You will have seen the colourful historic buildings of the Old Town Square in Prague, and the chocolate box images of the rural landscape of the Czech Republic, but have you ever considered purchasing property in this country that perfectly merges historical with contemporary.
Where is the best place to invest and why?
There’s no shortage of places to invest in the Czech Republic, from the architecturally significant capital Prague to Brno, the second largest city in the country and a thriving business community. It may be tempting to invest in property in the capital but it doesn’t represent as sound a financial proposition as investment in the rest of the country. Property prices are higher and it may take 10 years before you see any significant return on your investment.
On the other hand, the remainder of the country is rich with property that can bring returns of between six and fifteen per cent. There are even bigger rewards to be had if you have the financial wherewithal to invest in larger properties such as ski chalets and bigger family homes. There’s a good reason for this; the fact that a lot of property can be purchased for half the price of similar property in countries such as Austria, Germany and the UK.
What is the main pitfall?
You need to be aware that there is plenty of fraud about in the Czech property market; be aware and be prepared. Do not make the mistake that your attorney and real estate agent will necessarily protect you; you may be right but this is not necessarily the case. You have a responsibility to research the market you are entering into and the correct procedures to follow when you’re making a purchase.
The purchase process can be lengthy
While the process of purchasing property in the Czech Republic is not complicated it can be lengthy. In essence it’s similar to the process in a lot of countries. Once an offer has been accepted the buyer pays a deposit which is held in escrow until the contract to purchase is signed. If you are buying a property it’s at this point that your attorney will carry out searches on the property. If the outcome of the search is positive then the purchase contract is signed. It’s at this point that the Land Registry becomes involved and it can take a few months for the registration to actually be completed. It’s important to note that the remainder of the purchase price is held in escrow until the registration is complete.
If you’re willing to invest the time and patience in the Czech property market it’s certainly a place where you can see good returns on your money. It’s worth noting that, in addition to the purchase costs, you’ll need to allow for costs and taxes which normally equate to approximately ten per cent of the purchase price.