Optimism Returns To The Prague Property Market
News Posted On: 27 October 2011
It looks as if optimism is returning to the residential property market in Prague, amidst a growing sense that the worst may be over for a capital that has felt a fraction of what its wider nation has. Prague's location at the heart of Europe, combined with its strong economy – especially compared to its neighbours – have increased its regard as a good investment destination over the last 10 years.
In contrast to many other cities, Prague is remarkably stable, and prior to 2008 the property market saw healthy price increases. Although these price increases were not as spectacular as those seen in other European cities, they always felt a lot more stable. Not least because the rental market in Prague is strong, due to high demand from young professionals living and working in the high-tech industries in the city.
During the past year prices in Prague have declined by 4.1% on average, but most people feel the market has already bottomed out, and prices are unlikely to drop any further. The mortgage market in Prague is pretty healthy and with affordability at 2005 levels, the volume of new mortgages has increased by 45% already this year.
GDP growth in the Czech Republic is expected to be 2.3% this year, and as with many European countries this figure was recently revised downward from 2.9% but is still pretty respectable. Analysts expect Prague to be a good long-term investment.
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Written by Les Calvert
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