Czech residential real estate market study 2018: trends and predictions

posted 14 Mar 2018, 22:43 by Conbiz Info Center   [ updated 14 Mar 2018, 22:44 ]

Czech residential real estate market study 2018: trends and predictions

This comprehensive market survey was prepared for those foreign investors who are considering investing their capital in one of the most attractive European real estate markets – the Czech Republic. This study is based on a number of highly credible and publicly accessible market surveys and analyses, as well as on our professional experience. It aims to identify driving trends in the Czech residential real estate market in 2018 and in the upcoming years. This study primarily deals with the Prague real estate market in which 65 % of all apartment transactions in the Czech Republic occur. Accordingly, this is the predominant market of the Czech Republic, followed by Brno (centre of the Moravia region) with a 10% share in apartment transactions. Note: the information that follows refers to the Prague real estate market, unless explicitly stated otherwise.

Short look back at 2017 residential real estate market

The rapid rise in apartment prices over the previous 2 years was driven by many unique factors coming together at the same time. To name the most important: release of postponed demand from the global financial crisis years, very cheap mortgages, transfer of the obligation to pay the real estate acquisition tax to the buyer, a new Czech law on Consumer Loans and stricter regulation of mortgages by Czech National Bank (CNB). Many people wanted to finalize their real estate transactions before all of these changes began to apply.

Overview of 2018: small cool down after 2 hot years 

The majority of real estate market analysts and realtors expect a cool down of the real estate market in 2018 after previous two hot years. Prices of residential apartments in Prague VIP locations should either grow slowly (predictions oscillate between 5-10% year-to year increase) or remain stagnant, depending primarily on real estate location. Some realtors even expect a small decline of prices in the category of second hand apartments located outside of top Prague locations, which are primarily in demand by the Czech middle and lower class. 

The mortgage market this year is shaped by more expensive mortgages and dropping demand for them. Mortgages are becoming more expensive and less affordable for the Czech middle class that can have considerable impact on the real estate market in following years. However, right now the Czech economy is in outstanding condition and is expected to continue growing steadily. Unemployment is very low and salaries are rising. Due to the favourable economic conditions, people are still strongly motivated to purchase real estate even though mortgage regulations are tightening (read further). 

These, and other trends described below, should keep the real estate market in 2018 very similar to last year market. It is expected that there will be continuous high demand for real estate in Prague and other Czech towns from investors.

Detailed overview of trends in Czech residential real estate market in 2018 from investor`s point of view

Demographics: growth of domestic population and immigration

The population of the Czech Republic continues to rise. Year 2016 was even considered to be a baby boom year. In any event, regardless of growth driven by domestic birth rates, the population is steadily growing because of immigration. According to much cited statistics of Prague municipality, Prague expects until 2030 an additional 150 thousand new inhabitants. This number is based on official statistics. Unofficial estimations of immigration are higher. Needless to say, somebody has to satisfy this rapidly growing need for housing, either by building new apartments or offering rental properties. Construction of new apartments is proceeding very slowly in Prague and Brno as we reported in previous market forecasts. Those in the know regarding real estate trends speak of ongoing tension between developers and local and central governments regarding the constant delays in easing onerous regulations and administrative obstacles that delay the approval procedures of new projects. Apart from long administrative procedures, the municipalities of two biggest Czech real estate markets, Prague and Brno, are also continue struggling with drafting their future urban development plans. As relevant building legislation changes very slowly (read further) the supply of new apartments in Prague and Brno will continue to decline, as it cannot keep pace with growing demand. This will tend to push the prices of apartments` further up. 

Mortgages: interest rates will slowly increase

Mortgages are becoming more expensive and less affordable to the Czech middle class. Why? First, because the period of historically low interest rates is certainly over. From 1.77% in December 2016, interest continued to rise in 2017 and exceeded 2%. Interest rates have continued to rise in 2018 and are expected to exceed 2.5 % in this year. According to mortgage brokers, interest rates might even reach 3% this year, in line with the Czech national Bank (CNB) intentions. This will influence the affordability of higher mortgages, especially for the Czech middle class people.

Calculation of mortgages future development (in Czech crowns)

Mortgage amount

1 million CZK

2 million CZK

3 million CZK

Monthly payment 2017 (rate 2,1 %)


10 213

15 319

Monthly payment 2018 (rate 2,5 %)


10 598

15 897

Monthly payment 2018 (rate 3,0 %)


11 092

16 638


However, more than rising interest rates are affecting the affordability and attractiveness of mortgages. A restrictive mortgage policy of the Czech National Bank (read more about CNB`s restrictive rules on commercial banks regarding offering higher than 80% LTV mortgages) continues. Furthermore, since January 2018 commercial banks have begun to obey CNB`s maximum 80% LTV rule very carefully. Generally, they try to restrict mortgage applicants who try to arrange parallel loan financing to their mortgages in order to secure financing for more than 80 % of property value.

