Foreigners bought 8 percent of new flats

The largest interest was in new flats in development projects

In the third quarter of 2017, foreigners bought 8 percent of new apartments in development projects in Prague. Most often the foreign buyers were Russians.

Just under a third of the development project flats were sold in Prague 10, followed by Prague 5 with a share of 30 percent and Prague 9, which was roughly at one-tenth, according to a survey by consultancy Deloitte.

“Of all residential segments, foreigners most often buy apartments in development projects, which shows the current high foreign demand for modern and new housing in Prague. [The city] is currently perceived as a safe place with a historic center and a high standard of living,” Deloitte real estate analyst Petr Hána said in a press release.

In the Q3 2017, some 5,348 dwellings were sold in Prague, of which approximately 80 percent were standard transactions according to Deloitte. The rest came from privatization, the transfer of a cooperative apartment to personal ownership or family sales.

Development projects made up of half of the standard sales, followed by older brick houses at 22 percent, panel houses at 20 percent and family houses at 8 percent.

Most of the apartments were bought by individuals, accounting for 64 percent of the transactions. Couples jointly bought a third of the flats and the rest went to legal entities.

In terms of age, most people buying an apartment were between 31 and 40 years of age. This is also the most common age for a mortgage, according to Deloitte.

For development projects, and brick and panel houses, 36 to 37 percent of sales were in this age group.

In the case of panel apartments, the most frequent buyers are between the ages of 21 and 30, with people aged 31-40 just slightly behind.

Women account for 52 percent of those buying in development projects, while for other categories men are in the lead, but the differences between sexes is negligible.

The largest proportion of apartments in brick houses, over one-fifth, were sold in Prague 3. Sales in prefabricated houses dominated Prague 4, accounting for almost 40 percent. A quarter of family houses were sold by the owner in Prague 9, followed closely by Prague 4, according to the Deloitte survey.

Apartment prices have been increasing due to lack of supply. Developers blame the long process of red tape involved in getting building permits, which is one of the most complex in Europe.

Changes in the law that took effect in the last quarter of 2017 are meant to streamline the process and reduce the amount of time from planning to construction.

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