Buyers Wait and See in the Hungarian Real Estate Market

Buyers tend to have a wait-and-see approach in the Hungarian real estate market where the number of transactions has fallen by 40-50% in recent months, and demand is falling even more, according to the real estate brokerage network Balla Real Estate.

The managing director, Ákos Balla, said in a statement that buyers are uncertain because of high lending rates and rising energy prices. He noted that the rise in interest rates is a sensitive loss for the real estate market, as in some locations, the proportion of people buying property on credit has reached up to 50%. 

According to the statement, there is significant demand for energy-efficient properties in particular, while demand for energy-poor properties has fallen so sharply that they will only find buyers at significant discounts of up to 20%.

The expert also pointed to the new-build market, which has seen annual price increases of 20-30% in recent years. These prices are unlikely to fall, as construction and financing will not become cheaper, and further price increases are likely. This will result in fewer transactions and, in his view, fewer new-build homes coming onto the market in the future.

Ákos Balla said that following last year's 10% increase in rental prices, the rental market is likely to see a similar increase this year. The fall in the number of people buying is generating demand in the rental market, so prices will continue to rise. However, many people are no longer able to afford the rising rents, so more and more young people are likely to be forced to return to their parents' home, he said.