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Should you rent or buy?

Put the same home side by side: bought with a mortgage, or rented while the money you'd have put down is invested. See which leaves you better off, and from which year.

A typical 55 m² two-room flat in Frýdek-Místek, at the area's median asking price and rent per m² today. See Frýdek-Místek's market

Start from an area

Pick a town, district or neighbourhood and a layout. The price and the rent become the area's medians today.

The home

Without the charges for services (heating, water, the lift).

If you buy

746.000 Kč of your own money. Under 36, banks may lend up to 90 %.

Worked out for 55 m²: repair fund, administration, insurance and property tax.

Over the years

Buy: after 10 years2,6 Mio. Kč

Rent: after 10 years1,8 Mio. Kč

The result

Buying comes out ahead from year 2. After 10 years you'd have 855.734 Kč more than if you rented.

A month in the first year

Buying
17.264 Kča month
Renting
13.000 Kča month
Buying
Mortgage: 15.910 Kč · Owner's costs: 1.630 Kč · Upkeep: 1.554 Kč · Tax relief: −1.830 Kč
Cash on day one
763.000 Kč
Mortgage: 2.984.000 Kč

What you'd have after 10 years

If you buy
2.626.810 Kč
If you rent
1.771.076 Kč
Break-even
Year 2
Homes for sale in Frýdek-MístekHomes to rent in Frýdek-Místek

What you'd have at each year's end

Year by year

Year by year
YearHome valueStill owedPaid to ownPaid in rentBuying: you'd haveRenting: you'd have
13.841.900 Kč2.939.491 Kč207.166 Kč156.000 Kč803.020 Kč861.885 Kč
23.957.157 Kč2.892.733 Kč208.656 Kč160.680 Kč978.036 Kč961.428 Kč
34.075.872 Kč2.843.612 Kč210.186 Kč165.504 Kč1.159.378 Kč1.061.541 Kč
44.198.148 Kč2.792.010 Kč211.770 Kč170.460 Kč1.347.278 Kč1.162.159 Kč
54.324.092 Kč2.737.800 Kč213.409 Kč175.584 Kč1.541.982 Kč1.263.178 Kč
64.453.815 Kč2.680.850 Kč215.116 Kč180.852 Kč1.743.746 Kč1.364.525 Kč
74.587.430 Kč2.621.022 Kč216.880 Kč186.276 Kč1.952.831 Kč1.466.100 Kč
84.725.052 Kč2.558.170 Kč218.690 Kč191.856 Kč2.169.511 Kč1.567.789 Kč
94.866.804 Kč2.492.142 Kč220.594 Kč197.616 Kč2.394.072 Kč1.669.496 Kč
105.012.808 Kč2.422.776 Kč222.535 Kč203.544 Kč2.626.810 Kč1.771.076 Kč

Thinking of letting it instead? Work out its cash flow

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How the comparison works

The same home, bought or rented, month by month for the years you stay. Money is never left idle: whoever pays less in a month invests the difference, and both earn the same return.

What it counts

  • Buying: the down payment and the purchase costs on the first day, then each month the mortgage, the owner's costs and upkeep. The home's value grows each year.
  • Renting: the rent, rising once a year. The charges for services are left out, because owners pay them too.
  • The renter invests what the buyer put down on day one. After that, each month, whichever side pays less invests the difference.
  • At each year's end the buyer sells: the home's value, less the mortgage still owed and the selling costs, plus their investments. The renter has their investments.
  • Mortgage interest on your own home lowers your income tax base, up to a yearly cap; the saving comes back once a year with the tax return.

What it leaves out

  • Inflation: everything is in today's crowns as they'll be paid, not adjusted to today's value.
  • Rate changes: the rate stays the same for the whole term, though real mortgages are re-fixed every few years.
  • Moving and furnishing, which both sides pay.
  • Tax on investment gains: shares and funds held for over three years are free of income tax in Czechia.
  • Risk: a home's value and investments can fall as well as rise, and neither is certain.

Every starting figure and its source

Verified figures come from the law or the ČNB, checked on the date shown. Assumptions are typical values: change them to yours.

Questions

Questions about renting or buying

Is it better to rent or buy in Czechia?

It depends on three things: how many years of rent the home costs, how long you'll stay, and what your money would earn elsewhere. Where homes cost many years of rent, renting and investing the difference can leave you ahead for a long time; where rents are high against prices, buying catches up sooner. Put in your own figures, or start from an area to use its live medians.

How long do I need to stay for buying to pay off?

The calculator shows the break-even year: the first year's end from which selling would leave you better off than having rented. Buying costs about 17.000 Kč in fees up front and selling about 3 % of the price at the end, so short stays favour renting.

What does an owner pay that a tenant doesn't?

The building's repair fund, its administration, insurance of the home, the yearly property tax and repairs inside the home. Tenants and owners both pay the charges for services such as heating and water, so the calculator leaves those out.

Can I deduct mortgage interest from my taxes?

Yes, for your own home. The interest lowers your income tax base by up to 150.000 Kč a year for loans from 2021, or 300.000 Kč for older ones, which saves 15 % of the interest you deduct. The calculator assumes you pay at least that much income tax in Czechia; switch the relief off if you don't.

How much do I need to put down?

At least 20 % of the price. The ČNB caps a mortgage at 80 % of the home's value, or 90 % for applicants under 36. On top come the purchase costs: the cadastre fee and a lawyer for the contract and escrow.

Is this financial advice?

No. It's a model with the assumptions shown on this page. A mortgage adviser can tell you what a bank would actually lend you and at what rate.

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