Budapest Still Attractive to Foreign Real Estate Investors

“The wonderful capital, Budapest, with its unique location and rich historical and cultural heritage, is a magnet for everyone. It has also been a focus for foreign real estate investors for many years, mainly due to the boom in tourism, as fortunately the Hungarian capital remains a very popular destination for European city breaks. That is according to Ben-Ezra Orran, a specialist in city center real estate at Central Home.

A statement by the company says that in recent years, Budapest has been joined by a few other Eastern European cities, such as Prague, Krakow and Bucharest, which continue to conquer with their affordable property prices, based on the cities' rich historical heritage and numerous attractions.

Ben-Ezra Orran is of the view that "the pre-pandemic boom is only partially back. What hasn't changed much is that, as in the previous period, Asian investors, especially Chinese and Vietnamese, are now dominating the downtown real estate market. The war situation has affected the presence of Russian and Israeli investors, but even they have not completely disappeared from the market."

According to the expert, Hungarian investors are also starting to recover from the difficult period and are returning as interested and active buyers. If we look at the same period last year, it is clear that the dynamics have increased and the market has become more active, both in terms of supply/demand and in terms of the total investor base. If we had to put this into numbers, the current figures suggest that Central Home has seen roughly 30-40% more movement.

"Of course, there are always the most popular destinations in Budapest, areas, districts or streets where interest is stronger than usual. We have also seen an upturn in District VII compared to our last analysis, with the Gozsdu Courtyard and Király Street area booming again. Average foreign investor searches are around HUF 90 million, mostly for 1-2 bedroom, good quality renovated apartments suitable for AirBnB," he adds.

However, short-term rentals can be risky in many cases. In almost all the districts in question, local authorities and administrations are preparing to tighten up. And the new legislation could have a significant impact on the market for apartments for sale in inner city districts, which are currently considered attractive by investors.