Prauge getting more expensive

[CMDAVILACLI]

Hi... for those of you (at least here in the States) thinking about going to Prague, check out this report in today's news... (I'm glad I visited Prague several years ago when it was still a bargain!)

cmdavilac




Prague Tourists Rattled by Rising Koruna Avoid Beer, Souvenirs c.2008 Bloomberg News
By Yon Pulkrabek and Marketa Fiserova
July 28 (Bloomberg) -- Mindy and Gerald Gartner say they looked forward to celebrating their 25th wedding anniversary in Prague, known for its inexpensive beer, food and hotels.

After paying the equivalent of $80 for breakfast and then buying a $5.50 cup of coffee in the Czech capital, the New York couple decided against a souvenir necklace because of the price.

I understood Prague was going to be the cheapest of the three places we were going to and if this is the cheapest, its a little scary, said Gerald, 52, chief financial officer of New York City-based AHRC NYC, a non-profit organization that offers aid and legal services for the disabled. While on vacation, you sort of dont like to think about whats affordable, he said. When it hurts the pocketbook, you have to be more reasonable.

The Czech koruna rose to a record against the U.S. dollar and euro last week, making it the worlds best performing currency and damaging the former communist citys reputation as a bargain destination. Prague topped Berlin, Brussels and Stockholm for the first time in a cost of living index published by consulting firm Mercer LLC on July 24. Tourism officials forecast a decline in visitors when second-quarter figures are released on Aug. 15.

Demand has been falling since May as people cancel their stays, citing the strong koruna, said Veronika Mirovska, owner of Accomm-Prague s.r.o., which sells lodging and excursions to tourists. You can get a holiday flat for the same price in Vienna, or even in the center of Paris.

In the 12 months through Friday, the koruna gained 19 percent against the euro and 37 percent against the dollar as annual economic growth of at least 5 percent since 2005 attracted foreign investment. Prime Minister Mirek Topolanek and central bank Governor Zdenek Tuma have spoken out against the currencys strength this month in an effort to reverse the trend.

Prague, a city of 1.2 million people, jumped to 29th place in Mercers 2008 ranking of cities from 49th place last year, making it more expensive than any other eastern European city outside of Russia. Revenue at shops and restaurants in the center of Prague has dropped as much as 30 percent this year, said Tomio Okamura, a spokesman for the Association of Czech Tourist Agencies.

A glass of beer in Pragues picturesque Old Town Square costs $6.56, or 4.13 euros, more expensive than a half-liter in Berlin, Frankfurt, Vienna or Madrid, according to price data compiled by Bloomberg News.

A plate of traditional pork, dumplings and sauerkraut at the Grand Cafi Praha on Old Town Square costs 420 koruna ($27), or 18 euros -- twice the cost of a comparable dinner in Frankfurt and Berlin and more than an order of fish and chips in the Museum Tavern near the British Museum in London.

Its a catastrophe, said Rita Hysi, who owns two Old Town jewelry stores specializing in traditional Czech semi-precious red garnets. Im in the red, I cant pay invoices. It was never like this. This is the worst in a decade, she said.

Marie Brejcha, a 30-year-old project manager from Sweden, is on her second trip to Prague in two years. When she was last in the Czech Republic, the koruna was 22 percent cheaper against the Swedish krona than it is now.

Its just like having lunch in Stockholm, said Brejcha, as she strolled near Pragues historic astronomical clock on Old Town Square.

Relief may be coming. The koruna reached its all-time highs -- 22.908 against the euro on July 22 -- before central bank chief Tuma signaled that the bank may cut interest rates as early as next month to counter the korunas strength and avoid damage to the economy. The koruna is forecast to fall to 24.2 against the euro by the end of the year, a decline of 2.6 percent, according to the median prediction from 24 economists and currency strategists compiled by Bloomberg.

That would be good news for Ota Ledvinka, the 38-year-old manager of the Old Town Squares Erpet Bohemia Crystal shop.
With the koruna this strong, tourists first pay for their hotel, then food and only commit the last bit of money to presents and souvenirs, she says.

And as for the Gartners of New York, they said they were headed to Venice after their stay in the Czech Republic, and hoped that the Italian city would be less expensive than Prague.

Everything you touch here is like a fortune, said Gerald. Its been a little bit of a shock. --

[kyshel]

Old Town is the most obscenely expensive part of Prague. You want to eat ther, that's the price. Shameful, but that's what it is.
Of course, if you look around the corner, and choose a less "touristed" bar or restaurant you won't pay those prices. My nephew just spent a week there in June, and after having been in Tel Avia, Jerusalem and Athens, he was so relieved to be pay E$2 for a huge pilsner. The pork, duck and dumpling dinner at a decent tourist restaurant near Charles Bridge costs $25 for 2, with beer.
You can find expensive establishments anywhere.

[CMDAVILACLI]

Hi Kyshel,

You are right about heading outside of the most touristy spots when going to a city to reduce the overall costs... a little hunting around usually results in great finds. It's just a drag when you want to get a quick cup of coffee or pop into a museum that the prices have increased so much one has to think twice about one's budget! (Okay, I'm not going to get on my soapbox about "when I was younger and you could actually travel on $10.00 per day!)

