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Property and mortgage market data, 18.01 – More than a third of Budapest clients signed contracts for over HUF 20 million last year. Between September and December, for example, their share was 42%, which reflects an increase of 10 percentage points in 2021. The number of applications in this value range has increased steadily from quarter to quarter, to a lesser extent in the East and to a greater extent in the West. However, the HUF 10-15 million category remained the most popular throughout the year in both rural regions.

The majority of customers opted for a 20-year term: while in the country more than half of the applicants (52% and 54% in the East and in the West, respectively) went for this option, its share was 35% in Budapest. The second most popular choice was a term of 25 years, followed by the 10-year alternative. At the end of last year there were almost no mortgage applicants who had signed a mortgage for less than 5 years. The share of loans with fixed interest rates for at least 10 years showed an increasing trend throughout the year, ending at 87% in Budapest, 91% in the East and 80% in the West in 2021.

How high can Hungarian house prices rise? There is still room for price rises, 27.09 – The Hungarian real estate market has grown exponentially over the past 10 years, and not even the economic impact of the Coronavirus pandemic has reduced house prices. Hungary is still in the middle of the pack in the European price race, but experts see further room for price increases. Let’s take a look at what the market is like in Europe’s capitals.

The house price index for the European Union shows that house prices rose by 6.1 percent in the first quarter of 2021 compared to the same period last year. The annual growth rate has never been so high since the third quarter of 2007. Compared with the end of last year, despite the impact of the epidemic, a further 1.7 percent increase in prices is forecast for the European housing market. The highest price increases were recorded in Luxembourg (+17%) compared to 12 months earlier, but were also above 10% in Denmark, Lithuania, the Czech Republic and the Netherlands. Among the Visegrád Four, not only the Czechs (11.9 percent) but also the Poles are ahead of Hungary in terms of market development: while Poland recorded a +7.2 percent increase compared to Q1 2020, Hungary had a mere +4.6 percent and Slovakia an even more moderate 2 percent.

Pandemic catches up with residential property market, 24 March – The Coronavirus hit the property market in a period of consolidation and its effects will undoubtedly depend on how fast and effectively the individual governments respond to the pandemic. There is a suggested (and not obligatory) quarantine, i.e. people tend to stay at home which resulted in a reduction of propensity to buy and even the number of property visits by 60 per cent compared to previous months. However, urgent sales transactions are still completed rapidly. The effects of the new virus are mostly felt in Budapest – there are significantly less inquiries. In the country, on the other hand, the market is still seeing some brisk activity and there are almost no signs of a panic. That said, the situation is changing rapidly in response to the latest news and government measures. During first couple of weeks of the month we were witnessing the usual March market slowly waking up from its winter sleep. Last week, however, the number of new inquiries suddenly fell by more than 60 per cent and also the volume of new assignments given to property agents has fallen by 30 per cent.

Hungarians take out ever increasing loans, 1 October 2018 – Banks do not mess around when approving loan applications: clients are notified about the result within three weeks. Despite an ever growing demand there is no congestion in the approval procedure: banks pass their decisions within no more than 15 working days. The processing time of standard mortgage applications submitted to UniCredit Bank is 9 working days, while “client friendly residential loans” are processed within 7-8 days.

Processing is completed within five working days at K&H Bank, provided that a full set of documentation is available. According to CIB Bank processing times have become shorter since the introduction of “qualified client friendly residential loans”.

Almost all banks reported an increase of the volume of loans compared to the same period last year. In 2018 the average loan applied for by clients of UniCredit Bank exceeded HUF 13 million, which is an almost 20 per cent increase from last year. The average loan at K&H Bank is almost HUF 10 million, compared to HUF 9 million last year.

Shocking housing info about 1.3 million Hungarian families, 5 August 2018 – On average, every third Hungarian families are facing difficulties in paying their housing expenses on account of the lost balance between their income and their housing expenses. Apart from income, the ability to pay for housing is strongly determined by schooling and the type of residence. If a family needs to spend too much (more than 35-40 per cent) of their income on housing then they are facing an affordability problem. According to latest surveys 32 per cent (1.3 million households) are affected. This means that they do not have enough money left for maintaining an acceptable standard of living.

