Changes Coming to Home Subsidy in Budapest – Higher Amounts and Updated Regulations

Published: December 15 2023

The Hungarian government is proposing changes to the regulations and amounts of the home subsidy known as "Falusi CSOK" in preferred small settlements. These changes would impact the amount of the subsidy and the required length of the social security coverage.

Starting from 2024, the amount of the Falusi CSOK subsidy is set to increase significantly. Additionally, if homeowners plan to renovate or expand their existing homes and have a child, they could be eligible for a fixed subsidy amount of 600,000 HUF. This is an increase compared to the current rules, where renovation after having one child is eligible for 600,000 HUF, and renovation after having one child is eligible for 500,000 HUF.

One of the key requirements for the subsidy has always been the appropriate social security coverage. The proposed changes would introduce a uniform requirement of a two-year social security coverage, regardless of the number of children or the housing goal. This is stricter compared to the current rules, which require a 180-day coverage for building or purchasing a new home after having one or two children, a one-year coverage for renovating or expanding an existing home after having one or two children, and a two-year coverage for building or purchasing a new home after having at least three children, or renovating or expanding an existing home after having at least three children.

The proposed changes would unify the deadlines for childbearing. Currently, if homeowners plan to have one child, they have four years to fulfill this goal. If they plan to have two children, they have eight years, and if they plan to have three children, they have ten years. It is important to note that the definition of "young couple" is changing. From the time these changes are implemented, a couple can only apply for the subsidy if the female spouse is under 41 years old. This change aligns with the regulations of the CSOK Plus subsidy and expands eligibility to single individuals and partners regardless of their marital status.

The subsidy for children born after the goal has been met is often overlooked. If homeowners originally applied for the subsidy and took out a mortgage, but have a child after achieving their goal, they can apply for additional support. The proposed changes would increase the post-birth subsidy to 1,000,000 HUF per child, compared to the current amount of 400,000 HUF.

The CSOK loan is a fixed 3% interest rate loan that can be applied for in addition to the CSOK subsidy. From 2024, this loan will still be available, but only if homeowners also apply for the Falusi CSOK subsidy. The maximum amount of the loan depends on the housing goal and the number of children. For homeowners with two children, the maximum loan amount is 10,000,000 HUF, and for those with at least three children, it is 15,000,000 HUF. This applies to all housing goals, including new home purchases, construction, renovation or expansion of used homes, and renovation or expansion of existing properties. Currently, homeowners can apply for half of the total amount for renovating or expanding an existing property compared to other housing goals.

What changes are coming to home subsidy in Budapest? The proposed changes aim to modify and clarify the regulations of the housing subsidy available in preferred small settlements in Hungary. This includes increasing the amount of the subsidy and updating the requirements for social security affiliation.

What form will the housing subsidy, known as Falusi CSOK, continue to have? The only form of the housing subsidy that will remain is the Falusi CSOK, which is available in small settlements with less than 5,000 residents.

Will the amount of the Falusi CSOK increase? Yes, according to the proposed regulations, the amount of the Falusi CSOK will increase starting from 2024. There will also be a uniform amount of 600,000 forints for renovation and expansion of existing homes after having one child.

Are there any changes to the required social security affiliation for the subsidy? According to the proposed regulations, there may be a change in the required social security affiliation. Currently, the duration of the affiliation depends on the number of children and the purpose of the subsidy. The proposed change suggests a unified two-year affiliation requirement regardless of the number of children or the housing purpose.

Will the requirements for childbearing be standardized? Yes, the proposed regulations aim to standardize the deadline for childbearing. Currently, there are different deadlines depending on the number of children. The proposed deadlines are:

Is there an age limit for couples who can apply for the housing subsidy for a planned child? According to the proposed changes, a couple can apply for the Falusi CSOK for a planned child if the wife has not yet reached the age of 41. The current regulations state that the wife must be under 40 years old at the time of application.

Are there any changes for retroactive subsidies for children born after fulfilling the housing purpose? Yes, there will be changes for retroactive subsidies for children born after fulfilling the housing purpose. The proposed regulations state that if the applicant already received the housing subsidy and had a loan related to it, they can receive additional support for a child born after the fulfillment of the purpose. The amount of this retroactive subsidy will increase to 1 million forints per child, compared to the current amount of 400,000 forints.

Will there be an increase in the maximum amount of supported loans for renovation and expansion purposes? Yes, according to the proposed regulations, there will be an increase in the maximum amount of supported loans for renovation and expansion purposes. The maximum amount will depend on the housing purpose and the number of children. For example, if there are two children, the maximum loan amount will be 10 million forints, and for at least three children, the maximum loan amount will be 15 million forints.

Can the CSOK loan be applied for alongside the housing subsidy? Yes, the CSOK loan, which is a subsidized loan with a fixed interest rate of 3%, can be applied for alongside the Falusi CSOK subsidy. The maximum loan amount will depend on the housing purpose and the number of children.