Real estate in Hungary: how much it costs and how to buy

1. Hungary’s real estate prices are some of the lowest in the EU. Purchasing prices for apartments in Budapest are 20% lower than in Ljubljana and Madrid and 30% lower than in Lisbon.

2. Up to 40% of foreigners buy real estate in Budapest as an investment, as per Statista research.

Foreign buyers are attracted by low prices, a stable market, and the opportunity to decrease property prices by several per cent due to the exchange rate adjustment.

After joining the EU, Hungary did not switch to the euro, and there are fluctuations of the national currency — a Hungarian forint — exchange rate against the euro and dollar.

Terms of obtaining a Hungary Golden Visa

3. Foreigners investing €500,000+ in real estate can obtain a Hungary residence permit. The investor must also have sufficient funds for travelling and living for the entire stay in Hungary. The Golden Visa program will launch in 2024.

4. In 2023, property rental prices increased by 12% year-on-year. The most popular apartments among tenants are an average of 55 m² in Budapest, Debrecen, Szeged, and Miskolc.

The gross rental yield is 5%. In Budapest, it ranges between 3.5 to 8%.

5. The Hungarian real estate market is on the rise. Since 2015, real estate prices have increased by 2.5—3 times.

The graph shows the growth of the real estate price index in Hungary compared to the average EU real estate price index, as per the Eurostat data

HUF 900,000, or about €2,360 per m², is the average property price in Hungary in 2024.

The most expensive developments are in Budapest: on average, new housing in the capital city costs €2,900 per m². In prestigious and tourist parts of the city — including districts I, II, V, and XII — prices for apartments may reach €5,500 per m².

In major Hungarian cities, average prices per square metre of new real estate are as follows:

• €2,310 in Debrecen;

• €2,300 in Siófok;

• €1,760 in Székesfehérvár.

€1,100 per m² is the average resale property price in Hungary. In Budapest, the price is twice higher — €2,200 per m².

Veszprém and other areas near Lake Balaton are as popular with foreign real estate purchasers as Budapest. The average property price there is around €1,600 per m².

In Hungary, there is a growing demand for apartments up to 60 m² in modern residential complexes. Prices for such properties grow faster than others; in 2022, the increase in Budapest was 21%. Additionally, property maintenance in new buildings is cheaper than in historical ones due to the higher energy efficiency class of new properties.

Source: Numbeo

Property buyers in Hungary pay stamp duty for the title transfer, administrative fees, and charges for the services of experts who accompany the deal.

The stamp duty for the title transfer is paid when the deal is completed. The rate is 4% of the purchasing price for properties under 1 billion forints, or €2.6 million. The buyer pays 2% for the exceeding amount for more expensive properties.

The stamp duty is paid within 90 days after the purchase.

The primary real estate buyers pay the VAT of 5%. The tax is usually included in the property price.

Administrative fees are the following:

• €170—200 — for obtaining permission for property purchase;

• €60 — for putting a veto on activities with the property;

• €30 — for an extract of the land registry;

• €22 — for property ownership certificate.

Legal, realtor, and notary services are also paid for by the buyer. The expenses usually do not exceed 5% of the property price.

Expenses when purchasing real estate are about 10% of the property price. When purchasing apartments for €175,000, the buyer will spend about €192,500 on the deal, all taxes and fees included.

After purchasing real estate in Hungary, a buyer pays a transfer tax, or a stamp duty, at a general rate of 4%. However, in some cases, a new property owner can be allowed to pay a reduced tax:

1. If buying a new property within 3 years after selling the previous one, a person pays the tax only if the purchase price of a new house is higher, and the tax is imposed only on the difference in selling and purchasing prices.

2. Buyers under 35 purchasing their first property pay property tax at a 2% rate. The main condition is to buy property for less than HUF 15 million, or €39,500.

3. Newly built properties can be taxed at a reduced rate: the amount under HUF 15 million, or €39,500, is not taxed. The buyer only pays the tax to the amount over this value. Properties cheaper than HUF 15 million are not levied.

Budapest is the capital and the largest city of Hungary. It is known for its historical buildings, great Danube views, cultural sights, and high life standards. At the same time, the cost of living in Budapest is lower than in many other large EU cities.

Buying property in Budapest allows one to experience the charm of living in a historical house with elegant architecture, high ceilings, and unique decorations.

Budapest is the most popular city among real estate investors: in 2022, more than half of properties purchased by foreigners were located in Budapest. As a result, property prices are the highest compared to the rest of Hungary.

Examples of real estate for purchase in Budapest

Hungary, Budapest

€642,000+

Classic three-bedroom apartment, Ujbuda, Budapest

150 m²

3

3

Hungary, Budapest

€593,000 — €946,000

Stylish apartments with city view, First District, Budapest

75 m² — 107 m²

2—3

2—3

Hungary, Budapest

€552,000 — €581,000

Elegant apartments with 4 bedrooms, Eleventh District, Budapest

103 m² — 124 m²

4

4

Debrecen is the second-largest city in Hungary. The city has a convenient location and an airport, making it easy to travel to any part of Europe. There are several universities and research centres in the city, so it can be a choice for those who seek a place with good educational opportunities.

