High Mortgage Prices Push Czechs to Rent

As the cost of mortgages in the Czech Republic continues to rise, more and more people are turning to renting instead of buying. This is particularly true among those who cannot afford the high cost of a mortgage but still dream of owning their own home.

According to Tomáš Carba of the Association of Rental Housing, the past year has seen a significant increase in demand for rental housing, often out of necessity. The high mortgage interest rates have made homeownership practically unattainable for many.

Real estate agents in Prague have noted increased demand for rental properties, particularly from immigrants, mostly from former Soviet Union countries. This has increased rental prices, which have risen four to ten percent yearly. However, prices have stabilized in the past two months.

The high demand for rental housing has made it difficult for some, with long queues of potential renters forming for specific properties. The competition is fierce in some cases, with multiple interested parties vying for the same property. As a result, some renters have had to pay up to three times their monthly rent as a deposit to secure a place to live.

Despite the high cost of renting, it remains a popular option for many, including young couples who cannot afford a mortgage and have yet to save enough for a down payment. The average rent for an apartment in Prague is around 19,300 Czech koruna per month or approximately 350 korun per square meter. This represents an eight percent increase year over year, but the rate of increase has slowed in recent months.

Those looking for smaller apartments are facing exceptionally high demand, with prices for one-bedroom apartments reaching over 400 koruna per square meter. In Brno, rental prices are similar to those in Prague, with the average rent for a one-bedroom apartment at around 350 koruna per square meter.

While renting may be the only option for many, some are turning to alternative forms of housing, such as cooperative apartments. These offer an alternative to traditional mortgages and can be more affordable for some.

As home ownership becomes increasingly unattainable for many Czechs, the demand for rental housing will likely continue to rise. While prices have stabilized somewhat in recent months, they remain high and may continue to grow.