Unprecedented demand for garages in Budapest

Over the past four years, the number of cars on Budapest’s roads has increased by 13%, which in turn has led to greater competition for garages in the capital. Based on information from ingatlan.com, the average price of a garage has annually grown by 36%, and today, it reaches €12,700. This figure is double the 2015 average price for a garage in Budapest.

As reported by Forbes, the garage market has also been swept up in Budapest’s real estate boom, as demand for garages is increasing. Statistics from KSH indicate that this rise will continue in the coming years.  To a certain extent, the increased demand is understandable; since 2014, the number of car sales in Budapest jumped significantly, and storage facilities are unable to keep up. Garage rent rates have also increased in addition to the cost of buying garages outright.

Unprecedented demand

According to the study, at the end of last year, there were 600,000 cars in the capital, which is a 4.1% and 13% increase compared to the previous year and 2014 respectively.

Based on ingatlan.com’s statistics, this demand for garages in the Hungarian capital is unprecedented as a record number of inquiries have been made with regards to purchasing parking spaces.

The rise in the number of cars and the increased demand for garages are reflected in the prices. In April this year, the average price of a garage was €12,700. This is a 36% surge compared to January 2018 and is more than double of €5,900, the average price Budapest residents had to pay for garages in 2014. Garage rent rates have risen by €70 over the past year, which is a 15% increase.  The supply of parking spaces is unable to keep up with the demand; Budapest accommodates 1500-2000 more cars each month while the number of garages advertised for purchase and renting is 70-80 and 150-200 respectively.

Unequal supply and demand

However, there are significant deviations in the different parts of the capital. For example, since 2014, District XIII saw a 36% increase in the number of registered cars, meaning that by the end of the year, there were 61,000 of them. This has also been reflected in the surge of garage prices in the area. In April, prices were at €12,100, while back in 2015, people could purchase parking spaces for merely €5,300.

Car sharing?

According to ingatlan.com analyst László Balogh, car-sharing options should alleviate parking pressures in the capital; however, there is little evidence of things changing just yet.

There are around 1000 car-sharing vehicles on Budapest’s roads, which is 0.1% of all cars in Budapest. Nonetheless, as we reported, more and more car-sharing firms are introducing their services to the Hungarian capital, which will hopefully reduce demand for garages.

We also communicated Budapest’s property price boom.

Source: forbes.hu, ingatlan.com, ksh.hu