This development certainly does not harm either domestic or foreign investors. Interests on Czech bank accounts are still close to zero. This will motivate domestic investors to search for stable alternative to saving accounts to deposit their savings in. Moreover, although interest rates are growing, even a 3 % rate is still cheap, affordable and attractive for foreign investors, if we take into account returns of investment achievable with taking mortgages with such an interest rate.

Apartment affordability: growth of apartments` prices and rent prices growth

The number of middle class people who can afford to buy a new apartment in Prague will continue to decrease. The main reason for that is dramatic growth of new apartments` prices compared to 2 years ago, together with lower mortgage affordability. According to statistics, the affordability of apartments measured by the purchasing power of Czech people is the worst in country`s history. It takes 11 years for the average Czech person to save enough money to purchase a typical70 square meters flat. This statistics of one of leading public real estate portals displays the rising price of a 60 meter flat in Prague over time. 


Decrease of apartment affordability among the middle class pushes rental prices up. Last year they grew even faster than the purchase prices of new apartments – in many locations by an average 25% annual increase. That development was again positive for investors because it moderated the risk of their investments. Statistics from different developers differ, but we can assume that over one third of all residential apartments in Prague are being purchased for investment purpose. 

Development of salaries and the Czech economy

Czech economics is in outstanding condition. It has been growing continually for 5 years now. Salaries are growing in all sectors and unemployment is low (and practically non-existent in Prague).  According to many economic analysts, the Czech economy is set to continue growing at its current rate for the foreseeable future. Its future condition remains, of course, highly dependent on global markets, but so far everybody is optimistic. Currently, the main problem businesses face is not a lack of work, but lack of a work force. This applies to both blue and white colour work.

Very optimistic forecasts about the future development of the Czech economy and greater demand for new labour force led to significant growth of salaries in 2017. This trend continues in 2018. Inflation is expected to reach 2.5% this year. If we take into account inflation, real salaries should grow by 4% to 5% this year. The unemployment rate dropped in 2017 under 3% and, according to the prognosis of the CNBm should fall beneath 2.6% this year. This creates a unique opportunity for all employees to ask for raises and employers must be responsive if they wish to retain their work force. A combination of rising salaries, inflation and poor appreciation of savings on bank accounts, as aforementioned will lead to rising investment in real estate.

New regulation: Airbnb, Building Act and real estate services

The Airbnb phenomenon radically disrupted the real estate market in Prague, especially in the Prague 1 neighbourhood. Around 11 thousands Prague flats are now registered on the Airbnb website. So far, Czech legislation bodies have not put much efforts to regulate shared economy services. Currently these services operate in a sort of “grey” zone. This means that they are not illegal, but there are many controversies in interpretation of the law, and even disagreements by different authorities on how the existing legislation should be interpreted.  This is expected to change - and soon. Czech governmental bodies in cooperation with the Prague municipality are now preparing new legislation that should define new rules for modern shared economy services as Airbnb or transportation platforms as Uber.

In January, the much anticipated new amendment of the Building Act entered into force. The Ministry of Regional Development, initiated new legislation that promised to solve, through this amendment, the most crucial legislative problems which delayed new residential development in Prague and Brno. New amendment merges merged what have until now been separate administrative procedures (environmental impact, urban planning, and building permit procedure) into a single procedure to shorten the length of the integrated approval process. Although developers welcome this new law and see it as a step in the right direction, at the same time they don`t consider it to be a long-term solution. The majority of developers are sceptical about its practical impact. The new law has not shortened the decision-making periods of public bodies. In addition, there are still approximately 40 other minor laws that regulate particular parts of the building permit process (fire safety, public health, water management etc.). Developers assume that unless a completely unified new Building Act is adopted, and all approval competencies merged under a single ministry, nothing will really change. They also assume that the new law will not increase the availability or rate of construction of new apartments. Therefore, the supply of new apartments in Prague and Brno in the upcoming years will not meet the demands of the growing population. This will keep prices of all apartments high.

As we wrote in the past, the Czech Republic has been waiting for new regulations of real estate services for far too long. Due to elections and changes in the central government, the new law will most probably not leave the table of Ministry of Regional Development. How much longer will it take?

Major trends on new apartments market in Pragu

The distribution of new apartments` prices has changed significantly over the previous years. Apartments priced at under 45 thousands CZK per square meter have basically disappeared from the market. Price per square meter of new apartment in Prague have risen, on the average from 60 to 90 thousands CZK in the past 3 years. Furthermore, it is common for apartments to be purchased for these prices by investors during very first phase of new developer projects – pre sale – when they exist ‘only on paper’. Investors will later resell those flats with profit margins that will influence the statistics of new apartment prices for both the purchase year and the following year.

