The Impact of the Global Pandemic on the Czech Real Estate Market By Anna Minjaríková
When the news of COVID-19 started to surface in the media at the beginning of 2020, hardly anyone was able to foresee the impact of the disease on the world population and economy. The Czech Republic has been fighting to contain the virus since March, and, although it has been largely successful in minimising the spread, virtually no aspect of everyday life has remained unaffected, the real estate market being no exception. The beginning of the epidemic in the Czech Republic The first positive cases of the coronavirus were confirmed on 1 March this year. The Czech Republic was among the first countries to respond to the threat, declaring a national state of emergency on 13 March, followed in quick succession by the closing of its borders at midnight on 15 March. All the restrictions later implemented, coupled with the threat of the disease itself, plunged people’s lives and the entire economy into a state of limbo, bringing most of the country to a halt. This paralysed the housing market, especially during the first month of the epidemic – those who did not have to move were no longer searching for a place to rent. Consequently, this stifled the demand for buying properties.
Sale and purchase of real estate During the pandemic, buyers’ demand for apartments slightly decreased. However, even after the decrease it is still higher than the supply. This is noticeable especially in Prague and other large cities, which is mainly due to the slow authorisation of building permits and a lack of land for new buildings. It is not recommended to panic-sell your property immediately because of the fear of falling prices. However, if you’re certain that you would still like to sell your property in the foreseeable future (within half a year or so), you should sell now, as there are only two possible short-term outcomes: prices could either fall further or very slightly increase, meaning that owners will not stand to gain much from a delayed sale.
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