Czech property reservation: checks before signing

The viewing went well, the agent says another buyer is interested, and a reservation agreement is waiting on a tablet. This is not merely a request to stop advertising. It can move money and risk before you have the final purchase, mortgage and escrow documents. Slow the process into verifiable steps.

Start with readiness, not the form

Before reserving, verify ownership and recorded restrictions in the official Czech cadastral viewer, inspect the property, request material documents, estimate repair and transaction costs, and test financing against this property and price. A standard form cannot compensate for a check you have not performed.

If the title sheet shows a pending change or restriction, first use the plomba, lien and easement guide to turn it into specific evidence and reservation conditions.

Use the apartment and SVJ document checklist, the house viewing and offer checklist, or the land due-diligence checklist before deciding which risks must become conditions in the reservation.

What the broker must provide at this stage

If the reservation is substantively a real-estate brokerage agreement, Sections 11 and 12 of the Real Estate Mediation Act add concrete safeguards. For a property recorded in a public register, the broker must provide the buyer with an extract reflecting a state no older than three working days, no later than the day the brokerage agreement is concluded. The broker must also disclose recorded defects and restrictions, those it knew or should professionally have known, and the amount or calculation of commission agreed with a third party for the same property.

Failure to provide the required extract gives the prospective client a statutory route to withdraw from the brokerage agreement within 14 days after it was concluded; missing Section 12 information has its own withdrawal consequence. These rights concern the brokerage relationship. Do not assume without review that they automatically cancel a separate seller–buyer promise.

1. Make the seller’s commitment visible

Identify whether the agreement is between buyer and agency or also includes the seller. Check who promises to stop marketing, refuse other offers, provide documents, remedy title issues, cooperate with valuation and mortgage security, and sign the next contract. A fee paid to an intermediary is not automatically the same as a seller’s enforceable promise to sell.

2. Identify the purchase precisely

• Cadastral area, title sheet, parcel or unit designation and ownership share.
• Cellar, parking, land shares, fixtures, furniture and equipment included.
• Purchase price, tax treatment where relevant and treatment of the reservation payment.
• Known leases, easements, liens, enforcement, disputes, defects and planned changes.

The reservation, future agreement, purchase agreement and mortgage valuation must describe the same asset. Do not let a marketing address stand in for the legal unit or parcel identifiers.

3. Translate every unresolved risk into a condition

• Mortgage approval for at least a stated amount by a stated date.
• A minimum acceptable bank valuation or maximum required cash contribution.
• Satisfactory title, building, SVJ, technical inspection or zoning documents.
• Seller delivery of documents and cooperation by concrete deadlines.
• Agreement on the final purchase and escrow wording after independent review.

A useful condition states the evidence, deadline, notice method and consequence. “Subject to financing” is weaker than a clause defining minimum loan amount, rejection or low valuation, required applications, seller cooperation and the amount and deadline of the refund.

4. Follow the reservation money

• Who pays, who receives and who holds the money?
• Is it an advance on purchase price, commission, separate fee or security?
• When is it credited, earned, returned, retained or set off?
• Which party pays it back, to which account and within how many days?
• What deductions are permitted and how must they be documented?

Ask for the account holder and payment reference in writing. Do not transfer a substantial sum to a different person or ordinary operating account merely because the instructions arrived from a familiar email chain.

If the agency describes itself as holding money in escrow for the transaction, Section 4 matters. A broker generally may not offer its own escrow. The statutory exception begins with the client’s request on a separate written document and requires a written escrow agreement, a separate escrow account for that depositor, bank notification, records, and cashless transfers. An advance genuinely owed to the agency is a different classification, which is why the purpose and account cannot be left vague.

5. Read the next contracts now

Request the draft purchase agreement, escrow agreement and relevant future agreement before the reservation becomes irreversible. Check purchase-price funding, mortgage lien cooperation, cadastral filing, priority of filings, release conditions, handover, utilities, defects, penalties and what happens if the cadastral office interrupts or rejects the registration.

Then use the dedicated purchase contract, escrow and cadastral filing checklist to test the complete payment and transfer sequence.

For an advocate’s escrow, review the current Czech Bar information on advocate escrows and its safe-escrow checklist. The release instruction should depend on objective documents and cadastral state, not a vague confirmation from one interested party.

6. Put the timeline on one page

Consumer protection matters, but document names do not decide it

Section 14 of the Czech Real Estate Mediation Act limits a brokerage agreement from obliging a consumer to conclude the property or future property contract. The Czech Supreme Court applied that protection to a three-party document that was substantively a brokerage agreement and rejected a contractual penalty for not buying. That is not an automatic refund rule for every “reservation agreement”; parties, substance, payment and obligations still matter.

If you are being asked to sign today

If financing later fails

Preserve the bank decision, valuation, agreements, notices and deadlines. Then use the dedicated guide for a mortgage rejected after a reservation fee; the answer depends on the clause and reason for failure, not on rejection alone.

If the seller instead refuses to continue, use the seller-withdrawal decision pathto separate an agency-only reservation, seller commitment, future contract and signed purchase agreement before any fee is released.

Sellers facing the opposite problem can use the buyer-withdrawal fee, commission and relisting workflowbefore treating the reservation amount as compensation.

If the transaction has already failed and the agency will not return the money, use the reservation-fee accounting, demand and ADR workflow.