Due to the corona virus crisis at the beginning of this spring, many real estate brokers and financial experts expected real estate prices to fall due to lower demand for housing and lower demand for mortgage loans. However, we have not witnessed significant decline in property prices.
The desire for real estate ownership did not pass even during the crisis. On the contrary, it was supported by the abolition of the real estate acquisition tax and a fall in mortgage interest rates. However, the coronavirus crisis had a negative impact on output of the construction industry, which will affect the price of real estates. There is still a shortage of apartments, especially in the capital, and the demand for them is really high. The combination of high demand with a decline in newly completed dwellings is putting pressure on real estate's prices.
In times of financial uncertainty, people and investors may perceive real estate as a safe investment and tend not to postpone real estate purchase any longer. This is also affected by abolition of real estate acquisition tax and low interest rates in the Czech Republic. Mortgages fell sharply during this autumn with interest rates below 2%.