The graph below represents evolution the average prices of new apartment in the period of 2013 – 2017. This calculation does not include extreme cases, that is the 5% most expensive apartments and the 5% least expensive apartments. The Graph indicates that the average price of new apartment has been growing rapidly since the second half of 2015. Since then it has grown by 50%.  In the end of 2017 it reached 81 526 CZK incl. VAT, equivalent to an annual10% rise in prices since 2013. The most dramatic growth was in the highly popular neighbourhoods of Prague 1,2 and 6.


According to two Studies of developer companies published by consulting companies KPMG and CEEC Research (2017), the demand for residential real estate will once again exceed the supply in whole Czech Republic in 2018. The Prague market of new residential apartments is currently mostly driven by the absence of new building permits and quality lands for construction. The most attractive locations suitable for new residential development from a developers` perspective are Prague 5, 9 and 10. Developers will continue to focus on smaller apartments with 2+kk layout with very good amenities in surrounding of apartment building. More than three quarters of asked developers are planning to increase prices of new apartments in Prague by 4% in 2018. However, the number of new apartments released in the Prague market should only increase very mildly (0.6% year-to year increase).

The majority of real estate developers estimate that the prices of new apartments will continue growing over the next 2 years, however growth will not be as dramatic as it has been over the previous 2 years. There are couple of reasons for this. Firstly, housing affordability strongly depends on salaries and their growth – although stable – currently does not reflect price growth in new apartments market. Indeed, there few Czech middle class people who can effort to buy a new apartment at 90.000 CZK per square meter, which was the common price of new apartment in 2017. One example above all: one of the major Czech real estate developers – company Central Group – in its press release displayed a calculation according to which potential buyers can purchase in 2018 in Prague a small studio for the same price for which they could have purchased a 2+kk apartment two years ago.

Regional trends

According to the portal which provides the macro data of the Czech real estate, real transaction prices per square meter in 2017 for all flats – old and new – were 65.000 CZK in Prague (to complete a picture, average offer price of apartment in Prague on real estate portals was 73 526 Kč which is approximately 10% annual increase), 50.000 CZK in Brno region, 35.000 CZK in Pilsen region and 29.000 CZK in Liberec region.

Pilsen has become third strongest Czech region in number of new apartments offered for sale. The average price offered for new apartments in Pilsen is currently 49.000 CZK which is 1000 CZK above the national average. The average sale price of a flat in Pilsen is 2.5 million CZK. Considering the dramatic rise of apartment prices in Prague, the return on investments for apartment rental properties in Pilsen are in many cases more favourable. Therefore, many experienced realtors prefer real estate investments in Pilsen over Prague.

New apartment prices have also been rising in other county towns in the Czech Republic,  especially in Brno and Olomouc. In Brno, the situation in regards to poor approval procedures of new residential development is very similar to Prague. Realtors expect 7% price growth of new apartment prices in 2018 there. Continuous dropping of new apartments supply in Prague and Brno also influences the prices of second hand apartments.

Executive summary for foreign investors

The Majority of experts involved in real estate, and realtors do not perceive rapid growth of apartment prices in Czech Republic as a bubble. Quite the reverse, they claim that growth is based on very real factors – more people are coming to live and work in Prague or Brno (and other towns) as new construction stagnates, preventing supply from keeping up with demand. Lower apartment affordability will force more and more locals to either postpone their real estate purchases or choose to purchase residential apartments outside of Prague (which is already a big trend and many developers are building and purchasing lands in Prague` s surroundings for new residential projects).

Changes in the mortgage market still do not have much effect on foreign investors. They are not seeking a 100% LTV in any event. Moreover, although interest rates grow, they are still relatively low. In other words, mortgages are still cheap and attractive for foreign investors. According to the Studies of developer companies published by consulting companies KPMG and CEEC Research (2017) every fifth apartment (23%) in Prague is currently being purchased by foreigner. With respect to demographics and affordable mortgages on one side versus rise of rental prices in 2017, investment purchases of real estate in Prague and other Czech towns (Brno, Olomouc, Pilsen) will bring every satisfactory returns of investment.

Are you considering real estate investment in Czech Republic? Join our many satisfied clients and invest in rental properties with our help. Contact our consultants for more information.

Lease rates of office space in the Czech Republic are amongst the lowest in the world.

posted 18 Dec 2017, 00:53 by Conbiz Info Center   [ updated 6 Feb 2018, 01:52 ]

Lease rates of office space in the Czech Republic are amongst the lowest in the world. 

