The coronavirus epidemic has drastically changed the Hungarian real estate market, as a result of which, several differences can be observed in the case of not only Hungarian but also foreign property investors and home buyers.
This year’s stagnation has come after several years of growth. Concerning foreign interest in the Hungarian real estate market (primarily in Budapest), in 2018, an increase of 23% could be observed compared to the previous year’s results, but this growing tendency dropped to 6% in 2019.
According to László Balogh – leading economic expert of ingatlan.com –, this year’s numbers show mixed results.
Even though more people visited the advertiser’s website, the amount of serious interest has decreased, which can be explained by two factors:
- Due to the pandemic, Hungarians living abroad became more interested in property purchase due to possible repatriation; however, because of uncertainty, they decided not to carry out an actual purchase.
- On the other hand, foreigners – also due to the negative effects of the pandemic – tend to postpone property purchase in another country.
Based on the analysis carried out by ingatlan.com, the top list of foreign interests can be ranked accordingly:
- United States: between early January and mid-July, 870,000 visitors watched the offers, showing a 60%-increase. However, only 7,000 of them were actually interested in a Hungarian property for sale, which means a 23%-decrease compared to last year.
- German potential investors are in second place, with 6.3% more views this year; however, the number of inquiries has dropped by 15%.
- The UK ranked third on the list, showing 4.3% more views this year; still, actual inquiries decreased by 22% in the first half of the year.
In previous years, Chinese property investors and home buyers played an important role in the Hungarian real estate market, with 71% more Chinese users looking around for supply this year; however, the amount of actual interest has decreased by 50%.
Not surprisingly, the amount of foreign interest decreased significantly during the most critical period of the pandemic, April. However, in May, a slight increase could be observed, as a result of which the amount of interest in July was already close to the level in January.
As Hungarian news portal Pénzcentrum reports, it is still impossible to forecast what the situation of foreign demand in the Hungarian real estate market will be like in the forthcoming period. According to preliminary figures, due to the coronavirus epidemic and travel restrictions, there may be fewer foreign buyers this year. Furthermore, foreign investors will probably be affected by the regulation on short-term rentals as well. The spread and popularity of apartment hotels, as well as their high yields, significantly contributed to the fact that more foreigners appeared on the Hungarian market than before. It is also a question of how many Hungarians working abroad will decide to move home due to the impact of the epidemic or other factors.