In a new development, international investors can now receive up to 60% financing for the purchase of Czech real estate!

posted 1 May 2019, 22:56 by Conbiz Info Center   [ updated 2 May 2019, 10:38 ]

In a new development, international investors can now receive up to 60% financing for the purchase of Czech real estate!

As is well known external financing is often an attractive way of leveraging your capital and transforming a good investment into an excellent investment.

Until a year ago international investors, including Israelis, enjoyed the possibility of securing extremely generous morgatges from Czech Republic banks. However, about a year ago the Czech banks completely cut off credit to foreign investors. This was a purely business decision which sought to reduce risks deriving from overexposure to foreign investors.

However, following a long negotiation with one of the largest banks in the Czech Republic, we are pleased to announce that we have finally established an extremely comfortable loan avenue for Israelis to purchase real estate assets for investment in Prague (the capital of the Czech Republic) and Pilzen (the fourth largest city in the Czech Republic).

From this day (1 May 2019) forth, investors seeking to secure financing for their acquisitions need not be citizens or residents of the Czech Repulic. Yes, Israeli investors can also secure financing of up to 60% (!) to purchase revenue producing real estate in the Czech Republic.

By the way, for projects such as purchasing buildings, renovating or upgrading them, and selling thereafter ("flipping") it is possible to secure, following the submission of a business plan, funding of up to 70% and sometimesthe same percentage of the renovation.

For additional information



The impact of rising tourism on apartment prices in Prague

posted 1 Mar 2019, 05:22 by Conbiz Info Center   [ updated 1 Mar 2019, 05:22 ]

The impact of rising tourism on apartment prices in Prague


The Czech Republic is considered to be a genuine tourism powerhouse. Breathtaking scenes and nature, historical cities and comfortable transportation are only some of the factors behind the country's great attraction to tourists. Being located smack in the center of Europe has also helped it become a first class tourist site. Only a few hours by train sperate the capital of the Czech Republic, Prague, from Vienna and Berlin. Thanks to the Schengen Agreement, travel between these states is comfortable, affordable and does not involve any passport control checkpoints.

Tourism in Prague

Most tourists who arrive in the Czech Republic spend several nights in Prague and continue onwards to the rest of the state. However, a significant portion of them come specifically for Prague and to no other site in the country. What this means is that from year to year the number of tourists visiting Prague is constantly rising. For example, in 2018 Prague registered a rise of 3.2 percent in the number of tourists in the city compared to 2017 – roughly 8 million visitors to a city with a population of only 2.5 million people. This is after 2017, which is considered a peak tourist year – with over 20 million tourists in all of the Czech Republic (a rise of over 9% in comparison to 2016).

The impact of tourism in Prague on the residential real estate prices in the city

One of the influences of tourism is on the cost of apartments, particularly for the purpose of short term tourist rentals. The data of the central office for statistics in the Czech Republic indicates that in all of the Czech Republic, the number of visitors to the various hosting sites such as Airbnb (and other such platforms) has reached 21.3 million in 2018 – 1.3 million more than in 2017, which constitutes a rise of 6.4%. the great demand for short term living accommodations leads to an often double digit return on investment for residential apartments purchased in Prague.

Another effect of tourism is on the prices of second hand apartments. A survey performed in the field by the Bezrealitky Portal has found that Prague is the most expensive city in the Czech Republic in terms of real estate. In Prague, prices have reached 80,361 Czech Korunas per square meter (According to other surveys, these prices have reached 101,091 Czech Korunas per square meter). The prices of private homes have also risen over the past year and Prague has registered a rise of 36% in their prices (Up to a level of 68,647 Czech Korunas per square meter).

What does the future hold?

The expectation is that the real estate prices in Prague will continue to rise and in some areas even more than in the previous year. For example, in the center of Prague and in sites that are a short distance away from the capital. The reasons for this, other than the rising tourism, are many, such as non availability of rental apartments in the areas of greatest demand, construction laws which place encumbrances on the beginning of construction, long processes to receive construction permits and the absence of infrastructure to expand real estate supply.

Are you interested in investing in Prague? Join us


Real estate values in the Czech Republic continue to rise

posted 25 Feb 2019, 06:41 by Conbiz Info Center   [ updated 9 Mar 2019, 10:47 ]

Real estate values in the Czech Republic continue to rise

Data from various sources indicates that, much as expected, the real estate prices in Prague are only rising and that this trend is not expected to change. The projections were that a rise of 10% in 2017 and a rise of 7.5% in 2018 would take place but of course reality exceeded all expectations : in 2017 the price rises were 13.3% , the highest rise in the European Union countries.

The Graph below (Source) illustrates the changes in prices for new apartments between 2013 – 2017 after the removal of outliers amounting to 5% of the most expensive and least expensive apartments.


An additional study indicates that over the years 24014 – 2018 the real estate prices in Prague have risen by 59.3%, so this represents a stable trend of increasing real estate assets value (source).


What is the significance of this in terms of price per square meter?

In 2016 the price of new apartments in Prague reached an all times record high – 60,000 Czech korunas per square meter. This record however was broken in 2017 – on that year the average price per square meter in Prague for all types of apartments (new and second hand apartments) was 65,000 korunas. In this year the most popular districts for investment in the city were Prague 1, Prague 2 and Prague 6. The significance of this is that the price of, for example, a 60 square meter apartment (the average apartment size in Prague) has risen by over ten percent in 2017 alone. The graph below proves this (Source).


