CTK reported that June's fall in Czech building output confirms a long term trend and the decline in housing construction is linked with low demand. Developers are cautious before launching new projects when they have not yet even sold the completed flats.

The Czech Statistical Office said that Czech building output sank by 4.7% YoY in June 2010 after a 0.5% increase seen in May. The number of started flats was down by 31.8% to 2,448. The number of started flats in family houses sank by 19.2% YoY and the number of started flats in apartment houses declined by 45.9%. The number of completed dwellings in family houses decreased by 18.3% and in multi dwelling buildings it sank by 74.1% YoY. A total of 1,539 flats were completed in June.

Mr Michal Hrncir of law office Ambruz & Dark told CTK that "Developers have not yet sold earlier completed projects and so are starting new projects with caution. The 46% YoY decrease in the multiple dwellings segment proves this. Last year was also meager in general as regards new projects. A dramatic turnaround in the construction of new projects cannot be expected in the coming months."

According to CSU data, the number of flats completed in the first half of 2010 fell by only 5.5%, which means that roughly the same number of new flats is being put onto the market as last year.

Mr Jiri Pacal board member of Central Europe Holding said that demand for flats was affected by lower number of young people willing to buy a flat, low income from rented flats and privatization of municipal flats.

(Sourced from Czech News Agency)