Why should YOU consider a Real-Estate investment in the Czech Republic?

THE HOUSING MARKET IN PRAGUE, CZECH REPUBLIC.

The Housing market is in its expansion stage - especially in Prague. This trend is demonstrated by rapidly increasing sales of new houses, apartments and ground plots by many developers. Around 50% of offered family houses and apartments are sold before beginning of their construction, 40% during construction and only some 10% after construction is completed.

Estimates suggest that, by 2010, the number of households will increase by 7.2 percent. In 2010 there will be a need for 4,344,000 dwellings. For comparison, in 1991 there were 3,706,000 inhabited dwellings in the Czech Republic. This means there is a need to build 638,000 new homes in the next 20 years (31,000 new homes yearly). Other estimates show 20,000 dwellings a year will be removed from the housing market (due to age and deteriorated condition). As a result, 51,000 homes must be finished yearly.

The number of people purchasing properties in the Czech Republic as an investment before entering the EU is increasing. In previous years people used to buy properties mainly in order to solve their own housing situation. Nowadays more and more people are purchasing houses or ground plots as an investment. The current low interest rates offered do not support traditional savings methods. Investments into properties in developing areas are achieving up to 60% annual growth on investment. Annual rental yields are generally more competitive than in Western Europe including the UK.

The number of people purchasing multiple properties is also increasing. The rapid growth of the Czech middle class wealth from savings. Combined with a relative severe shortage of housing forecast over the next 10 years provides optimism that long-term growth in real estate prices will continue at a steady yet rapid pace."

"Finally, anticipation of EU entry has very positively affected the market's optimism of future growth prospects of real estate in general."