In 2018, the average price of a new apartment in Prague rose by 18.6% to over 101,061 Czech Korunas per square meter. In addition, the restrictions placed since June 2018 in the field of mortgages makes the dream of purchasing an apartment almost impossible for many Czechs.

The significance of all this is that as the quality of life in Prague continues to rise, purchasers of apartments are forced to settle, both in terms of location and in terms of the size of the apartments, in order to enjoy affordable housing. Inexpensive housing at a level of beneath 60,000 Czech Korunas is almost unobtainable.

The price rise per square meter in the Prague 1 District 

The significance is that a 50 square meter apartment which cost 6,750,000 Czech Korunas in January 2017 today costs 7,650,000 Czech Korunas

The price rise per square meter in the Prague 2 District 

The significance is that a 50 square meter apartment which cost 4,820,500 Czech Korunas in January 2017 today costs 6,075,000 Czech Korunas

The price rise per square meter in the Prague 3 District

Here, a 50 square meter apartment which cost 4,125,500 Czech Korunas in January 2017 today costs 4,825,000 Czech Korunas

The price rise per square meter in the Prague 9 District

The significance is that a 50 square meter apartment which was sold for 2,950,000 Czech Korunas in January 2017 today costs 3,910,000 Czech Korunas

The housing shortage in Prague is only growing more acute 

Over 2018 only 5000 new apartments were apartments - a decrease of 9% in comparison to 2017. That was the lowest level since 2012 and a decrease of 30% in comparison to the peak year of 2015. Most of the apartments that were handed over were in Prague 5 (23%), Prague 9 (20%) and Prague 10 (17%). The lowest level of new apartment handover was registered in Prague 6 – only 2%. This level is projected to decrease further in 2019 to 4600 new apartments.

The contractors claim that as usual part of the problem derives from the fact that few new construction apartments are being provided – what prevents them from meeting the rising demand for new apartments in Prague. Additional reasons are the new guidelines in the field of mortgages and rising interest rates.

What this means is that smaller apartments may be more expensive per square meter, but they are less expensive than large apartments. The most expensive apartments are 1 + KK deployment apartments at an average cost of 120,000 Korunas per square meter. After them in the price range are apartments in the KK +3 deployment sold for, on the average, 92,000 Czech Korunas per square meter. About 70% of the apartments in Prague were sold for a price higher than 90,000 Czech Korunas per square meter.

It is therefore no wonder that the scope of real estate transactions in Prague has declined by a third in 2018 – to only 60 billion dollars. Some 60% of the investors are locals and some 20% are Germans who identified the potential for investment over the border. In other words, purchasing an apartment in Prague offers them a very fine return on investment from rental fees alone.

The rental prices in Prague continue to rise

In Prague, an average rise of 2.5% a year in lease. Nonetheless, in comparison to other European cities, the rent rates in Prague were the lowest this year. Only in Warsaw was a higher rate registered – 4.3%.

Prague was fifth in the survey of the KPMG company which examined the rent rates in Europe : first ranked were the German cities Munich and Berlin (at 11,345 and 10,142 Czech Korunas per square meter respectively), Vienna (7913 Korunas per square meter), Warsaw (7376 Czech Korunas per square meter).

Are you interested in purchasing real estate in Prague? Please contact us and we will be delighted to help you locate a great investment in this beautiful city.


Minimum wage in the Czech Republic rises again

posted 22 Jan 2019, 01:49 by Conbiz Info Center   [ updated 22 Jan 2019, 01:50 ]

Minimum wage in the Czech Republic rises again


On January 2019 the minimum wage in the Czech Republic will rise by 1150 Korunas to 13,350 Korunas. This rise is projected to influence many financial obligations such as income tax deductions, the income tax rate and tax benefits for working parents.

The rise in the minimum wage is expected to jeopardize the statues of the Czech Republic as an inexpensive country, that is as one of the countries in the European Union where salaries and labor costs are particularly low. However, since the raise is not limited to those who receive minimum wage (some 150,000 people) it is expected to impact the entirety of the market.

As a rule, a higher wage results in higher tax and health insurance payments, both on part of the employers and on the part of the employees. The health insurance in the Czech Republic today constitutes 13.5% of the wages and the minimum payment is 1803 Czech Korunas a month. The minimum wage constitutes the basis for calculating the health insurance of tax exempt individuals such as part time employees, students and the unemployed.

In addition, the minimum wage constitutes the basis for calculating the maximum possible subsidy for unemployment subsidies – the ceiling is equal to half the minimum wage. In addition, the minimum wage affects the pension which is considered to be tax exempt up to a certain ceiling – up to 36 times the minimum wage. The minimum wage also serves to calculate some of the tax exemptions for working parents and hence is also expected to influence this field.

The significance is that the rise in the minimum wage contributes, among other influences, to the national budget. The revenues of the Government of the Czech Republic is projected to be 1.26 Czech trillion Czech Korunas more than in 2018, primarily thanks to various taxes and fees. That is why there is no wonder that there are already those in the Czech Republic calling for an even greater increase in the minimum wage.

More on wages and salaries in the Czech Republic.


Relocating to Prague? This article is for you

posted 14 Jan 2019, 00:08 by Conbiz Info Center   [ updated 14 Jan 2019, 00:12 ]

Relocating to Prague? There are a few things you should know about seeking and finding an apartment in the Capital of the Czech Republic 


Question – how long does it take to lease an apartment in Prague?

