Property price increase may stop this year in Budapest

According to hvg.hu, the skyrocketing of property prices may stop in 2018. This is because the number of property purchase is decreasing. As we reported, there was an 18.4pc increase in the prices of Budapest properties in 2016. Also, on a national scale, prices have increased by 10-15pc since 2015.

Price increase may stop

Based on Ingatlan.com’s analysis, property prices increased even in 2017. For example, real estate prices grew by 10pc in Budapest; however, the trend might stop in 2018.

To start with, László Balogh, economic expert of Ingatlan.com said that price increase in itself is not surprising. This is because demand for new and resale flats has not changed. However, two significant changes happened in 2017. On the one hand, more and more property purchases were financed with loans because interest rates were lower than ever. On the other hand, property purchase in Budapest is not increasing anymore. As a result,

dynamic price increase may stop this year.

He added that probably other big cities would become the motor of the property market in Hungary. There the demand is growing, and prices are increasing.

Clearly, one can still experience considerable differences in the country regarding prices. In fact, the average price per sqm in Budapest was 543 thousand HUF at the end of December. This means a 16pc rise since 2016 December. To make matters worse, the increase rate was even bigger in case of tower blocks in Budapest. Here the average price per sqm exceeded 405 thousand HUF (EUR 1,300) which equals a 19pc growth. The analysis highlights that