TNBiz (TNBiz)
Markets  |  December 27, 2012 07:40:05

Prognosis: Medium and large apartments in 2013 slightly cheaper

PRAGUE (MEDIAFAX) - Prices of two or more indoor flats are in the opinion of experts in 2013 to decline by up to four percent. Prognosis of Realtors released on Thursday, Tomas Skolek Lesensky from society.

Reasons for the decline in prices of larger apartments are in an economic recession, when people prefer to save small apartments. However, demand for housing in part save historically minimum mortgage rates. People pay in monthly installments for a medium-sized apartment in an average of 2 500 CZK less than three years ago.

In the past four years, suffered a fall in prices of all categories of apartments. Real estate was at its peak price in the fall of 2008, when the U.S. bubble burst in the real estate market. Since the financial crisis, declining demand for private housing due to economic uncertainty households.The drop in demand also contributed to the high risk premium mortgage banks, educated crises in the world. The actual decline in real estate prices, would then also affect interest rates in the economy, which currently maintains the Czech National Bank on the value of 0.05%.

"Times before the financial crisis, with growth in real estate prices significantly exceeded inflation, are on a very long history. Apartments, as well as almost every asset investment nature, are due to the extremely low interest rates overpriced. The growth in prices is possible, but only if we're talking about nominal growth, "said Jaroslav Brychta, principal analyst for an investment of X-Trade Brokers. "The decline in real estate prices may continue and the expected recovery has been postponed until 2014," she said in her presentation to the December conference expected development of real estate and development projects in the Czech RepublicEva Zamrazilová the Slovak, a member of the Bank Board of the Czech National Bank.

The main author of real estate prices is supply and demand in the housing market. A reduction in demand, and therefore prices, affects several years lasting economic recession. The only significant stimulation of weak demand, the prices of housing loans. Not to cheap credit, decline in prices would in all categories of apartments even more vigorous. "It is above a record low mortgage rates, which in 2012 raised the demand for real estate. For apartment worth CZK 2.5 million households paid 3 years ago 12,500 CZK per month, now with repayment mortgages usually gets under 10 000 CZK. Mortgages should be very cheap and the whole year 2013, "commented Jan Kruntorád, CEO of Cheetah Finance, which deals with consultancy in the field of mortgage lending.

Martin commas

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