Answer – it all depends on what you are seeking and what your requirements are. If you are looking for a reasonably priced apartments in the center of the city then you need to hurry up – the demand for apartments in this location is high and they are often leased within 48 hours of being advertised. Small apartments for short term lease are also difficult to obtain

Question – what do you need to know before you start seeking an apartment in Prague?

Answer – first of all, do not permit yourself to be enticed by real estate offers on Facebook (unless they are direct publications by a recognized and established real estate agencies). We have heard of many scams, including scams leading people that are not careful into being tempted to pay a down payment prior to signing a contract.

It is recommended that you set down your parameters and seek an apartment that meets various parameters that are important to you, such as travel time to work, distance from educational institutions and so forth.

Question – what are the lease rates of apartments in Prague like?

Answer - the prices in Prague as of now are at their peak and range between 13,000 - 35,000 Czech Korunas a month for a fifty meter apartment and there are, of course, also higher price range apartments on the market. It all depends on the location of the property, its size, its furnishings and more…

Question – where is it recommended to lease an apartment in Prague?

Answer – in zones 4, 6 and 7. All of them have excellent public transportation access, an abundance of parks and many municipal services and yet their lease rates remain quite reasonable. However, there are quite a few other recommended neighborhoods. Each has its own advantages and disadvantages.

Question – what does one need to take into account insofar as additional cost such as heating are concerned?

Answer – it is worthwhile to diligently read the lease agreement and examine what exactly it includes. Sometimes the lessor is responsible for the fees of various services – and that means that various other costs are to be expected. In addition it is worthwhile to examine the quality of these services (heating, elevator, electrical systems, water and so forth) so as to avoid unpleasant surprises in the event that it is the lessor who is responsible for bearing unexpected expenses (malfunctions, repairs and so forth).

Question – are there any additional payments such as a deposit? How does it work?

Answer – in the Czech Republic it is customary to pay a deposit to the landlord. This deposit is generally equal to the sum of a month – two months of rent, but if the leased apartment is fully furnished in can be higher.

Question – what is the significance of kk?

Answer – the significance of kk is "kitchen corner". This concept is common in new buildings because in them the kitchen is part of the residential area and not a room in its own right. In other words, if an apartment the size of kk + 2 is described, what this means is that the apartment contains two rooms and a kitchen corner. The same is true for kk + 3, kk + 4 and so forth. On the other hand, if the apartment is described as 2+1, this means that it contains two rooms and another room which is the kitchen. Read more about this here.

Question- are pets allowed in a leased apartment?

Answer – the law of the Czech Republic prevents a landlord from prohibiting the entry of pets into an apartment. On the other hand – pet friendly apartments are considered rare and so usually require negotiations with the landowner and a larger deposit.

Question – what about the Czech neighbors? Are they friendly? Is it considered acceptable or customary to knock on their doors and introduce myself to them?

Answer – generally speaking, the Czech neighbors tend to be a little shy. English is not a common language amongst the older generation and it is customary for the new residents to be held responsible for establishing neighborly relations – it can only be beneficial to do so.

Question – can I invite friends or family members as guests in my apartment?

Answer – of course. Visits by friends and family are not contrary to any Czech Republic law. If they are Israeli, their tourist visa is valid for 90 consecutive days. Insofar as guests from other (non-EU) countries - it is always worthwhile to check in advance.

Question – what is the customary early notice period for leaving the apartment?

Answer – the lease end period must be regulated in the contract. For the most part it is 3 months long and a 1 month notice is considered to be quite rare. Usually if the residents seek to leave the apartment earlier than usual – they will lose their deposit money unless an early understanding on the matter is reached with the property owners.

Additional information can be found here regarding work in the Czech Republic


The Na příkopě Street in Prague 1 is now one of the most expensive streets in the world

posted 30 Nov 2018, 05:17 by Conbiz Info Center   [ updated 30 Nov 2018, 05:17 ]

The Na příkopě Street in Prague 1 is now one of the most expensive streets in the world 

The Na příkopě street in the Old City of Prague is now the 19th ranked street in the world in terms of rent rates, according to a study performed by the Cushman and Wakefield Company which reviewed the rent derived from apartments in 446 streets in 65 countries.

The most expensive street for rent in the world is the Causeway Bay Street in Hong Kong. The second is fifth avenue in New York. In Europe the most expensive street for rent was the New Bond street in London – a ranking which made it the third highest street in the global ranking.

However, thanks to the rise of 5% in the rates of rent over the past year, the Na příkopě Street in Prague 1 has reached the 19th rank this year (2018). The average rent per square meter in this street is 6000 Czech Korunas. (!)

One of the factors impacting the height of rent is the location of the apartment on the street and its size. The most attractive apartments are corner apartments or studio apartments. The latter usually charge higher rent.

Another apartment in Prague considered expensive in terms of rent is the Pařížská street. However, the Pařížská street is not a residential street for the most part but a commercial and trade boulevard. Another difference is that the Na Příkopě street is more touristic so that the potential market of tenants is more wide range than the Pařížská street.

Nonetheless, this street also has international brands such as Tous, Vapiano and Swarovski and includes the flagship store of the international brand H&M. The street is already considered the most important shopping street in the Czech Republic given its location.

