Did you know that you can break your mortgage fixation, sell your property, and refinance anytime, even if you fixed with the bank for three, five, or eight years or so? The bank must allow you to close the mortgage prematurely… for a cost. And there is a big change from January. Let us start from the beginning. What is fixation: When you take your mortgage for let’s say 20 or 30 years, the interest rate will not stay the same for the whole time. When taking out the mortgage, you choose a “fixation period”, which means that for the next X amount of years, the rate will be fixed at for example 5.39%, which is the best rate we can get today (end of November 2023). With this in mind, you might be tempted to go for a shorter fixation and hope the rates go down. But, if you can refinance anytime anyway, why not choose 10 years and simply break the fixation whenever it suits you? How much did it to break fixation? Depending on when you signed your mortgage or renewed your fixation period (which, for the sake of working out these costs, is considered a reset...
KKCG Real Estate Group shared the successful sales results of the second phase of family houses and villas at the POMEZÍ residence in Košíře, Prague. KKCG REG started the construction in November 2018 at the foothills of Stolové Hory Vidoule in Košíře. The first phase, completed in 2021, included 90 premium apartments across four residential buildings. The ongoing second phase, which started in May 2019, comprises 38 family houses, four apartment buildings with 148 units, and five standalone villas. The 3.7-hectare sloping plot was creatively designed with a mix of apartment buildings, family houses, and villas to ensure privacy and scenic views for all residents. Otto Koval, Executive Director of KKCG Development, attributed the project’s success to its premium location next to the Košíře-Motol nature park, unique urban design, and personalized client approach. The entire Top’rezidence POMEZÍ, covering 3.7 hectares, is set to be completed in the summer of 2024, offering amenities such as relaxation areas, retention ponds, community spaces, and sports facilities. Currently available for sale are the last three row houses (4+kk) and one standalone villa with a 400m2 floor area. The successful approval of 60 apartments and the initial groups of family houses from the second...
Buying a property in another country is simply not as easy as ordering food delivery through a phone app. That is a fact. The Czech Republic might not be the simplest when it comes to bureaucracy, language, and banking so today I want to share the three biggest mistakes I see expats (but also Czechs) make when buying a property, so you do not have to go through the same again! Oh – and one really, really bad idea to end with, something you should NEVER EVER do… Mistake Number 1: Not using a lawyer when buying a property. This is something I cannot get my head around and usually Czechs are worse at this than expats. The story goes like: “No, why should I need the lawyer, I think the contract looks OK. I asked my friend who works in…” I am not speaking just of purchase contracts either, but even the first reservation contract, which you sign when you want to take the property off the market. Recently I heard a story “I need a lawyer, I signed a contract and now there is a problem since the seller is doing XYZ”. Better late than never, however, if...
With Prague’s population expected to grow fundamentally over the next 25 years, the municipality continues to cooperate with residential developers in order to prepare for the new wave of residents looking to relocate to Czechia’s thriving capital city. For developers such as Horizon Holding it is essential to plan out neighborhoods and develop new ways for Prague to improve in terms of living quality that will attract new residents. Active in the Czech market for over twenty years, Horizon has completed several residential projects in Prague and its suburbs, including quarters such as Modřany, Karlín, Čimice, and others. As of today, the developer completed apartments for over 1,500 families and is about to start new projects that will bring thousands of new apartments to the market. “We are not necessarily attached to one location or one quarter, but we choose what we believe to be an interesting project meeting our standards, preferably of bigger scale with over 100 apartments,” said Yishay Furman, CEO of Horizon Holding. “We prefer projects that can be phased, to start with 100 units, then we gradually expand further the neighbourhood with retail units, build parks that include playgrounds, resting areas and also art, as you...
Did you know that the Czech Republic is one of the most favorable countries to invest in when it comes to taxation? Preceded only by Luxemburg or Switzerland, the Czech Republic offers perks such as no acquisition tax, tax benefits for residents, favourable deductions for rental income, and even no tax to pay on profit if you own the property long enough. One of the most positive parts when it comes to property investments is actually the tax systems. Yes, I do mean positive… I am not mistaken. Speaking to foreigners from all around the world, I often get surprised looks when I explain there are almost no taxes to keep in mind when buying a property here. If we compare to other acquisition costs like solicitor fees in the UK or annual property taxes in the US, here we have really nothing to complain about. Let’s take it step by step: Before 2020, there was a 4% acquisition tax paid to the country’s financial office and which was an obstacle to purchasing property for many people. Luckily this requirement was removed during the Covid pandemic so now you do not need to think of extra 4% to pay from...
A new bank is in the final stages of preparation before going live, and it could soon be offering mortgages. Partners Bank received its license from the Czech National Bank in August, and its backers expect to launch publicly in March. Initially, it will offer the basic services of payments, but within a year, it expects to be able to offer mortgages and loans too. Within ten years, they hope to have half a million clients. In a statement, the Director of the Partners Financial Group, Petr Borkovec, said the aim is to offer clients a complete financial service. “We see the launch of the bank as entering a new financial league. We will offer our clients a perfect financial service. Thanks to licenses, data, and technology, it will connect their entire financial life in one app, which will give them full and immediate control over their finances, enable them to live a healthy financial life, and ensure the growth of their wealth.” The Partners Group has operated in the Czech financial advisory space for 15 years. According to seznamzpravy.cz, Partners’ app allows clients to choose advisory services already. Later, it will be expanded to include all the banking services...
