At the end of 2024, the monthly cost of a mortgage payment for an apartment exceeded the average monthly rent by CZK 9,245, according to an analysis by the Association of Rental Housing provided to the Czech News Agency. While the gap narrowed by CZK 287 compared to November, it was CZK 459 larger year-on-year. The analysis attributes the persistent gap to the continued rise in apartment prices, which has outpaced rent increases. Falling mortgage interest rates have not been sufficient to offset the effect of property price growth. “The gap between mortgage payments and rental costs may narrow over the course of the year as mortgage rates decline. However, the extent of this narrowing will depend primarily on the rate at which housing prices continue to grow,” said Jakub Vysovský, President of the Association of Rental Housing. In earlier years, the situation was reversed. Data from the association show that before 2022, mortgage payments were on average CZK 765 more expensive than rents. However, since spring 2022, renting has been economically more favorable, with the monthly gap ranging between CZK 7,000 and CZK 9,000. The widest difference occurred in the third quarter of 2022, when mortgage payments exceeded rents by over CZK 10,300. The comparison between rental and ownership costs is based on an average apartment size of 52.6 square meters. The calculation uses data from Deloitte’s Real Index and Ren Index, alongside average mortgage interest rates. “The analysis provides a purely economic comparison and does not consider personal preferences. Homeownership builds equity, while renting offers flexibility and reduced responsibility,” explained Tomáš Kašpar, Vice President of the Association. According to Deloitte, apartment prices in the Czech Republic increased by 5.8% quarter-on-quarter in the final quarter of 2024, with the average price reaching CZK 110,100 per square meter — an increase of CZK 6,000 compared to the previous quarter. Price growth was most notable in the Hradec Králové and Karlovy Vary regions, while prices fell in the South Bohemian and Pilsen regions. In contrast, rents slightly decreased by 0.3% quarter-on-quarter at the end of 2024, with an average monthly rent of CZK 309 per square meter. More recent data show a 2.3% increase in the first quarter of 2025, bringing average rents to CZK 316 per square meter. Mortgage rates have also been gradually declining. According to Swiss Life Hypoindex, the average mortgage rate fell below 5% in early May 2025 for the first time since spring 2022, decreasing to 4.96%. The monthly installment for a CZK 3.5 million mortgage with 80% loan-to-value (LTV) and a 25-year term was CZK 20,381, representing a year-on-year decline of over CZK 1,100. Source: CTK