Construction output in Czechia has sped up its year-on-year growth quite considerably. The latest CZSO data (released in October) cover August of this year and point to an unprecedented rise of 17.1% compared with August of the previous year. And this is no seasonal anomaly. Czech construction has been growing steadily since last November. Back then, however, year-on-year growth stood at 2.5% (and as recently as April this year it was 3.3%), while since May the pace of year-on-year change has been in double digits.
It's not just about motorways
“Growth is being driven by the large volume of civil engineering projects under way,” explains Radek Matějka, Director of the Agriculture, Forestry, Industry, Construction and Energy Statistics Department at the CZSO. Civil engineering works include the building of roads, motorways and railways, as well as telecommunications and energy networks. This sector grew year on year by as much as 27.4%, evidence of major investment from the government as well as from state-owned and private companies.
The biggest new projects include another section of the Prague Ring Road and the D3 and D35 motorways
Yet building construction, i.e. the construction of buildings, is not lagging far behind either – it grew by 11.2% year on year. In August, building permits were issued in total for projects worth almost 58 billion crowns. “This was helped by permits for a larger number of projects with budgets above one billion crowns. If these were hypothetically subtracted, the indicative value would be slightly below the level of last August,” explains Petra Cuřínová, Head of the Construction and Housing Statistics Unit at the CZSO.
Residential construction under way
Wondering how many residential properties that means? During August, according to the Czech Statistical Office, construction began on 2,757 new flats. That is a marginal year-on-year decline of 0.4%, offset, however, by the higher value of permitted projects. Completions reached 3,033 flats, which is 35.4% more than in the same period of 2024.
When looking at CZSO data, bear in mind the time lag and the difference between the number of newly issued permits and the properties currently being completed
Analysts point out that for most months this year the number of completed flats has been at a similar level as last year, so the data currently reported for this segment partly reflect seasonal fluctuations and perhaps also developers' efforts to let as many families as possible spend the Christmas holidays in a new home. In the figures for completed properties, the currently reported growth of 17.1% will show up over roughly the next two years. However mixed the news from the residential sector may be, it is certainly not the case that new flats are not being built or disappearing from developers' offerings. This is down to demand from families as well as from retail and institutional investors adding completed properties to their portfolios. Are you looking for a tenant for your investment flat right now? Or are you still considering buying one but unsure whether you can handle all the related paperwork? We would be happy to introduce you to our concept of comprehensive property management, which includes, among other things, finding a suitable tenant through an experienced management company. We will send the rent to your account every month, saving you a great deal of time and worry. If you are interested, don't hesitate to call +420 277 000 330 or write to sales@flatservice.cz. We will gladly come and see your flat and prepare a free, no-obligation estimate of the expected market rent.
