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As we reach mid-2025, property prices in the Czech Republic continue their upward trajectory, with Prague leading the charge.
The Czech real estate market has rebounded strongly after a brief stagnation in 2022-2023, driven by lower mortgage rates and persistent supply shortages. Current data shows that residential property prices increased by 8.4% to 10.7% year-on-year in 2024, with this momentum continuing into 2025.
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Czech property prices are rising significantly in 2025, with Prague experiencing the sharpest growth at 7-18% year-on-year, while regional cities like Brno and Ostrava see more moderate increases of 5-7%.
The combination of falling mortgage rates (now below 5%), limited housing supply, and strong demand from both domestic and foreign buyers continues to push prices higher, making the Czech Republic one of the least affordable property markets in Europe relative to incomes.
| City | Price per m² (CZK) | 2024-2025 Growth |
|---|---|---|
| Prague | 139,900-163,000 | 7-18% |
| Brno | 80,000-90,000 | 5-7% |
| Ostrava | 45,000-55,000 | 5% |
| Regional Towns | 50,000-65,000 | 2-4% |
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
What are the current average property prices per square meter in June 2025?
Property prices in the Czech Republic vary dramatically between Prague and other regions.
As of June 2025, Prague commands the highest prices with average transaction prices for new apartments reaching CZK 156,851 per square meter, while offer prices hover around CZK 163,000 per square meter. For all types of apartments including second-hand properties, Prague's average sits at approximately CZK 139,900 per square meter.
Brno, the country's second-largest city and growing tech hub, offers more moderate prices ranging from CZK 80,000 to 90,000 per square meter. This represents roughly half of Prague's prices while still providing access to a dynamic urban environment with strong economic fundamentals.
Ostrava presents the most affordable option among major cities, with prices between CZK 45,000 and 55,000 per square meter. Despite lower prices, Ostrava offers attractive rental yields of around 6%, making it particularly appealing for investment purposes.
It's something we develop in our Czech Republic property pack.
How much have property prices increased in the past 12 months?
The Czech property market has shown remarkable recovery with substantial price increases across all segments.
Nationwide, residential property prices surged by 8.4% to 10.7% year-on-year in 2024, marking a strong rebound from the stagnation period of 2022-2023. This growth has accelerated into 2025, with the Housing Index reaching 230.20 points in Q4 2024, up from 224.70 in Q3.
| Property Type | Prague Growth | National Growth |
|---|---|---|
| Older Apartments | 18% | 10% |
| New Developments | 7-10% | 7% |
| Family Houses | 15% | Stable |
| Panel Buildings | -0.39% | Varies |
Prague experienced the sharpest growth, with older apartments appreciating by an impressive 18% year-on-year. New-build apartments in the capital saw transaction prices rise by 10%, while offer prices increased by 7%. Regional cities like Brno and Ostrava recorded more moderate but still significant growth of 5-7%.
The rapid price appreciation reflects pent-up demand released as mortgage rates fell and buyer confidence returned to the market.
Which Czech cities are experiencing the fastest property price growth?
Regional variations in price growth reveal interesting investment opportunities beyond Prague.
While Prague dominates headlines with its 7-18% growth rates, several regional cities are experiencing even faster appreciation. Plzeňský kraj recorded the fastest regional growth at 12.8%, reaching CZK 74,600 per square meter. This western region benefits from proximity to Germany and a growing industrial base.
Among individual cities, Ostrava surprised with 14.62% year-on-year growth in early 2024, followed closely by Olomouc at 14.53% and Pardubice at 11.88%. These cities offer more affordable entry points while delivering strong capital appreciation.
Prague's internal dynamics also vary significantly by district. Prague 7 saw a remarkable 14.0% increase to CZK 146,400 per square meter, while Prague 1 experienced a 12.0% decline despite remaining the most expensive district at CZK 256,200 per square meter.
The fastest rental growth occurred in Liberec with a 7.6% increase, indicating strong investment potential in this northern city near the German and Polish borders.
What are the property price forecasts for 2026 and beyond?
Market analysts project continued growth, though at a more sustainable pace than recent years.
For 2026, experts anticipate annual price increases of 5-10% across major cities, with Prague maintaining its position as the growth leader. This projection assumes continued economic stability, GDP growth of 2.8% annually, and mortgage rates stabilizing around 4.5-5%.
Long-term forecasts extending to 2030 suggest cumulative price growth of 25-40% from current levels, driven by persistent supply shortages and ongoing urbanization. The Czech Republic's construction sector, despite 3.3% real growth projected for 2025, cannot keep pace with demand, particularly in Prague where the housing deficit exceeds 20,000 units.