Analysis of the results of the annual poll of the Cushman & Wakefield’s Company, which inspected 215 cities in 58 states results in the conclusion that Prague offers a relatively inexpensive work environment for businesses. Office space in Prague is roughly 90% cheaper than that of Hong Kong, considered to be the most expensive city in the world – a yearly cost of 3200$ in Prague, compared to 27,432$ in Hong Kong for every workstation. The annual poll of the company made use of a new system this year and so the results cannot be compared to earlier years. The new system calculates the lease rates, the service fees, and the number of square meters of office space allocated to every employee.

Prague was ranked the second most inexpensive city for business in Europe after Bratislava (the capital of neighboring Slovakia) due to the following fact – the monthly rent in the highest quality offices in Prague is no higher than 21 Euro per square meter. The expectation is that no more than 400,000 square meters of new office space will be added in the next two years so that no significant price rises are expected. Nonetheless, Prague has only reached second place due to another fact- employees in Prague enjoy less average work space than in other cities (10 square meters in Prague compared to a worldwide average of 11.8 square meters). 

New office space areas in Prague. 

At the moment, many new projects in Prague are being constructed that will include offices. These include Smichov City in Prague 5, the Flower House in Vaclav Square, the Rosetta Palace on Jungmannova street, the Drn project at the corner of Národní třída and Mikulandsk – a number of projects near the metro stations Pankrác and Pražského, and also spaces in historical buildings in Prague 1 that will be refurbished and become offices. The area around Masarykovo nádraží is also expected to develop and include a shopping center and offices. 

Below is a list of the cities where it is most expensive to rent out office space. The stated price is the rounded rental fee per year for every work station. 

  1. Hong Kong – 27,400$ 
  2. London – 22,600$ 
  3. Tokyo – 18,000$ 
  4. Fairfield county Conneticut, United States – 17,400$ 
  5. San Francisco – 16,000$ 
  6. New York – 15,900$ 
  7. Silicon Valley – 15,000$ 
  8. Geneva – 13,400$ 
  9. Sidney – 12,000$ 
  10. Paris – 11,700$ 

For additional information regarding the Czech Republic, real estate and investments – click here

The highest lease rates in the Czech Republic are in Prague and Pilsen

posted 12 Nov 2017, 11:07 by Conbiz Info Center   [ updated 12 Nov 2017, 11:08 ]

The highest lease rates in the Czech Republic are in Prague and Pilsen 

According to the poll of the Trigema company, the areas with the highest rents in the Czech Republic are in Prague. The lower rental fees are in the Usti and Labem region and the districts of Moravia and Silesia. In the second quarter of 2017, the rental rates in Prague were double that of the rental fees in other locations in the Czech Republic. For example: a 2+kk apartment in Prague was being rented, on the average, at 14,000 Czech Korunas per month. In contrast, apartments in the Moravia and Silesia regions were being rented out for only 7000 Czech Korunas. Below are the findings of the poll, by Czech province:

  • South Moravia – an average lease for an apartment of 11,916 Czech Korunas. 
  • Central Bohemia – an average lease for an apartment of 9,875 Czech Korunas. 
  • Pilsen – an average lease for an apartment of 9,762 Czech Korunas. 
  • Liberec – an average lease for an apartment of 7,805 Czech Korunas. 
  • Moravia and Silesia – an average lease for an apartment of 7,355 Czech Korunas. 
  • Ústí and Labem – an average lease for an apartment of 7,037 Czech Korunas. 

“The residential market and the rent are closely bound,” says Mark Soral, the CEO of the Trigema company, and adds: “In places that are considered attractive residential areas, the prices of new and old apartments are higher and the apartment rental fee accordingly rises”. The data of the Trigerma company proves this. In the first quarter of 2017 the average rent of apartments in Prague was: 

  • For a 1 kk+ size apartment the rent was around 11,294 Czech Korunas. 
  • For a 2 kk+ size apartment the rent was around 14,223 Czech Korunas. 
  • For a 3 kk+ size apartment the rent was around 18,134 Czech Korunas. 

The most expensive areas to rent were in the center of the city, for example in Prague 1 the average rent was 41,611 Czech Korunas whereas in Prague 2 they were around 29,579. It must, of course, be recalled that these are average prices. On one extreme, an apartment in Prague 9 had been leased out for 4200 Czech Korunas, whereas on the other extreme another apartment in Prague 2 had been leased out for 130,000 Czech Korunas. 

If you too are considering investing in Prague, talk to us. We have specialized in the city and we have hundreds of satisfied customers.