Unsurprisingly, affordably is primarily affected by the inequalities of the income status of Hungarian families. Among the poorest 40 per cent of families almost 60 per cent are facing difficulties in paying their housing expenses. Among the richest 30 per cent this ratio is only 10 per cent.

Warning signs on the apartment market, 23 July 2018 – Demand is still soaring on the market of new apartments but price hikes stole some of the impetus. According to the CEO of a major property agency there are still approximately 7-10 thousand apartments sold in Budapest annually but the average time needed to sell a property has increased as a result of the higher prices.

According to market experience HUF 30 million is a dividing line: more expensive properties take longer to sell.

The low VAT resulted in neither overdevelopment nor oversupply and apartments in the process of building sell within a year maximum.

Some analysts expect a small supply increase after 2020 and also a stronger demand for pre-owned apartments.

Apartment boom at Lake Balaton, 24.05.2017 – Many new apartments are being built at Lake Balaton and prices at Lake Velencei are also increasing. According to figures published by KSH, the National Statistical Office of Hungary, holiday home construction is also on the upswing. At Lake Balaton apartment development projects are also intensifying. Judged by the number of planning approvals and properties in the blueprint phase the number of completed apartments will peak in the next few years. Buyers increasingly prefer newly built condominium properties with a panoramic view directly at the lakeshore. These command significantly higher prices, not only on account of their better features but also because the number of building plots with direct connection to the water is diminishing.

Even though prices at Lake Velencei are lower compared to those of Lake Balaton, some factors put an upward pressure on prices there, too. First, the effects of the bourgeoning apartment market of neighbouring Székesfehérvár can also be felt in the surrounding area. Second, some settlements around Lake Velencei are comparatively close to Budapest, which means they can offer a viable alternative for buyers from the capital.

Residential property market report, 12.05.2017 – According to a recent residential property market report published by MNB, the National Bank of Hungary, prices in Hungary grew by 15.4 per cent on average last year. This increase can continue at a more subdued rate in 2017. Budapest witnessed the highest increase with 22.5 per cent, which is, however, still lower than the 25-30 per cent seen in previous years. Domestic residential property market is still shaped by rising prices and a growing turnover, and the supply side responded to increased demand with a significant boost of construction activity. The report, which was published for the third time this year, says the increase in demand was supported by favourable household income and labour market trends and low interest rates. MNB experts say neither the increasing volume of residential loans nor the growing average apartment prices are a sign of overheating.

Experts expect a boom in apartment construction, 03.04.2017 – According to experts the number of apartments constructed this year may rise significantly, but a change in VAT legislation and the lack of skilled workers may have an unwelcome effect on the construction industry. A recent survey showed that the number of condominium apartments completed this year will reach 2010 highs, but even last year’s 10 thousand was a four-year record. Experts base their estimate on the number of planning applications mainly in the periphery of Budapest, in larger Hungarian towns and in the vicinity of Lake Balaton, mainly as a result of the 5 per cent VAT. This VAT rate will probably be in force until 2019 only, so – due to the time requirement of planning permission procedures – developers have only one year left to start new projects.

Satellite settlements’ decreasing popularity, 26.09.2016. – The population of Budapest is increasing by almost 0.6 per cent a year, while the settlements in the outskirts are rapidly losing popularity. The inner districts of the capital are more and more appealing to apartment buyers, which is reflected in increasing prices. Ten to fifteen years ago Budapest and several other large Hungarian towns were facing slumming, a phenomenon known by Western metropolises, i.e. the radical worsening of standards of living in the inner districts. However, development projects succeeded in reversing this tendency and now potential buyers are again showing increased interest in downtown areas. At the same time, the population growth of satellite settlements has slowed down: while at the turn of the millennium some of these places registered an annual growth rate of as high as 4-7 percent, today there are hardly any that grow at a rate exceeding 1 per cent a year.