Mortgages and building law in Brno – Real Estate Week 14 Sep 2026

Welcome to another edition of Real Estate Week — my Monday look back at what happened to mortgages, housing and construction here in Brno and across South Moravia over the past seven days. As always, in plain language, with no scare stories. You will find all the hard numbers at the end of the article.

This week had two big stories. Czech mortgages got more expensive again — even though the Czech National Bank is not moving its rates. And the Chamber of Deputies overrode the Senate and confirmed the amendment to the Building Act that has been debated all summer. On top of that, a survey confirmed what I hear from clients almost every day: housing is people's number one concern.

Czech mortgage rates in September 2026: up for the sixth time in a row

Let me start with what affects the most people. According to the Swiss Life Hypoindex, the average offered mortgage rate climbed to 5.51 % in September. In spring it still looked like mortgages would keep getting cheaper — in March the rate was 4.89 %. Since then it has risen by more than half a percentage point, and according to economist Lukáš Kovanda it is now at its highest level since June 2024.

Banks confirm it in practice. Česká spořitelna raised rates on all fixation periods from 11 September — by a tenth of a percentage point on the one-year fixation and by three tenths on all others. Its lowest rate (with all discounts) now starts at 5.39 %.

What does that mean in crowns? For a model mortgage of CZK 3.5 million over 25 years, today's monthly payment comes to roughly CZK 21,500 — almost CZK 1,300 a month more than in March.

Why Czech mortgages are rising when the central bank is not raising rates

I get this question a lot right now. The answer is that the price of a mortgage is not set by the CNB's base rate alone. For longer fixations, banks effectively "buy" money on the financial market, and its price follows mainly interest rate swaps. This year, those are being pushed up by more expensive oil and gas, fears of inflation returning and geopolitical uncertainty.

For context: Czech inflation is still under control — 1.9 % in August according to the Czech Statistical Office. But markets look forward, not back. The CNB board meets on 17 September; according to Kovanda, a rate hike is not the baseline scenario, but its probability is somewhat higher than a few weeks ago.

Swiss Life Select adds a useful thought: autumn may not bring cheaper mortgages, but it may bring "more interesting" ones. Banks traditionally compete harder for clients in autumn — only this year it is more likely to be targeted offers for a specific fixation, refinancing or creditworthy clients than across-the-board cuts.

What it means for buyers: do not expect rates to drop back below five percent by the end of the year. Calculate your payment at today's rate and get offers from several banks — the differences between them are currently bigger than any average shows.

What it means for sellers: buyers with a mortgage have a slightly smaller budget than in spring. They have not disappeared, but they calculate more carefully — a price that worked in March may not go through today without negotiation.

New Czech Building Act 2026: what it changes for construction in Brno

The second big story. On 9 September the Chamber of Deputies overrode the Senate and confirmed the coalition amendment to the Building Act. The Senate had rejected it in August; it now goes to the President for signature.

What the amendment brings, in a nutshell:

• One office, one procedure, one stamp. Building permits are to be unified under a centralised state building administration.
• Appeals will no longer be "sent back". The superior authority will have to decide itself and will not be able to return the case for a new hearing — today one of the biggest time-wasters.
• Regional capitals will be able to issue their own building regulations. That includes Brno.
• Large residential projects as reserved structures. Buildings for mass housing with a floor area of 10,000 m² or more will be classed as reserved structures, and their construction will be in the public interest by law.

Opinions differ sharply. The Czech Chamber of Commerce calls it a "necessary but not sufficient" condition and warns that everything will depend on moving experienced officials into the new authority and finishing the digitalisation. The opposition and some senators, on the other hand, see the law as written for developers.

What it means for us in Brno: nothing in the short term. Flats that will be completed in Brno and the surrounding area over the next two or three years already have their permits. If the reform really does shorten permitting, it will show up in the supply of new-builds only in several years — and the transition period, while the authorities are being restructured, may actually slow some projects down for a while.

What it means if you are building yourself: if you are planning a family house or an extension, watch when the amendment takes effect and what transitional provisions it contains. A procedure already under way may follow different rules than a new one. This is exactly where you should check the specific process with your architect or the building authority.

