BBJ: Hungarians expect home price rises; see investment opportunity
Most people expect further significant price rises on both the Budapest and provincial real estate market, while also eyeing newly built real estate as the best form of investment, says research commissioned by property developer Cordia.
Every seventh Hungarian thinks about buying an apartment or a house, covering the costs through selling real estate they already possess, taking out a loan, or using other forms of savings, according to the research commissioned by Cordia, a subsidiary of the Hungarian-owned Futureal Group.
Some nine out of ten people believe that apartments in Budapest will get more expensive, with the majority of respondents calculating with a price increase of at least 10% in the next year. Every third surveyed person believes that a price growth exceeding 20% is not impossible.
The rate of those who think that real estate in the countryside will become more pricey is around 75%. However, only about one-tenth of respondents think that an increase over 20% is realistic, with every fourth person considering a 10-19% rate plausible, in case of both new and old homes.
The research reveals that while most are aware of prices skyrocketing and rental fees increasing, only about a quarter of those surveyed are aware that the beneficial 5% VAT rate in case of new homes is set to end soon, most likely resulting in a further price hike.
New homes are considered the best form of investment at the moment by Hungarians, followed by used homes. In third place is gold, followed by currencies, and land. Not surprisingly, bank deposits are in last place, thanks to low interest rates, with even cash proving to be a more popular investment option.
On average, 14% of respondents are planning to purchase real estate in the next 12 months. The rate is even higher in Budapest, standing at 17%. The number who plan to carry out renovations is higher, standing at a quarter of all respondents. In Somogy and Zala counties, in southwestern Hungary, every third respondent is planning renovations.