It is however important to note that this street has yet to reach its full potential and in the near future its attractiveness is still projected to rise. Among other things, the renovation of the Savarin palace that will be connected to other buildings in the street and the renovated Václav Square is planned. In addition, the street is projected to be the site of additional business compounds, such as in Václav Square and the National Museum.

Are you considering the purchase of real estate in Prague? Talk to us.


Comprehensive review of heating systems for residential homes in the Czech Republic

posted 30 Nov 2018, 04:24 by Conbiz Info Center   [ updated 30 Nov 2018, 04:25 ]

Comprehensive review of heating systems for residential homes in the Czech Republic 

מבנה הסקה מרכזית אופייני לעידן הקומוניזם - חברת MVP הצ'כית

Summer in the Czech Republic does not last long and heating systems in private and apartment buildings are a critically important element. The homes are heated from as early as September to May and even June. The heating systems in the Czech Republic are diverse and change in accordance to the history of the structure, in depending on the type of the house and just how cold the environs of the building get.

The Primary heating systems are:

Central heating

The central heating systems in the Czech Republic were built primarily in the communist period, as the communist government favored centralized services. However in spite of the time that passed since the fall of communist rule in 1989, some of them are still in use to the present day. These systems generally include the following features: a single large heat source, a number of transmission stations and end stations that connect between different consumers. These heating systems mostly utilize fuel, oil, gas or coal.

The primary advantage of these systems is their ease of use. The home consumer simply opens the valve (which is also used for heating and supplying warm water) or call the supplier in case of an accident. If such a system is installed in an apartment building, the residents are not required to sign a contract versus the supplier because the heating is included in a package which includes additional payments (maintenance, cleaning common areas, a maintenance fund and so forth') which are paid by building committee.

The downside of this heating solution is its inefficiency, in other words, massive losses of energy between the energy source and the final consumer. Sometimes as much as 40% of the energy can be lost along the way – which of course comes out of the pocket of the apartment owners. In addition, the maintenance costs of the heating infrastructure and the large scale transference are considered to be expensive, so that the home owners must absorb these costs as well. You will likely find the central heating system in old Soviet era buildings (Sídliště) if no central heating system exists in your building you should not install it – the operation is difficult, and it is not reasonable that you should pay such high rates on your heating energy when other, more affordable types of heating systems are readily available.

דוד גז מקצועי המשמש במערכות חימום מרכזיות

For example, the Prague Heating Corporation, Pražskáteplárenská a.s, bills over 650 Czech Korunas on every kilowatt of electricity, VAT included, without taking into account energy losses deriving from the distance between the source and the recipient.

It is very easy to break away from the public network and develop a local heat source in every building – a very common practice in those areas of the Czech Republic which enjoy access to effective electricity networks.

Nonetheless, there are sites where it makes sense to maintain central heating (for example large industrial regions) for one reason – in these places the heat is a beneficial byproduct of the industrial process. An illustration of this is the area of the power station Opatovie, where the final price in 2017 for a kilowatt of electricity was around 500 Czech Korunas. However, as a general rule, the prevailing trend is to minimize central regional heating systems and to prefer more efficient local solutions.

Central building based heating

A similar solution to regional central heating is a central building based heating. For the resident, it is much the same: heating and heated water is supplied just as in regional central heating. The difference is that the energy source is located in the building itself, usually in a special boiler room in the basement of the building. The significance is that energy losses are considerably lower in comparison to the transmission of heated water/ steam from a central location many kilometers away.

The energy losses in the interior pipes of the building are barely felt by the residents since the HOA of the buildings receives fuel for a relatively low price given the massive amounts they purchase each year. In some cases the issue of the heating is handed over by the HOA to special committees in the framework of outsourcing, but the local energy source is retained.

מערכת חימום מבוססת גז במרתף של בניין דירות צ'כי

If the management of the system is done properly, the energy prices in such a setup should be lower than in regional central heating. In any event, the pricing calculations should include the initial investment in setting up the building central heating up, and the cost of maintaining the system. This type of heating is primarily used in newer buildings, but it is also sometimes used in old brick buildings or Panelák.

Individual heating

Individual heating is used both in private homes and in apartments in large buildings. In order to do so one can use two sources of energy, but for the most part only a single source (mostly in private homes) is used, due to the regulations in the field of fuel storage. We will shortly expand on this. 

Usually, personal heating results in the lowest energy losses, but home owners must pay higher retail prices for the energy source: either fuel or electricity. In any event, the primary problem is maintenance, because the cost of repairs and replacement parts is levied on the homeowner and a professional is required to make repairs. Furthermore, the chimneys and the boiler must occasionally be inspected, in order, for example, to examine the levels of carbon dioxide emitted into the atmosphere.

Solid fuel combustion systems

דוד פחם מודרני עם תא אחסון לדלק והזנה אוטומטית

These systems produce energy by burning solid fuels such as wood chips or blocks, with their combustion heating up water. The warm water is transferred to radiators, water pipes or containers. In these systems fuel expenses are relatively inexpensive but the setup costs are higher. In addition, since storage of fuel is required in this case – such systems are not suitable for apartments. Furthermore, the property owners must ensure the supply and quality of the fuel in accordance to the specifications of the boiler: it must be fed with specific types of fuel, sometimes several types or a specific mixture. It is important to note that certain modern devices can feed themselves with fuel automatically, but they still must be manually filled, and their operational mode must be defined.