New apartment prices in Prague continue to rise (2017)…

posted 12 Nov 2017, 11:00 by Conbiz Info Center   [ updated 12 Nov 2017, 11:02 ]

New apartment prices in Prague continue to rise (2017)… 

The prices of new apartments in Prague are not projected to drop in the upcoming years and as of the second half of 2017, the average price per square meter is around 75,791 Czech Korunas. A rise of 15% in comparison to the previous year has in fact taken place, according to the data of the real estate companies Trigema, Sanska and Central-Group. In fact, over the past two years, the prices of new apartments in Prague have grown by over 33% and with them the average rental rates – they have risen over the first months of 2017 at an even higher rate than the prices of the apartments. 

According to the Czech Central Bureau of Statistics, over the past year 1342 new apartments have been built in Prague, representing a drop of 25% over the past six months in the supply of new apartments, to a level of 3600 apartments. Contractors in Prague claim that the reason for this is the long process that is currently required before one receives a building permit. According to them, in Denmark the process includes 5 stages, whereas in the Czech Republic it is made up of 33 different stages, which causes a construction project in Prague to last, on the average, 8 years. Of these 8 years, 2 years are spent on construction in practice, and 6 years are spent getting permits of various types. 

However, the short supply is not the only cause for the price rises- additional reasons must also be considered. Chief among them is a high demand that is being driven by continuous economic growth and a rise in the real salary. Another reason is the attractiveness of the city, considered to be one of the employment hubs of Europe. Nonetheless, analysts project that the rises in real estate prices will slow down, but that the trend will not change. According to them, only an unexpected economic or political crisis might lead to a decline in apartment prices. 

Do you want to hear more interesting offers about apartments in new projects in Prague? 

Contact us here

The city council of Prague has launched new information sites for short term apartment renters and tourist oriented apartment owners.

posted 26 Oct 2017, 02:47 by Conbiz Info Center   [ updated 26 Oct 2017, 02:48 ]

The city council of Prague has launched new information sites for short term apartment renters and tourist oriented apartment owners. 

The city council of Prague has launched two new online sites ( and for investors renting out apartments for tourists in Prague who utilize online services such as Airbnb, Roomorama, Trivago, VRBO and iBooking. The sites are intended for both apartment owners and renters, and currently provide information in English, Czech, German and French.

The Mayor of Prague claims that the sites benefits both parties: “The tourists in Prague can find recommendations on those sites, and important rules, such as regarding the leasing laws, the requirement to maintain quiet during the night hours between 06:00 and 22:00 and additional useful information”. “Furthermore, these sites provide apartment owners with vital information regarding their due taxes, their business liability, and the need to inform the tourist police regarding guests in their apartment and so forth.” 

The Prague Municipal Government claims that most apartment owners who rent out their apartments via internet sites do not pay what the law requires them to pay, namely 15 Czech Korunas a day for every guest, which has resulted in the loss of millions of Koruna’s to the municipal revenues. The new sites detail when and how they must pay this sum to the municipality as well as additional information, such as the need to maintain a business license and the need to register guests. 

The sites remind those renting out their apartments that at the end of each month they must report to the relevant quarter data of various sorts, such as the number of days guests have spent in their apartment, from which the total toll is derived. The sites further remind those renting out their apartments that nonpayment of the fee may result in a fine. Furthermore, the tourist police must be notified within 3 business days of the tourist lease regarding the hosting of a tourist. 

The advantages of the new information sites 

These demands from apartment owners who rent out their apartments to tourists are to their benefit for one primary reason – in the event of an inspection they are covered by presenting the registration of the current guests, a registration which includes their personal details. The sites claim that lack of knowledge of the law does is no protection from being penalized by it, and that each individual renting out his apartment is obligated to perform his duties. 

It is true that as of now many of the homeowners seem to rely on the fact that it is difficult to supervise tourist hosting. The Prague Council Member Jan Wolf makes two claims: on the one hand, many apartment owners are not aware of their legal obligations, and on the other hand, the information is not always accessible. He claims that making the information accessible is a first step in ensuring that the apartment owners fulfill their obligations. 

One thing that the internet sites remind their readers is that even though they are providing short term hosting services, they must not forget that the apartment is located in an area where local residents live. The intent is to direct the apartment owner’s attention towards the fact that not all apartments are suitable for being rented out, for example, in terms of safety and security and neighbors complaint.

There are already frequent complaints by neighbors to short term rented apartments, primarily regarding noise, but not only. Some of the complaints claim that short term rentals change the character of the neighborhoods, and raise rent and apartment prices, making residence in the neighborhoods where short term tourist rentals takes place more economically difficult, even impossible, for long time residents. 

The results 

Various cities around the world have limited the possibilities of performing short term tourist rentals. For example, in Berlin only those living in the apartment are permitted to rent it out and high fines are levied on violators of this prohibition. In New York and Amsterdam the number of days an apartment can be rented out during the year is limited and in Vienna there is mandatory registration of short term tourist rental apartment owners, which increased the amount of taxes collected by 50%. 

