Prague apartment rental prices rose by around 20 percent in 2022

While rental prices across the Czech Republic did not see a surge alongside year-on-year inflation in 2022, Prague was an unfortunate exception, according to data provided by property management server UlovDomov.cz to Czech News Agency. Rents in the Czech capital were up by an average of around 20 percent over the past year.

The average rent for a 2+kk (two rooms and a kitchen corner) apartment in Prague is now CZK 17,940 per month, according to the data. That represents an increase of CZK 2,777 per month, or about 18 percent year-on-year.

Other flat sizes saw an even bigger increase. The average rent for a 1+kk apartment in Prague rose by 2,349 last year, and rents for a 3+kk were up 5,129 per month in 2022. Both sizes saw year-on-year increases of about 22 percent.

Rental prices in Prague over the past year rose by more than the country's rate of inflation, which has hovered between 14-18 percent since May. However, other cities in the Czech Republic did not see nearly as big a rise in rents.

In Brno, for example, the average monthly rent for a 2+kk apartment rose by CZK 672 in 2022, according to the to the provided data, which represents a year-on-year increase of only six percent. In Plzeň, rents increased by an average of seven percent, and in Olomouc, they rose by up to 12 percent.

"Even though rents increased last year, the increase in prices in most cities ended up below the inflation level," UlovDomov.cz's Michal Hrbatý told Czech News Agency. "So it was not comparable to the jump in energy prices, for example, which for some households rose by more than 100 percent."

According to real estate analysts, the increase in rents is largely a result of the increase in Czech mortgage rates. Those looking at housing options are currently opting to rent instead of taking out a large mortgage, resulting in more competition on the rental market and an increase in prices.

Because Prague's property costs are already so much higher than other cities, the Czech capital is seeing even more competition on the rental market.

According to analysis conducted by UlovDomov.cz, a 30-year mortgage on a 60 square meter Prague apartment at current rates would come out to around CZK 42,000 crowns per month. That's around 2.4 times the monthly cost of the same flat on the rental market, which would be about CZK 18,000.

In Olomouc, meanwhile, the cost of taking out a mortgage at current rates would be about 1.8 times the cost of renting. In Ostrava, a mortgage would only come out to about 1.4 times the cost of current rents.

For Prague renters, the news isn't all bad. Rental prices actually fell in the fourth quarter of 2022, with the average rent for a 2+kk down CZK 850 compared to the third quarter of last year.

As always, the lack of available properties on the market, and few new developments on the horizon, remains a problem in the Czech capital.

"It would help if the city districts had a uniform and transparent approach to negotiations with developers," Dana Bartoňová, business director for property developer YIT Stavo, told Czech News Agency regarding the situation in Prague.