Gas combustion boilers / heaters

This technology is similar to the solid fuels combustion heaters, but it is more convenient, for no storage of fuel is required (except for LPG based solutions that are primarily used in homes which are not connected to natural gas networks) or manual control and fueling. There are three primary types of devices of this sort:

  • WAW stoves – local devices lacking a water circuit that produce heat but not hot water. They are most commonly used on old properties.
תנור גז מקומי מודרני

  • Karma boilers which are used to supply warm water, but not to directly heat the property. This type of boiler is also primarily present on old properties.
  • Integrated boilers – boilers which supply both heated water and heat through water radiators. Use of these boilers is the most common on Prague properties.
דוד גז ביתי משולב בבית

Heat pumps

Heat pumps are systems that operate on the principle of using air conditioners solely for heating. These systems include three types of devices with 2 main advantages:

  • They are usable everywhere and require only one energy source (electricity).
  • They are far more efficient (up to threefold) than regular electric heaters. This derives from the fact that heat pumps may make use of electric energy, but primarily to transfer thermal energy outwards.

Group 1 – air to air solutions

מזגן

The heating devices in this group are in fact heat exchange air conditioners. In other words there is no use of internal radiators, so that the rooms are warmed solely by heated air leaving the devices. In the summer these devices can be used as air conditioners.

These systems are primarily used on properties that are not populated all year round (such as vacation homes), because they are highly efficient in freezing weather. These systems must be backed up with other heating systems, such as electric stoves. These heating systems are the only type suitable for use in apartments because they do not require extensive external infrastructure.

Group 2 – air-water solutions

משאבת חום אויר מים

In these systems the heat exchange is warmed by the air coming from without, but the heat s distributed by water to the radiators or pipes to heat the floor. The advantage is that the system can be connected to the existing piping and thereby save work hours. The costs of heating utilizing this system are low, but the purchase price of the system is rather high. In addition, the system is not particularly efficient in freezing situations.

Group 3 – water – earth solutions

איור של משאבת חום מבוססת אדמה מים

This solution is much like the water- air solutions with one key difference: the location of the heat exchange. Unlike the air-water systems, in the heat exchange here is located deep in the ground, where the temperature is stable all year around. The significance of this is that the system is far more effective in freezing weather, which is precisely the time when it is most needed. On the other hand, this solution is considered to be the most expensive of all the heat pumps.

Fireplaces

For day to day use, fireplaces are primarily an aesthetic addition or a supportive solution for another, automated, system. While certain fireplaces include a heat exchange that can be directly attached to a radiator by a water pipe, for the most part the heat is directly distributed by heated air manufactured by the fire.

קמין

Solar collectors

Unlike photo voltage panels, these systems do not create electricity, but use the rays of the suns to heat water. In fact, these systems can be used both to supply heated water, and to heat the home. There great advantage therefore is in the fact that sunlight is free and that there are no heating costs other than the costs of installation and maintenance.

פאנלים סולאריים

Nonetheless, these systems are not sufficiently powerful to provide heated water and heat apartments 24/7 (particularly in the cloudy Czech winter). A supportive solution of some type is required. In fact, solar collectors usually serve to reduce energy consumption and heating costs, rather than providing a comprehensive solution. Furthermore, since a large roof space is required to install the system – this solution is particularly suited for private home owners.

Local electric heater

This is supposedly the simplest and least expensive solution which requires the lowest costs of installation and technical requirements (other than powerful fuses). In a local electric heater use is made only of electricity, so that it is far less efficient than heat pumps. The meaning is that heating prices in this case are considered high.

Since local electric heaters are not very efficient, they do not serve as a primary source of heating but only as a supportive solution (for example of properties that are not populated year round). This category also includes heating with various types of infra-red panels.

Floor – embedded heating

חימום רצפתי

This type of heating is considered exclusive but is usually not used as the only heating solution but is combined with various other radiators. Floor embedded heating can be performed solely by electricity or be part of a more complex solution such as a generator linked to a water based heating system.

Accumulation electric boiler

This solution includes a water tank equipped with an electric spiral that warms the water within it, so that it is primarily intended to supply heated water. Since the energy costs required from using these systems are relatively low for local electric heaters - they are used primarily during the nighttime in order to utilize the low electric billing rates during those hours.

דוד מים מחומם על ידי חשמל

Since this is a simple solution, it is frequently used as a source for heated water in addition to solar systems. It is common in many apartments in Prague. Sometimes the water tank can be heated by a gas based boiler which is used as a backup when the central heating system is inactive (for example in the summer months).

Who pays for the heating?

In most cases the costs of direct heating are paid directly by the resident or the lessor to the HOA (except in short term rental properties). If use is made of personal heating units the resident is responsible for signing an agreement versus the energy/ fuel supplier and pay for whatever he consumed.

Sometimes, the contract versus the supplier does not change (when the property owner is the one who signed the contract versus the supplier), so that the lessor pays the energy fees in addition to the apartment rental fees. If the apartment is used for short term rentals, the heating costs are paid by the owner unless the rental arrangements are carried out by a management company. In these cases, the management company pays the fee to the property owners who are signed up with the energy suppliers.

It is important to note that Czech Republic law defines the maintenance costs of the heating systems (periodical checkups, repairs and so forth) as paid by the property owner, for it defines the heating system to be an inseparable part of the property.

On the other hand – it may seem preferable for property owners to equip the apartment with heating solutions with low installation and maintenance costs, so that the price of the heating price itself is insignificant. On the other hand, there may be pressure on the part of the tenant to reduce the rent for most tenants calculate the final costs. Furthermore, in recent years more and more people have begun to take the ecological impact of residence into consideration, so they will prefer properties with higher energetic efficiency.

