The Czech Republic
Total Area: 78,866 km²
GDP (in billion USD): 215
The Czech Republic is a landlocked country in Central Europe. The country is bordered by Germany to the west, Austria to the south, Slovakia to the east and Poland to the north. Its capital and largest city, with 1.3 million inhabitants, is Prague. After four years of price falls, the Czech Republic’s residential market remains depressed.
Currently, the lack of affordable housing, which inhibits labor mobility, is a major factor slowing economic growth in the Czech Republic. Problems include lack of financing, shortages of materials and labor, and a poorly developed infrastructure. In the mid-1990s the government drafted a new housing policy which, among other things, would lift existing restrictive legal provisions barring occupants from buying and reselling flats and differentiate rents according to quality and location of flats.
According to the 2001 census, there were about 4,369,239 dwelling units within the country with about 87% permanently occupied. About 1,983,521 dwellings are houses. There is an average of 2.69 people per household.
Apartment asking prices dropped by 5.2% (-7.4% inflation-adjusted) in 2011, according to the Czech National Bank (CNB). In Q4 2011, apartment prices fell by 0.9% (-1.4% inflation-adjusted), and are expected to fall another 4% in 2012, according to analysts. Transactions last year were 20% below the peak levels of 2008.
The Czech economy is now in recession. It is expected to contract by 0.2% in 2012, having shrunk by 0.3% q-o-q in Q3, and 0.1% q-o-q in Q4 2011. In 2011, the economy expanded by 1.7%, following growth of 2.7% in 2010.