The relocation.com.ua project analyzed the Czech residential real estate market in the first half of 2025.
In January–June 2025, construction output in the Czech Republic grew by 8.5% year-on-year: building construction +7.5%, civil engineering +10.6%. At the same time, new orders for companies with 50+ employees decreased by almost a quarter (22.7%) in terms of quantity, but their total value increased by 19.6% (CZK 224.2 billion) due to large infrastructure government contracts. The estimated value of projects approved for construction amounted to CZK 224.9 billion (-19.5% y/y). Construction began on 16,295 apartments (-5.4% y/y), and 16,962 were completed (-3.3% y/y). Most of the starts were in Prague (multi-family), the Central Bohemian Region, and the South Moravian Region.
Overall, it can be concluded that production is growing, but the decline in permits and housing starts signals a restrained supply in the not-too-distant future of 2026.
Demand for rental housing remains strong, especially in Prague: modern institutional projects (BTR) show high occupancy rates, with waiting lists in some places. According to Savills estimates, as of June 2025, there were about 4,600 modern rental apartments in 81 projects in the city, with the highest concentration in the Prague 9 and Prague 5 districts.
In 2025, rental rates grew by about 6% year-on-year, but their dynamics lagged behind the growth in purchase prices.
The primary housing sales market in Prague continues to revive: in Q2 2025, 1,848 apartments were sold, the second strongest quarter since Q3 2021. The average asking price for new projects reached CZK 168,000 per sq m (≈€6,824): +2.7% q/q and almost +9% y/y.
Aggregate indicators confirm the “upward phase” of the cycle: according to Eurostat, in Q1-2025, the housing price index in the Czech Republic grew by ~9.9% y/y, and CNB analysts note that prices have exceeded long-term trends and previous highs in 2022. At the same time, housing affordability is deteriorating: according to the Deloitte Property Index 2025, Prague is among the three least affordable major European cities for purchasing new-build properties.
Monetary policy has eased: in May 2025, the CNB lowered its key 2-week repo rate to 3.50% and kept it there in August, signaling a pause in further cuts. The easing is being passed on to mortgage rates: the average real rate on new mortgages fell to 4.60% in May and 4.56% in June. At the same time, the volume of new mortgages in June reached CZK 29.4 billion, and July, according to industry reports, came in at around CZK 30 billion.
According to forecasts for the next 6-12 months, housing prices: base scenario — continued growth (low supply, pent-up demand, easing rates). The pace is likely to moderate against the backdrop of a high base and affordability constraints. Rental: demand pressure remains (migration to large cities, expensive mortgages for some households). As BTR projects are completed, local stabilization is possible, but at elevated rates.
Construction: in 2025, production will be sustained by infrastructure growth, but a decline in permits/starts will narrow housing supply in 2026, supporting prices. Mortgages: The CNB is signaling a “pause” at around 3.5% on 2W-repo; this implies a gradual further decline/stabilization of mortgage rates, but without any sharp moves. Risks include inflation in services and the external situation in the EU.
