Foreigners are more and more interested in Hungarian real estate
Considering the number of the real estate buyers from outside the European Union, origo.hu reports that the Chinese have taken over the Russians, when it comes to Hungary. Every fifth real estate purchase in Budapest is made by a foreigner.
Over the course of 2016, over 1200 Chinese citizens have bought apartments, holiday homes or other kinds of buildings in Hungary, whereas the number of Russian buyers is 446 and Ukrainians 231. 3163 foreigners have purchased 2929 real estates in Hungary, which means that the previous three countries have participated in 60 percent of the transactions.
In 2012, the Russians had a 38 percent share in the sales and the Chinese only 13 percent, however, their ratios have swapped: in 2016 the Russians had 14 percent, the Chinese had 38 percent. The Ukrainians, on the other hand, had their shares between seven and fifteen percent.
The number of foreign customers is growing constantly
These numbers refer only to those buyers whose origin country is not an EU member, since they cannot make any purchases without a permission. The number of all foreign buyers is much higher: in 2015 it was 8330, two thousand more than in 2012. As of yet, there is no real estimate regarding 2016. From the data given, it is obvious that non-EU buyers are in majority: from 15-17 percent in 2010, their rate has grown to 33 percent.
According to László Balog, lead economic expert at Ingatlan.com, foreigners own more and more immovable properties. There are more transactions, but the number of these is exponential with the growth of the Hungarian real estate market. In Hungary, six to seven percent of the purchases are made by foreigners, a number which is around 15-20 percent in Budapest, though there are substantial differences between the districts.
Budapest is the favourite spot
Most of the buyers are of German, Slovakian and Romanian citizenry. The latter two make their purchases usually around the border, because they can buy properties cheaper in Hungary than in their home countries. It is not just the Hungarians across the border who make these investments.
Budapest is by far the most popular among the foreigners, who are generally interested in the apartments in the downtown area and the family houses in the inner districts of Buda. The capital is followed by the Balaton region and West-Hungary.
From the three thousand immovable properties sold in the last year, 2100 were sold in Budapest. The top twelve investments by non-EU buyers were made in the capital city.
The five most popular districts are the following: 7th, 6th, 13th, 5th and 8th. Thirty-seven percent of non-EU investors prefer these five districts. Among the favoured areas outside the capital are Hévíz (13th place on the list), Debrecen (18th) and Pécs (20th).
The majority of Chinese buyers resort to the capital, however only half of the flats sold to Russians are in Budapest. Russians bought seventy-five properties in Hévíz in 2015 and forty-four in 2016. They are also keen on Zala county.
Ukrainians are a lot like Russians, only half of their transactions were done in the capital, the majority of their purchases were in Szabolsz-Szatmár-Bereg county, near the Ukrainian border.
Hungary is still relatively cheap, despite the rise in prices
Recently Financial Times reported that the real estate prices have grown the most in Hungary during 2016, and the reason for this are the high prices in the more expensive areas of Budapest. There was a 75 percent growth in prices in the fifth district between 2013 and 2016.
They also inform that in the central districts the majority of the buyers are foreigners, primarily from China, Russia and the Near East. The number of investments made on the Hungarian real estate market has grown by 121 percent (around 459 million euros) in the first quarter of 2017, according to estimates. Tourism plays a huge role in the popularity of Budapest, and the fact that the prices are still lower than in Prague, Bratislava or Vienna.
Luckily, the presence of the wealthier foreigners has not yet caused a rise in prices that would make those too high for Hungarians. However, foreigners are well aware of the market prices, so nothing can be sold to them at a price higher than the actual worth of the estate.