Buying a property - What awaits me?
Everyone knows that buying a property isn't like going to the baker's. It is a process at the end of which you want to own your own house or flat and you will have to pay a lot of money for it (and these days it really is a lot of money). And it's no surprise that where money is involved, if you know how to navigate your way through the process you can save yourself a lot of money, in some cases a huge amount. So what are the basic tenets of buying real estate in the Czech Republic? What should you know, and what must you know? This is covered in the next article and then in a series of other articles, where the individual aspects of buying real estate are described in more detail.
Before You Buy
Before you enter the real estate market, there are a few things you should think about, calculate, and become aware of which you therefore need to know. In the Czech Republic, ownership of real estate is generally acquired by being entered onto a public list. This is the Real Estate Cadastre, which is administered by the cadastral office. In order to actually own a property, you will need to be registered in this register as its owner. As a foreigner, you should know that there are no restrictions on foreigners when buying and selling real estate. You do not have to check your immigration status, residence permit or visa. You don't even have to be present in the Czech Republic to buy a property legally. You must, however, use all your own money to make such a purchase. The moment you need a mortgage or other financing, you will have to check up on all these things. But more about that in the article, "How to get a mortgage in the Czech Republic''. And you also need to know how the real estate market works. That there are private buyers and sellers on it will probably not be a surprise. Yet in addition there is an important real estate cadastre and also real estate agencies, real estate agents, real estate offices, and so forth. There is more about them in the article, "The real estate market in the Czech Republic''. You can find out which type of documents you must prepare and at which point of the process in our "purchase timeline". Then you just need to calculate whether investing in real estate in the Czech Republic will pay off at all, or if it wouldn't be better to wait a while. If after studying all the above you are sure that you really want to buy real estate, you need to define what it should be. From my practical experience, I can advise you that it is better to start with the narrowest possible selection and gradually widen it in accordance with the market, rather than vice versa…
During the search
In the case that you've successfully gone through the previous phase and haven't neglected anything, you've got everything in place to really focus on what's important: Choosing the right property for you. Here the options will vary greatly depending on which type of property you opted for, so I can in general refer you to articles in the group, "During the search", which will guide you in the right direction on how to proceed and what to primarily watch out for in this phase. This is where problems arise that can easily turn into years of inconvenience if not given enough attention! Feel free to read them all, even if you are looking for an apartment and the article is about a house - they are still both places to live and can have a lot of things in common.
Real estate transfer
Transfer of real estate is a very important part from a legal point of view. Even a small mistake here can have huge consequences. It will save you a lot of stress if you hire a professional for this step, if you have not already done so. But if you want to try it yourself, be sure to at the very least read: "What contracts are you likely to sign and what should they look like?" The "purchase timeline" which you are already familiar with can assist you a great deal in this regard! Above all, you should know that a free of charge transfer is not possible. Even if you don't pay a broker, adviser, or even a lawyer, the Cadastral Office will certainly charge you a fee to register your new property in the Real Estate Cadastre. Although at present the fee is a relatively modest 2,000 CZK, if the contracts you draw up yourself are not sufficiently well written and are returned to you by the cadastral office as insufficient, you may end up paying again and again.
After the purchase
Once the property is transferred into your name, it still needs to be officially handed over. With this step, the risk of damage passes legally from the former owner to you. Put simply, from this moment on if the house burns down, it's your problem. It is also necessary to register with energy utility companies and other regular fees associated with the property. Property acquisition tax was abolished in 2020, so you no longer have to file a tax return and pay taxes. Except for one, which can be easily forgotten because the tax is registered for only once, in January of the following year before it is subsequently calculated automatically. Here we are of course talking about property tax. Currently, if you use any of the options of verified communication with state administration, calculating your returns is relatively simple. If you don't, on the other hand, it's quite complicated. We don't offer a comprehensive guide on how to fill in this tax return, but prefer to recommend someone who will do it competently and at a very competitive cost.
As you can see, this article is just a signpost to others
and yet it is still quite long. You should now be aware that buying a property
is not so simple that a complete set of
instructions can be crammed into a few lines. It is essential to study
the process. And if you don't want to read a lot of texts and learn them for
just one purchase, it's perhaps better to turn to the professionals who will
guide you through the process and explain everything you need to know exactly when you need it. But if you
enjoy reading and studying, welcome to our website - the information you need
to successfully buy real estate in the Czech Republic is all here!