House hunt in Hungary: a modern mash-up for $ 895,000
Hungary, the landlocked Central European hill and lowland nation with around 10 million inhabitants, saw house prices double in the decade between 2010 and the first quarter of 2021, with just two more countries in the European Union (Estonia and Luxembourg) overtaking in this growth, according to Eurostat, based on data from the Hungarian Central Statistical Office.
“In Budapest, it was an even bigger increase,” said Gabor Borbely, director and head of business development and research at brokerage firm CBRE in Budapest. “This comes, of course, from a much lower base, so Hungary is among the cheapest markets in the European Union. If you compare Budapest to Prague or Warsaw – which are similar in size, similar purchasing power, similar geography – residential prices are even much lower. In some cases it is 40-50% cheaper to buy in Budapest than in Prague.
The global pandemic, which is currently largely under control in Hungary after peaking in late 2020 and again last spring, halted this decade-long price spike in Budapest. Home prices fell a few percentage points in 2020 before rebounding earlier this year to their 2019 levels, Borbely said.
Budapest’s residential market has been hit harder by the pandemic than the rest of Hungary, with international buyers disappearing and domestic buyers moving away. As in other countries, many residents have decided to buy homes in areas outside of the capital, particularly in resort areas, brokers said.
“Prospective buyers are increasingly open to the idea of considering properties on the outskirts of large cities or in the countryside,” said Karoly Benedikt, head of marketing, public relations and analysis at the Duna House agency, based in Budapest.
Changes in consumer behavior have pushed house prices up to 10-20% in some areas outside Budapest, and even more at Lake Balaton, a freshwater lake 48 miles long about 80 miles in length. ‘west of Budapest, said Mr Borbely:’ The gap between the capital and regional markets is definitely narrowing, which is something really unique that we haven’t seen in the last two decades.