Czechia ranks fifth-worst in the EU for housing affordability: experts urge greater focus on renovation

Czechia has come in 23rd out of 27 EU countries for housing affordability — the fifth-worst result in the bloc. That's according to the 2025 Prosperity and Financial Health Index, whose experts, together with the Šance pro budovy alliance, warn that new construction alone won't solve the problem — the country needs to make far better use of renovating existing buildings.

According to the index, an average flat in Czechia costs a buyer 13.6 years' worth of salary, and a tenth of Czech households spend more than 40% of their income on housing. "Affordable housing today isn't just about how many flats we can build. Just as important is how we deal with the buildings we already have," says Marta Gellová, director of the alliance.

Not enough new flats

According to the Czech Statistical Office, 33,430 new flats were completed in the country in 2025. Yet, per the Ministry of Regional Development, more than 380,000 households are in need of affordable rental housing. The latest comparable OECD data show that social rental housing accounted for just 3.6% of Czechia's housing stock in 2021 — compared with an EU average of around 8%.

"Renovation is a very practical tool: it can cut running costs, improve living quality, and unlock the potential of buildings that already stand in Czech towns and villages," Gellová stresses.

The state wants to attract private investment

The Ministry of Regional Development is using several financial support mechanisms. Under the National Recovery Plan's "Affordable Housing" programme, three investment schemes worth a combined €320 million have been prepared, offering subsidised and subordinated loans as well as a capital fund. For individual projects, 30-year loans at 1–3% interest are available, along with support of up to CZK 300 million per project.

"Early results from the affordable housing programmes show growing interest not just from municipalities and public investors, but increasingly from private investors, for whom affordable rental housing is becoming an attractive investment," says ministry representative Milan Hladík. He notes that state support is meant to act as a catalyst — lowering risk and drawing in private capital.

Housing isn't just about rent and mortgages

Šance pro budovy insists that households pay not only for rent or mortgage repayments, but also for heating, electricity and repairs — and a building's energy efficiency directly affects those final costs. Czechia already spends relatively heavily on housing construction — 5.6% of GDP, the sixth-highest share in the EU — yet affordability keeps worsening year after year.

Renovation needs a plan, not improvisation

One key problem is that renovation is often treated as a one-off fix: owners replace windows, roofs or heating systems as the need arises, without a long-term plan, leading to inefficient decisions that last for decades.

"Too often we renovate by copying what the neighbours did, rather than basing decisions on the building's actual condition and a family's long-term needs. We need better renovation passports, stronger independent energy consulting, and predictable financing tools," says Michal Čejka of the Passive House Centre.

"Investment costs make up only 14% of a building's total lifecycle expenses. The goal is to make housing affordable not just at move-in, but over the long run," Marta Gellová concludes.

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Around Prague, based on reporting by ekolist.cz