Energy Performance Certificate (PENB)

Energetic performance of buildings related to the issue of heating systems. A new regulation requires any revenue generating real estate property to include a PENB grade certified by a qualified inspector (The grade ranges from A – maximal energy performance, to G – low energetic performance). Falling to provide such a certification, automatically renders the property a PENB G level property.

This ranking system is similar to the energetic ranking provided in the European Union to various electrical devices and its purpose is to motivate the property owners and contractors to build and repair the properties in a manner that will result in maximum energetic efficiency. Since such ranking takes into account renewable energy parameters as well, one should see it as a warning to the property owners and future residents : while it is possible to save money by renting/ purchasing a low energy performance property, this means higher bills and indirectly wastage of resources.

דוגמה לאישור יעילות אנרגטית

A table summarizing the types of energy sources for heating in the Czech Republic

 Type Price per Kilowatt inc VAT (2018)Used in buildingsUsed in apartmentsUsed in private homes
Solid fuel boilersCoal or wood – 250-350 Korunas V  X  V
Gas boilers / heatersNatural or fluid gas : 440-640 Korunas V  V  V
Heat pumps 200-400 Korunas  V  V - only air to air solutions  V
 Fireplaces  400 Korunas  X  X  V
Solar collectors 0 Korunas  X  V  V
Floor embedded heating 730 Korunas  X  V  V
Accumulation electric boiler 610 Korunas  V  V  V

To read additional important information before you purchase real estate properties in the Czech Republic – click here.

Home insurance in the Czech Republic

posted 10 Nov 2018, 07:32 by Conbiz Info Center   [ updated 10 Nov 2018, 07:33 ]

Home insurance in the Czech Republic

I woke up, feeling wetness in my bed. Since I had celebrated my second birthday a long time ago, this seemed a bit odd to me… what the hell was going on here? I rose from my bed and turned on the light and was more than a little concerned by what I saw – a miniature rainstorm in my bedroom which changed the color of the ceiling from white to drippy yellow…

I instinctively began to grab my valuables and remove them from my bedroom: my computer, iPad, wallet a watch, all of them soaked by the water which did not stop dripping from the ceiling. I woke up my girlfriend with a yell and asked her to run and flip down the electric switch in order to cut off the current in the apartment and prevent electrocution. In the dark, we began to clean the apartment together from our belongings, each of us barking instructions at the other, in what looked like a scene from a particularly dramatic disaster movie.

We called the fire department to help us stop the water. They arrived promptly and hurried to the floor above, where the source of the problem seemed to be. The firemen banged on the door and it was opened by a surprised looking elderly gentleman. When we entered his apartment the source of the problem was readily apparent – an open faucet and an overflowing bathtub. It turned out that our old man fell asleep, forgetting to turn off the bathtub faucet, creating a miniature shower inside my bedroom.

The end result of this minor catastrophe was a destroyed suede jacket, a few damaged computer parts, a couple thousand Czech Korunas and one sleepless night. Sitting over the following weekend and thinking about what happened, I understood that we had gotten off rather cheaply…

Property insurance is the right way to protect your property from various problems. A good insurance policy can cover you against all possible dangers to your property: this includes natural disasters such as flooding, fire, leaks, lightning strikes, hail storms, snow, falling tree damage and more. Furthermore, an appropriate insurance policy can cover even cases such as lawyer fees unpaid by the renter.

In order to receive information on different insurance policies you can directly approach one of the major insurance companies in the Czech Republic such as: 

What kind of damages can apartment insurance cover?

  • Fire, including a fire caused by an explosion, a lightning strike, a falling plane and more. 
  • Break-in and burglary 
  • Flooding, including flooding caused by a rising river, an earthquake or an avalanche. 
  • Snow caused damage, including damage caused by objects such as electric poles which have fallen on the apartment. 
  • Damage caused by a supersonic boom of an airplane. 
  • Soot and smoke damage 
  • Damage caused by sewage backup or a short circuit 
  • Damage cause by various electric problems (including high and low voltage) and vandalism 
  • Damage caused by nonpayment of rent 
  • Insurance against legal suits by tenants 

Insurance against tenant legal suites

Apartment owners are also advised to insure against legal suites of the following types: damage causing tenant death or injury, property damage, other property claims, particularly loss of income and profits, recompensation for medical costs, sick leave compensation, compensation for court commissions in the event of a legal suit and so forth.

If you are reading this article since you are considering the purchase of real estate in the Czech Republic, take a moment to consult with our experts.


The different districts of Pilsen – characteristics and atmosphere

posted 4 Nov 2018, 10:55 by Conbiz Info Center   [ updated 4 Nov 2018, 10:56 ]

The different districts of Pilsen – characteristics and atmosphere 

The city of Pilsen is divided into ten urban zones – 10 different quarters. Each of them has its own unique history, composition of residents and distinct characteristics unlike any you might find elsewhere in the Czech Republic. Pilzen is the fourth largest city in the Czech Republic and a little over 180,000 people reside within the city limits. The city is the site of a large university, the Skoda vehicle factories and the largest beer breweriesinthe Czech Republic – Pilsner Beer.

