Apartment prices have been falling for a year straight, says the analysis


Compared to last year, apartment prices are now 6.2 percent lower. “We now expect that apartment prices will stabilize in the following period, but we may even be approaching a turning point,” says Martin Vašek, CEO of Hypoteční banka.

This is shown by the HB Index statistic, which is based on estimates of the market prices of properties purchased by Hypoteční banka clients through a mortgage loan. The discounting of family houses stopped after half a year.

In the past three months, compared to the previous quarter, prices went down the most in the Pardubice, Moravian-Silesian and Ústí regions. In the Moravian-Silesian region, prices are also the farthest from last year’s peak – of course, this is due to the fact that generally cheaper flats in blocks of flats in large housing estates are now being sold there.

Apartment prices in Prague fell faster than in the surrounding Central Bohemia region. Specifically, in Prague, flats in panel flats in large housing estates in Prague 4, 8 and 9 fell the most. In Central Bohemia, flats fell the most in the districts of Rakovník and Příbram.

Small apartments are no longer a hit

Compared to last year, fewer apartments are still being sold, but sales numbers are already growing slightly.

“Households react positively to the slight drop in interest rates and perceive significantly lower apartment prices year-on-year. The growing demand from clients for housing loans is also reflected in the easing of the inflationary environment and the deferred demand for real estate,” says Vašek.

In the past quarter, the mortgage bank recorded a greater interest in larger apartments with a layout of 3+1 and 3+kk. At the same time, their prices fell the slowest. On the contrary, the prices of small 1+1 flats, which used to be “the drivers of price growth”, fell the fastest.

It may be related to the fact that young people, who used to ask for just such apartments, are now asking – and going straight to rent. “The young generation simply does not buy so-called starter apartments, but goes straight to rent. The market has stabilized in this respect and prices are stagnating,” explains Martin Vašek.

Source: Mortgage bank

HB Index, third quarter 2023: apartments

Houses with regard to energy

Demand for family homes has stabilized, the bank says. So she stopped falling. The interest is more in cheaper houses. On the contrary, people do not want larger and more energy-intensive buildings due to more expensive energy.

“It can be interesting for clients to buy a property with a worse energy standard and then invest in modern energy-saving heating, renewable sources or insulation, for which the New green savings subsidy can be used,” points out Martin Vašek, CEO of Hypoteční banka.

In contrast to the construction of apartments, where builders often postpone new projects, the construction of new family houses also continues. Some building materials have become cheaper and construction companies have fewer orders, so building is a bit more affordable. Most are built in the Central Bohemia region and around Brno.

Source: Mortgage bank

HB Index, third quarter 2023: single-family homes

Buy land, it will be more expensive

Where prices rise, however, is land. In a year-on-year comparison, they are more expensive by 11.9 percent. But at least the price increase is progressing more slowly. But demand exceeds supply.

“The price of a plot of land is most often influenced by its size and shape, but also by transport accessibility and civic amenities in the place where it is located. In addition, with the rising price – as in the previous period – the interest in land in locations further from the outskirts of large cities continues to grow. The plots are also a promising investment, as there is a shortage of them on the market,” says Martin Vašek.

HB Index 3Q23Source: Mortgage bank

HB Index, third quarter 2023: land

editorial office of Peníze.CZ

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