VISUALIZED: Spiraling Czech house prices make renting cheaper than a mortgage

With the ever-growing costs of property prices nationwide, renting is becoming a more affordable housing option for Czechs compared to purchasing apartments with mortgages, particularly in major cities like Prague and Brno, according to data from various real estate platforms.

A December analysis by real estate service UlovDomov.cz revealed significant disparities between rent and mortgage costs for a standard 60-square-meter, 2+kk apartment in older buildings. In Prague, mortgage payments were CZK 16,000 higher than rent per month, while in Brno, the difference was CZK 12,000. 

This is underpinned by the fact that purchasing a 70-square-meter apartment now costs the equivalent of 14.7 years of gross wages in Prague, according to real estate firm Central Group. A decade ago, it took fewer than 10 years.

Thankfully, not everywhere in Czechia sees such huge differences between rent and mortgages—in Ostrava, the gap is just CZK 600, reflecting the city’s lower real estate prices overall.

According to UlovDomov.cz, renters in Prague and Brno spend less than 60 percent of the average net monthly wage on housing, while Ostrava residents pay under half. Despite historically lower property prices in Ostrava and Ústí nad Labem, prices in these regions are still rising faster than elsewhere in the country.

Data from mortgage service Swiss Life Hypoindex showed a slight decline in mortgage rates to 5.1 percent on average in January, yet affordability remains a challenge. The Ministry for Regional Development noted in its November housing report that homeownership remains a cultural preference for most Czechs, but it is increasingly out of reach for many households.