments to the market in more than double quantities. At the same time, an unusually high demand and price increases were observed in the market. Against 2014, the price level of the Prague offer has currently increased by 92 percent," added Petr Hána, a manager in Deloitte’s real estate department.

Average asking price for available new apartments per m2 and year-on-year growth in Prague at the end of the period:

Period	Average Price (CZK/m2)	Year-on-Year Change (pct)
February 2017	88,500	22.4
April 2017	90,400	23.0
June 2017	92,600	22.5
August 2017	93,500	23.6
October 2017	93,100	15.0
December 2017	95,900	12.4
February 2018	95,800	8.2
April 2018	99,400	10.0
June 2018	100,300	8.3
August 2018	102,100	9.2
October 2018	104,100	11.8
December 2018	106,100	10.6
February 2019	107,900	12.6
April 2019	107,100	7.7
June 2019	107,700	7.4
August 2019	110,000	7.7
October 2019	110,500	6.1
December 2019	112,500	6.0
February 2020	114,500	6.1
April 2020	115,700	8.0
June 2020	115,600	7.3
August 2020	117,200	6.5
October 2020	118,200	7.0
December 2020	120,000	6.7
February 2021	123,400	7.8
April 2021	125,400	8.4

Source: Deloitte

Asking prices for new available apartments in March and April in individual parts of Prague:

City Part	Average Price per m2 (CZK)	Year-on-Year Change (in pct)
Prague 1	193,000	-0.6
Prague 2	175,500	28.7
Prague 3	129,400	-1.7
Prague 4	122,000	8.3
Prague 5	129,300	6.9
Prague 6	128,400	3.4
Prague 7	133,500	18.8
Prague 8	125,500	8.8
Prague 9	110,400	7.3
Prague 10	115,900	8.0

Source: Deloitte