To Rent or To Buy in Brno?
This article was written by Monika Souza, a European Financial Planner. With over 10 years of experience, she advises expats living in Brno on investments, pensions, mortgages, and long-term wealth strategies.
A mortgage is more than a loan. Often, it is a decision as to where you will pay to live for the next thirty or more years. You will be paying someone either way, a bank or a landlord, so the real question is who gets your money.
Most of my clients fall into one of two groups, with very different needs:
1] The expat who decided to stay in Brno
I am currently helping an expat family find a home and arrange their mortgage. They know they want to stay in the Czech Republic: their children are growing up here and they want a stable life in one place.
For them, buying makes sense, and even with the mortgage, they still have:
- an emergency reserve;
- money for repairs and unexpected expenses;
- sufficient monthly flexibility;
- and space in their budget for the long term.
Owning a home can be part of a retirement plan, but it should not be the entire retirement plan.
Mortgage rates today (summer 2026) are around 5%. Many people see a rate close to 5% and immediately think it is a bad time to borrow. I do not necessarily agree.
The length of the mortgage can make a surprisingly big difference to the monthly payment.
Here is a calculation on a loan of CZK 8,000,000 at 4.99%:
- With a 30 year maturity: CZK 42,897 per month
- With a 25 year maturity: CZK 46,721 per month
The difference is roughly CZK 3,800 a month.
Instead of automatically choosing the shorter mortgage, you could take the longer maturity and invest the difference. Over time, that investment could help you repay the mortgage earlier, or simply become part of the portfolio that will generate income for you later in life.
2] The expat who’s not committing to Brno
My second client wants close to the opposite. He has no intention of committing to one city, or even one country, so we built a very different plan around that.
He currently pays about CZK 20,000 a month in rent. Buying a comparable property would increase his monthly housing cash flow by roughly another CZK 25,000.
Rather than taking on the higher payment, we decided to invest the difference and increase his target retirement capital so that his future passive income can also cover housing costs.
For him, the flexibility is worth it. He can decide where he wants to live year by year, without a mortgage or a property tying him to one place.
There is nothing financially wrong with that plan. But if you expect to rent throughout retirement, you need to plan for it. Your housing costs will not disappear when you stop working, so you will need more capital to generate enough income later.
But how do you actually compare rent and a mortgage?
There is no universal rent-to-mortgage ratio that tells you when you should buy. But comparing the two is still a useful starting point. The important thing is to compare the right numbers.
I would not compare rent with the full mortgage payment, because part of the mortgage payment is a repayment of the principal. A better starting point is therefore rent versus the interest part of the mortgage.
Let’s use the same CZK 8 million mortgage from the example above.
At 80% LTV, it would correspond to a property worth around CZK 10 million. Based on current average prices in Brno, that would be roughly an 83 m² flat.
Rent for a similar 83 m² flat is currently around CZK 32,400 per month.
With a CZK 8 million mortgage at 4.99% over 30 years, the full monthly payment is approximately CZK 42,900.
But during the first three years, the average interest portion of that payment is around CZK 32,500 per month. The rest goes towards paying down the loan.
So instead of comparing CZK 32,400 rent vs. CZK 42,900 mortgage payment, I would look at: CZK 32,400 rent vs. approximately CZK 32,500 in average monthly interest during the first three years.
Even though there is no difference, that does not mean buying is for everyone.
To buy the CZK 10 million property in our example, you also need around CZK 2 million for the 20% down payment. If you stay in a rental, that money can remain available or be invested and used to build future passive income.
This is why I would never make the decision based on the monthly payment alone.
If you know you want to stay in Brno for the next 20 years, raise your children here, and have a home that is yours, buying can make perfect sense.
If you are not sure where you will be in three or five years, want the option to move abroad, or simply value flexibility more than ownership, renting can make just as much sense.
Your age, family situation, income, savings, future plans, and time horizon all matter.
A bank will not ask you where you want to retire, whether you plan to move abroad in five years, or whether the mortgage payment will prevent you from investing, traveling, or taking time off work.
So, these are the questions you need to ask before you buy:
- In ten years, what matters more to you: having a home of your own, or being free to live wherever you choose?
- When and where do you want to retire?
- Would the mortgage leave enough space in your budget for investing, traveling, and other things that matter to you?
- Are you buying because it fits your plans, or simply because buying property feels like the thing you are supposed to do?
One more thing: if you already know that you want to own a property, waiting for lower mortgage rates does not necessarily mean you will get a better deal. Property prices may rise while you wait, so you can end up taking a cheaper mortgage on a more expensive flat.
Where to start?
You need to run the numbers, but you also need to look at the bigger picture: where you want to live, how long you expect to stay, what else you want to do with your money, and what you want your life to look like ten, twenty, or thirty years from now.
There is also one more question that is easy to overlook: what do you want to leave behind? For some people, the goal is to build financial wealth that can be passed from one generation to the next. For others, it may be important to leave their children a physical asset – a home, a flat, or a family property.
This is exactly what I explore with clients in our first financial analysis session. We look beyond individual products and calculations and put the whole picture together like a puzzle – your housing, investments, family plans, future income, and long-term goals – so that decisions such as whether to rent or buy actually fit the life you want to build.
Consider getting professional help to get you started. Here’s a list of expat-friendly financial advisors the Brno Expat Centre tested for you. This article was written by Monika Souza.
Sources: Valuo.cz, Deloitte Rent Index, hypoindex.cz, Czech National Bank