Pilsen 1 – the old city

Pilsen zone 1 was established as an administrative center when many new residents arrived in the city. This zone lay in the north of the city and is sometimes also called the "northern suburb". This is the site of the old city quarter called Roudna and a number of independent villages such as Bolevec, Bila Hora and Kosutka.

This district was previously integrated with the Lochotin residential district and later on with various other residential projects such as Košutka, Bolevec and Vinice. It is currently the largest district in the city in terms of residents (50,000 people) and is considered to be a leading district in terms of the environment, built up area to land reserve ratio, and in terms of recreational activity options.

Pilsen 2 – Slovany

The Pilsen 2 district lies in the south-eastern part of the city, spreads across 405 acres and is home to 35,000 people. The area borders on the north the central train station, in the west the Radbuza river and in the east the Úhlava Úslava river.

The Pilsen 2 district contain the following areas: Božkov, Doudlevce, Hradiště, Koterov, Lobzy as well as the eastern suburb. It borders upon the 4th, 3rd and 8th district.

The Slovany neighborhood is considered to be the best neighborhood in Pilsen. This is in fact the area around Siant Slovenska. Another interesting site in the district is the Saint Nicholas Square.

Pilsen 3

The Pilsen 3 district sprawls over 876 acres and connects the historic part of the city with new districts such as Bory, Doudlevce, Skvrňany, Nová Hospoda, Zátiší, Valcha and Radobyčice. The Pilsen 3 district is considered to be one of the most populated districts in the city.

This district contains the central square "Náměstí republiky". This is a very pleasant place to hike, particularly before Christmas, when the holiday markets are breathtaking in their beauty. You can read more on the square in the Pilsen Municpal Government Site.

Another good area for real estate investments in the city is the environs of the Americká street.

Pilsen 4 - Doubravka

The Pilsen 4 district is also called Doubravka after one of the communities which were located on the site prior to the city's expansion. This area is in the eastern sector of the city and borders Pilsen 1 on the North, Pilsen 2 on the south, and Pilsen 3 on the west. The district unifies the Doubravka, Letná and Lobzy districts as well as the peripherial towns Bukovec, Červený Hrádek, Újezd and Zábělá and Zábělá. It is home to some 25,000 residents.

The Pilsen 4 district is considered to be one of the most dynamic and fastest developing districts in the city. New residential buildings with family homes are being built up between the towns, and many empty lots are being opened up for residential construction. The future municipal real estate development plan includes continued development of the residential and industrial infrastructure and the district has become a regional immigration magnet.

Pilsen 5 - Křimice

Pilsen 5 is located in the west of the city and the river Mze flows through it. The district almost completely covers the area of the ancient village of Křimice and a part of the historic village of Radčice.

Pilsen 6 - Litice

This area lies in the southern part of the city and 2 rivers flow through it, one of them, České údolí, dammed. The area the district sprawls over lies on the territory of an identically named village, but it was a separate district between 1970-1974. Since 1990, Pilsen 6 is an independent municipal district.

Pilsen 7 - Radčice

The rural Pilsen 7 district is located at the west of the city on the banks of the river Mže. Pilsen 7 borders Pilsen 9 and Pilsen 5, is home to no more than 1000 residents and is surrounded by a natural rock formation. It also includes a romantic castle which has been preserved from the early 20th century.

Pilsen 7 is part of the municipal area of Pilsen since 1976 and has been made an independent district in 1990. The area hs a strong agricultural character thanks to the river Mže and the fertile land which surrounds it. The north of the district contains a forest, located in the center of a restored village, with historical estates, and an industrial zone in the west.

Pilsen 8 - Černice

Pilsen 8 contains the preserved historical center of the city, built in the first half of the 15th century. The northwest of the district borders the right bank of the Úhlava river. The southeastern portion of the districtcontains woods with a mountain bike path which leads to the ruins of the Radyně Castle. The northern part of Pilsen 8 contains the Olympia mall which includes a cinema, a post office branch and many stores (such as the Kika brand furniture stoor) and a gas station.

Pilsen 9 - Malesice

The area lies on the northwestern side of the city, on an area previously occupied by a village with a castle in its center.

Pilsen 10 - Lhota

This district was founded in 2003 as a result of the linkage of the village of Lhota in the city of Pilsen. The area lies in the south-western edge of the city, sprawling over 96 acres. The area enjoys a real estate boom and the population growth within it is projected to continue.

For additional information on real estate purchase in Pilsen click here

The guide to purchasing real estate in the Czech Republic 

Israel's Ambassador in the Czech Republic, Daniel Meron, Praises the Friendship Between the Two Countries

posted 5 Oct 2018, 23:36 by Conbiz Info Center   [ updated 5 Oct 2018, 23:36 ]

Israel's Ambassador in the Czech Republic, Daniel Meron, Praises the Friendship Between the Two Countries 

The Czech Republic and Israel share nearly 30 years of Diplomatic Commercial and Tourism Relations. Furthermore, the State of Israel views the Czech Republic as one of its closest friends. Those were the words of the Israeli Ambassador in the Czech Republic, Daniel Meron, in an interview to the Czech Newspaper Prague Daily Monitor.

The President of the Czech Republic, Milos Zeman, will arrive in a state visit in Israel on November 2018, and ambassador Meron states in regard to this visit that: "We are looking forward to the visit because Zeman is a great friend of Israel." The ambassador claims that this is one of the most important visits the Czech Ambassador is expected to carry out in the first half of 2018. The president is expected to inaugurate a Czech House in Jerusalem as a preparatory step to moving the Czech embassy to Jerusalem from Tel Aviv.

