PURCHASE OF REAL PROPERTY IN THE CZECH REPUBLIC
The original wording of the Foreign Exchange Act stated that the ownership title to real property in the Czech Republic could only be acquired by individuals and legal entities with their permanent residence or registered office within the territory of the Czech Republic. The only and frequently used way to acquire real property was to establish a Czech limited liability company, which subsequently carried out the purchase. Although this process was quite simple, it was an undue complication which unnecessarily increased the costs of the acquisition of real property in the Czech Republic and, moreover, it meant tax obligations on subsequent resale. Free and open real property market was one of the conditions for the accession to the European Union and, thanks to that, permanent residence was required only for purchase of agricultural land from May 2009 and all restrictions were finally lifted in June 2011.
FOREIGN NATIONALS PURCHASING REAL PROPERTY IN THE CZECH REPUBLIC HAVE THE SAME RIGHTS AND OBLIGATIONS AS CZECH NATIONALS
To enter into a purchase agreement and to have the ownership title registered in the Cadastral Register, it is sufficient to provide the data contained in a passport and the address of permanent residence anywhere in the world. The Cadastral Office usually registers the new owner in the Cadastral Register within 3 to 4 weeks of the submission of the relevant purchase agreements with notarized signatures. The progress of the proceedings may be monitored on the internet. After the conclusion of the proceedings, each party receives one copy of the purchase agreement with a stamp of the Cadastral Office as confirmation; and one copy remains filed in the archives, which are accessible to the public.
RISK-FREE PURCHASE OF REAL PROPERTY
The key factor of a safe purchase of real property in the Czech Republic is especially the manner of payment of the purchase price. The reservation fee, typically amounting to 3 – 5 % of the purchase price, is usually paid to the intermediary of the purchase in cash. The remaining part of the purchase price should always be paid through custody with a notary or attorney-at-law, or through an escrow bank account, on the basis of a special escrow agreement stipulating detailed conditions of when and how the amount is to be released from the escrow.
VISA
Ownership of real property in the Czech Republic entitles the nationals of non-EU member states to obtain Schengen Area visa for the whole family. This short-term visa authorises its holder to stay within the territory of the Schengen Area for a period of up to 180 days per year.