Hungarians spend half of their earnings on rent

Average lodgers in Western Europe spend 25 % of their incomes on housing, while a Hungarian one may spend even 50 % on the same, says Gergely Ditróy, chief analyst of Otthontérkép, portfolio.hu reported.

Ditróy claims that the proportion of those living in their own properties in Hungary is close to 90%.

“It has been known for long that the proportion of those living in their own properties are much higher in Hungary, and in the former Eastern Bloc, than in Western Europe, such as Germany, Austria, Switzerland, and the United Kingdom, where it is around 50%. In Romania, more than 90% of the population live in their own properties”, Ditróy explained.

Furthermore, he adds that this indicator is important because in a country where millions of people live in properties of different qualities a property market that is operating with well-thought-out conditions also has its own traditions.

Furthermore, Ditróy emphasises that “rent prices should be compared as to what extent we have to spend our average earnings on housing.”
The rent prices have increased in Hungary so far, which has several reasons, such as the tourism-related uses of properties, and that the younger generation prefers renting to purchasing an apartment and borrowing, Ditróy noted.

“If the average earning is taken into account, 35% to 50% of the earning of a household is spent on housing in Hungary, which means that we have to spend almost half of our total income on a 70-80 square metres lodging. In Western Europe, the same is less than 25%”, said the analyst.

Ditróy adds that the situation is not as good in the Visegrad countries as in Germany, but the average earnings are quite low in Hungary, while the property prices are higher everywhere.

translated by Gábor Hajnal

Photo: Daily News Hungary

Copy editor: bm

Source: http://www.portfolio.hu