2020 is the best time for a property purchase in the Czech Republic
This year has significantly changed our lives. The corona-crisis has negatively affected many sectors of the economy – the unemployment rate has increased, some business areas have hard times, and some people have real financial problems. However, it is worth noting that since the beginning of the year, there have occurred many positives, particularly in the real estate market. Analysts believe that 2020 is the best time for real estate purchase in the Czech Republic. Let's figure out why - together.
- Cancellation of the 4 % real estate purchase tax
The government approved the cancellation of the four percent tax on the purchase of real estate. Moreover, the tax will be refunded to those who bought the property after December 2019. The cancellation of the tax means that the real costs of real estate purchase will be significantly lower.
- Simplifications of the conditions for mortgages obtaining by the Czech national bank
From April 2020, there are new simplified requirements for obtaining a mortgage in the Czech Republic. So, the minimum down payment was reduced from the existing 20 to 10 percent. The requirement of the relation of total net income to the monthly mortgage payment was increased from the existing 45 to 50 percent. And the ratio of total debt to total net income no longer matters when issuing a mortgage. The new conditions allow more people to get a mortgage.
- Maintaining the possibility of receiving a tax deduction on the mortgage interest rate
Despite the adoption of a new law on the cancellation of the real estate purchase tax, the right for a tax deduction of mortgage interest still remines.However, it is worth noting that the maximum deduction amount will be reduced from 300 thousand CZK to 150 thousand CZK per year.
Thus, the current situation is optimal for those who decided to buy a property right now.
