Christmas is one of the most important festivals in the Czech Republic, a time of peace and love where we celebrate with our family and friends. We decorate the tree, sing Christmas carols and many of us go to Midnight Mass. The atmosphere in both St Vitis Cathedral at Prague Castle and St Peter and Paul’s Cathedral in Brno is wonderfully unique.

Before the service on the 24th, presents are left by Ježíšek, Baby Jesus, who we never see but who rings a bell as he leaves, and we open them after a traditional meal of soup, fish, schnitzels with potato salad. As in most countries, food is an important part of our celebrations throughout the Christmas period: stuffed and roasted duck, goose and turkey along with dumplings and platefuls of spiced Christmas cookies.

There are many legends and traditions attached to Christmas. Some families look into the future by cutting an apple in half or only ever set the table for the Christmas feast with an even number of places. It’s also considered bad luck to get up from the table before the end of the Christmas meal.

November has been relatively mild and sunny this year but once December arrives, the temperature normally drops and the days seem very short. That’s the perfect time for thousands of Christmas lights that shine across the city and along with the snow that sometimes falls, transform the streets of Prague into a beautiful winter wonderland. At present, everything is open in the city, restaurants, cafés and shops but unfortunately the traditional outdoor events were cancelled last minute. 

Meanwhile the Prague real estate market has just experienced an extreme year with a widening chasm between supply and demand, which led to dramatic price growth. The quantity of apartments in new buildings is low, because the authorities are slow to issue the necessary building permits, whereas demand is strengthened by investment purchases, so given the uncertain economic situation and the lack of other investment opportunities clients see buying a property as a safe place for their money.

Strong demand is shown by a record 6,100 new apartments sold in the first three quarters of this year. For comparison – only 5,800 apartments in new buildings were sold in the whole of last year. The result is that the average price per sq m of an apartment for sale in a new-build building in Prague reached CZK128,000, which is a year-on-year increase of 11 per cent.

The highest demand is for studio and single-bed investment apartments on the edge of Prague with good access to the city centre because they are affordable to clients thanks to the relatively low price of CZK 4–7 millions.

The rental market has also seen changes. In 2020, there was a big increase in the number of available apartments, because a large quantity of apartments originally intended for short-term rental were released as long-term rental and prices fell as a consequence, in particular in the city centre.

We are now witnesses to the fact that this trend is starting to turn round, demand is slowly returning and, as a consequence, the range of apartments on offer is falling and rents are starting to rise.

Looking into 2022, we assume that the selling prices of real estate will increase further, because the supply of apartments will still be insufficient. The number will not increase sharply compared with the same period, but still insufficient to cover the current deficit of flats on the market.

Due to rising real estate prices and mortgage interest rates, the growth rate will be slower, as some clients will not be able to afford to buy real estate. The rental market will continue to recover slowly and rental housing prices will rise slightly.

Veselé Vánoce from the Czech Republic.

Further information

Contact Peter Višňovský

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