Due to the corona virus crisis at the beginning of this spring, many real estate brokers and financial experts expected real estate prices to fall due to lower demand for housing and lower demand for mortgage loans. However, we have not witnessed significant decline in property prices.
Before the cancelation the buyers had been subject to the 4 % tax rate of the tax base (known as real estate transfer tax). The tax base was usually the purchase price of the property you were buying. As it is no longer applicable you can save for example CZK 200,000 when purchasing a CZK 5,000,000 worth property.
The average interest rate on mortgage loans is currently 2.15 percent. The present average interest rate is at the same level as it was in November 2017.
In the Czech Republic, a legal person can also apply for a mortgage loan / business loan for a property. Not only existing companies can apply but also a newly established business company, the main business activity of which will be renting of the purchased real estate. Purpose of the business mortgage will be the same as it would be...
The abolition of real estate transfer tax in the Czech Republic has already been the subject of discussion several times. However, during the coronavirus crisis, the pressure to cancel the tax increased to the point, where the government approved the draft law on transfer tax abolition in May. The proposal to abolish the real estate transfer tax...
Abolishment of the real estate transfer tax
The real estate transfer tax is supposed to be canceled as the draft law was further discussed during the meeting of Czech Chamber of Deputies. This change would mean that buyers are no longer subject to the 4 % tax rate of the tax base. Tax base was usually the...
Abolishment of the real estate transfer tax have been officially announced by the Government of the Czech Republic. This decision might be crucial for those who have been hesitating to purchase the property.
After the Board of the CNB decided to liberalize some of the limits last week, more applicants have higher chance to fulfill the requirements for obtaining the mortgage loan.
Even this spring increase of interest rate is not expected due to the current health situation. Although we were expecting interest rates to increase early this year, coronavirus have changed the situation on financial markets. The sharp decline of interest rates on interbank market affected price of money which means mortgage loans will be...
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