Changing Real Estate Market in Hungary

Q4 2019 data indicate that the property market is in a state of change in Hungary. The latest analysis by the Duna House property agency says that for the first time in many years, the majority of residential property indices of Duna House are falling, but the price index of brick and mortar apartments in Budapest is still on the rise. Concrete block indices decreased the most significantly: in the last quarter of 2019, prices of this type of property have fallen both in Budapest and in the Eastern and Western part of the country.

Looking at pre-owned apartment indices, apart from increasing prices a slower turnover speed, the reduction of investor activity and also the rising ratio of apartments on offer that were bought as an investment speak of a changing market environment, the study says.

The idiosyncrasies of the changes in prices may have been driven by the weakest demand of the past three years – as far as the Demand Index is concerned, the last time Duna House measured weaker demand was in 2013. New-build properties should be treated as a separate segment of the property market where – partly on account of the VAT change introduced at the end of last year – the figures by Duna House the real estate research center Eltinga are still indicating increasing prices and a brisker demand than on the preowned market. In the 4th quarter of 2019, the average price per square meter of newly built apartments in Budapest was HUF 883,000, which currently equals to cca. EUR 2,640.