The deep friendship between the two states began almost as soon as the velvet revolution took place. According to Ambassador Meron this ended the dark period which began during the Second World War in which the Jewish community in German occupied Bohemia and Moravia was almost completely exterminated by the Nazis (The Jewish community prior to the war was 90,000 strong. Only 10,000 Jews survived the war within Bohemia and Moravia). Immediately after the war there was a brief honeymoon between reborn Czechoslovakia and the Zionist Movement and the State of Israel – a honeymoon that was cut short by the Communist takeover in 1948.

The ambassador states that during the brief period between 1947 to 1948 (in which Benes served as the President of Czechoslovakia, and Masaryk as the Foreign Minister) Czechoslovakia supported the principle of a Jewish Homeland in the Land of Israel.

There are three fields in which Czechoslovakia helped Israel in its early years. The first was weapons and ammunitions including training. According to the ambassador "The first pilots in the Israeli Air Force, which today is apparently one of the best air forces in the world, were young men who were trained in Czechoslovakia, and some of them were Czechs." He claims that "This aid was essential for our victory in the war of independence, and we do not forget this."

The second field was political support in the establishment of the State of Israel, including voting in the UN in favor of the 1947 partition plan. Ambassador Meron claims that the third field has been forgotten by history – it is the aid Czechoslovakia provided to Jewish refugees. He notes that Poland was filled with Jewish refugees after the holocaust, and that Czechoslovakia enabled them to pass through its territory to Austria, and thence to Italy, where they embarked on ships to Israel or the United States.

Meron stated that: "When Václav Havel was elected President of Czechoslovakia in 1990, he stated that friendship with Israel was important. Moreover – he promised that the new Czechoslovakia would be extremely close to Israel and this has been the situation ever since. And if I may fast forward 30 years to the present, the Czech Republic has indeed become one of Israel's closest friends in Europe."

Jerusalem currently holds a square named after Václav Havel, and Israel is filled with sites named after Thomas Masaryk (The President of the first Czechoslovak Republic) – the man who had vigorously defended Jews and battled antisemitism since the days in which he was a student of law.

Commercial partnership 

The trade between the two countries is currently typified by the exchange of traditional industries from the Czech Republic with the products of digital industries from the State of Israel. Meron states: "We are one of the Czech Republic's best trading partners outside the EU block. In fact, the Czech exports to Israel rise yearly, primarily because the Škoda Automobile Company is so successful in Israel". This success has led Škoda to open up a new center in Tel Aviv and invest in many Israeli companies, particularly high tech and transportation. The ambassador expects this type of cooperation to continue and even to expand. In addition, Israel and the Czech Republic closely cooperate in hydrological issues.

For example, Ambassador Meron has met with the Czech Agriculture Ministry in order to examine possible solutions for the drought in the Czech Republic. According to the Ambassador: "We have made great achievements in turning the Israeli Deserts verdant. This has led some in the Czech Republic to enquire whether we would be willing to share our technologies and knowledge with them. That is why I believe that the water crisis can be a basis for future collaboration."

Tourism potential 

According to the ambassador, Prague is considered to be a central tourist attraction for Israeli tourists. Prague is renowned for its beauty, the friendliness of its residents and its Jewish history. Prague is in fact one of the most attractive tourism sites for Israelis in the entire world, and around 200,000 Israeli tourists flock to it every year. Nonetheless, the ambassador claims that most Israelis miss the attractions the Czech Republic holds outside of its capital.

The Ambassador himself has traveled across the Czech Republic over the two years in which he has served in the country and says: "I want to see Israelis get out of Prague and visit Český Krumlov, Kutná Hora, Brno, Karlovy Vary, and Pilzen". Meron believes that there is a great deal of potential growth in this type of tourism.

In addition, there are several Jewish sites outside of Prague. For example: around a 100 Czech villages in which Jewish communities existed until the 1930s. in most cases only the Jewish cemeteries in those villages survived. Various initiatives restore the Jewish culture in these villages such as:

  • Partial funding by the European Union has helped restore 10 synagogues throughout the Czech Republic.
  • The "ten star" program of Chabad which provides each synagogue with a different focus through which Jewish life may be interpreted and understood.

However, few Czech tourists reach Israel, and the ambassador states that only about 25,000 Czech tourists reach Israel every year. However, the hope is that this number will continue to grow. One of the opportunities to increase Czech to Israel tourism is Israel's hosting of the Eurovision contest in 2019.

The ambassador states that : "Anyone who travels to the Eurovision next year in Israel will enjoy himself big time. Israel has an incredible gastronomic scene, particularly for vegetarians and vegans. The state is very modern and yet simultaneously biblical, which many archaeological sites to explore, so that everyone can find what to love."

The ambassador praised the Czech performance and the contest and notes that "I particularly loved Mikolas Josef's song which was special and different." He did not understand why the Czech Republic did not win one of the first ten places to this day and he states that: "The Czech Nation is extremely musically talented, including in classical music and the opera."

Ambassador Meron knows that many people wonder at Israel's participation in the contest in spite of not being physically part of Europe but claims "We are European in our culture and association and we are an open society."

In addition he states: "The Arab countries surrounding us do not permit us to participate in various musical contests in the Middle East. Our music is also very Western, as is our culture and our values" He summarizes by stating: "We view ourselves as Europeans to all intents and purposes".

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