Published: November 22 2023
Budapest has become increasingly popular among foreigners looking to buy real estate in Hungary. The Hungarian Central Bank has released data showing a high rate of foreign property buyers in the market. This article will discuss the key details and trends regarding foreigners buying property in Budapest and other areas of Hungary.
Rising Rate of Foreign Property Buyers
Recent data from bank360.hu reveals that the rate of foreign property buyers in Hungary has been steadily increasing. In Q2 2023, 6% of property sales were made by foreign individuals, totaling 1,800 properties. This rate was even higher in Q3 and Q4 of 2022, reaching 6.6% and 6.5% respectively. In 2022, the number of foreign nationals buying property in Hungary exceeded the pre-COVID peak, with almost 8,000 purchases. The weak forint was a major factor attracting foreign buyers to Hungary last year. On average, foreign buyers spent HUF 43.3 million (EUR 113,000) to buy an apartment in 2022, compared to the average of HUF 25.2 million in 2018.
Regional Variations in Foreign Property Ownership
Certain areas in Hungary have higher rates of foreign property ownership. In the downtown districts of Pest, the rate of foreign property owners exceeds 20%. In the West and South Transdanubia regions, it reaches 10%. Budapest specifically saw a rise in the rate of foreign buyers, reaching 8.7% in 2023 compared to 7.8% in the previous year. The growing interest of foreigners in Somogy County can be attributed to the popularity of Lake Balaton. Germans, Austrians, and Dutch nationals are interested in investing in these regions due to the more affordable property prices.
National Decline in Property Transactions
Although the number of foreigners buying property in Hungary decreased in 2023, following the national trend, the rate of foreign buyers increased significantly. From January to September of that year, there was a 28% decrease in property transactions compared to the previous year. Foreign buyers represented every fifth buyer in the downtown districts of Budapest. This rise can be attributed to a higher decrease in Hungarian buyers. The economic uncertainties, skyrocketing inflation, and interest rates were factors impacting the overall decrease in property transactions.
Top Foreign Buyers and Investment Trends
Germans make up the majority of foreign property buyers in Hungary, with their numbers growing by 69% compared to 2022. Vietnamese, Chinese, and Russians were the biggest spenders on apartments, with an average expenditure of HUF 60-70 million (EUR 157,000 - 183,000). Interestingly, the French also made significant investments, with an average expenditure of HUF 51 million (EUR 133,000). Slovaks were the second-largest group of buyers, most of whom were above 65 years old. They showed particular interest in small Hungarian villages near the border. Retirement was a common reason for West and Central Europeans to invest in Hungary, while East Asians, such as the Chinese, came to work or start businesses in the country.
Popular Areas for Foreign Buyers
Aside from Budapest, several towns have become popular among foreign buyers. Rajka, Battonya, Győr, Mosonmagyaróvár (all close to the border), and Hévíz (close to Lake Balaton) are among the most sought-after locations for foreign property purchases outside of the capital city.
Questions & Answers
What is the rate of foreign property buyers in Hungary? Based on recent data from the Hungarian Central Bank, the rate of foreign property buyers in Hungary is constantly high. In 2022, almost eight thousand foreign nationals bought real estate in Hungary, and in the first half of 2023, more than 3,200 foreign nationals bought real estate in Hungary.
Which districts in Budapest have a high rate of foreign property owners? The five downtown districts of Pest in Budapest have a rate of foreign property owners of more than 20%.
Which regions in Hungary have a high rate of foreign property owners? In the West and South Transdanubia regions of Hungary, the rate of foreign property owners reaches 10%.
Which nationalities spent the most on buying property in Hungary in 2022? In 2022, Vietnamese, Chinese, and Russians spent the most on the Hungarian market to buy property. The average amount spent by foreigners to buy an apartment in 2022 was HUF 43.3 million (EUR 113,000).
Why was Hungary popular among foreign buyers in 2022? Hungary was popular among foreign buyers in 2022 because of the weak forint, the currency of Hungary.
Why did the number of foreigners buying property in Hungary decrease in 2023? The number of foreigners buying property in Hungary decreased in 2023 due to economic uncertainties, skyrocketing inflation, and interest rates. However, the rate of foreigners increased significantly because the decrease in Hungarian buyers was higher.
What was the rate of foreign buyers in Budapest in 2023? In Budapest, the rate of foreign buyers in 2023 was 8.7%, which is a significant rise from the previous year's rate of 7.8%.
Which regions outside Budapest were popular among foreign property buyers? Rajka, Battonya, Győr, Mosonmagyaróvár (all close to the border) and Hévíz (close to Lake Balaton) were popular target towns outside Budapest among foreign property buyers.
Which nationalities were the majority of property buyers in Hungary? Germans were the majority of property buyers in Hungary, and their number grew by 69% compared to 2022. Vietnamese, Chinese, and Russians also spent a significant amount on buying property in Hungary.
Why do West and Central Europeans come to Hungary to buy property? West and Central Europeans come to Hungary to retire, while East Asians come to Hungary to work as employees or start businesses here.
Which small Hungarian villages near the border had a high number of real estate purchases by Slovakian nationals? Dunakiliti, Abaújvár, Gönc, or Hidasnémeti, small Hungarian villages near the border, had a high number of real estate purchases by Slovakian nationals.