Why Do Property Prices Keep Going Up?

Property prices keep going up: in the case of an apartment with a favorable location sellers don’t have to give a discount off the price anymore; in fact, the possible buyers offer more money to avoid somebody else getting the apartment. But why do prices keep increasing, and how long can this trend continue?

In 2013 Everyone Started to Buy Property

From the outbreak of the crisis in 2008 to 2013 property prices were decreasing. But in 2013 news stated that prices won’t go any lower, thus everyone should consider buying an apartment – and investors did so. Apartments in the city center were the best investments, since they were relatively cheap, and the demand for apartments to rent in the city center kept increasing, thus investors could realize an 8-10 percent yield buying such a property.

50-75 Square-Meter Apartments Are Most in Demand

Regarding the price it is not unimportant how big and where the apartment is. 50-75 square-meter apartments for HUF 12-20 million, located in the 11th, the 2nd, the 13th or the 12th district – and outside the capital in Veszprém County – are most in demand. But by 2014 apartment prices went up in every district in Budapest.

Foreign Investors’ Presence Is More Prominent

Since many lost their trust in financial services companies, those who have money to invest, are more likely to invest in property than keeping their money in savings accounts or starting trading stocks. Foreign investors’ presence in the market is also getting more prominent, since despite the increasing prices, Hungarian property is still very cheap. Thanks to the Subsidized Housing Program for Families (CSOK) starting in July, property market is expected to get more intense outside the city center as well.

Source: 

http://index.hu/gazdasag/2015/04/23/lakasarak_lakaspiac_ingatlan/