Trend change? Hungarian real estate prices are falling

Based on a new survey, real estate prices in Hungary fell by 10 percent, while the number of foreign investors increased by 30 percent in June. An expert of ingatlan.com says the reason is the weak forint. Below you can read the details.

According to Forbes, the Hungarian real estate market is changing because of the weak forint. As we reported, the euro rose above 410 forints, while the dollar also broke the 400 mark on Wednesday morning. That means another historical low for the Hungarian currency. At the beginning of 2022, 1 EUR was 360 HUF. In May, it rose to 380 HUF. Meanwhile, in the last few days, it has been breaking all previous records.

The weak forint considerably affects the Hungarian real estate market since most foreign buyers do not pay with forint. Ingatlan.com says that the number of real estates priced in euros is not high in Hungary, but

their number is constantly growing.

“Classical buyers, meaning people, families moving from one flat to another, pay in forint and calculate with the Hungarian national currency. Those using the euro are investors and foreign owners.” Therefore, primarily villas, big downtown flats and more expensive real estate are priced in euros, László Balogh, an expert of ingatlan.com, told Forbes.

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In 2021, only half percent of the deals offered in the Hungarian real estate market were priced in euros. However, this rate increased to 1.5 percent this year because of the stronger euro. In some cases, the price of the real estate went up by 5-10 percent when it was priced in forints.

“There are areas where the rate of real estate priced in euros is higher than the national average. These are 

the region of Lake Balaton, Somogy County, Budapest and the cities and villages close to the country’s western border,

Mr Balogh said. In the capital, for example, the rate of euro real estate was 1.6 percent compared to 0.4 percent in 2021. The rate in Somogy County is even higher: 2.1 percent compared to 1 percent.

Hungary became a highly desirable destination for foreigners who want to change their euro to forint to buy real estate. For them, the price of real estate in Hungary decreased by 10 percent on average because of the weak forint. László Balogh said that was the reason why the rate of foreign investors rose by 30 percent in June compared to May.

 

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Source: forbes.hu