Interest in second homes in the mountains has noticeably cooled

Prague - Demand for so-called second homes in the domestic and Slovak mountains plummeted significantly in the second half of last year due to the financial crisis. After several years of growth, property prices in mountain resorts in the Czech Republic and Slovakia have stagnated, described the situation in today's press release by the international consulting company King Sturge.
    According to experts, recreational housing is more sensitive to economic fluctuations than the area of housing intended for everyday use. The purchase of recreational housing can usually be postponed, while the purchase of residential housing generally cannot.
    In some mountain areas, according to Jiří Reeh, director of the Hradec Králové branch of the real estate group Bonus Group, the demand for recreational housing has dropped by up to 60 percent. Part of the potential buyers is deterred by the economic situation, where they want to keep cash for themselves rather than for mortgage payments. Another part of potential buyers is waiting to see if property prices in the mountains will drop.
    Larger-scale construction of new recreational housing projects in domestic mountain resorts has only occurred in the last three to five years. The most sought-after area is the Krkonošsko region, where there are currently approximately 20 new development projects. In an imaginary second place are the Jizera Mountains and Šumava.
    "As for recreational properties in the mountains, people have preferred new apartment buildings over cottages or chalets in recent years. They are usually more expensive and require more operation and maintenance," said Reeh.
    The past years were also marked by a construction boom of new recreational housing in Slovakia. The most sought-after destinations were the mountain resorts of the High and Low Tatras and the Donovaly area, where new apartment complexes began to emerge. "Sales prices saw very strong growth in 2006 and 2007, while in 2008 they rather stagnated," noted Janka Polyaková from the Bratislava branch of King Sturge. The Slovak mountains have reportedly been particularly affected by a noticeable decline in buyers from abroad.
    In contrast, according to King Sturge, interest in properties in the Alps from neighboring countries has not waned. Their prices reportedly increased by approximately five percent last year. German real estate agencies reportedly expect price increases again this year.