Procedures for the practical implementation of changes in the CNB’s Recommendation on the management of risks associated with the provision of consumer credit for housing

25 March 2026

Introduction

At its meeting on 27 November 2025, the CNB Bank Board decided to amend the CNB’s Recommendation on the management of risks associated with the provision of consumer credit for housing (pdf, 409 kB). The amendments include Recommendation D (The provision of consumer credit secured by residential property to purchase residential property for investment purposes) and Recommendation E (The provision of consumer credit secured by residential property to purchase a third and each additional residential property), where questions may arise regarding their practical implementation by providers of such credit.

In this document, the CNB therefore provides a more detailed explanation of the individual changes to Recommendations D and E and describes the procedures for implementing them in practice. The definitions of terms in this document correspond to those in the aforementioned Recommendation, in Act No. 6/1993 Coll., on the Czech National Bank, as amended, and in Act No. 257/2016 Coll., on Consumer Credit, as amended, unless otherwise indicated.

Loans subject to the newly amended Recommendations D and E

All consumer credit secured by residential property provided for the purchase of residential property from 1 April 2026 onwards is subject to assessment. For such loans, providers should verify compliance with the conditions set out in Recommendations D and E and, where applicable, apply the upper LTV and DTI limits.

In the case of the purchase of a third and each additional residential property, the determining factor is not the purpose of the purchase (owner-occupied housing or other) but the number of properties already owned.

Providers should also verify compliance with the conditions set out in Recommendations D and E and, where applicable, apply the relevant limits in the case of:

• loans secured by residential property for the purchase of residential property under construction,
• loans secured by residential property for the purchase of residential property with subsequent reconstruction,
• loans secured by residential property for the acquisition of a share in a housing cooperative,
• loans secured by residential property for the future purchase of residential property in a development project,
• refinancing or refixing of loans secured by residential property involving an increase in the total amount of the consumer credit,
• the assumption of debt secured by residential property.

Conversely, the newly amended Recommendations D and E does not apply to:

• refinancing or refixing of loans not involving an increase in the loan amount,
• loans for the purchase of land without subsequent construction (any future construction loan is irrelevant),
• loans intended exclusively for construction or reconstruction.

The number of residential properties owned includes the following properties

All residential properties in the Czech Republic and abroad, including cooperative shares in housing cooperatives, should be included.

• The number of residential properties owned in the Czech Republic should be verified in the land register; a mere declaration by the applicant is generally not sufficient. Such verification is not required for applicants declaring an investment purpose (Recommendation D applies to them) and for applicants declaring the ownership of two or more properties (the property being acquired is the third property and Recommendation E applies to them). Verification is also not required for loans meeting the parameters of Recommendations D and E (i.e. an LTV of up to 70% and a DTI of up to 7).
• For foreign residential properties and shares in housing cooperatives that cannot be verified in the land register, the applicant should provide a declaration confirming their number (or absence).

Neither the manner of use of the residential properties owned (owner-occupied housing, rental, recreation, etc.), nor their financing is a determining factor; the number of the applicant’s existing loans is not relevant for the purposes of Recommendations D and E.

When verifying the number of residential properties, the provider may take into account their actual character, in particular in the following cases:

• if multiple residential properties recorded in the land register form a single unit intended for use by one household, they may be regarded as one property,
• if a property is used for recreational purposes and is clearly unsuitable for permanent residence (e.g. lacks year-round water or electricity supply or a sewage system).

Likewise, a residential property that is demonstrably intended for sale may be disregarded. However, a mere statement by the client or a draft contract is not sufficient. The determining factor is a signed contract (a purchase contract or an agreement to conclude a contract) proving the sale in a binding manner.

Conversely, if a property is recorded in the land register as a single unit but serves as housing for multiple households (e.g. an apartment building), it should be regarded as multiple units; any additional residential property being acquired is thus always regarded as a third or additional property.

Inclusion of a residential property with multiple owners

If an applicant owns at least a 50% share in a residential property, this property is included as one property owned; the same applies to joint marital property (JMP), including the analogous property regime of partners. Shares are not aggregated – each residential property in which an applicant owns a share of at least 50% is included separately. Ownership of two such shares is therefore regarded as ownership of two residential properties, and Recommendation E applies to the acquisition of an additional one.

Procedure in the case of multiple loan applicants

Where multiple applicants are acquiring a residential property, the number of residential properties owned is assessed separately for each applicant, and the highest number identified is used for the assessment.

The volume exemption applicable to the setting of upper LTV, DTI and DSTI limits

The 5% volume exemption applicable to the setting of upper LTV, DTI and DSTI limits pursuant to Article 45a(1) of the Act on the CNB does not apply to Recommendations D and E.

The relevant passages of the Recommendations are worded as “…that the LTV/DTI ratio for no new consumer credit…”. This means that no exemptions are specified.