What about Prague? 

We believe that the regulation of the issue is indicative of the intention of the Prague Municipal Government to regulate affairs, not prohibit short term tourist oriented apartment rentals. Accordingly, the future of the short term tourist apartment rentals looks bright. In any event, a management company specializing in the management of tourist apartments in Prague will be aware of the local laws and usually uphold them. So accept a heartfelt recommendation from us- utilize the services of an experienced management company and do not settle for a recently established company or one which is not considered 100% reliable. 

Should you require any assistance in purchasing or managing tourist oriented apartments we will be happy to assist you or direct you. Just contact us.

Update: funds can be transferred to the Czech Republic without any need for an application to the Israeli Tax Authorities

posted 23 Oct 2017, 06:23 by Conbiz Info Center   [ updated 23 Oct 2017, 06:32 ]

Update: funds can be transferred to the Czech Republic without any need for an application to the Israeli Tax Authorities

The green route, which the Israeli Tax Authorities announced on the 26.09.2017, makes investment in the Czech Republic easier and more remunerative than ever!

One of the primary barriers Israelis who invest abroad (such as individuals who purchase shares in local corporations or who purchase local assets overseas) have encountered up to now is the obligation to deduct the tax at the source while making payments (an obligation based on clauses 164 and 170 of the Israeli Income Tax Ordinances). This obligation made no distinction between types of monetary transfers, regardless of whether they were considered to be a taxable income or not. As a result, those transferring finds were required to provide the banks with tax deduction at source certificates, which extended and complicated these transactions, and sometimes made them non-remunerative or hurt payment obligations (when the transactions were finalized).

The streamlined route to transfer funds to the Czech Republic 

On September 26 2017, the Israeli Tax authorities published a statement according to which, in certain cases, transfer of funds abroad would be permitted on a green route, without any need to apply to the Israeli Tax Authority Offices to receive a permit. Rather, all that would be required would be the signing of an appropriate statement (included in form 2513/2). This form is to be filled by the person transferring the funds, and handed over to the bank, where it would be kept and presented to the tax authorities, upon its request. In the framework of this statement, the signature of the person transferring the funds is required to affirm that he is aware of the authority of the Israeli Tax Authorities to determine a tax deduction at source rate, in the event that any discrepancy should be discovered between the details of the application and the transfer actually committed. 

The streamlined Green route is applicable in the following cases: 

1. The transferred funds are intended for a resident of a treaty member country and to a bank account present in a treaty member country. 

The list of the 53 treaty countries is present in clause 6 of the form, and includes the Czech Republic. The bank account and the foreign resident are not required to be present in the same treaty member state. 

2. The transfer is being performed in order to make one of the following types of payments: 

  • Investment in stock
  • Investment in real estate or other tangible assets
  • Providing a loan to an overseas resident
  • Providing an owner’s loan
That is it! Everything is going to be easier, take less time and be much more remunerative from now on! 

We the professionals working in Conbiz can help you receive the best decision for your business. For additional details and setting up a consultation meeting-, you can contact us here today.

To review the full statement of the Israeli Tax Authority to the Israeli Accountants Bar see here

This article was written by CPA Mr. Avi Babai.

It is important to note that this article was written solely in order to provide a general overview of the taxation issue to Israeli investors in the Czech Republic and is not a substitute for professional consultation by a qualified accountant or tax advisor.

Property values in the Czech Republic have registered this year (2017) the highest rise in values in the European Union

posted 23 Oct 2017, 05:13 by Conbiz Info Center   [ updated 23 Oct 2017, 05:16 ]

Property values in the Czech Republic have registered this year the highest rise in values in the European Union

In the second Quarter of the year 2017, the apartment prices in the Czech Republic have risen by 13.3% - the highest rise in the countries of the European Union, where prices have risen by no more than 3.8% (in the Euro block) and by 4.4% (In all states that are members of the European Union).

Eurostat published these numbers on Wednesday. According to them, Ireland is second (a rise of 10.6%) and Lithuania is third (a rise of 10.2%). The company spokesperson has stated that the accelerating growth in the apartment prices in the Czech Republic is related to the policy of the Czech Republic’s Central Bank, and to a low availability in the apartment market in the Czech Republic.

The number of apartments sold in the Czech Republic in 2015 was considerably higher than the demand prior to the world financial crisis in 2008, according to local Czech experts in the field of real estate. Furthermore, since the end of 2012, the rate of sales has risen considerably.

