On a yearly basis, the demand for second-hand apartments in Budapest has declined by 14% since the beginning of June. This can be partly explained by the fact that real estate investors are less interested in purchasing new properties. At the same time, demand for new homes in Budapest has increased by 7% during the summer period. As far as the countryside is concerned, the need for rural properties was similar to last year’s results. The Hungarian capital’s 14% drop might stop price increase in the market of second-hand homes in Budapest.
This summer has been a turning point in Budapest’s real estate market – according to the latest analysis of ingatlan.com.
We can talk about a turning point as the demand for second-hand properties in Budapest decreased by an average of 14% during the last three months.
The absence of property investors partly explains this; the decline coincides with the launch of government securities providing outstanding interests – by which investors can realise the same amount of yields with less hazard – reported by László Balogh, economic specialist of ingatlan.com.
Price increase in the capital might stop
According to the analysis carried out by ingatlan.com, over the last three months, there were periods when demand decreased by more than 20% compared to previous year’s results. According to the expert, the number of sales in Budapest’s real estate market can also drop since demand shows a close correlation with the number of purchases. The expert also added that the decreasing number of sales might result in the fallback of the continuously increasing price level of second-hand apartments in Budapest.
However, in the countryside and the case of new apartments, steady demand can be observed.
As penzcentrum describes, even though the demand for second-hand apartments in Budapest is declining; in case of the new housing market, demand shows an increasing tendency. During the summer period, the number of people interested in new apartments was 9% more than a year earlier. According to the specialist, many people would like to avoid VAT increase which is planned to be realised by the end of this year.
In the countryside, demand for second-hand homes also kept pace with last year’s levels during the summer period. The reason for this might be the fact that the number of job-creating investments have increased in the big cities; additionally, in these settlements real estate buyers can take advantage of government subsidies more efficiently.