The European Investment Bank (EIB) will be involved in supporting the emerging sector of affordable housing in the Czech Republic. This year, he will prepare a market evaluation and recommend a suitable form of financing for housing construction and renovations. The bank’s experts will also select specific projects with high potential. Among other things, the goal is to create a system that will be attractive to multinational investors as well. In Prague, the contract on the advisory role of the bank was signed by its vice president Kyriacos Kakouris – on behalf of the Czech side, they were the Minister of Finance Zbyněk Stanjura and the Deputy Prime Minister for Digitization and the Minister for Regional Development Ivan Bartoš.
Available rental housing in the Czech Republic will expand the offer in addition to owner-occupied, cooperative, social or commercial rental housing. “In many European countries, so-called affordable housing is a key part of the effort to find a way out of the housing crisis. We are working to ensure that it also plays an important role in the Czech Republic. These are long-term cheaper rents that even middle-class people can afford if they don’t own real estate. The goal is not to replace owner-occupied housing, but to offer a decent alternative, for example, to young people who, at the beginning of their careers, cannot yet afford a mortgage,” explained Bartoš.
“The low affordability of housing is a problem for many of our citizens, especially those who belong to the low and middle income groups. In the area of housing support, interdepartmental cooperation is therefore key, and it is thanks to it that we were able to sign the contract with the EIB today. Our goal is to support investments in rental housing projects that will meet the criteria of quality, energy efficiency and affordability,” said Finance Minister Zbyněk Stanjura.
The Czech Republic has so far lacked practical experience in the area of investments in affordable housing. The Ministry for Regional Development and the Ministry of Finance therefore asked the European Investment Bank for its advisory services in 2023. The cooperation agreement is the result of regular negotiations between the two departments and representatives of the bank. “I am proud that the Czech government is relying on the expertise of the EIB to fulfill this important goal, and I believe that our work will support the development of the affordable housing sector in the Czech Republic and attract investments from public and private sources,” explained EIB Vice President Kyriacos Kakouris.
This year, the bank will carry out a detailed analysis of the housing market in the Czech Republic and help prepare a strategy for the development of its affordable sector. EIB experts also identify a stockpile of housing construction and renovation projects. Following this, they will prepare suitable financing options, including a possible share of funds from the bank and other international partners. “For the coming years, we have negotiated about eight billion crowns for affordable housing in the Czech Republic from the National Recovery Plan – but we are thinking long-term. We are setting up an investment system that meets European rules, and above all, it will be permanently attractive to foreign investors,” added Bartoš.
This year, the MMR plans to start supporting affordable housing as part of the program of the same name under the State Investment Support Fund (SFPI). He is negotiating its terms with the European Commission these weeks. At least 2.25 billion crowns will be available in it for this year. In the next two years, the MMR expects another almost five billion crowns. “The program, as well as the entire concept of affordable housing, envisages intensive cooperation between municipalities and the private sector. We will therefore offer practical help to local governments with the preparation of projects – teams of experts will be available for them directly in the regions. We are also preparing concrete examples of construction and financing that will make it easier for them to implement the project,” added SFPI director Daniel Ryšávka. Investments in affordable housing are part of a broad reform of the Ministry for Local Development Housing for Life. It also includes, for example, a new construction law or a draft law on support in housing.
foto: Radek Vebr