Impact of the COVID-19 pandemic on the real estate market in the Czech Republic

Abstract

The COVID-19 pandemic has affected a number of areas including the real estate market. The crisis occurred both on the demand and on the supply side, but also, for example, in the field of real estate valuation. Such crises are quite common on the real estate market with cyclically recurring situations. Therefore, it is necessary to pay attention to this issue and to be able to recognize the first symptoms of the problems. The aim of the presented article is to report on the development of the real estate market in the Czech Republic in the time period 2019-2021, focusing on the effects of the COVID-19 pandemic, if these had an impact on the market at all. Data from real estate advertising is collected in a period of one month;beginning April 2020, the data is collected in the period of 15 days. The data is concerned mainly with the offer prices of flats intended for rent or sale and represents all municipalities in the Czech Republic. The data is purged from duplicate advertisements, unreliable advertisements and advertisements for which the price data has not been filled in. The authors evaluate the real estate market using their own SW tool EVAL while the research refutes the premises about the significant impacts of the COVID-19 pandemic on the real estate market in the Czech Republic, which corresponds with the opinions of other authors. The research shows that the potential impacts are more noticeable especially in the short-term rental sector. The real estate market in the Czech Republic has been in imbalance for a long time as it is affected by many opposing factors pushing the supply and demand for real estate up and down at the same time. The situation regarding COVID-19 intensified this fact even more and caused a confusing and, in the future, difficult situation to predict. © 2022 Author(s).