2014 Czech property forecast

2014 Czech property forecast in written format: http://www.czechpoint101.com/newsletter/2014-forecast/2014-czech-republic-property-forecast-prague-brno-ostrava-pardubice-hradec-kralove-olomouc-zlin/ This is our video format of our Czech property 2014 forecast. First of all, let's, look at an overview of 2013, what happened last year. What we predicted: We felt that the property prices would be between stagnation and a 1% increase. So a turnaround from the decreases of the previous years. And, we saw a decrease in Q1 of 0.6%. But then in Q2 and Q3, 0.2% increases. And it looks, by all indications, that Q4 as well will show, a decent increase. So we should finish the year, around, stagnation to, 1% growth. We'll see exactly what it finishes out as. What are going to be the biggest factors for 2014? Well, the biggest thing, the same as 2013, are the super cheap mortgage rates. They are very low. And for sure if there is any indication that interest rates are going to be increasing, in the near future, we will see a bit of a stampede, like we have in the UK and Canada, for people to secure, or fix their mortgages and buy property. So, this is something that could cause a quite quick jump in property prices. This shows all mortgages granted from January to October of each of these years. 2013 we can see was a record year for total amount. However, the grey part indicates refinancing, and the orange, new purchases. So, the majority, or a large part was refinancing. Real wages continue to decrease in 2013, and this is, major negative on property prices. Buyers don't feel like stepping forward to commit to a mortgage when their earning power is decreasing. However as of the end of 2013 everything looks better in terms of what's happening in the European and global economies including Germany, which is very important because Germany is the biggest trade partner with Czech Republic. And this is very positive for the coming year. A big thing, as well, that we should see, is that buyers will acknowledge that property price decreases are behind us. No one likes to buy something and see it go on sale the next week. And many buyers, we feel, have been holding back purchases because they want to definitely see that prices are increasing and that they won't be surprised or embarrassed by buying something that goes down in price in the future. So, with Q4 this should be three quarters of growth, and this should put this doubt out of the minds of these buyers. Again, in 2013 we saw a decrease in the number of dwelling units started. And of course with supply and demand, the supply is being reduced, and, for new units, demand continues to be quite strong. So this will positively affect our prices. As well, Czechs are really viewing property as an investment of choice. They're moving their money out of the bank accounts where they get such poor interest and other investments, such as stocks which also haven't been doing so well. And so smaller units are really in demand for Czech investors. And we're, we should see this continue into 2014. Long-term we think that the Czech economy will do very well. There'll be more Foreign Direct Investment (FDI) into the country. This is for, because of things such as the low debt to GDP ratio. As well, the Czech National Bank artificially weakened the currency and this won't continue forever. And, as well, the, the really low taxation rates that Czech Republic has. So, our conclusions, in the short-term, this year coming forward, 2014, we expect to see a little bit more of a growth, around 3%.