Residential construction drives growth in the Czech Republic

Construction sector rebounds in the Czech Republic: residential drives growth

The construction sector in the Czech Republic is back on a growth path, sending encouraging signals for the entire building industry. In October, construction output increased by 7.1% year on year, confirming a turnaround after a period of slowdown. Although a slight month-on-month decline of 0.4% was recorded compared to September, the annual figure points to a solid recovery, driven primarily by the residential sector, now once again at the center of market momentum.

New housing starts surge: real estate market gains strength

The most significant figure concerns new housing starts. In October, construction began on 3,457 residential units, marking a 34.5% increase compared to the same period in 2024. This growth reflects sustained housing demand and renewed investor interest in the Czech real estate market. The expansion was largely fueled by apartment buildings, which continue to represent a concrete response to housing needs in the country’s most densely populated urban areas.

Central Bohemia, Prague and South Moravia lead construction activity

The strongest momentum comes from the country’s most developed regions. Construction activity in Prague, along with Central Bohemia and South Moravia, accounts for the largest share of new residential projects. These areas are characterized by high urbanization, better access to services and a more dynamic labor market. The trend confirms that construction development closely follows the Czech Republic’s main economic and demographic drivers.

Construction output and completed homes: growth with caveats

Alongside rising housing starts, the number of completed apartments has also increased. In October, 2,914 units were completed, representing a year-on-year jump of 58%. However, this figure should be interpreted with caution. The increase is partly due to a low comparison base, as October 2024 recorded one of the lowest numbers of completed homes on record. Despite this base effect, the data still point to accelerating construction activity and a stronger capacity to deliver projects.

Building permits on the rise: stronger investment in construction

Another positive signal comes from the value of building permits, which rose by 7.3% to reach CZK 46.6 billion. This increase indicates growing confidence in the construction sector and a higher propensity to invest, particularly in residential development. The higher value of permits also suggests larger-scale projects, which could support construction output in the coming months and further strengthen the national real estate market.

Source: novinky.cz