The housing market is experiencing the phenomenon of a price rise stop, said László Balogh, senior analyst at ingatlan.com. The only time a similar halt was seen was in the second quarter of 2020, when the coronavirus epidemic emerged. This is good news for those who plan to buy property in Hungary – a sign to do so in the near future.
The average price per square metre of apartments and houses in Budapest was HUF 959,000 (EUR 2,313) and HUF 794,000 (EUR 1,915) respectively in mid-October, representing a year-on-year increase of 20 and 19 percent, but stagnation compared to the beginning of September. In other words, the price increase has stopped, according to an analysis by ingatlan.com.
The price freeze is also due to the opening of the supply-demand gap in recent months, napi.hu reports. In other words, supply is constantly increasing, while interest in properties for sale is decreasing. The coming months will determine whether the stagnation following the rise in prices for some properties for sale will turn into a fall in house prices.
A visible turnaround
A clear “message” has been sent by homeowners offering their property for sale in Budapest, according to the latest data, said László Balogh, chief economist at ingatlan.com. In mid-October, the price per square metre for apartments in Budapest was HUF 959,000, while the price per square metre for houses was HUF 794,000. This compares to HUF 800,000 (EUR 1,929) and HUF 666,000 (EUR 1,606) a year earlier. In other words, year-on-year price increases of 20 and 19 percent, which is equivalent to a monthly average price increase of 1.6 per cent.
The turnaround is shown by the fact that prices have remained unchanged since the beginning of September, meaning that for six weeks second-hand property prices have remained essentially unchanged. “The halt in price rises indicates that uncertainty and caution have appeared on the part of buyers and sellers have started to adapt to this,” the expert commented.
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More subdued months ahead
It is still too early to say whether the stagnation will last, or whether sellers will be forced to cut prices, or whether prices in the capital will get a new boost once the economic uncertainties have been resolved, napi.hu writes. According to the expert, the changes in Budapest are worth paying attention to because the trends in the capital are typically reflected later in the national picture.
In any case, according to the expert of ingatlan.com, purchasing power will be more subdued, partly because the energy crisis in Europe and rising interest rates due to inflation are having a negative impact on demand. Buyer hesitancy in the second-hand housing market could further reduce the number of sales in Budapest and nationally.
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Source: napi.hu, ingatlan.com
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