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CONTENTS
1 Prague and the Czech Republic
5 Taxation
6 Legal
7 The Residential Market
12 Prague’s Core Districts Reviewed
16 The Beauty of Bratislava
16 About Marathon Consulting Group
LOCATION
Landlocked in the heart of Europe, the Czech Republic
(pop. 10.4 million) sits between Germany to the west,
Poland to the north, Slovakia to the east, and Austria to
the southeast. The country is composed of the regions of
Bohemia and Moravia, as well as parts of Silesia in the
north. Comprising a total area of about 79,000 square
kilometers, the Czech Republic is considered a mid-size
EU country. Its size is comparable to Austria or Ireland
and it would fit inside France seven times. One third of
the country’s citizens reside in the five largest cities of
Prague, Ostrava, Brno, Plzen, and Oloumoc.
OVERVIEW
In Czechoslovakia in November 1989, the communist re-
gime was unseated after a series of student demonstrations
and strikes. As it was a nonviolent affair with no known
deaths, the events became known as the Velvet Revolution.
The country then gained further independence January 1,
1993, when it peacefully separated from the Slovak Repub-
lic, thus becoming the Czech Republic.
The Czech Republic is a formal member of NATO, the
United Nations and became a member of European Union
on May 1, 2004, along with nine other former Soviet bloc
countries. It is a pluralist multi-party parliamentary rep-
resentative democracy.
Sunset over St. Mikuláš church in Louny, northern Czech Republic. Photo © Petr Kraumann
INDUSTRIAL AND
ECONOMIC INFRASTRUCTURE
The Czech Republic is considered one of the most highly
developed and industrialized economies in the region. The
principal industries are machine building, iron and steel
production, metalworking, chemical production, electron-
ics, transportation equipment, textiles, glass, china and
ceramics production, brewing, and pharmaceutical prod-
ucts. Its key agricultural products are sugar beets, pota-
toes, wheat, wine grapes, and to the delight of beer lovers
everywhere, hops.
Prague and Brno have, over the last decade, experienced
a shift from an industrial-based economy towards that of
a service-based model. Smaller regional cities’ industrial
output (specifically in the automotive sector) have spiked
FDI and contributed significantly to GDP growth.
AVERAGE INCOME
In 2007 the gross nominal monthly wages were CZK
21,692, or about EUR 870. Over the next two years this
figure is expected to increase by 7,5% per annum, placing
the Czech Republic ahead of the pack when compared to
other bloc countries such as Poland, Slovakia, and Hun-
gary. As impressive as this seems, the Czech Republic’s
average salary still pales in comparison to other neigh-
boring EU countries such as Austria (49% of the aver-
age Austrian salary, approx. CZK 76,000) and Germany
(51%, approx. CZK 73,000).
More money, more shopping, higher GDP. Photo © Getty Images and Mike Kemp
Living the modern life above Smichov, Praha. Photo © James Lambert
Open floor plans are more common in today’s flats. Source: Marathon Consulting archives
The panorama to Prague and the Vltava River is nothing if not spectacular. Photo © Lukáš Hron
Further still from the city center are the less affluent (but some-
times equally desirable) areas that comprise the spacious remain-
der of the city limits and beyond that are the city outskirts and
newly-popular satellite suburbs such as Libeň and Vysocany in
Prague 9.
Along with an overview of these areas is information on average
sale and rental prices. These are estimated using 68 square me-
ters as the average size. Sale price averages includes both existing
and new build sales.
THE CENTRE OF IT ALL:
STARE MěSTO AND MALA STRANA
The picture-postcard heart of the city is reflected in its hefty real
estate prices across the board. Heritage Preservation laws almost
exclusively protect Prague 1 and as such redevelopment and new
construction is rigorously constrained. This, in turn, drives prices
up even higher. Foreign buyers dominate the market here, and
typically local Czechs are unable or unwilling to match the high
market demands. The stunning architecture and cosmopolitan
lifestyle, however, often prove irresistible to many buyers once
they hit the pavement.
Average Sales Price : 8.2 million CZK (about 120,000 CZK/m2)
Average Rental Price per Month : 27,200 CZK (400,- CZK/m2)
The Vinohrady Water Works on Korunni Street in posh Vinohrady. Photo © ŠJů
VINOHRADY
Vinohrady (Prague 2) is by far the cream of the crop of all of
Prague’s neighborhoods. The district is quiet, beautiful, and af-
fluent. Shady sidewalks and bustling bars, cafes and restaurants
combine to form an unforgettable living experience. Vinohrady
also boasts two of the city’s most beloved parks: the sprawling
Riegrovy Sády and the Havličkovy Sády, which overlooks the vast
Nusle Valley. Vinohrady’s treasures don’t come cheaply. Prices are
higher than other “ring” neighborhoods, but perhaps not surpris-
ingly the district’s continued growth (an impressive 15% over the
last year) is a testament to its allure.
