I lived in Hungary at the apex of the Orban years. It was fascinating to witness. People either loved him or hated him (most loved him back then). Even more interestingly, many individual foreign investors chose to invest in Hungary because of Orban and his vision. Others, mostly institutional, stayed away.
Orban lost the Hungarian elections in May, and has been replaced by Peter Magyar who is considered to be more of a “moderate.”
People on both sides of the aisle reacted very strongly.
With Benedek, my real estate buyers agent in Budapest, we had a quick discussion about the potential impact of these elections on the local real estate market.
No politics – just trying to keep a cool head to analyze the situation.
- Budapest Real Estate Investor Guide
- Get in touch with Benedek our Real Estate Buyer’s Agent in Budapest
The first victim: the Hungarian Golden Visa
Unfortunately, we are no longer comfortable processing Hungarian Golden Visas. This program was very much linked to the Orban administration and the risks of the new administration simply canning the program and cancelling investor applications halfway through the process is just too high.
To a World of Opportunities,
The Wandering Investor
Services in Hungary:
- A Real Estate Lawyer in Budapest, Hungary
- My favourite buyer’s agent in Budapest, Hungary
- Golden Visa in Hungary through real estate investment
Articles on Hungary:
- Budapest, Hungary Real Estate Market: 2026 Investor Guide for good value for money in Central Europe
- A cheap Plan B in rural Hungary
- Investing in the Stock Market in HUNGARY, good value or value trap?
- Best neighbourhoods and districts to buy Real Estate in Budapest
- Buying historic property in Budapest – full rental yield and ROI calculation
- Hungary Golden Visa – Timeline and Cost vs. other Schengen Residency Programs
- The Lesser-Known Neighborhoods of Budapest for Lifestyle and Investment Real Estate
If you want to read more such articles on other real estate markets in the world, go to the bottom of my International Real Estate Services page.
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Transcript of “Budapest Real Estate Market Update – A Hungary Without Orban”
LADISLAS MAURICE: Hello everyone from beautiful Budapest in Hungary and today we’ll be discussing the real estate market and how it will be impacted by the change in government here in Hungary together with Benedek. Benedek, how are you?
BENEDEK: I’m fine, thank you. Nice to see you again, Ladislas.
LADISLAS MAURICE: Yes. So big changes in Hungary made worldwide news. People are very emotional about it. They’re either excited or they’re very disappointed. So what’s your take on the potential impact that these elections will have on the real estate market here in Budapest?
Impact of Magyar administration on real estate market
BENEDEK: Well, what we are expecting is on the short-term, we are expecting that the market will continue to stall because everybody is waiting out to see how it goes, but in the mid-term, we expect a gradual increase in property prices. The new government is more pro-EU and they are better falling in line. So the EU is already releasing funds that they were previously withheld towards the Orban regime. So the EU is already releasing funds that were previously withheld for the Orban government. So we are expecting institutional money to come in as the new government is better falling in line. And in terms of private investors, there are people on both sides. So some people were previously deliberately investing here because of their conservative views, but I have also talked to people on the other side of the spectrum. What we are really expecting is nothing… Not major changes but rather a gradual real value increase over time.
LADISLAS MAURICE: So do you have any people that are saying, “Oh, you know, we’re Orban is leaving, so now we’re gonna like sell?”
BENEDEK: Yes and no. So I know people that are saying Orban is leaving and this is bad and I’m not that confident anymore that I want to invest here or come here to live part-time. I haven’t met anyone who is deliberately sort of panic selling because of the changing government.
LADISLAS MAURICE: Yeah, because if you look at the situation, let’s say you’re conservative and you invested here because you like Orban. Okay, he lost the elections. The current government no one really knows what they’ll be up to. Their main platform was, “We’re not that different from Orban, except that we won’t be as controversial, we’re not corrupt.” Essentially that, that was the main kind of main platform that they went on. So it’s not entirely clear what they will be up to, but they certainly didn’t run on a left-wing platform. They were still running on a very pro-business platform. So, I don’t know, we’ll see what comes out of it. But essentially, the people who would want to sell because Orban lost power, it’s then the question is where else are you gonna invest? You know, are you gonna send your money back to Germany? You’re gonna send your money back to Canada? So I think a lot of people were in the first few days very disappointed and said, “Let me sell,” but then, you know, after kind of digesting the news, you know, they’re thinking, “Oh, well, you know, let’s see what happens.”
BENEDEK: Yeah. Everybody’s like, “Let’s see what happens now,” exactly.
