“Owners who offer real estate during this period are starting to make partial concessions. This does not necessarily mean that the price trend will reverse significantly, but it indicates a cooling of growth. At the same time, it gives a clear message that the demand is not speculative and strong enough to sell everything, so to speak, “says the head of Bezrealitka, Hendrik Meyer.
According to him, a certain cooling of the market is typical for the summer months, but this year may be different. “The annual cooling of supply and demand could be more significant this year than last year. The sellers are also making concessions due to the fact that overvalued properties are starting to rise disproportionately above the current average at a time of low supply, ”adds Meyer.
Development of apartment prices in the Czech Republic
The phenomenon mainly concerns localities where prices grew strongly above average during the first quarter, typically in the case of Moravian regional cities. “The situation in Ostrava or Brno is such that sellers are afraid that the situation on the market may be significantly worse in a year or two. Those interested often push the price through real estate agencies and the result is lower by 15 to 25 percent, “says DaVinci Investments partner Vlastimil Bijota.
During the pandemic, Ostrava flats became the most expensive in the Czech Republic. According to data from the consulting company Deloitte, prices were 31.3 percent higher in the first quarter compared to last year. At the same time, flats rose by an average of “only” 19% for the entire country. Similarly, in Brno, flats appreciated above average, with prices rising from pre-pandemic levels by 22.3 percent.
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“We registered information that several properties in some non-top locations were sold at a lower price than expected due to the circumstances,” says the head of the real estate agency Luxent – Exclusive Properties Jiří Kučera. According to him, this may mean signs of a certain market exhaustion. “Given the general lack of supply, almost any price has been accepted for solid properties so far,” Kučera recalls.
Experts emphasize that for buyers is an increasingly important measure of the value of the location of real estate, also due to the growing rationalization of purchases. “The purchases of qualified investors play a growing role, and in individual transactions, those realized with the help of loans, ie sanctified by the bank, predominate. This gradually reduces the space for reckless purchases under inadequate conditions, “adds Kučera.
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