The Czechs take out record huge mortgages


During the last half of the year, the average mortgage loan amount has considerably increased, particularly up to the level of 2.8 million CZK in August 2020. According to the similar statistics of the previous year, in August 2019, the average amount of a mortgage loan was 2.32 million CZK.

   By the opinion of the head of the consulting company Golem Finance, this is primarily connected with the fact, that the demand for more expensive apartments in attractive places continues to grow.Also, the increase of the average amount of a mortgage loan is due to the fact that many investors are trying to save some up of their own capital in order to create reserves or provide the further arrangement of the apartment after its purchasing.The wealthiest buyers and those whose professional activities have not been affected by the coronovirus pandemic have become more interested in investing in such assets, thatcan resist the inflation and thatcan show high profitability in the long term.

   Interest in mortgages,among other things, grows due to its cheapening, as at the present time, we can see the lowest mortgage rates since November 2017.The conditions for obtaining the mortgage have also been simplified, as in the spring the Czech National Bank reduced the requirement for a down payment from 20% to 10% of the property value.

   A stable mortgage market encourages the growth of real estate prices. According to the September research of the consulting company Deloitte, the average apartment prices in Prague and regional centers increased for about 10.4% during the second quarter of 2020.

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