Institutional capital and EU funds return to Hungary
LADISLAS MAURICE: Okay, but yeah, I mean institutional money is going to come in. You know, the Orban government was controversial in many international circles. Now these EU funds are going to come, institutional money is going to come, funds are going to come back. Um, so for sure it’ll have a positive impact on the real estate market. You know, whether it’s the change is positive for the country or not, I mean that’s a different debate. We’re not here to debate this, but just from a pure real estate market point of view, it should be positive like you say in in the medium term. What about a construction activity?
Construction activity and housing supply in Budapest
BENEDEK: In the recent years or almost a decade now, Hungary had historically low newly built apartment numbers and the new government wants to help the supply side, uh in order to be to have more new developments, so that it will be possible for people to have a better access to newly built apartments.
LADISLAS MAURICE: Okay, so subsidies and all of that.
BENEDEK: Yeah.
LADISLAS MAURICE: Why did Hungary have such a low construction rate?
BENEDEK: I think it was because it was a tough thing to get bureaucratic approvals, um, if you didn’t have the right connections. It was just very few, a select few big companies that were able to do these developments.
LADISLAS MAURICE: And the cost of financing as well.
BENEDEK: Yeah, financing is always a hard topic in Hungary. Hungarian banks are usually tougher than other nations’ banks that I know of.
LADISLAS MAURICE: Yeah, so a lot of these construction will mostly be focused on the outskirts of Budapest and other areas in Hungary. You know, sure increased supply in the medium to long-term because projects on average from purchasing land to getting all the approvals and actually having the keys to the apartment on average in Hungary, it’s four years. So which is quite long. You know, in other markets, you can get a building done in two years. Here it’s four years. So we’re not going to see any of this happen we won’t see any of that extra increased supply for probably five years at least, and then even then it’ll be rather in the outskirts, it won’t be in downtown Budapest where there already where there are regulations in terms of zoning and height and all that. So core real estate should not be impacted by potential increase in supply down the line. And for now it’s just talk, you know, saying you want to increase supply and actually increasing supply, especially in the face of relatively tight labor market is uh are two very different things.
Is Budapest still good for rental yields?
LADISLAS MAURICE: So Benedek, a few years ago, you and I were making videos, we’re going around apartments and, you know, showing the return on investment and how attractive it was, and you in some cases, we could get net rental yields of 10%. You were, you know, you had these, we had these case studies. Now we’re not really making these videos anymore.
BENEDEK: No, we are not. And I am suggesting the same thing to all the clients that I talk to. Budapest is no longer a yield or cash flow option. It’s more of a lifestyle/capital appreciation speculative market. Most of my clients nowadays are purchasing because they want to spend some time here during the year or they want to just keep their money in a political environment that they think is good for their capital. Yields are being compressed because the rental figures are not able to keep up with the property price increases. So nowadays, uh a realistic yield is a gross 3-4% for a long-term rental property.
Budapest as a modern European capital
LADISLAS MAURICE: Yeah, so not a yield play anymore. Uh, but, you know, Budapest, I mean when we first met, Budapest was still very gritty, a little rough around the edges. And now is genuinely a center of European culture. Uh, the infrastructure is best in class. I mean, right here, we’re right in front of the Museum of Ethnography. It’s brand new. It opened what, two years ago?
BENEDEK: Yeah, some two years ago.
LADISLAS MAURICE: A stunning structure, new museums everywhere. It’s it really is a center of culture. It’s got great infrastructure, I mean airport-wise as well. The airport in Budapest is great. I never wait more than five minutes at security, flights to everywhere in Europe, all over the world, really easy in and out. They’re going to be building a train from the airport to downtown as well. When is that due? They’ve been talking about this for a while, though.
BENEDEK: Well, who knows when it’s going to realize but in it’s in the foreseeable future in several years probably.
LADISLAS MAURICE: Essentially, Western European standards, which was not the case before. You have still less than Western levels of real estate prices, but you do have the standards. But what you have, what you don’t have in the West is safety. Like absolute safety. It’s very safe here. Nothing will happen to you.
Taxes and transaction fees on Hungarian real estate transactions
LADISLAS MAURICE: And two, you also have lower taxation and more landlord-friendly laws. I mean, you can buy real estate, you can sell it after five years, not pay any capital gains. In Spain, you’ll get slapped with 30%. Taxes on rental income are just 15% and a lot of deductions are allowed. Transaction fees between buying and selling are also much lower than in most Western countries. So it’s just a friendly environment to put your capital and now it comes with Western standards. And as the West continues to just kind of go down the path it’s going down, so effectively you get Western standards, but with more landlord-friendly taxation and laws and an environment that in many ways is now better than the West.