Before you is the full list of the real estate price rises in the countries of the European Union: 

  • The Czech Republic - 13.3% 
  • Ireland - 10.6% 
  • Lithuania - 10.2% 
  • Latvia - 9.6% 
  • Bulgaria - 8.6% 
  • Sweden - 8.6% 
  • Slovenia - 8.3% 
  • Portugal - 8.0% 
  • Hungary - 7.7% 
  • The Netherlands - 7.3% 
  • Romania - 7.2% 
  • Slovakia - 6.6% 
  • Luxembourg - 6.2% 
  • Denmark - 5.8% 
  • Spain - 5.6% 
  • Malta - 5.5% 
  • The United kingdom - 5.0% 
  • Austria - 4.9% 
  • Estonia - 4.8% 
  • Poland - 4.6% 
  • Croatia - 4.3% 
  • Germany - 3.7% 
  • Cyprus - 3.6% 
  • Belgium - 3.5% 
  • France - 3.5% 
  • Finland - 1.5% 
  • Italy - 0.2%

Are you interested about hearing more about investments in real estate in Prague? Please Contact us.

The economy of the Czech Economy is very successful in the second quarter of 2017 as well

posted 27 Sep 2017, 01:58 by Conbiz Info Center   [ updated 27 Sep 2017, 01:58 ]

The economy of the Czech Economy is very successful in the second quarter of 2017 as well 

The numbers prove that the economy of the Czech Republic is amongst the strongest in Europe. The GNP in the second quarter of 2017 was higher by 2.5% than the previous quarter. This is a rise of 4.7% compared to the matching quarter last year. According to the Central Statistics Office of the Czech Republic (CSU), these figures are higher than the forecast that projected a 2.3% rise in this quarter, and a 4.5% rise compared to the previous year. The figures prove that the rapid growth measured in the first quarter of 2017 was continuing. In fact, they are proof that the economy of the Czech Republic is one the fastest growing economies in the European Union. The positive developments of the Czech economy derived from a rise in demand, both locally and globally.

While the data pleasantly surprised the projections of the economists, they are disadvantageous in one respect. These positive figures may increase the probability that the Czech National Bank (CNB) might raise interest rates. The rapidly growing economy, the overly calculated labor market, and high inflation, will likely cause the central bank to raise the interest rates this year, probably in November, but perhaps in September,” stated the chief Economist of the Czech Banking Union.


In terms of demand, the growth of the GDP in the second quarter of 2017 derived from both local and global demand. Together with the continually growing domestic demand, there is a new activity that integrates all of the growth factors in the field of domestic demand. According to the CSU data, the growth in the Gross Domestic Product this year contributed to growth in expenses of 1.7%, a growth in domestic consumption of 1.5% and a growth of 2.1% in external trade.


In terms of expenses, the expenses of the households (in all types of consumption) grew by 1.8% during that quarter and by 4.4% compared to that quarter in the previous year. The government expenditures also grew by o.4% during that quarter and by 1.9% in comparison to the same quarter in the previous year. The expenditures on assets also grew in the second quarter of 2017, both relatively to the first quarter and compared to the matching period in 2016.


Insofar as investments are concerned, investment has grown not merely in the fields of transportation and real estate, but also in the fields of equipment and machinery as well as in the fields of investments in structures. In comparison to the first quarter, the investment in assets in the second quarter was similar (6.3%), but in comparison to the second quarter of the previous year, the rise in investments in assets was 7.7%.

Foreign trade

Stable results in the field of foreign trade has also resulted in the growth of the economy of the Czech Republic. The foreign trade balance in services and goods in the second quarter of 2017 reached 92,000,000 Czech Korunas. Exports grew realistically by 7.3% in comparison to the parallel period in the previous year, as a result of growth in transportation equipment as well as trade in machinery and electrical equipment. Imports grew during this period by 6.2%, significantly contributing to various fields in the auto industry, the manufacture of electrical equipment and trade in basic metals.


The growth of the Czech economy is accompanied with a rise in employment, and the total number of employed has risen by 0.4% in this quarter. In comparison to the previous year, this is a rise of 1.3% and it is parallel to rises in the economic field in all of the Czech Republic. This is the picture that arises from the analysis of the data performed by the CSU- the Czech Republic Central Statistics Office.

For additional information regarding the economy of the Czech Republic, look here.

Prague, because 100,000 Chinese can’t be wrong!

posted 26 Sep 2017, 00:02 by Conbiz Info Center   [ updated 26 Sep 2017, 00:04 ]

100,000 Chinese can’t be wrong!

South Korean and Chinese tourists are the top visitors to Prague in 2017. 100,000 Chinese tourists and 140,000 South Korean tourists have graced the streets of Prague in the past year. In fact, the number of East Asian tourists visiting Prague has consistently grown every year (with the exception of Japan, which we will discuss later on). One reason for this is, among other things, is the direct flights from Prague to various East Asian cities, but this is far from the only cause.

