Fast times in the Hungarian real-estate market

Both developers and buyers have reacted swiftly to recent changes affected the real estate market in Hungary. Effects of changes in the property market were the main themes of the Valuation property conference organized annually by Portfolio and RICS Hungary since 2011.
 

Both developers and buyers decide fast

Tibor Földi, CEO of Cordia Magyarország Zrt. explained that price dynamics can depend on the availability of lot supply. Strong  investment demand in the downtown of Budapest can raise the prices even more. Gábor Kiss, Managing Director of Metrodom Kivitelező Kft. noted that the relationship between demand and supply has become more favourable. The developer thinks that property prices can locally reach the top in the coming years, followed by a perspective correction. It can be the consequence of the temporary nature of the reduced VAT (valid only until 2019) making both developers and investors decide quickly.

A dominant capital

Gábor Rutai, Chief Analyst of Duna House added that the Hungarian real estate market is dominated by the capital. In the countryside demand is increased by investors and people moving into bigger towns looking for jobs. Tibor Földi agrees that most developers are active only in Budapest, however, the south-eastern part of lake Balaton, Győr, Kecskemét, and Debrecen can also be interesting for developing companies dealing with large volume projects.

Upturn in the construction market

Property developers have reacted fast to the introduction of reduced VAT and the expansion of The CSOK Programme. András Csoma MRICS, Board Member, RICS, moderator of the session said that we are seeing the emergence of a property development boom which may not be handled by the whole market. Compared by the boom of 2000, the affordability of the apartments has been going a little bit better, which inspires optimism – added Áron Horváth, Manager of ELTINGA / Lakás Riport.

Gábor Tokodi, Deputy-CEO of FHB Bank reported that banks primarily consider housing projects with many apartments (mainly 20-50, but principally 50+). The expert thinks that the expansion of the CSOK housing benefit program caused a significant move on the Hungarian property market and it can also reduce the high rate of cash buyers.  The participants of the conference also agreed that the rise of the demand will provide opportunity for developers to increase real-estate prices.

(Source: http://www.portfolio.hu/ingatlan/lakas/nagy_meglepetes_var_a_lakasvasarlokra.2.230157.html?utm_source=index_main&utm_medium=portfolio_box&utm_campaign=portfoliobox)