Tuesday, 14 October 2025
The Czech mortgage market remained active in early autumn, with banks and building societies recording one of the strongest months of 2025. According to data from the Czech Banking Association’s Hypomonitor, lending volumes rose in September compared to the summer average, continuing the recovery trend that began in the second quarter.
The total value of new mortgage loans reached an estimated CZK 37 billion, driven by higher demand from homebuyers and refinancing clients. Compared with August, lending increased by around 14 percent, marking one of the highest monthly totals since 2021. Industry analysts note that buyers are taking advantage of stable interest rates and increased competition among lenders before potential rate adjustments later in the year.
Interest rates for new mortgages remained near an average of 4.5 percent, little changed from August, and roughly half a percentage point below last year’s level. Although swap rates — which influence long-term borrowing costs — have eased slightly, financial institutions say the broader cost of money in the interbank market remains elevated, limiting room for deeper rate cuts.
Economists suggest that steady rates, together with a mild improvement in purchasing power, have encouraged both buyers and banks to re-enter the market. “The mortgage sector has regained much of its dynamism,” said one Czech banking economist, pointing to stronger household confidence and the return of developers launching postponed projects.
The average new mortgage in September exceeded CZK 4 million for the first time, reflecting both rising property prices and borrowers’ ability to stretch loan amounts under current income limits. Refinancing activity also picked up, accounting for roughly one-fifth of all mortgage lending.
Despite the renewed momentum, experts caution that further growth will depend on how quickly the central bank begins reducing its main policy rate. If monetary policy remains tight and real estate prices stay high, the autumn revival may slow heading into 2026. For now, however, September confirmed that the Czech mortgage market is on steadier ground than at any point since the downturn of 2023.
Source: CTK
