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Hungarian real estate market is facing troubles
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Risks and inflationary side-effects are mounting in the housing market, where demand is expected to fall in the short term. This is due to more expensive credit, thus a slowdown in construction and purchase can likely be experienced. Continue reading below for more information.
The upward impact on housing prices triggered by the postponed demand during the pandemic and brought forward by rising lending rates is fading. All the while investor participation is back above 40 percent. With high inflation, some money is seeking refuge in real estate. Many investors, on the other hand, have become active sellers, as they are now cashing in on the returns they were earning on their previous home purchases. The benefits of the recent record prices are on the rise, VG reports.
Hungarian real estate market to stagnate
Tünde Tancsics is an analyst at Eltinga Real Estate Research Centre. The expert from the research centre, known for its housing market reports, explains the following. “The housing market will inevitably slow down. With demand now entering a downturn, and the growth that has been underway since 2014 is now looking all but over.”
She adds that, in nominal terms, prices will rise with inflation at 10-12 percent. But in real terms, a gradual depreciation may already be starting to take place as demand slows.