Investments in small flats in Prague pay off the fastest

In Prague, investments in rented apartments of 20 to 39 square meters will return the fastest. The money invested in the purchase of properties of this size is currently returned on average in 25 years and the apartment is rented in 42 days. The most expensive apartment rentals are in Prague 1, 2 and 5, according to data from the real estate portal Sreality.cz, operated by Seznam.cz, the company announced. According to the data, the purchase price of real estate in the capital is the highest in the whole Czech Republic, yet many investors see the metropolis as a very lucrative location.

"In Prague, it is 100% true that the smaller the size of an apartment, the faster the return on investment. This is basically true in other larger cities as well. Smaller apartments in Prague, especially in the centre or with good access to the centre, are rented quickly. Owners of flats of 120 sqm or more wait longer for a new tenant. For them, the average advertising time is longer than 60 days," said Hana Kontriš, manager of sector services at Sreality.

According to Sreality, the return on investment depends on many parameters, including the condition and layout of a particular apartment. An apartment in Prague is rented on average around 40 days from the placement of an advertisement. The average selling price of the smallest apartments is around CZK 4.5 million and the rent is around CZK 15,636 per month.

Apartments with a size of 60 to 79 sqm are the fastest to rent. The average rent in such an apartment costs CZK 23,214 per month and it finds its tenant within 38 days of the advertisement. The average selling price is CZK 8 million and the return on investment is 29 years. According to current calculations, investments in flats of more than 120 square metres, which cost on average more than CZK 20 million, will be returned to the owners in 55 years. The average rent in such large flats is CZK 31,156.

Rents are traditionally the most expensive in the city centre, i.e. in Prague 1 and 2. However, the more expensive parts of the city also include Prague 5, which Kontriš says is often sought after because many job opportunities are located there. The average rent in Prague 1 is CZK 524 per square metre, while in Prague 2 it is CZK 28 less. In Prague 5 the rent is 437 crowns per square meter, about 22 crowns more than in Prague 3 and 7.

An analysis by the real estate company FérMakléři.cz shows that prices of older apartments rose between four and 13 percent year-on-year in almost all large Czech cities in the first quarter of this year. The median price in the Czech Republic is CZK 60,737 per square metre, up 4.6 per cent year-on-year. Traditionally, the most expensive flats are in Prague, where in the first quarter a square metre in an older flat cost CZK 125,400 on average. Three months ago, prices in Prague were around CZK 121,700.

According to an analysis by the UlovDomov.cz portal, rents in older apartments in larger Czech cities increased by three percent year-on-year in the first quarter of this year. The most popular 2+kk flats can be rented for CZK 16,737 per month on average. In Prague, monthly rental prices rose by one to four percent year-on-year.

Source: Sreality.cz and CTK