Average Czech mortgage rate unchanged at 4.91% in early December

The average mortgage rate in the Czech Republic remained at 4.91% at the start of December, the same level recorded since October and the lowest since April 2022. According to the Swiss Life Hypoindex, which tracks banks’ advertised rates for loans covering up to 80% of a property’s value, the average has fallen by roughly a third of a percentage point over the course of this year.

“Even December has not brought a change to the mortgage market, rates continue to stand still. The market thus characterizes stagnation, although individual special offers of banks work with individual discounts, but average rates are kept below the five percent threshold without a more noticeable movement in both directions. For clients, this means an environment in which monthly payments are still relatively high, but at the same time there is no risk that the parameters of mortgages provided will change fundamentally from month to month,” said Jiří Sýkora, analyst at Swiss Life Select.

Sýkora noted that developments in 2026 will depend largely on the Czech National Bank’s monetary policy, inflation trends and the broader economic outlook. “If inflation continues to move closer to the inflation target and the central bank is not forced to enforce more restrictive conditions, banks may reach for a slight further rate cut during 2026, typically in the order of tenths of a percentage point, not a full percentage. That is why it is not possible to expect a significant movement of rates next year, but rather a continuation of the current very gradual trend,” he said.

He added that a moderate rise in residential property prices remains the most likely scenario for 2026, though at a slower pace than during the market boom before 2022. In larger cities and sought-after areas, demand and limited supply may continue to lift prices, while tighter financing conditions could reduce investor activity in the buy-to-let segment. “For next year, we expect mortgage rates to move mostly in the four percent band, with possible shifts in the order of tenths of a percentage point. However, mortgages for two percent will remain only a memory in 2026,” Sýkora estimated.

At the start of December, the monthly repayment on a 3.5 million CZK mortgage with an 80% LTV, a 25-year maturity and the average offered rate of 4.91% remained effectively unchanged at around 20,285 CZK.

Source: CTK