Average Sales Price: 5.4 million CZK (about 79,000 CZK/m2)
Average Rental Price per Month: 20,400 CZK (300,- CZK/m2)
ŽIŽKOV
Žižkov (Prague 3) is a bit of an anomaly. Part of the
district is every bit as posh as its neighbor, Vinohrady,
while other less-fortunate pockets remain stuck in “up
and coming” mode. Žižkov is one of Prague’s most vi-
brant places to live and its values will continue to climb
no matter the location. The district saw 16% growth last
year. This trend looks to continue into 2009 as buyers
snap up more of the affordable existing housing stock
and as several new developments begin to come online.
A bit of research goes a long way in this neighborhood, as
there are deals to be had almost everywhere in Žižkov.
Average Sales Price:
4.6 million CZK (about 68,000 CZK/m2)
SMICHOV
Just south of Malá Strana on the western side of the
Vltava lies the Smichov district of Prague 5, a beauti-
ful, busy district as varied as Prague itself. Rising up
from the riverfront into the hills high above the city,
locals can experience both urban and truly suburban life
in one neighborhood. The focus of a huge redevelopment
push earlier in the decade, Smichov’s local economy has
benefited greatly from these efforts. Property values
have jumped over 20% annually since 2006, the highest
increase of any “ring” district. The area is flush with
excellent shopping and services and an impressive clus-
ter of entertainment and transportation options. The
district is not without a few trouble spots due to heavy
commerce. Nevertheless, Smichov remains an oft-over-
looked gem in Prague’s crown worthy of every prospec-
tive buyer’s consideration.
Average Sales Price:
5.44 million CZK (about 80,000 CZK/m2)
Smichov’s bustling shopping mall draws thousands daily. Photo © Honza Groh
DEJVICE
Dejvice (Prague 6) is an affluent neighborhood located diametri-
cally across the city from its “sister” district Vinohrady. Often con-
sidered an older, quiet area, Dejvice is home to some truly impres-
sive manors and most of the capital city’s national embassies. The
quality of life here is high, and it comes at a price. Several notable
foreigners’ schools and easy access to Prague’s airport make De-
jvice the district of choice for wealthy businesspeople and diplo-
mats. Dejvice is also home to the spectacular open space known
as Divoka Šarka (Wild Sarka). This vast natural playground finds
many Praguers visiting year-round and remains a treasured pre-
serve amidst the urban development. The good news for the aver-
age buyer is that Dejvice has a share of increasingly renovated
panelaks that offer good value in a truly excellent location. Prop-
erty value increases were in line with much of the city at 15%.
Average Sales Price: 5.23 million CZK (about 77,000 CZK/m2)
Average Rental Price per Month: 17,000 CZK (250,- CZK/m2)
PRAGUE 9 - VYSOCANY
The Vysočany district of Prague 9 served as a manufacturing site
for locomotive producer CKD, the Praga car factory, a Kolben fac-
tory and Avia Aero among others. It reached its peak during World
War II and continued well into the 1950s. A restructuring of the
city’s industrial zones since the early 90s has driven a number of
factories out of business and literally cleared the air. The facto-
ries were slowly replaced with office parks, and new residential
developments began filling the vacant parcels. The main boule-
vard, Sokolovska, has been restored, adding to the gradual gen-
trification of the entire neighborhood. Vysočany is home to the O2
Arena (originally Sazka Arena), a world-class indoor sports and
entertainment stadium, as well as a new indoor ice-skating rink
currently under construction that will be opening shortly. There
are many local shops, including the new Fenix Hotel and Shopping
Center (with one of the largest congress facilities in the city) and
restaurants, affording a true neighborhood experience. A Metro
(subway) line as well as several tram lines will help the district
grow, as many budget-conscience buyers look specifically for loca-
tions in close proximity to public transportation. These service get
local residents into the city in well under 30 minutes.
Average Sales Price: 3.4 million CZK or about 50,000 CZK/m2)
Average Rental Price per Month: 15,000 CZK (220,- CZK/m2)