The European Investment Bank (EIB) will be involved in supporting the emerging affordable housing sector in the Czech Republic. Later this year, it will prepare a market assessment and recommend an appropriate form of financing for housing construction and reconstruction. The Bank's experts will also select specific projects with high potential. The aim is, among other things, to create a system that will be attractive to multinational investors. In Prague, the agreement on the advisory role of the bank was signed by its vice-president Kyriacos Kakouris - on behalf of the Czech side, it was signed by Finance Minister Zbyněk Stanjura and Deputy Prime Minister for Digitalisation and Minister for Regional Development Ivan Bartoš.
Affordable rental housing in the Czech Republic will expand the supply of housing alongside owner-occupied, cooperative, social or commercial rentals. "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 plays an important role in the Czech Republic as well. It is about cheaper rents in the long term, which even middle-class people can reach if they do not own property. The aim is not to replace owner-occupied housing, but to offer a decent alternative to, for example, young people who cannot yet afford a mortgage at the start of their careers." Bartoš explained.
Low housing affordability is a problem for many of our citizens, especially those in low- and moderate-income groups. Inter-ministerial cooperation is therefore crucial in the area of housing support, and it is thanks to this that we were able to sign the agreement with the EIB today.
"Low housing affordability is a problem for many of our citizens, especially those in low- and moderate-income groups. Inter-ministerial cooperation is therefore crucial in the area of housing support, and it is thanks to this that we were able to sign the agreement with the EIB today. Our aim is to support investment in rental housing projects that meet quality, energy efficiency and affordability criteria," said Finance Minister Zbyněk Stanjura.
The Czech Republic has lacked practical experience in the area of investment in affordable housing. Therefore, the Ministry of Regional Development and the Ministry of Finance asked the European Investment Bank for its advisory services in 2023. The cooperation agreement is the result of regular meetings between the two ministries and representatives of the Bank. "I am proud that the Czech government is relying on the EIB's expertise to achieve this important objective and I am confident that our work will support the development of the affordable housing sector in the Czech Republic and attract investment from both public and private sources," explained EIB Vice President Kyriacos Kakouris.
Later this year, the bank will conduct 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 will also identify a pipeline of housing construction and reconstruction projects. Following this, they will prepare suitable financing options with a possible contribution from the Bank and other international partners. "For the next few years, we have negotiated roughly CZK 8 billion from the National Recovery Plan for affordable housing in the Czech Republic - but we are thinking long-term. We are setting up an investment system that meets European rules and, most importantly, will be permanently attractive to foreign investors," Bartoš added.
This year, the Ministry of Regional Development plans to launch support for affordable housing under a programme of the same name under the State Fund for Investment Support (SFPI). Its terms are currently being negotiated with the European Commission. At least CZK 2.25 billion will be available for this year. In the next two years, the Ministry of the Interior is counting on almost five billion crowns more. "The programme, as well as the entire concept of affordable housing, envisages intensive cooperation between municipalities and the private sector. Therefore, we will offer practical assistance 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 Daniel Ryšávka, Director of SFPI. Investments in affordable housing are part of the Ministry of Regional Development's broad reform Housing for Life. It includes, for example, the new construction law or the draft law on housing support.
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