Number of forced auctions of real estate increased in the Czech Republic

Number of forced auctions of real estate increased in the Czech Republic

910 forced auction of real estate held in the Czech Republic in 2012. Since the beginning of 2013, the number was already 531. Experts predict that by the end of 2013 the number of forced auctions will grow up to 1,000, reports portal Novoya.com.

Czech banks are initiators of 70% forced auctions of real estate. Defaulters of mortgage and consumer loans first have the opportunity to reduce the amount of the monthly loan payment, and in case of refusal must part with property. Banks return their money by selling defaulters’ housing at auctions.

Speculators, who buy property cheap and then reselling it at a higher price, are the main buyers at forced auctions in the Czech Republic.

Most often, houses and apartments are sold for a part of the original price, and banks do not have enough money raised to cover the loan amount. Thus, the non-payers are not only deprived of their property, but still remain to banks.