Czechia's economy is growing. So why does everything still feel expensive?

On paper, 2026 has brought some encouraging economic news in Czechia. Inflation has cooled to around two percent, unemployment remains among the lowest in the EU, and real wages, measuring growth in pay adjusted for inflation, are growing again.

For people managing rent, groceries and other everyday expenses, those improvements may not translate into feeling better off.

“The macro picture, looking at the economy as a whole, is strong,” says Jan Stránský, wealth manager at WOOD & Company, “but rankings measuring growth rates and averages don't show how far your particular salary goes at your local supermarket in your home town. They also do not capture how household incomes fare in the context of high borrowing costs and elevated property prices.”

Expats.cz spoke with Stránský to learn why this is the case, what it means for your finances, and how you can try to mitigate the effects.

Czechia’s strong economic performance is shown by a handful of indicators, including real wage growth of 4.3 percent year-on-year in the second quarter of 2026, and an unemployment rate that remains low at five percent, despite mild growth compared to last year.

GDP measures the total value of goods and services produced in an economy. GDP growth measures how that output changes over time.

“It’s solid, but it says little about how gains are distributed,” Stránský states. “Inflation is now back near the central bank's two-percent target. This is good news, but low inflation means prices are rising slowly, not falling. The painful price jumps that we saw 2022–2023 are now baked in.”

And what about real wage growth? “This is the star metric of 2026,” Stránský explains. “It means wages are finally outpacing prices, with the average gross salary now hovering around CZK 50,000.”

It sounds strange, but reading good news about the economy can actually make some of us feel worried about our own circumstances. Many will ask themselves an awkward question: if the economy is doing so well, why don’t I feel better off than before?

If you’re asking yourself this question, you’re not alone. Stránský points out three factors that explain the gap between the picture presented by the statistics and the real sentiments felt by people in Czechia.

First, averages mask the reality faced by the majority. “Roughly two-thirds of Czech employees earn below the average wage, with the overall figure pulled up by high earners, especially in Prague's tech and finance sectors,” Stránský says.

Second, the lost ground of earlier years hasn't been recovered. “Even after two years of real wage growth, purchasing power has not fully returned to pre-pandemic levels,” he adds. “Households are climbing out of a cost-of-living hole, not standing on an all-time financial peak.”

Third, incomes look very different in the context of exorbitant property prices. “Prague rents and property prices are among the highest in Europe relative to income,” the wealth manager explains. “The average monthly rent for a one-bedroom studio flat in Prague exceeds CZK 20,000 in inner-city locations and easily costs more depending on size and location.”

The imbalance is apparent. “When housing costs rise faster than wages, a salary raise doesn’t make you feel any richer,” Stránský adds.

The practical takeaway is that a stabilizing economy provides opportunities. Foreigners in Czechia must, however, draw the right conclusions from the rankings to make their money grow.

“The economy today rewards capital (what you own) more than labor (what you earn). This is why so many in Czechia feel like they aren’t participating in economic growth, and it's why investing is so crucial. If you can't beat rising asset prices, the next best thing is to own a piece of them,” Stránský concludes.

Should you want to reach out to Jan Stránský at WOOD & Company directly for a free investment consultation, he can be reached at jan.stransky@wood.cz.