New apartment – illustrative photo.
Prague – Three out of ten Czechs are considering buying a house or apartment in the next five years. At the same time, however, more than a third of people have canceled or postponed the purchase of real estate in recent years due to rising mortgage and energy prices. This is according to an Ipsos survey for Broker Consulting, according to which people expect mortgage interest rates to rise further this year. The results of the survey were presented at a press conference in Prague.
A survey of 1,010 respondents showed that out of 29 percent of those thinking about buying an apartment or house, people under the age of 34 plan to do so most often. They are mostly single with a university degree and their net monthly household income exceeds 60,000 crowns.
The survey confirmed that Czechs desire to own an apartment, 72 percent prefer a family home and 20 percent an apartment in personal ownership or a cooperative apartment. “Czechs continue to like owner-occupied housing and do not like inflation. We actually know this about ourselves, but it's good to confirm it with numbers from time to time,” commented the chairman of the National Budget Council, Mojmír Hampl, on the results of the survey.
Due to the economic situation, higher mortgage interest rates and the increase in energy prices, ten percent of respondents canceled the purchase of real estate and 26 percent postponed it. The main analyst of Broker Consulting, Martin Novák, said that people have to decide whether the purchase is worth it at the offered prices, or speculate whether they will fall. “If it makes sense, I wouldn't wait to buy,” Novák said. He added that at the end of last year, the difference between the offer price and the sale price was ten percent.
Two thirds of Czechs who are planning to buy real estate believe that mortgages are now unaffordable for them. According to the current Hypoindex, the average rate of mortgage loans in March was 6.27 percent. 45 percent of people expect another rise in mortgage prices this year, which surprised Česká spořitelna economist Michal Skořepa. “In that case, the hypothesis that the market will start to wake up falls apart. From these numbers, the outlook is sadder than I would have thought,” Skořepa pointed out. Economists and developers, on the other hand, estimate that mortgages could begin to decline in the second half of the year.
Most people expect real estate prices to rise further this year. A fifth expects the price of new buildings to increase significantly, a quarter expects an increase for older apartments and rents will also increase.
The survey showed that a third of people would put the money saved for an unrealized property purchase into a savings account, and a fifth would leave it in a current account account. Skořepa said that he considers this to be a manifestation of financial illiteracy and that the Czech Republic should unlearn keeping a lot of assets in current accounts.