Buying a property is a fairly serious decision that we take in order to achieve one of two goals. The first is to cover the housing needs of a person or his family members. The second is to invest in real estate in order to generate rental income as well as the expectation of increasing the market value of the chosen property.
Many people still believe that investing in real estate is one of the safest and most transparent ways of investing. Earning rental income does not require specific professional skills and a lot of time. Low mortgage rates make buying property even more profitable and attractive. It is also worth noting that over the last few years the price of apartments in the Czech Republic has increased by more than 10% per year.
However, it should be noted that property in Prague is very expensive, mortgage interest rates are starting to rise and rental prices are falling due to the influx of apartments on the market that have been rented out via Airbnb. It is obviously worth asking the question: Is buying an apartment today a smart investment? Let's answer it. The growth in the value of real estate in the Czech Republic is due to the fact that demand far exceeds supply. In other words, the population needs more flats than are currently physically available on the market. The Czech economy is developing rapidly, many young professionals are entering the country, but not as many apartments are being built as would be needed.
There is no reason to believe that prices are at their peak and will fall in the foreseeable future. As far as the rental market is concerned, it should be understood that temporary reductions do not play a significant role in long-term planning. For mortgage rates, the situation is as follows: The Czech National Bank has raised them, but according to analysts, competition in the banking market will not allow mortgage rates to rise significantly. Therefore, they can be expected to remain at their current level. In summary, it is clear that real estate will not become more affordable and loan conditions more favourable in the foreseeable future than they are today. And that's why you shouldn't wait long to make a decision to buy a property. This investment will certainly pay off.