The demand for tourism in Prague began following movies and series filmed in Prague, for example a popular romantic Chinese drama series that was filmed on the staircase of a Prague concert hall, the Rudolfium. A South Korean TV series resulted in a similar outcome, and Prague has since become a popular site for marriage for East Asian couples, which has resulted in a steady stream of East Asian tourists in the Karl Bridge and the Old City area.

Prague was also the site in which a popular Indian film was filmed, as well as the scene of several Bollywood films, which brings to the city tens of thousands of Indian tourists every year. In the first half of 2017, 40,000 Indian cities reached Prague, in comparison to 60,000 in all of 2016. Indian tourism is considered particularly surprising since to this day no direct flight exists from cities in India to Prague. There is also no direct flight from Japan to Prague, but the Japanese still throng Prague in massive numbers- around 80,000 in 2016.

However, television is not the main “culprit” for the situation and focused advertisements in South Korea and China have begun to bear fruit. Projections in Prague is that the trend is not going to change an time soon and they are already producing maps, tourist guidebooks and tourist information in Chinese, Korean and Japanese as well as an internet portal in these languages.

Excellent news for investors!

This may come as a surprise but you too can turn a profit from the East Asian tourist traffic in Prague, particularly in the tourism areas in Prague 1. Purchasing an apartment for an investment and short-term rentals (through, for example, Airbnb) can derive an annual double-digit return on your investment. Now all you have to do is learn a bit more about investing in tourism oriented apartments in Prague.

A general background regarding Pilsen and real estate investments in Pilsen

posted 25 Sep 2017, 06:07 by Conbiz Info Center   [ updated 25 Sep 2017, 06:11 ]

A general background regarding Pilsen and real estate investments in the city 

Pilsen in the fourth largest city in the Czech Republic and is the Capital of the eponymous province. The city is located at the junction of 4 rivers, about 90 kilometers west of Prague, and around 200,000 people live there. The City was founded in 976 and rapidly became a central trading city thanks to two factors: its geographical position on a trade crossroads and the natural resources its location is endowed with. The city has been subjected to several sieges since it was founded. None of them, however, ever breached its walls and that is why, perhaps, Rudolf the Second, Emperor of the Holy Roman Empire , selected it as his capital.

A city with something of everything

Architecturally, the city is heavily affected by the Baroque period and as of 1989, many of its historic structures are undergoing renovation. Academically, the city has three universities and economically and culturally speaking it is the center of Western Bohemia. Since the 1990s investments in the city has risen, particularly foreign investments such as those by the Daikin Company and Panasonic who also maintain factories in the city. Moreover, if that is not enough- Pilsen was also selected as the Culture Capital of Europe for 2015, which attracted more attention and investments its way.

Pilsen is one of the more economically affluent cities in the Czech Republic and its residents enjoy a high gross domestic product - 44,000 dollars per capita. The presence of the Skoda automobile factory, the Pilsner Beer factories, the presence of many pampering spas and the largest distillery in the Czech Republic. Moreover, of course, we cannot neglect the Jewish angle, can we? You will no doubt be happy to hear that Pilsen contains some of the largest Synagogues in the world, such as the old synagogue of Pilsen, which is the second largest in the entire world that holds many concerts.

And that is only the beginning…

Pilsen today continues to enjoy the economic benefits of its geographic position. The city is connected to both Prague and Germany by major highways. Furthermore, the city is proximate to the International Airport of the Czech Republic and attracting foreign investments is a top priority of the municipal government’s agenda. The proof of this is that Pilsen is the only city in the Czech Republic that is a member of the International Trade Center Network. The city thereby joins 330 cities in the world and shares valuable business information with foreign investors (both companies and individuals).

Real estate in Pilsen

From a real estate point of view, Pilsen is second onlyto Prague as a real investment target in the Czech Republic, in spite of only being the fourth largest city in the country. Rent prices in Pilsen range between 3.75- 4.2 Euro for square meter a month, nearly as much as Prague (3.8- 4.25 Euro per month for square meter). In fact, a 12% rise in residential unit process was registered in Pilsen as early as 2013, while rises in Praguewere more moderate. Nonetheless, the Czech Television reported that in 2017 the prices in the Pilsen region dropped by 6.1%.

Nonetheless, Pilsen is an excellent city for real estate investment for a single reason: it is a college town and construction of residences for students is a trend in the Czech Republic. An additional site claims that investment in Pilsen is worthwhile for two reasons: the initial investment price is amongst the lowest in Europe, and the return on investment is amongst the highest in Europe.

Here you can read and broaden your knowledge on investment in real estate in Pilsen.

If you wish to receive information from us regarding opportunities for investment in the city, contact us and we will be delighted to offer you interesting opportunities for investment in the city.

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