SVJ, the owners' association (společenství vlastníků jednotek)

The owner of a flat with a CZK 4,000,000 mortgage at 5.00 % pays the bank CZK 23,384 and the SVJ, for example, CZK 4,500 a month to cover the repair fund, management and advance payments for services. When assessing income, the bank counts total housing costs, not just the mortgage payment.

An SVJ is compulsory in a building with at least five units, four of them owned by different people; with fewer units it can be founded only if all owners agree. Where it must exist and does not, the land registry will not register the sale of a flat to a further buyer. Before buying, ask the SVJ to confirm that the seller owes nothing, and get the amount of contributions, the repair plan and details of any SVJ loan. Under § 1186, debts on contributions to building management and on services pass to the buyer only if the buyer could have found out about them. The law presumes they could not if a debt is missing from the confirmation or if the SVJ, though asked, does not issue the confirmation without undue delay. Read the minutes of recent owners' meetings too: an approved insulation project or lift replacement turns into a higher contribution right after you buy.

In a cooperative flat (družstevní byt) the cooperative owns the building and the member has only a lease and a membership share. In an SVJ each person owns their unit, which can be pledged for a mortgage. A management company is only a service provider; decisions are always made by the owners' meeting.