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Since gaining its independence, the Czech Republic has experienced a boom in the number of foreign investors
who have become active in the real estate market in
that country. More and more foreign nationals -- primarily
from the EU but also from many other nations around
the world -- are becoming involved in the real estate
market in the Czech Republic.
Literally thousands of foreign nationals have invested
in commercial property in the Czech Republic. The
government of the Czech Republic has worked to liberalize
and streamline the laws in the Czech Republic that
deal with foreign ownership of real estate. While
there remain some hurdles to foreign ownership of
real estate in the Czech Republic, particularly for
foreign nationals from non-EU countries, these hurdles
hardly are insurmountable today. In addition, there
are proposals in the works that will remove many of
the barriers and hurdles to foreign ownership of property in the Czech Republic within the coming decade.
But, again and with that said, any of the hurdles
that remain in place today are far from insurmountable.
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As has been referenced, since the entry of the Czech Republic,
there has been a surge in the number of foreign nationals
who have taken to investing in property in the Czech
Republic. Many of these foreign nationals have tried to
take advantage of the economic growth that has been experienced
in the Czech Republic in recent years by investing in and
by purchasing commercial real estate in that country.
Investment in real estate is occurring not only in the more
urban, commercial centres in the Czech Republic but also
in some more rural areas of the country as well. The government
of the Czech Republic has been intent on decentralizing
commercial and industrial interests in the country to help
boost the economic prospects and wellbeing in all parts
of the country. Thus, many foreign nationals are investing
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Residential Real Estate in Czech-Republic - Single Family Properties |
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Within the Czech Republic are many graceful estates with
long histories. In recent years, many of these large residences
have been put on the market for sale. Many foreign nationals
have taken an interest in buying these properties for two
reasons. First, these foreign investors have taken to purchasing
these properties for use as their own second or holiday
residences.
In addition to buying these properties for their personal
uses, some foreign nationals are also buying these properties
to convert them into inns or bed and breakfasts that are
being used in the ever growing tourist trade in the Czech
Republic.
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Residential Real Estate in Czech-Republic - Apartments |
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For many years, apartments have been the primary residences
for many people who reside in some of the more major urban locations in the Czech Republic. This trend has not changed significantly
in recent years.
Since the entry of the Czech Republic into the European Union,
more and more foreign nationals have been spending extended
periods of time in the Czech Republic for business purposes.
In this regard, many foreign nationals have taken to purchasing
apartments in the major urban and commercial centers in the
Czech Republic for their own residential purposes while they
are in the Czech Republic on business.
A growing number of foreign nationals -- from the EU and from
other nations the world over -- are buying apartment units
and buildings for investment purposes. These people are in
turn renting these units to other people, generally foreign
nationals who are in the country for business purposes. Industry
analysts maintain that this trend is likely to continue well
into the next decade as more and more foreign nationals are
spending time in the country for business purposes and reasons.
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Many people who are interested in investing in real estate
in the international market are surprised to learn that the
vacation real estate market in the Czech Republic is doing
booming business in the 21st century. In the past decade,
the Czech Republic has become a major stomping and stopping
ground for tourists from across Europe and, indeed, from many
other countries from around the world.
With the increase in tourism in the Czech Republic since the
country gained its independence, there has been a similar
increase in the development and remodeling of different properties
that are being used by tourists and visitors to the country.
For example, a significant number of apartment developments
have been constructed with the goal of providing living space
to men and women who intend to visit the Czech Republic for
extended stays.
In addition to apartments, other vacation properties including
hotels and stand alone single family residences are being
developed, constructed and remodeled to provide living space
for people who are interested in traveling to the Czech Republic
for holiday purposes. Foreign nationals are highly involved
in this type of real estate development
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When considering the options for a mortgage on your overseas
property there are a couple of choices to consider;
- Do you consider raising finance on your existing property
in the UK to cover the whole cost of your purchase abroad?
A good idea if the interest rate in the country in question
is a lot higher than it is here in the UK as you will
pay a lot less in monthly repayments.
- Do you secure a mortgage against the property from a
local bank in the country of purchase? This can be a wise
option especially if the interest rate is lower than our
current UK interest rate. Most overseas mortgage / bank
lenders will require upto 30% deposit on mortgages. However,
you will need to give some thought to how you will service
your mortgage payments each month especially if you are
not living or earning in that country as you may well
lose out on exchanging money each time to cover monthly
expenses. Check out our Foreign
Currency page to see how you can save money in this
example
- Some Builders and developers may well offer their own
mortgage facilities on their properties for sale. This
can be beneficial to both parties depending on the logistics
of the mortgage or loan facility. Always check and compare
with the two options above before making your final descision.
For more details on Mortgages
in Czech-Republic visit our Mortgage page in the Czech-Republic section.
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Specific steps to buying real estate property in Czech-Republic |
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Overall, the process of purchasing property in the Czech
Republic by a foreign national is a rather simplistic process.
There are some additional requirements imposed upon a foreign
national when it comes to the purchase of real estate in the
Czech Republic at this point in time.
At the present time, the Czech government is working to liberalize
and streamline the laws governing the purchase of real estate
by a foreign national. Much of this effort is being expended
due to the Republic's admission into the European Union.
At the present time, a foreign national from the European
Union can purchase and own real estate in the Czech Republic
directly. Historically, in the Czech Republic, a foreign national
from any nation simply could not purchase and own a home
in the Czech Republic directly. In other words, in order to
purchase and own real estate in the Czech Republic in days
gone by, a person who was a foreign nation needed to establish
a limited liability company in the Czech Republic for the
purpose of taking title to real estate in the Czech Republic.
In today's Czech Republic, a citizen from one or another of
the nations that comprise the EU no longer needs to establish
a limited liability company in the Czech Republic to take
possession or and title to property within the Czech Republic.
Instead, a citizen of one or another of the EU member nations
can own real estate in the Czech Republic directly.
At the present time, residents and citizens of other countries
the world over that are not a part of the EU cannot buy real
estate directly in the Czech Republic at this time. With that
said, there is determined movement being had on the part of
the Czech Republic's government to revamp the provisions of
the law that prevent direct ownership of real estate by foreign
nationals who are not part of the EU. These changes in the
law are expected to take effect within the Czech Republic
within the coming decade.
In any event, and has been mentioned previously, a foreign
national from a non-EU can buy and possess real estate in
the Czech Republic after establishing a bona fide limited
liability company in the Czech Republic, the limited liability
company being the entity that will take title to real estate
in the Czech Republic on behalf of the non-EU foreign national.
Once the limited liability company has been established by
the non-EU foreign national, in some instances the purchase
of property in the Czech Republic can be a rather simple
two step process. In some instances, the purchase of real
estate can be as simple as executing one written contract
for the purchase of real estate. Subsequent to the preparation
and execution of the contract for the purchase of real estate,
in some instances the only other step that must be taken to
complete the sale and transfer of ownership in the subject
real estate is the filing of a petition regarding the sale
and transfer with the Cadastral Registry.
In some instances in the Czech Republic a foreign national
will be interested in buying real estate that is in the process
of being developed. In other words, the foreign national has
an interest in buying real estate that includes a building
or structure that is in the process of being constructed or
that is slated for construction. The buyer desires to have
the construction of the building, the development of the property,
be a part of the overall sales transaction. In such a situation,
rather than signing a simple contract for the purchase of
real estate, the purchaser will execute what is known as a
contract for future purchase contract. In other words, the
buyer is executing an agreement to enter into a sales contract
upon the completion of the construction or development on
the subject property in question.
Property Abroad always recommends using a Solicitor
or Lawyer
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CZECH REPUBLIC
