Rents · 10 September 2026 · 8 min read
Low and Legacy Rents: Valuing Prague Apartment Buildings
Rent control in Czechia ended more than ten years ago, but many Prague apartment buildings still have tenancy agreements with rents well below market levels. For owners, this is a sensitive issue, both personally and financially.
Why it matters to investors
Low rents mean lower current income and therefore a lower income-based valuation. They also offer potential, as rents may move closer to market levels over time. Investors therefore assess two scenarios: what the building earns today and what it will earn in several years.
The key question is: how certain and how fast is the transition to market rents? The less certain the route, the more of the potential upside investors will retain for themselves.
What the law allows
the Czech Civil Code allows landlords to propose a rent increase unless the parties have agreed otherwise. If the tenant does not agree to the increase, the landlord may apply to the court to set the rent at the level of comparable rents prevailing locally. The law limits the extent of increases over a given period.
The specific procedure depends on the terms of the tenancy agreement. Before taking any action, we recommend consulting a solicitor to avoid mistakes that could weaken your negotiating position.
Should you adjust rents before selling?
If rents can be increased within a reasonable timeframe, this may be reflected in the sale price. However, the process takes time, requires communication with tenants and carries reputational and legal risks. Sometimes it is better to sell the building with clearly documented potential and let investors compete for that upside.
The decision should be based on a calculation: how much additional income an increase would generate, how soon and with what degree of certainty, and how much investors would pay for it today.
How to present the potential effectively
Transparent documentation reduces investor uncertainty, and uncertainty is what depresses the price most.
- a rent roll showing the current rent and comparable market rent for each unit,
- tenancy terms, how long agreements have been in place and any special provisions (easements, lifetime rights of use),
- the history of rent increases and communication with tenants,
- flats that are vacant or could become vacant in the near future.
Frequently asked questions
Can I sell a building with tenants in place?
Yes, and most apartment buildings are sold this way. Tenancy agreements transfer to the new owner.
Is it worth evicting tenants before a sale?
Usually not. It is time-consuming, legally risky, and investors expect tenants to be in place. Always assess the decision on a case-by-case basis.
Authors: Maria Kopřivová, Michal Kopřiva, Pura Vida Property Advisory. Published 10 September 2026. This article is for information only and does not replace legal or tax advice.