Analysts particularly highlight energy-efficient properties and tech-equipped apartments as likely outperformers, reflecting post-pandemic lifestyle changes and EU environmental regulations. Suburban family homes near major cities are also expected to see above-average appreciation.
The main risk to these projections is the affordability crisis, with the Czech Republic already ranking as Europe's least affordable property market relative to incomes.
What are the current mortgage interest rates in mid-2025?
Mortgage rates have fallen significantly, creating favorable conditions for buyers.
As of May 2025, the Czech National Bank cut its key rate to 3.5%, down from peaks above 6% in 2023. This monetary easing has translated into commercial mortgage rates dropping below 5% for the first time in three years, with the Swiss Life Hypoindex showing average rates around 4.96%.
Financial advisors predict rates will fall further to approximately 4.6% by Q4 2025, potentially sparking even stronger demand. Banks are competing aggressively for mortgage business, with some offering rates as low as 4.5% for well-qualified borrowers with substantial down payments.
The dramatic shift from 2022-2023's high-rate environment has already triggered a surge in mortgage applications. Banks and building societies provided CZK 15.8 billion in housing loans in February 2025 alone, marking a 21% month-on-month increase.
However, new Consumer Credit Act rules allow banks to charge penalties up to 100% of the repaid amount for early mortgage termination, making refinancing decisions more complex.
Which property types are seeing the biggest price surges?
Different property segments show varying appreciation rates, creating distinct investment opportunities.
Older apartments emerged as the surprise winner, with 10% national growth and 18% appreciation in Prague. These properties benefit from established locations, often better construction quality than communist-era panel buildings, and increasing renovation activity that unlocks value.
New developments in Prague reached historic highs with offer prices at CZK 163,000 per square meter. Despite premium pricing, demand remains strong due to modern amenities, energy efficiency, and limited supply. Sales of new-build flats in Prague nearly doubled within a year.
It's something we develop in our Czech Republic property pack.
| Property Feature | Premium/Discount | Demand Level |
|---|---|---|
| Near Metro (Prague) | +15-20% | Very High |
| Energy Efficient | +10-15% | High |
| Tech-Equipped | +5-10% | Growing |
| Suburban Family Homes | +15% (Prague) | High |
| Panel Buildings | -5-10% | Moderate |
Properties near Prague metro stations command significant premiums, with Line A locations averaging CZK 132,400 per square meter - 17% more than Line C properties. Energy-efficient apartments and those with smart home features attract premium prices and faster sales.
How does new construction compare to housing demand?
The supply-demand imbalance remains the Czech property market's defining characteristic.
Despite construction sector growth of 3.3% expected in 2025 and an 18% year-on-year increase in new orders, supply dramatically lags demand. The housing deficit exceeds 20,000 units nationally, with half concentrated in Prague. Building permit approvals declined 3% year-on-year, from 92,838 to 90,020 units.
Twice as many new buildings were completed in 2024 compared to 2023, yet this improvement barely dents the shortage. The new Building Act introduced in July 2024 aims to streamline approvals, but the Czech Republic still has one of the EU's slowest permit processes, averaging nine years for complex projects.
Development is particularly constrained in Prague due to land scarcity, strict zoning, and NIMBY resistance. Over 72% of the 1 million square meters under construction is already pre-leased or pre-sold, indicating overwhelming demand.
This structural undersupply virtually guarantees continued price pressure, particularly in Prague and other major cities where job growth outpaces housing production.
What's driving foreign investment in Czech real estate?
International buyers increasingly view Czech property as an attractive investment destination.
Foreign investment is projected to rise by up to 15% in 2025, driven by several factors. The Czech Republic's EU membership provides legal security and free movement rights, while prices remain 30-50% below Western European levels despite recent gains.
Prague particularly attracts international buyers due to its historical charm, strong rental market, and position as a regional business hub. The influx of foreign specialists and students supports rental demand, with average rents rising 17% year-on-year to CZK 412 per square meter in Prague.
Non-EU citizens can purchase property without restrictions, though they cannot buy agricultural land or forests. EU citizens enjoy full property rights, and obtaining a mortgage as a foreigner is straightforward with proof of Czech employment or business income.
Institutional investors are also entering the market, developing professional rental housing targeting affluent tenants. This "build-to-rent" sector, common in Western markets, is just emerging in the Czech Republic and offers new investment opportunities.
How do Czech property prices compare to neighboring countries?
