16. February 2021
Market Report H2 2020: A Look Back at Turbulent 2020
“The Prague premium real estate market proved resistant to the coronavirus pandemic in 2020” is an apt summary of Svoboda & Williams’ sixth Market Report, which the real estate agency publishes biannually.
Stability in the real estate segment was mainly guaranteed by record low interest rates, the repeal of the property acquisition tax, and the fact that quality properties were increasingly seen as a good place for people to park their money and protect their savings. Demand for real estate from the portfolio of Svoboda & Williams therefore had a year-on-year increase of 5.4%. The average achieved price for a premium property also went up—clients paid CZK 131,900 per square meter for new builds and CZK 120,100 per square meter for resale properties. In contrast, according to the Rental Price Index by S&W + VŠE, rental prices decreased by 11% down to CZK 29,400 per month on average.
Market Report H2 2020, among other things, focuses on:
- the development of premium Prague residential property prices,
- the growing rental housing trend,
- the unprecedented interest in recreational real estate,
- the situation in the mortgage market,
- residential projects that can significantly transform the character of the neighborhood they’re in.
The analyses published in the Market Report are based on the data on sales and rental transactions generated by the activities of Svoboda & Williams. These figures are supplemented by real estate sales data obtained from the Cadaster of Real Estate, whose parameters correspond to the monitored sample. The Market Report relies exclusively on data based on achieved prices, which are calculated by factoring in the price for parking and a proportional part of the exterior. To recalculate the exterior area, this methodology uses a specially developed algorithm that progressively reduces the exterior area and takes into account the ratio of outdoor to interior spaces.
Another useful analytical tool for a more accurate interpretation of the rental market is the Rental Price Index by S&W + VŠE, which Svoboda & Williams developed in cooperation with the Faculty of Informatics and Statistics of the University of Economics in Prague. The source of the data for the index is the actually achieved rental prices of apartments offered by Svoboda & Williams. It’s therefore a good illustration of how the suspension of the tourism industry affected rental prices in Prague.