The average offer price of new residential projects in Brno has exceeded CZK 129,400 per sqm (€5,093) and Q2 2024 has broken the previous record from 2022. Demand has also grown sharply, as data by Trikaya shows.
Compared to Q1 2024, half as many new apartments were sold in Q2. In a year-on-year comparison, this is even a record increase of 254%. From April to June, 372 new residential units were sold in Brno, i.e. almost three times more than in the same period last year. This is the largest year-on-year increase in ten years. Compared to the first quarter, when 246 apartments in new buildings found their buyers, sales increased by 51% quarter-on-quarter.
With the drop in the prices of the largest items in the Czech shopping basket, energy and basic food, consumer confidence is returning to the economy. In this, the Czechs stand out from the rest of Europe. Paradoxically, the prices of rental housing, which have not yet responded to the greater availability of mortgages, remain relatively high and support the motivation of people to spend the same monthly amount on their own rather than on a rental apartment.
Rising sales also put pressure on the price. In the second quarter of this year, a square meter in Brno reached an average of CZK 129,400 (€5,093), which is about CZK 4,000 (€157) more than in Q4 2023. The value corresponds to the average for the entire three months, in fact, the increase in prices was even slightly greater - in June, the average price of available apartments climbed to 131,700 CZK (€5,183) per square meter.
The growth in sales has continued for the third quarter in a row and suggests that the gradual increase will not stop soon. This is also supported by a further decrease in the base interest rate, which the Czech National Bank lowered by half a percentage point to 4.75 per cent at the end of June. The rate is thus the lowest since the beginning of April 2022. During the second quarter, sales were dominated by one-room apartments with an average area of 33 sqm and an average price of CZK 140,000 (€5,510) per sqm.
"Apartment prices always follow the demand for housing and the availability of mortgages. This has been the case for three quarters in a row. Low inflation has depressed mortgage rates and the relaxation of credit conditions by the Czech National Bank has enabled more people to access housing finance since the end of last year. Both factors are driving the price growth of apartments, although so far only gradually," said Dalibor Lamka, Executive Director and Chairman of the Board at Trikaya.
