Investment Property - White Tower

Original Investment Summary - 01/11/2007 Investment Property White Tower

Prices starting from £40,071

Excellent rental location, approximately one kilometre from the city centre
One of the first new developments of its kind in a prime location near the city centre
Payment terms of 15/85
The best place to live in the Czech Republic, according to Czech newspaper, MF Dnes

White Tower in Hradec Králové represents an opportunity to buy into the rapid growth of the Czech property market at a very low price, starting at just £40,071/CZK 1,602,835. The average price per square metre (incl VAT) at White Tower is CZK 39,224/£980.

International and local developers have recently shown interest in the main regional cities of the Czech Republic. Demand has been high in Hradec Kralove this year and this has been pushing up prices. A development by major European company, Orco, located approximately 3km from the city centre, has recently sold out, such is the demand from the domestic market.

White Tower is located around 1km from the attractive city centre and five minutes from the main square. 50% of the units in the development have already either been sold or have been reserved at full market price, giving a clear indication that the domestic market is attracted to the idea of modern new-build apartments in this area.

Property Secrets has secured 30 units at 2% below the developer’s list price, with payment terms of 15/85. The price of apartments in the Czech Republic has risen by an average of 30%, according to 2006 figures, and capital growth at White Tower is expected to reach between 20–25% prior to completion, according to conservative estimates. This is based on growth figures placing Hradec Kralove among the top three best performing cities in the Czech Republic in terms of capital growth, where prices increased by a third in 2007 from a low base level. The situation in Hradec Kralove is similar to that found in Brno, one of the most successful Property Secrets’ markets, which has continued to record annual growth of 25% in the last two years.

The extension to the D11 motorway has improved journey times to the capital. Further plans to expand the motorway network to other major cities in the Czech Republic and beyond have increased the desirability of Hradec Kralove. A poll conducted by Czech newspaper MF Dnes resulted in the city being voted as the best place to live in the entire Czech Republic.

A number of residential developments have recently been constructed in the city, aimed at satisfying demand for contemporary new-build apartments. Interest has also come from outside the region, with people drawn to the city by employment opportunities. The property market in Hradec Kralove is still in the early stages of development with low stock levels and high demand from locals. Rental potential is good with demand coming from middle-class professionals on the domestic market.

Hradec Kralove is traditionally an area of low unemployment and the increased FDI in the region has further boosted the attraction of the area.

600 foreign companies have set up in Hradec Kralove and the surrounding region in recent years, along with multinational companies, Panasonic, Foxconn and Arrow International.

The city will also benefit from the expansion of Pardubice airport, the second largest airport in the Czech Republic, located just 20 kms away.

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