It just takes a little more planning to keep costs down.



cmdavilacli

[kyshel]

I'm so glad we didn't have to go to that "when younger" ...

Our last trip to Prague was 2 years ago and I recall getting the check for 2 glasses of wine and wow!! $8 each for wee small glass of what was probably poured from a jug--we sat at one of the cafes on the square and paid the price for the people watch. Our dinner for two the next night in a lovely 400 yr old cellar not far from the bridge cost us less than $60, wine, dessert and service included.

And--you're so right about this--planning and being aware of local prices is important.

[thepiranha]

I've been to Prague only once and it was dirt cheap. My wife and I were there in 1990 and lunch for two including beer was around $6, if my memory serves me correctly. Of course, if you wanted to buy something at the local market, there was one kind and one size, and if there was a rumor going around that a shortage of a product was on the horizon, the stores were mobbed with lines going out the door to buy that product. Because of that, there would be a shortage of the product because everyone was stocking up on it since they had no idea when it would be available. From everything that I've read, Prague isn't much of a bargain destination anymore. I guess that's the price of progress.

[claassenam]

I was in Prague and Budapest in late May - we chose the destinations thinking that since the two countries still aren't on the Euro, prices would be more reasonable than other parts of Europe. I wish this story was out beforehand so I'd have a better warning! We got great hotel deals - through Luxury Link, of course. But in my research beforehand I did feel that overall hotel prices were much more reasonable in Czech and Hungary than other Western European destinations. On the other hand, everything everywhere is priced in Euros - probably to make it easier for tourists - and prices on food, drinks and goods are as high as everywhere else in Europe. Apparently, according to this article, even higher than in many cities. Especially, as mentioned before, and like anywhere, if you eat, drink and shop in the most heavily touristed places such as Old Town Prague. In both cities we tried to avoid eating in the midst of the major crowds, and we found some great, slightly more reasonable, restaurants and had a wonderful time.

One helpful thing about the Luxury Link packages was that in both cities breakfast was included every morning and one wonderful multi-course dinner was included at each hotel - that is excellent value in cities where a basic (sandwich and a soda) lunchtime meal can cost $80 for two people and dinner is over $200.

How did the prices affect us on our trip? Well, like the tourists mentioned in the article, we avoided purchasing any souvenirs - very rare for us! (There honestly wasn't a whole lot we would have wanted, but we certainly weren't looking after paying for meals.) We were spending so much on food and drink we just avoided shopping altogether. It was a great trip and I wouldn't have done it any differently but the prices were certainly a shock to the system!

If you are headed to Prague or Budapest and would like some restaurant recommendations, let me know...

[CMDAVILACLI]

Hi Claassenam,



You are absolutely right about getting a hotel package of some sort that includes breakfasts and maybe even a dinner. It is amazing how much money you can save just by drinking the coffee, juice and having a piece of toast at the hotel. The good news is that inmany European hotels, breakfast is included, and the selection usually is satisfactory. A quick nosh and a few Euros saved before one heads out the door is a great way to start the day!

cmdavilacli

[thepiranha]

I don't know about others out there, but I have absolutely no desire to go to any city where a lunch consisting of a sandwich and a drink runs $80 for two people, especially when there are so many places in the world where your dollar has far more purchasing power. Prague's a beautiful city, but that's ridiculous! A multi-course lunch at Bouley, which is probably the best lunch in New York and certainly the best lunch that I've ever eaten, runs $76 or $96 for two, depending on which lunch you choose. And that's in New York, which is one of the most expensive cities in the world to visit.

[CMDAVILACLI]

You made a great point of going to fantastic restaurants for lunch. My husband and I do this everywhere we go... we head off to the best restaurants at lunch time and pay about half the price as it would be at dinner! I've eaten in some amazing places this way without destroying my budget. The only problem is that often times, after eating such a huge meal (with wine, I must add), we often times have to head back to our digs and rest up before going out site seeing again. Then we just pop into a fun, inexpensive cafe somewhere for a late lite supper.



And as for Bouley's... I've eaten there for both dinner and lunch - what an wonderful dining experience!

cmdavilacli

[bonniejoy03]

Hello everyone and thank you for reinforcing what my husband and I believed. It will be our 20th year anniversary in May and we planned to go back to where we honeymooned ...Yugoslavia. (one week in the Julian Alps and one week on the Adriatic.) I researched prices and realized how expensive this would be. I then thought about Greece (I am part Greek.) and haven't been there in a few years. Welll....I posted under destinations section and hadn't heard from anyone but did research and was shocked by the prices. I agree that it is hard to comprehend paying sky high prices. We even thought about renting a villa but we were told that store prices are high also. I am a little disappointed but I know that I would be even more disappointed paying the prices!





PS- We were to Prague in the 90's and had a friend's apartment. It was wonderful. Also, not a lot of tourists at that time. Food was sooo inexpensive!