The residential real estate market in the Czech Republic continues to grow rapidly, recording new historical price highs. In the second quarter of 2025, housing prices surged by 17% compared to the same period last year, nearly doubling the pre-COVID level. This trend has made the real estate sector one of the main drivers of inflation, and the possibility of purchasing a home is becoming increasingly inaccessible for many Czechs.
This is reported by Finway
Regional Price Trends and Records in Prague
According to Prague Daily, the average price per square meter of housing in the Czech Republic from April to June 2025 was 81,117 crowns (3,305 euros), which is 16.3% higher than the same period in 2024. The increase has continued for six consecutive months. The highest price increases were recorded in the Moravian-Silesian (+26%), Ústí (+24%), and Hradec Králové (+22%) regions. The Liberec region experienced the smallest price increase at 9%. None of the regions showed a decrease in housing prices.
In the capital of the Czech Republic, prices for apartments in new buildings also set a new record. For the first time, the average asking price exceeded 170,000 crowns (7,000 euros) per square meter (an increase of 8.8%), while the actual price was 165,019 crowns (6,700 euros), which is 12.3% more than a year ago.
Demand for Micro-Apartments and Lack of New Developments
The structure of purchasing demand is changing. Interest in micro-apartments is growing — this segment has increased by 56%, and in Prague, over 400 such properties entered the market in the second quarter of 2025. At the same time, the average selling time for a micro-apartment has decreased by 41% and is now less than two months, which is significantly faster than for other categories of housing.
As of the end of June, there were about 5,750 new apartments on the market (an increase of 7.5% for the quarter), but mainly due to older projects. Experts note that to stabilize the market in Prague, about 10,000 new apartments need to be introduced annually. Without accelerating the permitting processes, the supply shortage will continue to pressure prices.
The mortgage market is also showing dynamics: in June 2025, the average rate for new mortgage loans reached 4.56%, and the volume of loans issued increased by 50% — to 150 billion crowns (6 billion euros).
The Czech National Bank has halted the cycle of interest rate cuts that lasted for a year and a half, trying to curb further increases in housing prices.
According to Deputy Governor Eva Zamrazilova, the perception of real estate as a “risk-free” asset creates dangerous illusions. She urged the government to reconsider taxation approaches and limit foreign investments in housing, as well as to offer banks alternative investment products to reduce pressure on the real estate market.