The Czech Republic ranks among Central Europe's most expensive property markets.
| Country/City | Price (EUR/m²) | YoY Growth | Affordability (salaries for 70m²) |
|---|---|---|---|
| Czech Rep (Prague) | 5,600 | 9.3% | 13.3 |
| Slovakia (Bratislava) | 4,000+ | 12.7% | 12.7 |
| Austria (Vienna) | 4,920 | 3.2% | 8.1 |
| Poland (Warsaw) | 4,300 | 12.1-14.4% | 7.9 |
Prague's average price of EUR 5,600 per square meter exceeds all regional capitals except Vienna. More concerning is affordability - Czechs need 13.3 annual salaries to buy a standard 70m² apartment, the worst ratio in Europe.
While Poland and Slovakia show faster price growth, their markets remain more affordable relative to local incomes. Austria offers better value despite higher absolute prices due to substantially higher salaries.
This comparison highlights the Czech market's key challenge: prices approaching Western European levels while incomes lag significantly behind.
What's happening with rental prices in 2025?
Rental markets mirror the sales market with substantial price increases.
Average rents jumped 17% year-on-year in 2025, matching property price appreciation. Prague leads with average rents at CZK 412 per square meter, with the most expensive district, Prague 2, commanding CZK 477 per square meter.
For a typical 65-square-meter apartment in Prague, monthly rent now averages CZK 26,763. This represents a significant burden for average earners and pushes many toward smaller units or peripheral locations.
Regional variations offer some relief, with Brno averaging CZK 345 per square meter and Ostrava remaining relatively affordable. The fastest rental growth occurred in Liberec (+7.6%), suggesting emerging opportunities in secondary cities.
Rising rents support property investment cases, particularly in Ostrava where 6% gross yields remain achievable. However, the rental affordability crisis mirrors the ownership challenge, potentially limiting future growth.
Are there risks of a property market correction?
Several warning signs suggest the current growth trajectory may not be sustainable.
The primary concern is affordability - with 13.3 annual salaries needed for homeownership, the Czech Republic has Europe's worst affordability ratio. This extreme disconnect between prices and incomes historically precedes market corrections.
Some analysts describe current valuations, particularly for older apartments, as "unjustifiably high." The 18% annual growth in Prague's older apartment segment far exceeds income growth or inflation, suggesting speculative excess.
Additional risks include potential interest rate increases if inflation resurfaces, economic slowdown due to Germany's struggles affecting Czech exports, and political uncertainty around housing policy. The government acknowledges the crisis but has yet to implement effective solutions.
However, structural factors like chronic undersupply, continued urbanization, and foreign investment interest provide support. Most experts expect a growth slowdown rather than an outright crash, projecting price increases to moderate to 3-5% annually.
It's something we develop in our Czech Republic property pack.
Should you buy property in the Czech Republic now?
The decision depends on your financial situation and investment horizon.
For buyers who can afford current prices and plan to hold long-term, June 2025 presents reasonable entry conditions. Mortgage rates below 5% won't last forever, and supply constraints virtually guarantee continued appreciation over 5-10 years.
Investment buyers should focus on Ostrava for yield (6%) or Prague for capital growth. Brno offers a middle ground with moderate prices and solid fundamentals. Energy-efficient properties and those near transport links offer the best prospects.
However, buyers stretching finances to enter the market face significant risks. With 13.3 annual salaries needed for ownership, any income disruption could prove catastrophic. The market's current trajectory appears unsustainable, suggesting patience might be rewarded.
Foreign buyers benefit from the Czech Republic's EU membership and straightforward purchase process. Despite high prices relative to local incomes, Czech property remains 30-50% cheaper than comparable Western European markets.
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Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
As we reach mid-2025, the answer is clear: property prices in the Czech Republic are going up significantly. With year-on-year increases of 8-10% nationally and up to 18% for certain Prague segments, the market shows strong momentum.
The combination of falling mortgage rates, limited supply, and persistent demand from both domestic and foreign buyers continues to drive prices higher. While affordability concerns and potential economic headwinds pose risks, the structural undersupply in major cities virtually guarantees continued price pressure. For those who can afford to buy, acting sooner rather than later may prove wise as the window of sub-5% mortgage rates won't remain open indefinitely. Yes, property prices are going up.
Sources
- Integra Dom - Czech Real Estate Market Trends and Forecasts
- Conbiz - Czech Property Market Analysis 2024-2025
- Porta Invest - Prague Housing Market and Mortgage Rates
- Prague Daily - New Build Flat Sales in Prague
- Globihome - European Real Estate Investment Comparison
- CIJ Europe - Czech Real Estate Price Increases 2024
- Global Property Guide - Czech Republic Price History
- Czech National Bank - Housing Market Analysis
- Deloitte - Czech Republic Rent Index
- Czech Statistical Office - Real Estate Prices