Shifting trends in Budapest: Real estate prices, population declines, and creative housing solutions – VIDEO

Over the past two decades, Budapest’s real estate market and population landscape have undergone significant changes, with varying trends across its districts. These shifts reflect broader transformations in the capital, from population declines in the city centre to rising property prices in certain areas, and even the emergence of tiny, innovative living spaces.

Population decline in Budapest’s core districts

Between 2001 and 2022, Budapest’s population decreased by 5%, with 17 out of its 23 districts experiencing a decline, G7 reports. Notably, the most severe population losses occurred in the central districts of the city, such as the V, VI, and VII districts. In the V and VII districts alone, populations dropped by 24%, while the VI district saw a 20% reduction.

Interestingly, while inner-city districts faced depopulation, areas on the outskirts saw growth. The XXIII district recorded nearly a 10% increase in population, with the XXII and XIII districts also experiencing significant growth, each over 7%.

The issue of population decline in the VI district has been highlighted in connection with a potential ban on Airbnb. Local authorities have raised concerns that short-term rentals could be driving residents away, a factor contributing to the district’s noticeable depopulation.

Real estate prices: rising but uneven

While population declines mark the city centre, the real estate market in Budapest has seen notable activity, especially over the summer. Prices nationwide have shown little month-to-month change, with a slight increase of just 0.1% between July and August. However, over the past year, real estate prices have continued to climb at a steady rate of 6.5%, a slight uptick from the previous annual figure of 6.4%, László Balogh, economy expert at ingatlan.com, told Economx.

In Budapest’s outskirts, specifically in the agglomeration of Pest County, real estate prices surged by 1.2% in July, while the rest of the country saw more mixed results. Despite this, the annual growth in Pest County remained the lowest in Hungary, at only 3.2%.

Central Budapest’s luxury real estate market saw some price adjustments recently. In the VI district, the average price per square metre for premium apartments dropped by 1% in just four weeks, from HUF 1.45 million (EUR 3,670) to HUF 1.43 million (EUR 3,618). This decline comes amid broader discussions about potential regulations targeting short-term rentals, like Airbnb. In mid-September, a referendum on banning short-term rentals is set to conclude in the VI district, with government actions on the matter likely to follow.

Despite these fluctuations, real estate remains a hot commodity in several Budapest districts, with average prices per square metre exceeding HUF 1 million (EUR 2,530) in 11 districts. Meanwhile, in four districts—XVII, XXI, XX, and XXIII—prices remain more affordable, with average prices still under HUF 800,000 (EUR 2,024) per square metre.

Creative solutions in Budapest’s housing market

Amid these changing trends, creative housing solutions have emerged in Budapest. The city recently gained attention for what could be Hungary’s smallest apartment. Located near Nyugati station, this 3.2-square-metre property originally served as a bathroom, but the owner has transformed it into a fully functional living space.

The compact apartment, currently available for rent on Airbnb, includes a kitchen area, bathroom, and sleeping loft accessible by ladder. Despite its small size, the apartment is cleverly designed to meet basic needs for a short stay. However, it lacks natural light, with only a small window by the bed and a ventilation system to provide fresh air.

This tiny apartment is also up for sale, along with a larger, 30-square-metre property, underscoring the city’s growing interest in unconventional housing solutions as real estate prices and demand continue to rise.

Read also:

• How would an Airbnb ban affect Budapest’s rental market?
• Upcoming vote could jeopardise Airbnb’s future in Budapest

Featured image: depositphotos.com