Long-awaited turnaround in the Hungarian housing market here
The Hungarian second-hand housing market has seen an unprecedented turnaround, with sellers having to wait longer for buyers. Moreover, according to market participants, demand is down 20-50% month-on-month compared to last year, as reported Vilaggazdasaga Hungarian business news site.
Housing prices in Hungary have risen sharply lately, especially in the capital, where the price of a second-hand apartment can reach 1 million HUF (2,500 EUR) per square meter. At the moment there is a high demand for apartments with a smaller floor space, and the heating system is a very important consideration for buyers in light of the energy crisis and the drastic increase in prices. Energy.
However, the steady rise may be over now, as a Hungarian real estate agency, GDN Ingatlanhálózat, has reported a sharp drop in demand since May, the company’s founding owner said. Vilaggazdasag. As Zoltán Gadanecz said, only around 135,000 properties are expected to be sold this year, compared to 175,000 last year.
According to the expert,
the most important criteria for buyers now are how the property is managed, how it is heated and how high the overhead costs are.
Preference is given to houses with concrete panels, where central heating is still available at a reduced price, so high heating prices will not affect these apartments for the time being. However, these buildings are known to be largely outdated and expensive to operate, and any move to increase utility costs will have a significant downward effect.
In the future, an increase in the supply of homes for sale and for rent can be expected. This is due to the fact that owners will be forced to increase costs and that many vacant and underutilized properties could be put up for sale. These are mainly multi-family apartments where heating cannot be individually controlled or where common charges increase due to increased expenses.
As pointed out in the Vilaggazdasag article, a characteristic of the housing market is that prices fall more slowly than they rise. A shortage of demand for at least six months usually preludes sellers to cut prices, while everyone reacts to an increase in demand within 2-3 months.
As the time to sell a property, and with it the possibility of a bargain, has increased since May, the quiet decline in prices has begun.
This is due to a combination of a deteriorating economic environment, higher mortgage rates and fears of making ends meet.
However, new construction does not seem to be affected by the fall in prices, with new apartments in Budapest still rarely selling below 1.1 million HUF (2,740 EUR) per square meter. In fact, the typical price in the capital has risen to 1.3 million (3,240 euros) per square meter. And no one can build cheaper than that, according to the expert, because labor and material costs have increased.
Featured photo via Pexels
