Due to the ever-increasing prices, renting an apartment has become a luxury. Nevertheless, the majority is still willing to pay the high rental prices in Budapest if the apartment has good parameters. Data show that many people prefer to rent real estate in the current uncertain market environment rather than purchase a home.
Rental prices in Budapest are skyrocketing
Depending on location and equipment, apartments in Budapest can be rented out up to HUF 100,000 (EUR 265,95) more expensive, reports Pénzcentrum. According to Zoltán Gadanecz, the founder-owner of GDN Real Estate Network, the current trend clearly shows that people looking for rentals strikingly outnumber those who consider home purchases in Budapest. This may be due to the fact that many people don’t want to risk taking out a loan.
“For a long time, we kept being warned how expensive loans are. Interest rates skyrocketed last year, they were already over 10 percent at the end of the year, but since then a marked decrease has started. We are now at 8 percent interest rates, which already belong to the healthy category, but it takes time until this information reaches the masses. This is one of the reasons why the majority consider renting to be on the safe side,” he said.
Tenants are willing to pay more
Since the supply did not pick up, but the demand remained robust, the rental prices in Budapest started to surge. According to Zoltán Gadanecz, people are aware that they will not get their hands on a good rental unless they are ready to reach deeper into their pockets. “People do not mind paying HUF 40-50 (EUR 106,38 – 132,98) thousand more for a property that meets their needs in all its parameters, one that is cosy and feels like a proper home. Tenants are willing to spend more on rent and try to cut back on other expenses instead.”
What does the future hold?
According to the expert, what the future may bring depends on several factors. On the one hand, from the second half of the summer, as the academic year approaches, another wild run-up in rental prices can be expected. On the other hand, this can be counterbalanced if, in addition to falling interest rates, the market starts to recover and more people will opt for purchasing.