Prague Prime Homes
Real Estate Market in Prague
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REAL ESTATE MARKET IN PRAGUE

There are many factors that have contributed to the growth of the Czech property market in the past: The accession to the EU in 2004 is the main factor since it provided access to a formerly isolated market. The Czech Republic’s location in the centre of Europe along with its economic performance further boosts the market's attractiveness. The Czech standard of living is the highest of all Eastern European EU members and it almost touches that of its Western European neighbours, such as Austria and Germany. This is due in part to the huge infrastructure investments undertaken by the Czech government. The Czech Capital Prague is the most popular place in the Czech Republic to invest in property. It is the leading industrial centre of the Czech Republic and attracts more than three million tourists every year. Therefore house prices here are a higher than elsewhere in the country. 

Nevertheless prices for real estate in Prague are still lower than real estate prices in other European cities in particular following a decrease of prices in particular in the years 2009/10 as a result of the worldwide financial and economic crisis. Different to other markets, such as London, where property prices declined during the crisis as well, the real estate prices in Prague are not yet back to the pre-crisis level. As a result the market is currently not overheated which could provide a potential for future price growth.  Currently, the yields for residential real estate in Prague are about 4.5% to 6.5% depending on the location and condition of the property but given the stable economic and political development in the past almost 20 years, there exist the potential that prices will catch up with levels in other cities in Europe in the future.

This offers not only revenue opportunities from rental income or profits from the refurbishment of properties, but also appreciation potential if the prices catch up with the level in other cities in Europe. Investors should nevertheless be aware, that no guarantee can be given how the Prague real estate market will develop in the shorter term and the return potential stated in this document or in the specific project documentation is based on assumed profits from the re-development only and not based on possible value appreciation.