The biggest increase in real estate prices happened in these Hungarian towns

In its latest analysis, money.hu has compiled a top 10 list of the most dynamically rising Hungarian towns in the last 5 years.  The top list, compiled using data from ingatlan.com, includes several settlements in Baranya and Borsod-Abaúj-Zemplén counties. The experts also discussed how the development of lending rates has affected property prices.

Real estate trends

Trends in the real estate market over the past 5 years show that property prices have not risen fastest in the most up-and-coming and expensive areas, but rather in developing regions. Property prices in the top 10 most expensive municipalities have increased five to six times. The trends may even be interesting from an investor’s point of view, as the increase in property values in some developing rural municipalities can be of considerable benefit to those who have a good appreciation of the likely development of the property market in the area. And local property owners may find themselves in the favourable position of seeing their wealth increase significantly through the homes they own.

The following towns have shown the highest house price growth in the last 5 years.

What might be behind the boom in the property market in a particular region?

Favourable developments in the local labour market, for example, due to new investment, relative wage growth and population growth, all have an impact on house prices in a given area. These factors should be taken into account when considering where to consider buying a home as an investment. “It would not be surprising if in five years’ time the municipalities of Hajdú-Bihar, Csongrád-Csanád and Zala – and even Borsod-Abaúj-Zemplén – were among the most appreciating regions in terms of real estate. It is quite certain that the significant investments announced in recent months will stimulate property buying and may also increase the value of property in the municipalities concerned,” – said László Balogh, lead analyst of ingatlan.com.

Of course, individual house prices can also be influenced by a number of different things, such as the quality of the property, the number of rooms and bathrooms, the distance to schools and kindergartens, the accessibility of shopping centres and public transport, and the characteristics of the local area.

The money.hu experts have also highlighted that a developing region or municipality can already be on the radar of banks. Rising property prices are providing credit institutions with more collateral, making them more willing to lend and relaxing their pre-set conditions.

“There are clear signs of improving housing market developments from end-2023: historically high employment, rising real wages and consumer confidence, and a more favourable interest environment. In the property market, there is generally a strong correlation between interest rates and house prices. When market interest rates are more favourable, the housing market experiences higher demand, which typically pushes up house prices. This is supported by the latest housing price index from May from ingatlan.com, which shows that the pace of house price increases has become more dynamic, but there can be significant differences between regions according to the price index, which shows the up-to-date price trends,” – said Levente Korponai, head of money.hu.

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Source: money.hu