Housing Prices Rising Faster than Expected

Housing prices in Hungary rose by more than 9% in January compared to a year earlier, a faster increase than expected, real estate.com reported on Monday, based on data from its January house price index.

The housing price index, which is based on the number of advertisements posted on the real estate advertising portal, shows that prices rose by 1.6% in January on the national housing market, double the 0.8% increase in December.

The year-on-year increase in house prices was 9.4% in January, up from 7.8% in December.

Based on the experience of recent years, it is natural for housing to be repriced at the beginning of the year, but the return of thousands of investment buyers this year has led to extra demand and price increases, which is mainly in the housing markets of big cities, László Balogh, the portal's chief economic expert, explained in the statement.

The survey showed that the Northern Great Plain region, which includes Debrecen, saw a 13% annual increase in prices, while in Budapest the rise was 12%. In contrast, the Pest county, which covers the largest part of the capital's agglomeration, saw an annual price increase of only 5%, they said.

They stressed that the average price per square meter of second-hand housing in Budapest reached HUF 1.17 million at the beginning of February, while the average price of the cheapest quarter of the supply was HUF 903,000. Prices in the capital may continue to rise due to investor activity, and some of the owner-occupiers may prefer to move to the agglomeration areas, they added.

According to the housing price index, the most expensive district in the capital is District V, where the average price per square meter of second-hand housing is close to 2 million forints. In this district, the cheapest quarter of apartments for sale also has a price threshold of HUF 1.5 million per square meter. Among the districts with a wide range of supply, the average price per square meter for all second-hand flats for sale in district 13 is HUF 1.44 million, while the average price per square meter in district 11 is HUF 1.3 million. In outer districts 15, 17, 17, 18, 20, 21 and 23, the price per square meter remained below HUF 700,000 for the cheapest quarter of the range.

In Debrecen, the average price per square meter of second-hand housing is HUF 882,000, while the lowest-priced housing is priced at HUF 702,000. In Győr, sellers are asking a maximum of HUF 643,000 per square meter for cheaper residential properties, compared to HUF 824,000 for the former. In Szeged, the average price per square meter is HUF 792,000, while the price level for cheaper properties is lower than HUF 647,000, they said.