Unlike Budapest with its vibrant lifestyle, Debrecen offers a tranquil environment to its inhabitants. This is combined with a rich culture, a high quality of life, and lower property prices.

Towns around Lake Balaton, such as Siofok or Veszprém, are also in high demand among real estate buyers. In 2023, nearly 10% of properties purchased by foreigners were located in this area.

There are more than 70 development projects on Lake Balaton shore, and investors can purchase primary apartments with beautiful scenery.

The cost of living in this area is lower than in Budapest, Debrecen, and other big Hungarian cities. Being the main Hungarian resort area, Lake Balaton offers various recreational activities such as sailing, windsurfing, kayaking, hiking, cycling, and horse riding.

Lake Balaton scenery in Siofok. Visitors and inhabitants of the city can enjoy a vibrant nightlife, beautiful beaches, and the promenade with picturesque views of Lake Balaton

Hungarian legislation allows foreigners to purchase any properties in the country, except for farming lands and heritage assets.

Foreigners must obtain permission for real estate purchase at the Land Registry of the district where the property is located. The permission is obtained by the lawyer who accompanies the deal. The procedure takes up to 4 weeks.

The following categories do not need permission for purchase:

• citizens of Hungary;

• citizens of EU countries, as well as Norway, Lichtenstein, Iceland, and Switzerland;

• citizens of any country if inheriting property.

Foreigners must fully compensate for property purchase, ownership, and maintenance expenses. Buyers pay the title transfer stamp duty, owners pay utility charges and the annual real estate tax, and sellers have to pay the capital gains tax.

Real estate in Hungary allows obtaining a residence permit. The status is granted to the investor and their family for 10 years and can be extended once for the same period. To qualify, the foreigner has to purchase residential property for at least €500,000.

When investing in Hungarian real estate, foreigners should be aware of some pitfalls they might encounter.

Complex procedure of property purchase. When buying a property in Hungary, a foreigner cannot turn to public agencies in person. The purchase and sale deal must be accompanied by a lawyer who submits and receives all the documents on behalf of the buyer.

Most foreigners must also get special permission to purchase a house, which adds to the time and expenses.

Transfer of ownership specifics. In Hungary, property becomes the buyer’s possession not when a purchase agreement is signed but after a corresponding record is made in the land registry. This can take several weeks to several months, and until the process is complete, the buyer is not legally an owner of the property.

To the investor, this means that they might not make some significant decisions regarding the property, such as renovation, renting out, or moving, until the land registry record is made.

Protection of historical heritage buildings. The country protects its historical heritage, including houses. For some buildings, there are restrictions relating to property ownership and renovation. Thus, if a buyer wants to renovate their house, they might be obliged to get a special permit and comply with preservation guidelines.

Property energy performance certificates. The owner must have an up-to-date energy performance certificate in Hungary when selling real estate. The certificate includes information about the energy efficiency class of the building that can influence the value of the property and the expenses of a new owner.

If the seller provides an outdated certificate or does not provide it at all, the deal can be legally challenged or invalidated.

The annual property tax rate depends on the municipality where the property is located. The maximum rate is about 3% of the property’s cadastral value, or about €1 per m² a year.

Monthly utility costs depend on the property area, the energy efficiency class of the building, and the water and electricity consumption. On average, owners of 85 m² apartments pay €100—230.

Property insurance in Hungary is optional. Only properties purchased with a mortgage are subject to obligatory insurance.

When selling real estate in Hungary, the owner has to pay a capital gains tax. The tax rate is 15% of the difference between the selling price and the property purchase expenses.

The longer the owner holds the property, the lower the tax rate upon selling. The capital gains tax is not paid if the property possession time is over 5 years.

In 2024, Hungary launches the Golden Visa program, allowing foreigners to obtain a residence permit in return for investments in the country’s economy.

All there is to know about the Hungary Golden Visa

Available investment options include:

• purchasing residential property — €500,000+;

• investing in local real estate funds — €250,000+;

• donating to an institution of higher learning — €1,000,000+.

The investor first gets a Guest Investor Visa for 2 years, allowing them to enter Hungary. Within 93 days of entering Hungary with this visa, they must fulfil the investment condition — purchase property or real estate fund units or donate. After that, the investor applies for a residence permit.

A spouse, children under 18, and parents can be included in the application with the investor.

Investors holding residence permits get the right to move to Hungary, travel visa-free to the Schengen Area countries, and do business in the EU.

1. Up to 40% of buyers of Budapest’s real estate consider it an investment asset. The real estate market is growing, while Hungary’s property prices remain some of the lowest in the EU.

2. Lawyers must accompany a property purchase and sale deal. Only they have the right to make a purchase and sale agreement, obtain permission for purchase, and get the property ownership certificate.

3. Taxes and fees for property purchases make up to 10% of the property price.

4. The most attractive real estate in terms of investment are apartments of up to 60 m² in modern residential complexes.

5. Foreign real estate investors can obtain a residence permit in Hungary. A foreigner must buy real estate for at least €500,000 to qualify.