Saturday, 19 April 2014

Record number of new flats sold in Prague in 2012

ČTK |
16 January 2013

Prague, Jan 15 (CTK) - Sales of new flats in Prague exceeded the record of 2011 and grew by 2.5 percent year-on-year in 2012, according to an analysis developer Skanska Reality has provided to CTK.

While in 2011, a total of 4,562 new flats were sold in the capital, last year the figure amounted to 4,720.

The growth was caused by an influx of new projects in suburban localities where developer offered new flats for prices almost equalling their construction costs, Skanska said.

The growth was also boosted by uncertainties over changes in value added tax (VAT) rates and record-low interest rates on mortgage loans.

"Last year's sales were almost copying the figures of 2011 until the third quarter. The last quarter saw a remarkable increase as developers Central Group and Ekospol waged a price war in the Prague 10 district, offering two new projects for prices that almost equalled the cost prices for their construction," Skanska sales and marketing director Nadezda Ptackova said. This trend is unsustainable in a long run, she added.

While at the end of 2011, the average price for a flat in Prague was Kc57,403 per square metre, the average price in the same period last year stood 2.5 percent lower at Kc55,989 per square metre.

Developers with a dominant position on the Czech market include Central Group, Finep, Ekospol and Skanska Reality. Last year they sold 1,951 flats in Prague altogether.

Developers launched the construction of 3,598 flats last year, 25 percent fewer than in 2011. A total of 2,883 unsold flats were under construction at the end of 2012 and 2,685 underwent the process of approval.

The total number of new flats on the Prague real estate market fell by 12 percent to 7,183 units at the end of last year, compared with 8,190 the year before.

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