Now, as the British property market stagnates, the Czech capital has been named as a better investment and development project than London.

According to Emerging Trends in Real Estate Europe 2008, a real estate forecast by the Urban Land Institute (ULI) and PricewaterhouseCoopers, the Prague real estate market shows high stability and low risks, and investors anticipate slight rises in rents. The report ranks Prague 12th in the world for investment prospects – first in Central Europe ahead of both Warsaw and Budapest.

With cities in new Europe showing a large growth in opportunity, the Czech market is seen as a mature market with high stability and low investment risks. Prague is seen as a positive market with combined buy-hold ratings of 80 per cent plus for all asset classes.

"The story is very different depending on where in Europe you are looking to invest and your appetite for risk" according to Glen Lonie, CEE Real Estate Leader at PricewaterhouseCoopers, Czech Republic. "At one end of the scale Russia and Turkey are booming, at the other end London has fallen out of favour with many investors. We are seeing the emergence of very different real estate markets in Europe. As investors look for returns in a volatile market, they need to understand the complexities of the markets that they are moving into.

"As for the Czech and other central European markets, there is increasing consensus around their status as mature markets with high stability and a lower investment risk. This situation attracts some of the more conservative investors to the region. For those seeking higher returns greater prospects exist further east," he adds.

One downside of Czech market stability is rising prices – it is now hard to pick up a bargain anywhere close to the centre of Prague. However, it's still possible to find less pricey apartments on the outskirts of the city. Czech Point 101 offers brand new two-bedroom apartments for under 100,000 euros, while Ceres Property Services has new-builds in the popular Czech city of Brno for approximately 120,000 euros.

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For more information visit:
www.czechpoint101.com
www.ceres-group.com
www.pwc.com

Article first published 23 June 2008