Welcome to European Property Consultant's frequently asked questions section

Foreigners and foreign companies are not allowed to purchase real estate in the Czech Republic according to Czech Law. However, it is possible to purchase property through a limited liability company (s.r.o.). Setting up an s.r.o. is a relatively simple and inexpensive task and can be established in 3-4 weeks. For more information please click here.

Generally speaking, real estate transfer tax is payable by the seller; however, the buyer is, according to tax law, in the position of a guarantor of the real estate tax. Real estate transfer tax is charged at a uniform rate of 3 per cent. If the real estate is acquired from a company then the company (seller) will be subject to Czech corporation tax on net taxable income. The corporate tax rate is 24 per cent. There are many tax-deductible items that can be used to reduce taxable income, including depreciation of the capital cost of the building, interest charges etc. For more information, see our tax section.

The process of acquiring real estate is well established. Buyer and seller negotiate conditions. Typically, the purchaser will lodge the purchase price in a notary or escrow account to which the seller will have access only after the Buyer is registered as the new owner.

It is common practice to use buildings as collateral for bank loans. Generally, banks will lend around 70 per cent of market value. However, bank will usually appraise properties on the low side so be prepared to put down about 40 – 50 per cent.

This will depend on the type of building you are renovating, and what level of quality you are looking to achieve. Generally, as a rule, look to spend between 10,000 - 12,000 Kč/m2 for a low to mid-level quality and 15,000 - 20,000 Kč/m2 for standard to high-level quality.

Yes, although this is a matter of time and money. It is up to the owner to either find an alternative accommodation or buy the tenant out. Look to pay about 8,000 to 10,000 Kč/m2 and expect it to take anywhere from six months to a year to vacate the whole building. Although it is not guaranteed that every tenant in every building will leave, it is usually possible to come with reasonable solutions.

Generally, what you do inside of your building is not a problem. However, the Historical authorities are very particular about all reconstructions in the historic area of Prague; including the interior. All works are the subject of agreement with conservationists, who must approve all major changes.

Look to spend between 1 to 1 1/2 years. It mostly depends on the scale of the project and how long it will take to get all the permits; which usually takes about 6 months.

Our property management team can fulfill all your commitments in the Czech Republic.

For a reconstructed property or commercial building, you should expect to receive about 8-10 per cent annually. This, of course, depends on where you buy and how you reconstruct your building. If you are buying a reconstructed apartment, look to get between 6 - 8 per cent.