Residential Developments

These are now replacing the Historical City Centre as the high growth opportunities. Until about 2000-2001 in the Czech Republic and Slovakia there had been very little residential development. Despite rapid interest and development, the stock of quality residential housing as a whole has many years before supply catches up with demand. As the local economy grows and develops a young, professional middle class, there is a significant increase in demand by first-time buying looking for new, affordable apartments. This market is set to grow considerably over the coming years, fuelled by strong real wage increases and entry of more EU based businesses into the region, as well as by increased lending activity under even more attractive terms. The Soviet concrete-block houses (a.k.a. "Panalaks") that make up 80% of the housing stock were built with a design life-span of about 30-40 years. Most are reaching this age now, and are not attractive. We are seeing strong signs today that the introduction of new apartments to the market is causing these older buildings to become less attractive as the pent-up demand for new builds is released.