The Czech real estate market has been seeing a surprising trend as Dušan Kunovský, the owner of Central Group, decided to lower the prices of new apartments in Prague. This move is quite rare, especially given that the prices of new apartments have remained relatively stable in recent years, while the costs of older properties on the outskirts of Prague or inefficient buildings from the first republic have been falling.

Central Group’s new Harfa Living project in Prague 9 has lowered prices by an impressive 25% compared to the average market price. The company has labeled these as “introductory prices” that apply only to the first fifty units sold, which is an unprecedented move from the largest builder of new apartments in the country. However, it is unclear how the market will react to this move, and Kunovský himself is reportedly concerned about the broader implications of this “starter” discount.

Central Group has been able to provide preferential pricing due to its system of streamlined construction with high repeatability and large building volume, as well as its Economy standard. This move is a response to the increasing unaffordability of housing due to high prices for new apartments and costly mortgages.

In addition to lowering prices, some of the top players in the Prague residential market are turning to build low-cost rental properties for the city. This shift represents a departure from the luxury labels attached to high-end properties in attractive locations and a response to the growing demand for affordable housing in the city.

The Czech real estate market has seen a significant drop in the prices of older apartments, with the average cost of more senior apartments dropping by approximately 11% year-on-year in the first quarter of 2023. This drop makes it an excellent time to purchase such properties.

In conclusion, the decision by the Central Group to lower prices for new apartments in the Harfa project is a significant move that is likely to have implications for the broader market. With developers looking to meet the growing demand for affordable housing in the city, it remains to be seen how the market will continue to evolve. However, it is clear that there is a shift towards building low-cost rental properties and affordable housing, which could be good news for buyers and renters alike.

Article by Prague Forum