Budapest - view from the Buda Castle | Sándor Laczkó

EU record home price rise in Hungary

May 16, 2016

The latest home price index analysis by the Hungarian mortgage bank FHB suggests that home prices in the country rose by 14% on average from a year earlier, the biggest increase seen in a European Union member state.

According to figures quoted by the Hungarian news agency MTI, the average price of a resale home in Budapest, the most expensive area in the country, was HUF 16.3 million in the third quarter of 2015 while the average home price in northern Hungary was HUF 5.8 million.

In spite of a substantial increase, the number of building permits remains low in Hungary compared to pre-crisis levels. In order to boost home construction, the government has recently cut the VAT rate on construction from 27% to to 5% and expanded home purchase subsidies. This could have an impact on the number of building permits already this year, the bank group’s analysis said.


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