Czech Republic Property Ownership

While a real estate register exists as a depository for property conveyances, mortgages, etc., this information is not universally guaranteed and the process of documentation is slow.

Czech Republic Transaction Information

Transactions are documented in the real property register. Transaction documents (contracts) form the basis for real property conveyances since deeds are not used.

Czech Republic Trade Associations

Asociace realitních kancelárí Ceske republiky (ARK CR)
Na Chodovci 3
Praha
4
CZ-14100
Czech Republic

Phone : +420 272 762953
Fax : +420 272 766401
e-mail : arkcr@arkcr.cz
Web : www.arkcr.org

The Association of Real Estate offices of Bohemia, Moravia and Silesia was founded in 1991 by 17 real estate firms. From March 2002 the name was changed to Association of Real Estate Offices of the Czech Republic. At present time there are around 200 members - firms, which mean about 1200 individuals working as real estate brokers as members of ARK CR.

Czech Republic Land Rights

Under Czech law, buildings are not considered part of land, however, trees and growing crops are considered part of the land. Nevertheless, ownership of land and buildings must be registered.

Foreign ownership of real property is allowed. The state guarantees equal protection of ownership and other rights to real property for foreigners.

The Czech Republic retains certain rights in real property such as escheat and the right to levy real estate taxes.

Real property owned by one spouse before marriage remains separate property. Property acquired during marriage is considered joint in most instances. There is not homestead protection under Czech law.

Czech Republic Forms of Ownership

Real property in the Czech Republic may be owned in severalty or concurrence. Concurrent forms of ownership include General Partnerships (Verejna Obchodni Spolecnost); Limited Partnerships (Kommanditni Spolecnost); Limited Liability Companies (Spolecnost s Rucenim Omezenym) and Joint Stock Companies (Akcioua Spolecnost).

Czech Republic Real Estate Info Summary

Title & Contracts in Czech Republic:

Deeds, in a common law form, do not exists in the Czech Republic. Ownership of real property is transferred upon the recordation of a duly executed contract in the real estate register. real property can be conveyed upon death via a will. There is no form of title insurance in the Czech Republic, and the recordation process is uncertain and not guaranteed. Generally, poor record keeping makes it difficult to determine whether one has undisputed ownership to real property.

All rights and interests in real property must be registered in the real estate register.

Contracts in the Czech Republic are concluded when an offer is accepted. Contracts may be either oral or written, however written form is required if the contract relates to a property transfer. Contracts concerning real property are construed under the laws of the district where the property is situated.

Property Taxes:

Real estate tax is payable by the registered owner of land or buildings located in the Czech Republic.If ownership cannot be determined, real estate tax is payable by the user of the land/property.

In practice, the user of land/real estate bears the burden of the tax, either directly or through increased rent. All owners of real estate must file a real estate tax return with the Tax Office if any change to the real estate since the previous year has occurred.

Though tax is payable annually, no additional return needs to be filed unless the nature or ownership of the real estate changes.

Real estate transfer tax is levied on the sale or transfer of real estate. The tax rate is 3% and is levied on either the transfer price or the officially assessed value, whichever is higher. The tax is normally payable by the seller, with the purchaser acting as guarantor.

Czech Republic Mortgages & Financing

Real property may be mortgaged as security for a debt in the Czech Republic. Mortgage contracts must be written and entered into the real estate register in order to be effective. Most mortgages are established on the basis of debentures and mortgage bonds are issued. Date of entry into real property register determines priority.