Czech Property - An Introduction
The
Czech property market
is one of the most mature and best performing in Central and Eastern Europe, supported by a stable, successful economy.
Czech property offers investors a low risk, solid long term growth opportunity in a stable market with low buying costs and a mature mortgage market.
The main markets in the Czech Republic include the capital, Prague , and second tier cities Brno and Ostrava .
Prague's property market itself is a mixture of markets, with certain sections of the city performing differently to others. Click here to read more about about Prague property.
CZECH PROPERTY ECONOMIC DRIVERS
There are a number of factors driving the strong growth in the Czech Republic, not least rising salaries, continued Foreign Direct Investment (FDI) and strong GDP growth.
According to the Czech Statistical Office, salaries grew by 7.6% year on year in Q3 2007. Unemployment stood at a national average of 5% and just 2.3% in Prague itself.
Growing demand for skilled employees from major blue chip companies throughout the Czech Republic continues to drive salary levels upwards, in turn creating a greater level of affluency amongst the population.
As the Czech population becomes more aspirational demand for new build property will continue to grow, pushing prices up and sustaining the rapid rises we have seen in Prague, Brno and the rest of the Czech Republic.
GDP in the Czech Republic remains strong, with wages rising at sustainable levels and unemployment at its lowest level in over 10 years. Per capita, the Czech Republic has the highest GDP in Central & Eastern Europe, underlining its impressive performance in recent years.
This performance has led to huge FDI, with almost EUR 6 billion flooding into the country in 2006, mainly from Germany, Japan and the US. This has allowed the industrial base in the country to shift from manufacturing to the higher paid IT and logistics industry, as well as car production.
This level of FDI has led to the high level of employment and rising salaries - and in turn supported the capital growth in the Czech property market...and will continue to do so.
CZECH PROPERTY RENTAL MARKET
Prague property offers a rare combination of strong capital growth AND good rental yields - this is not usually possible, but the Czech property market is at this mature, transitional stage now.
This same combination - ideal for property investors - could soon be experienced in the likes of Brno and, later, Ostrava.
