Real estate & home loans: shocking differences between Budapest and other big cities
The average monthly salaries and real estate prices vary drastically across the country. While some people can easily pay back a home loan, it can take its toll on another family’s budget, depending on where they live.
Buying one’s own home is something we all dream of. Unfortunately, this dream is only possible for many with the help of home loans. Ingatlan.com and the Central Statistical Office looked at some data to figure out how people from different parts of the country can live and pay back loan instalments considering the real estate prices and average net income where they live.
In Hungary, buyers are required to have at least 20% or 30% of the total price of their desired real estate to acquire a loan from a bank to pay for the rest. Also,
people can spend maximum 50% or 60% of their monthly net income on loan repayments.
However, experts suggest never to reach this mark, because it would not leave room for unexpected expenses in the family budget. Once the loan is granted, people continue to pay it back in monthly instalments.
As real estate prices and monthly net salaries differ vastly in different parts of the country, it takes a much bigger toll on some people’s livelihoods to pay back a loan than on another’s.
In fact, people living in the most expensive regions can pay up to five times more than people living in less expensive areas, Forbes reports.
A survey by Ingatlan.com reveals that while
there are counties where on average, people need to spend only 1/10 of their monthly income on loan instalments, in other counties, the instalments can take up 40% of people’s budget.
For example, in Debrecen, it takes about 39% of the average monthly income of people to pay the most favourable loan instalments, while in Salgótarján, the same index is only 14%. The reason is the vastly different real estate prices and average monthly net salaries.
Real estate prices
As usual, the capital has the highest real estate prices on the market, where a 40m2 studio apartment costs around EUR 78,000 (HUF 28 million), while a flat with similar characteristics costs only EUR 16,700 (HUF 6 million) in the Northern parts of Hungary, in Nógrád County.
Read alsoIt is cheaper to live in a downtown hotel than to rent an apartment in Budapest
Net income
Data also reveals that the monthly net salaries are also highest in Budapest, where the average exceeded EUR 915 (HUF 328,000). In contrast, in Szabolcs-Szatmár-Bereg County, people earn only net EUR 500 (HUF 180,000) a month on average.
Read alsoCheck out how much flats in Hungary cost!
Source: Forbes.hu