BENEDEK: Yeah, exactly like you are saying, like I have a number of clients who are purchasing apartments here to use as a base in Central Europe and travel around from here. So they just, uh, park down here and fly to Rome in two hours or go by car to a number of neighboring countries or even river cruises are accessible via the Danube. It can also be regarded as a travel hub sort of. So I have several people doing that here.
LADISLAS MAURICE: Look, and it makes sense. It’s at the heart of Europe. It is also the holding costs of real estate are really low here. Property taxes are super low.
BENEDEK: Yeah.
Road infrastructure development in and around Hungary
LADISLAS MAURICE: Uh compared to, you know, Western cities. Again, the airport is a lot more affordable and faster. And like you say, the roads are really good around. I drove here from Montenegro. Last time I did this trip was about five years ago. Back then, it was 13 hours. It took me 10 hours and 15 minutes this time around of driving. Why? Because there are now all of these new highways in Bosnia, built by, with European Union money. Sometimes I get the benefit from these things. Um and they’re building more highways. So eventually the drive between Sarajevo and Budapest will be entire just brand new highways. It’s and it’s just you’re just seeing that all over also with the train. There’s a new train between Budapest and Belgrade. It’s the Chinese that did that one.
BENEDEK: Yeah.
LADISLAS MAURICE: Logistically, as a base, it makes sense. For capital preservation, it makes sense. Long-term capital appreciation as well. You’re it’s just you’re not going to be getting any high rental yields of any sort.
Airbnb regulations in Budapest
LADISLAS MAURICE: So Benedek, a lot of people want to buy a place, use it as a base, and then when they’re not around, put it on Airbnb. Is this possible in Budapest? Because there’ve been so many regulations.
BENEDEK: There are always new kind of regulations in regards to short-term rental. Right now, it’s still not possible because we are still in the moratorium window, but the moratorium expires by the end of this year. So from the next year, 2027 on, it should be possible to get new licenses for short-term rentals again. But it’s important to note that the short-term rental regulations are in the hands of each district individually. So each district is introducing new rules, new regulations that are making harder and harder to get new licenses. So it’s very important to not just rush ahead and buy anything that you like. You need to really check if it’s whether it will be viable for as a short-term rental. Short-term rental is in the same category as long-term rental. Yields also decreased in the short-term rental. Right now, based on the portfolio that I’m managing, I can say that the best option right now is to get a bigger unit with multiple bedrooms for bigger groups that are traveling together, and you don’t need to think about, you know, these stag parties around here, that’s not the typical kind of guest that will arrive in these apartments.
LADISLAS MAURICE: Not anymore.
BENEDEK: Not anymore.
LADISLAS MAURICE: It’s not really that much of a stag party destination.
BENEDEK: Because the city is no longer that cheap.
LADISLAS MAURICE: Yeah, yeah. So essentially, I could come here and if I wanted such a place where I spend a bit of time, I rent it out the rest of the time, I would have to buy an apartment with an existing license. Does a license get transferred to a new buyer?
BENEDEK: That’s a very good point because most people think it works like this, but here in Budapest, licenses are non-transferable because they are bound to the accommodation provider, so your individual persona, as Ladislas. So unless the license and the property as well is held by a company, you are not able to transfer licenses. It’s a very rare case that someone buys a property with a company and then if you buy the company, then you are getting obviously the property and the license as well with it.
How to contact Benedek for Budapest real estate
LADISLAS MAURICE: I wrote a whole article on the real estate market here in Budapest, the neighborhoods that are interesting, the neighborhoods that are a bit less interesting and some key learnings. There’s a link below. And if you want to invest in real estate here in Budapest, Benedek is the man to talk to. You’ve helped a lot of my clients find apartments here, do renovations, you can manage everything.
BENEDEK: Yep, exactly.
LADISLAS MAURICE: So not just in Budapest, but in the surroundings as well?
BENEDEK: Yep.
LADISLAS MAURICE: We did some interesting videos on some real estate along the Danube and some of the outer districts in Budapest that are very Hungarian, very typical, very nice. So there is, you can watch the next video as well on this. So, Benedek, always a pleasure.
BENEDEK: Always a pleasure. Me too.
LADISLAS MAURICE: Make sure to download my free ebook, 12 Mistakes to Avoid When Investing in International Real Estate, which you can find on my website, link below, and feel free to follow me on Instagram @thewanderinginvestor. I look forward to hearing from you.
