The spring survey by NMS Market Research showed that every tenth Czech between the ages of 26 and 36 plans to buy or build a property in the next 12 months. And according to him, up to half of young people were going to change their housing within 5 years. These plans make sense. Own housing, which is a natural choice for Czechs, is appreciating at record highs. Offer prices have increased by 146% since 2015, and sale prices by 162%. According to Eurostat, the price of real estate in the Czech Republic, and thus their value, increased year-on-year the most in the entire European Union in the first quarter of this year, by 24.7%.
Spring tightening of the conditions for obtaining a loan to finance new housing, high inflation and market uncertainty are now discouraging many potential buyers from purchasing apartments. However, investing in a new apartment is still an advantageous choice. The prices of apartments, and thus their value, have always increased in the long term.
“We have no reason to think that it will be any different in the future,” says the executive director of Central Group, Michaela Tomášková, adding: “We have great faith in our apartments and the long-term stability of the market. That’s why we offer clients the widest financing options with a down payment of only 10 percent, as well as the Money Back Guarantee program. Thus, in case of unfavorable economic developments, clients can terminate the contract until the apartment is handed over, and we will return all the money paid to them. Buying an apartment is therefore a risk-free investment with us.”
A new apartment = a qualitative jump in the standard of living
Owning a new apartment has historically been a preferred choice for Czechs, rooted even among the younger generation. It means not only real value, but also a big leap in the quality of living.
Research by the Institute of Planning and Development of the Capital City of Prague in 2021 found that people living in rented and sublet accommodation are less satisfied with their housing than people living in their own. In total, living in a rental reduced people’s satisfaction by 55%, according to research. These numbers correspond to the fact that most Czechs, unlike some other Europeans, live in their own. In the Czech Republic, according to Eurostat, it was 78.9% in 2020, while the EU average was 70%.
A big advantage of a new apartment these days is also the energy efficiency of buildings and cheaper operation than in older buildings. Central Group uses modern systems and new building materials in environmentally friendly construction. Apartments from the largest Czech residential developer are equipped as standard with double-glazed windows that let in natural light perfectly and, in combination with a high-quality facade insulation system and a heat recovery system, minimize heat loss.
“According to our analyses, the operation of a new apartment from Central Group can be up to 48% more economical compared to an apartment in a regular block of flats,” explains Tomášková.
Investing in your own is an investment in security
Due to high inflation and less affordable mortgages, people are now more and more often considering paying rent and committing to credit. Although paying off a mortgage is now more expensive than paying rent in Prague, investing in your own is still worthwhile. People don’t risk rent increases that won’t affect them. In addition, the average rent in Prague has risen by roughly a fifth year-on-year and is expected to continue to grow, while mortgage interest rates will gradually decrease. Mortgage repayments and rents will therefore come closer again.
“With the difference that with mortgages, the money paid to you remains in the form of your apartment, which will continue to increase in value, whereas with rent, you are appreciating someone else’s investment. And in the case of own housing, after a certain period of time, the repayment will disappear, unlike the rent – the debt to the bank will be repaid. In short, by investing in one’s own, one invests in security,” adds Tomášková.
700 apartments all over Prague with air conditioning or apartment equipment for free
The largest residential builder Central Group offers almost 700 apartments throughout Prague. Each apartment also offers air conditioning or complete interior equipment as a free bonus, including a kitchen, built-in wardrobes and any home accessories worth 200,000 to 500,000 crowns, depending on the layout chosen. Clients only need 10% to purchase an apartment. They can make additional payments up to a year after moving in, with the option of using a discounted mortgage. Central Group’s mortgage specialists provide clients with the best possible offer on the mortgage market.