According to the latest quarterly data of 2019, drastic changes have been experienced in the real estate market. After several years, a decline could be observed in the case of property price indices by the end of last year; however, the price level of brick apartments in Budapest still shows an increasing tendency.
The most drastic decline was experienced in the case of block apartments. In the last quarter of 2019, the price index of this kind of property decreased significantly not only in the capital but in the eastern and western part of Hungary as well.
According to the analysis of Duna House real estate agency, drastic changes in the property market can be explained by the increase of sell-by date and the growing extent of bargaining. Additionally, the declining number of investors’ purchases and the increasing value of properties can also serve as reasonable explanations.
The weak demand might have caused price changes in December; concerning demand, 2013 was the last year when the real estate agency measured such a low index.
The new housing market should be examined as a special segment, where property prices still show an increasing tendency due to the VAT change. In this case, higher demand can be experienced compared to second-hand apartments.
In Budapest, the average m2 price of newly built properties was EUR 2,655 (~HUF 883,000) in the last quarter of 2019 – reported by Forbes.
Some interesting data from the analysis:
- 14th district preceded 13th district of Budapest on the list of popularity;
- In the fourth quarter of 2019, more than one-third of the sold properties were between 40-60 m2 in the capital;
- In Buda, 21% of the purchases were realised at a price exceeding EUR 2,705 (~HUF 900,000) per m2;
- In Eastern Hungary, the average price per square meter has grown by 9%; while in the western part of the country, this ratio increased by 19% in the fourth quarter of 2019 (compared to the same period last year);
- In the case of block apartments, the average price/m2 was EUR 960 (~HUF 319,000) in Eastern Hungary, and EUR 890 (~HUF 296,000) in the western part.
- Regarding brick apartments, the average price/m2 was EUR 1,070 (~HUF 356,000) in the east, and EUR 935 (~HUF 311,000) in Western Hungary;
- In Budapest, block apartments were offered for sale at an average price of EUR 1525–1665 (~HUF 507,000-554,000) / m2.
Intensification can be observed in the case of mortgage loans as well.
In 2018, a total of EUR 2.56 billion (~HUF 850.35 billion) housing loans were taken in Hungary; while – according to the data of the real estate agency and the Hungarian National Bank (Jan. – Oct.) – this amount increased to EUR 2.71 billion (~HUF 903.33 billion) in 2019.