Budapest is on the decline: new apartments in Hungary are being built here!

source: MTI/Mohai Balázs

The number of new apartments per 10,000 inhabitants in Hungary has quadrupled since 2015. The significance of Budapest decreased, and several counties showed incredible growth.

The number of people interested in building has grown by 160 percent this year, partially due to the recycled 5% new housing price. If the current situation remains, there is a prospect of vigorous expansion, according to penzcentrum.hu.

At first glance, the long-term data on the newly built housing market paints a misleading picture. The number of new homes each year has multiplied in proportion to the population, and the expansion was not broken by the pandemic last year. The desire to build housing fell last year, according to the analysis of ingatlan.com based on its own data and official CSO figures.

The fact that the new housing market achieved outstanding data in the year of the epidemic is mainly explained by the slower response of this segment to the crisis. The construction of most of the flats handed over last year typically started 1-2 years earlier,
said László Balogh, senior economic expert of ingatlan.com.

He added:

The data also show that the market outside the capital has strengthened a lot in recent years.

According to the expert, Győr-Moson-Sopron has been outstanding for years in terms of population-related housing transfers. This is partly due to the county’s stronger-than-average economic performance, industrial development and proximity to the Austrian border, and in this context of its high number of commuters. In Hajdú-Bihar county, the developments in Debrecen play a major role in the recovery of the new housing market. At the same time, in Somogy, the settlements on the shores of Lake Balaton are the engine of development.

The epidemic effect is therefore not reflected in the number of finished flats, but the mood to build has declined. In 2020, permits were issued for less than 30,000 residential properties, a decrease of more than 10,000 from previous years.

According to the analysis, the average square meter of new residential properties for sale in Budapest was HUF 907 thousand at the end of April / beginning of May, while in Debrecen, it was HUF 663 thousand, in Kecskemét HUF 624 thousand and Győr HUF 521 thousand.

László Balogh said about the expected trends this year and in the future:

There is a prospect of development after the uncertainty caused by the pandemic has receded. As it has been increasingly felt in the second-hand housing market over the past year or two, the new housing market can be expected to move to the countryside.