The high proportion of homeownership in the Czech Republic has several significant national economic implications that are rarely discussed in society. The high level of investment in real estate for residential purposes prevents people from sufficiently participating in the appreciation of investments in the capital market. On the other hand, the positive impacts of being a home owner are an important factor in setting pension policies, that economic policymakers must consider.

Key Takeaways:

• In the European Union, an average of 70% of people live in owned housing, while in the Czech Republic, it is 76%. This high proportion is typical for post-communist countries.
• An important issue for policymakers is whether retirees have to pay rent from their pension. The average rent for 60 m² is 18,540 CZK, which is one pension (20,653 CZK).
• In the case of real estate investments, it is important to consider their non-productivity (i.e., that they do not generate additional cash flow) and the lower long-term appreciation compared to investments in the capital market.

Analysis –Martin Zeman

The analysis is in PDF under the link below.