In Prague, there are 7000 new apartments on offer, with an average price of 4.7 million

Prague - Developers have 7,000 new apartments on offer in Prague, with their total list price increasing by two billion crowns compared to the first half of the year, reaching 32 billion crowns. The average price of an available apartment is 4.7 million crowns, according to the latest analysis by the development company Trigema. At the end of the first half of this year, the average price of an apartment on offer was 4.64 million crowns.
      The average price of offered apartments per square meter increased by one percent quarter-on-quarter to 61,593 crowns at the end of the third quarter, which is roughly double the average monthly gross wage, which was 33,122 CZK in the capital during the first half of the year.
      In the third quarter, developers primarily introduced more expensive projects to the market, which is why the average price of apartments in new buildings rose by 19% quarter-on-quarter to 62,575 crowns per m². A year earlier, developers were listing apartments with an average price of 52,319 crowns per m².
      However, people are purchasing apartments at lower prices, as the average price of actually sold apartments is up to a fifth lower. The difference between the average price of an offered apartment and the sold one, according to Trigema, exceeds one million crowns. The average price calculated from the group of all sold apartments is 3.7 million crowns.
      "There are significant differences between what developers offer and what clients expect. They pick cheaper apartments, and the more expensive ones remain in developers' price lists," noted the chairman of the board of Trigema, Marcel Soural, who stated that there is great potential in the market for affordable projects.
      People, according to him, prefer to choose by absolute price. "In a given category, they would rather buy a smaller apartment and save on absolute price. Offered apartments are on average eight square meters larger than sold ones, which represents a ten percent difference," clarified Soural. The average size of an offered apartment is 75 m², while the average size of sold apartments has decreased to 66.7 m².
      During the first nine months of this year, developers sold 4,250 new apartments in the capital, which is a year-on-year increase of 22.7%. According to joint statistics from Ekospol, Trigema, and Skanska Reality, during the third quarter alone, people bought 1,400 new apartments, which is 28% more compared to the same period last year.
      Soural pointed out that the situation on the Prague market for new apartments is starting to closely resemble the state from the pre-crisis year 2007, when developers sold a record 5,300 new apartments. "Some market parameters indicate that the market is at risk of overheating, at least in Prague. We estimate that in two to three years, there will be overheating and a decline in annual sales. Then it will be a question of whether the projects currently being marketed will still be sellable," Soural cautioned, noting that a decline could be accelerated by the anticipated rise in interest rates for mortgages.
      The largest developers plan to introduce thousands of new apartments to the Prague market in the coming years for tens of billions of crowns. However, Soural is concerned about this influx. "We don't like it. We believe it will harm the market," he added.