Housing affordability in the Czech Republic: problem number one

The third item is more of a mood barometer, but a telling one. According to a survey commissioned by developer Central Group and presented at the Affordable Housing Summit, 49 % of people consider housing affordability the country's biggest problem. Healthcare and social services come second, far behind at 18 %.

From the state, people most often expect more public rental housing, subsidised loans for young people and faster building permits. KPMG added an interesting figure: Czechs hold around CZK 3.5 trillion in investment flats, roughly a third of all their savings.

Tenants feel it too. According to the Czech Statistical Office, rents in August were 6.1 % higher year on year — much faster growth than prices overall.

What it means for buyers: if you rent in Brno and are considering your own home, compare your rent honestly with a mortgage payment plus the costs of ownership (maintenance fund, insurance, property tax). Rising rents and more expensive mortgages shift that equation in both directions, so use today's numbers, not last year's.

What it means for landlords: rents are growing faster than prices overall, but tenants have their limits too. Set the rent according to what actually gets rented in your part of Brno, not according to the highest listings — an empty month costs more than a small discount.

What does it mean for foreigners on the Czech real estate market?

Nothing new specifically for foreigners this week — the same rules apply for Czech, EU and non-EU citizens. The rise in mortgage rates, the Building Act amendment and the CNB decision below apply to everyone identically.

Since that comes up often, here is the evergreen picture that has not changed:

• Who can buy. Any natural person, regardless of citizenship, can buy a flat, a house or land in the Czech Republic in their own name. There is no permit requirement and no residence requirement for ordinary residential property. The same purchase contract, the same cadastral registration and the same rules apply to you as to a Czech buyer.
• Mortgages are the real difference. Banks, not the law, set the limits here. In practice, applicants with EU citizenship and Czech income are treated close to domestic clients, while non-EU applicants are usually asked for a residence permit, income documented in the Czech Republic and often a lower loan-to-value ratio. Bank policies differ significantly, so it is worth comparing several — and with rates rising, the gap between offers matters even more.
• Everything runs in Czech crowns. Purchase prices, mortgages and cadastral records are in CZK. If you earn in another currency, the exchange rate is a real risk over a twenty-year loan, and a mortgage in a currency other than your income has its own legal regime and warnings under Czech consumer credit law.
• Get it checked. Contracts and cadastral entries are in Czech and the Czech version is what binds you. Have the purchase contract and the escrow arrangement reviewed by a Czech lawyer, and your financing by your bank, before you sign anything. This article is general information, not legal or financial advice for your specific situation.

Briefly from the CNB and legislation

• The CNB kept the countercyclical capital buffer at 1.5 %. For an ordinary client this is a "background" tool, but one point from the statement is worth noting: household lending remains high and the CNB is ready to raise the buffer further. At the same time, it notes that banks are not loosening lending standards across the board.
• In the Collection of Laws, nothing related to property, rentals or the land registry was published this week. The Building Act amendment has not yet appeared in the Collection — after the vote it went to the President for signature.

💡 Tip of the week

Is your mortgage fixation ending this year or next? Do not wait for the letter from your bank. Autumn is exactly when banks run targeted refinancing offers — and you will not find those in averages, only in specific quotes. Ask at least two or three banks, and with four numbers on the table (rate, fees, insurance, discount conditions) you negotiate very differently than with one.

For those who like numbers

I promised hard data — here it is, with sources:

