Property valuation (odhad nemovitosti)
A valuation of the property that the bank commissions before granting a mortgage, so that it knows what the collateral is worth. It is carried out by a valuer the bank works with or by its in-house department. The result is the collateral value, from which LTV is calculated. A valuation usually costs CZK 3,000–6,000, and many banks offer an online valuation of flats free or cheaply.
Example
The purchase price of a flat is CZK 5,000,000 and the valuation comes in at CZK 4,700,000. At 80 % LTV the bank lends CZK 3,760,000 instead of the planned CZK 4,000,000, and the buyer has to cover CZK 240,000 from own funds or with additional collateral. Had the valuation come out at CZK 5,300,000, the loan would usually not go up on a purchase: most banks work from the lower of the two figures.
In practice
You order the valuation through the bank, which will not accept a report from just any expert. Have ready the title sheet, a floor plan, project documentation for a house and the developer contract for a new build. If the valuation comes in low, ask for a review backed by prices of comparable flats, or try another bank. Never sign a purchase agreement with a fixed date for the balance before you know the result.
How it differs
An expert opinion (znalecký posudek) is prepared by a court-appointed expert for authorities, courts or the tax office, whereas a bank valuation serves only the bank. The collateral value is the final figure of the valuation and may be lower than the market price. The purchase price is simply what you agreed with the seller.
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