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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.

From 3+kk flat for sale, 102 m²: its asking price, floor area and Bytky's rent estimate. Open the listing

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

7,798,000 Kč of your own money. Under 36, banks may lend up to 90%.

Worked out for 102 m²: repair fund, administration, insurance and property tax.

Over the years

Buy: after 10 years25.5M Kč

Rent: after 10 years30.5M Kč

The result

Renting comes out ahead over 10 years: you'd have 5,042,800 Kč more than if you bought.

A month in the first year

Buying
183,554 Kča month
Renting
50,044 Kča month
Buying
Mortgage: 166,303 Kč · Owner's costs: 2,880 Kč · Upkeep: 16,246 Kč · Tax relief: −1,875 Kč
Cash on day one
7,815,000 Kč
Mortgage: 31,192,000 Kč

What you'd have after 10 years

If you buy
25,501,031 Kč
If you rent
30,543,831 Kč
Break-even
Not within 10 years
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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
140,159,700 Kč30,726,809 Kč2,202,648 Kč600,528 Kč8,228,100 Kč9,759,294 Kč
241,364,491 Kč30,238,112 Kč2,209,524 Kč618,540 Kč9,885,444 Kč11,770,021 Kč
342,605,426 Kč29,724,718 Kč2,216,616 Kč637,104 Kč11,602,545 Kč13,849,496 Kč
443,883,589 Kč29,185,381 Kč2,223,924 Kč656,208 Kč13,381,700 Kč16,000,139 Kč
545,200,096 Kč28,618,789 Kč2,231,448 Kč675,900 Kč15,225,304 Kč18,224,419 Kč
646,556,099 Kč28,023,566 Kč2,239,200 Kč696,180 Kč17,135,850 Kč20,524,913 Kč
747,952,782 Kč27,398,263 Kč2,247,180 Kč717,060 Kč19,115,936 Kč22,904,293 Kč
849,391,365 Kč26,741,361 Kč2,255,400 Kč738,576 Kč21,168,263 Kč25,365,310 Kč
950,873,106 Kč26,051,262 Kč2,263,872 Kč760,728 Kč23,295,651 Kč27,910,838 Kč
1052,399,300 Kč25,326,290 Kč2,272,596 Kč783,552 Kč25,501,031 Kč30,543,831 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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