• Swiss Life Hypoindex, September 2026 (published 9 Sep 2026): average offered rate (LTV up to 80 %) 5.51 %, +0.09 pp vs August, +0.62 pp since the March low of 4.89 %. Rates by fixation (LTV up to 80 % / over 80 %): 1 year 5.29 % / 5.58 %, 3 years 5.27 % / 5.58 %, 5 years 5.51 % / 5.82 %, 10 years 5.99 % / 6.24 %. Model mortgage CZK 3.5 million over 25 years: payment approx. CZK 21,520, almost +CZK 1,300 a month vs March. In August, some banks raised rates on selected fixations by 0.2–0.4 pp (Jiří Sýkora, Swiss Life Select). (source: Hypoindex.cz)
• Česká spořitelna, rates from 11 Sep 2026 (LTV up to 80 %, with discounts): 1-year fixation 5.29 → 5.39 %, 2 years 5.09 → 5.39 %, 3 years 5.09 → 5.39 %, 4 years 5.19 → 5.49 %, 5 years 5.29 → 5.59 %, 8 years 5.49 → 5.79 %, 10 years 5.69 → 5.99 %, 15 years 5.89 → 6.19 %, 20 years 6.09 → 6.39 %. "American mortgage" from 5.89 %. The rates include discounts for repayment from a Česká spořitelna account (0.5 %), for the green "Hypotéka pro budoucnost" (0.1 %) and for payment protection insurance (0.1 %). (source: Hypoindex.cz, 8 Sep 2026)
• Why mortgages are rising (commentary by Lukáš Kovanda, Trinity Bank): mortgages rose for the sixth time in a row and are at their highest since June 2024, when the CNB repo rate was 5.25 %; today it is 3.75 % (since June 2026). The CNB estimates that changes in the five-year interest rate swap (IRS) pass through to housing loan rates with a peak after about four months, with a long-term pass-through of 60 to 100 %. A CNB rate hike at the 17 Sep 2026 meeting is not the author's baseline scenario, but its probability has increased. (source: Hypoindex.cz, 10 Sep 2026) Tom Kadeřábek (Swiss Life Select) expects stagnation to a slight increase in mortgage rates over a six-month horizon. (source: Hypoindex.cz, 14 Sep 2026)
• Inflation, August 2026 (Czech Statistical Office, published 10 Sep 2026): consumer prices +1.9 % year on year (1.7 % in July), +0.3 % month on month. Rents (new and existing contracts) +6.1 % year on year, +0.4 % month on month. Materials and services for minor home repairs and maintenance +5.4 %, water supply +3.9 %, sewerage +3.8 %. Electricity −11.2 %, natural gas −4.8 %. Owner-occupied housing costs (imputed rent) +5.4 %. Average 12-month inflation rate 2.0 %. (source: CZSO, Consumer Price Indices – August 2026, in Czech)
• Building Act amendment: on 9 Sep 2026 the Chamber of Deputies overrode the Senate's rejection by 104 votes to 53; the law goes to the President for signature. Contents include: a centralised system of state building authorities, a single merged procedure, the appellate body may not return a case for a new hearing, regional capitals may issue their own building regulations, spatial planning within the independent competence of municipalities and regions, mass housing buildings with a floor area of 10,000 m² or more as reserved structures in the public interest, and an exception allowing illegal structures to be retained. (source: ČTK / ČeskéNoviny.cz, 9 Sep 2026, in Czech) Position of the Czech Chamber of Commerce (Zdeněk Zajíček). (source: Hypoindex.cz, 11 Sep 2026) The Ministry for Regional Development's response to senators' objections (incl. the "fiction of approval"). (source: MMR, 8 Sep 2026)
• Affordable Housing Summit, 9 Sep 2026: housing affordability is the biggest problem for 49 % of people in the Czech Republic (54 % in Prague); healthcare and social services second at 18 %. People expect the state to invest more in public rental housing (49 %), provide subsidised loans for young people (48 %) and speed up permitting (42 %). The survey was commissioned by Central Group. Czechs hold investment flats worth around CZK 3.5 trillion, about a third of their savings (Pavel Kliment, KPMG). Government commissioner Hana Landová estimated the cost of inefficient permitting at CZK 2,000 to 4,000 a year per citizen. (source: Hypoindex.cz, 10 Sep 2026)
• CNB, countercyclical capital buffer (10 Sep 2026): rate kept at 1.5 %; household lending remained high in H1 2026, and according to the Bank Board the probability of a further increase has risen. Next decision in November 2026. (source: CNB, in Czech)

A side note: the Financial Administration did not issue any property-related press release last week, and there was nothing on property, rentals or the land registry among the Constitutional Court's decisions. The Ministry for Regional Development's news concerned EU funds and cross-border cooperation, not South Moravia or housing directly.

Thanks for reading. See you next week with whatever the market brings.

— Pavel Maloušek, Realiťák Brno