If I had to select one area of Prague I love the most, it would have to be Prague – Royal Vineyards, Vinohrady in Czech, or “Královské Vinohrady”. As you might know from the recent article, Vinohrady was rated as one of the coolest areas in the world. Vinohrady has a unique and charming atmosphere and will always maintain its value because of its prestige, history, architecture, and limited areas for new development. In this article, I will cover the history of the villa district spreading from Bezručovy sady all the way down to the borders with Prague 3 and 10. You can look forward to a series of articles about the Vinohrady area, starting today with the history of the villa area and what happened before the first villas even began construction. The Early Years Vinohrady was originally a rural area with vineyards and orchards covering much of the land. The first permanent settlements in the area date back to the 12th century. By the 15th century, it was a thriving agricultural community thanks to an order of Charles the IV which stated that within a 3.5km area from Prague Castle, vineyards shall be planted and wine for the...
For those of you fed up with city life and looking for unique properties further away from town, I’ve found two interesting properties, one of which is a major bargain! First, the bargain: a picturesque neo-renaissance mansion for the price of 2kk in Prague Located in Veliká Ves near Podbořan, this charming Neo-Renaissance mansion is built on 311 m2 with a 700 m2 useable area and is a designated cultural monument. The property has undergone recent renovations to its facade and roof. It offers a ground floor, first floor, and an attic with a rectangular layout, along with an adjacent land measuring 1,490 m2. With its convenient location just 16 km from Žatec and less than 1.5 hours by car to Prague, this property presents a compelling investment opportunity. It’s perfect for hosting weddings or transforming into a hotel with a restaurant if the heritage department allows it. Customer walk-ins might be quite rare though given Veliká Ves has a population of only 313. The property is part of a bigger complex (not part of the purchase), which contains farmland – maybe you could even have fresh milk and eggs every day! This remarkable mansion and the adjoining land...
In the Czech Republic, two common types of properties stand out for investment: panel buildings, and brick buildings. Both have advantages and drawbacks, making it essential for investors and tenants to understand the differences between these choices. In this article, we’ll delve into what panel buildings are, compare energy efficiencies of both types, outline the pros and cons, and ultimately aim to help you decide which type of property is right for you. What is a Panel Building? Panel buildings, referred to as ‘panelaks’ in Czech, are large housing complexes characterised by pre-fabricated concrete panels. They became prevalent in former Czechoslovakia during the mid-20th century as a response to the urgent need for affordable housing. Panelaks are typically high-rise structures with communal spaces. While they might be largely overlooked by expats, did you know that around a third of the Czech population lives in these flats? They typically offer a variety of apartment sizes, accommodating different family sizes, but the buildings themselves are usually quite similar. Comparing the Energy Efficiencies One of the crucial factors to consider when choosing between panelaks and brick buildings is energy efficiency. Panelaks generally have great thermal insulation as the concrete panels, when well-maintained, provide...
If you’re in the market for a luxury villa, you might be in luck as one of the country’s most expensive properties has gone up for sale. The luxury villa, owned by investor and mathematician Karel Janeček, is located in Prague’s Smichov district. According to the real estate agent Jan Bareš of NRG International Realty it boasts six bedrooms, four bathrooms, two studies, a pool, a hot tub, a wine cellar, a home theatre, and a rooftop terrace with stunning views of the city. It also has a garden area, multi-car garage, and guest and nanny accommodation. Janeček bought the villa in 2016 for 48 million CZK and worked with architect Radovan Mačák to renovate it to a high standard. He is selling it because he is moving to a larger property outside Prague. “I decided to sell the property mainly because of the need for a bigger garden around the house,” he recently told Forbes. The villa has a usable area of 719 square meters and the entire plot is 983 square meters. The price tag is 137 million CZK. If you look at the price per m2, it is really not that bad, at roughly 190k / m2....
Finally good news for those considering getting a mortgage: the Czech National Bank (CNB) is removing some restrictions from next month. Last week, CNB board members agreed to remove the DSTI (debt-service-to-income) restriction, which was introduced in April 2022 to slow the market. At the same time two other restrictions, DTI (debt-to-income) and LTV (loan-to-value) were introduced, but unlike DSTI, they will stay in place. The removal of the DSTI restriction will come into effect as of July, meaning the amount people can borrow would look as follows: What is the limit on what you can borrow now? Once the DSTI limit is removed, the maximum amount you could borrow for a mortgage will mainly be limited by the DTI ratio, which means you can borrow up to 9.5 times your annual net salary if you are 35 years old or younger. Those over the age of 36 can borrow 8.5 times. For example: A couple is applying for mortgage with a net monthly income of 50,000 CZK + 60,000 CZK. With the DSTI rule removed, they can now borrow 12.54m CZK. If they are older than 36, that would be 11.22m CZK. How did DSTI limit the above? With the DSTI restriction in place, you can only dedicate...
As a popular tourist destination, Prague has experienced a high demand for short-term rental accommodation options like Airbnb. Some people believe that owning a property for this purpose can be profitable, but it’s crucial to understand the business before diving in. This article will examine the advantages and challenges of owning an Airbnb property in Prague, based on real-life experiences and insights from Nick Marley, who manages over 40 Airbnb flats in the city. What’s the ideal property for Airbnb? To attract guests and secure bookings, your property should ideally have a comfortable size and a functional layout. Studio and one-bedroom apartments are popular choices, as they cater to solo travellers and couples. Properties with multiple bedrooms and kitchen areas can also be popular, especially with families and groups of friends, as that’s typically something hotels can’t offer. Location is key though, with apartments in or near popular tourist areas like Old Town, Mala Strana, and Vinohrady being highly sought after. The key is to get as close to the center as possible. You might be surprised to know the Žižkov area around like Husitska street or near Zizkov stadium does better than JZP, for example. How do you fit...
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