Hungary's Real Estate Market Sizzles in Summer Heat

As the mercury rises, so do Hungary's property prices and rents. Budapest, the crown jewel of Hungarian real estate, continues to dazzle with average costs per square meter soaring above HUF one million (EUR 2,534). But it's not just the capital feeling the heat – the entire country is experiencing a property price surge that's hard to ignore.

The Hungarian real estate market has experienced a remarkable turnaround in 2024, contrasting with the downturns of previous years. There's been a substantial 36% increase in home sales, according to data from the Hungarian Central Statistical Office (KSH). This indicates a significant uptick in market activity and buyer confidence.

The overall house price index has reached 291% of the 2015 base. This means that house prices have nearly tripled since 2015, which is a substantial increase over less than a decade. Hungary now leads the European Union in housing price growth.

Skyrocketing prices
January saw a modest 1.6% annual price increase in the Hungarian real estate market, but by July, that figure had skyrocketed to a sweltering 6.4%. The east is leading the charge, with Szeged and Debrecen seeing property values climb by over 8% in just a year. Meanwhile, Pest County seems to be keeping its cool with a more modest 3% uptick.

When it comes to Budapest, it's a tale of two cities within one metropolis. While some districts offer relative bargains, others demand deep pockets. Take District V, the very heart of the city for instance – here, buyers need to shell out a whopping 1.8 million forints (€4,560) per square meter. Compare that to District XXIII, where you can snag a square meter for under 700,000 forints (€1,773).

Outside the capital, Debrecen wears the crown as the priciest city with an average cost of HUF 815,000 (EUR 2,065) per square meter, with Győr and Veszprém hot on its heels. But fear not, budget-conscious buyers – cities like Kaposvár and Szolnok offer more wallet-friendly options with average prices of between HUF 441,000 and HUF 479,000 (EUR 1,117 – 1,213).

Rental market ablaze
The rental market is equally ablaze. As summer leases expire and students flock to the capital, landlords are capitalizing on the demand. Rents in Budapest have surged by up to 15% compared to last year, with the average monthly rent now sitting at a hefty 245,000 forints (EUR 621).

Interestingly, while landlords are asking for more, tenants are only slightly increasing their budget. This widening gap between supply and demand could spell trouble – or opportunity, depending on which side of the lease you're on.

But it's not all doom and gloom. According to real estate expert László Balogh, this market heat could reignite investor interest, potentially fueling both short-term boosts and long-term growth.