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Investment in Budapest

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Investment in Budapest

Budapest is the capital of Hungary and ranks as one of the top destinations in Europe.

With facilities encompassing political, cultural, commercial and industrial, as well as transportation, it holds a diverse historical background for anyone to explore at their leisure.

When looking at foreign property, investment in Budapest is a viable option for many. Any foreigner can purchase property in the city, with many benefits such as:

appreciation and
rental yields.

Budapest real estate prices are substantially lower than other European capital cities.

There have been major corporations that have purchased real estate and have in turn created a demand for residential rental property.

Budapest has a strong economic growth pattern and Hungary continues to contribute over 80% of the Gross Domestic Product alone in the private sectors.

When looking at the city as a whole, Buda is the greener, quiter half of Budapest, with Pest residing more on the commercialized side of the spectrum. Together, these two halves offer extraordinary attractions such as churches and museums as well as shops, restaurants and nightlife.

In order to make an investment in Budapest, you must be informed on where exactly you wish to settle your interests.

Tips on Where to Invest in Budapest

There are 6 major sections that all have their own features and benefits depending on what type of investment in Budapest you are making.

District V – Inner city, the main financial district and the location of the Parliament buildings
The recently opened Fashion Street in Deák Ferenc utca makes the area an investment hotspot in downtown Budapest.
District VI (Terézváros)– the main social and cultural center, properties are numerous and pricing is cheaper than District V. The elegant Andrássy Avenue offers lots of properties for investment.
District VII (Erzsébetváros) – the Jewish quarter, veterinary and medical school district
District VIII (Józsefváros) – an area where the government is carrying out an extensive renovation project, ideal for investments in regards to long term
District IX (Ferencváros) – the local government is also carrying out renovations in this district with a number of cafes and bars especially in Ráday Street. Major universities are in IX districts with many students from foreign countries in need of apartments to rent near the public transport services.
District XIII – this district is a purposely built residential area containing many different styles of architecture, contains the Westend City Center shopping mall

The new Government Quarter will be built in XIII district which makes it a very lucrative area in terms of a Budapest property investment.

You will want to be sure of all the necessary steps you need to take when thinking about an investment in Budapest.

You should have no problems purchasing real estate or building lots as long as you are not intending to purchase producing land. There are applications that need to be processed and sometimes can take up to several months to complete the process. You do not want to be discouraged with investing due to some paperwork process.

Be prepared for all the necessary work and there will be no surprises for you come time to make your Budapest property investment.

One option when considering an investment in Budapest would be to hire a Buyer’s Agent or Search Agent to help manage the process for you.

They will keep your best interests in mind while making the entire process easier for you in the end. This can be looked upon as an investment in itself for your purchase that justifies the cost of hiring an agent.

Whether you go about it alone or with an agent, be sure that you are making an informed decision. Purchasing foreign property is a major step and should not be rushed through or taken lightly.

Cost of Property Investment in Budapest

Real estate prices very roughly between 200 000 HUF (cc. 800 €)-1 000 000 HUF (cc.) 4000 €) /m2 depending on location and condition of the property.

You'll have to hire an attorney to handle the legal process of buying. Attorney fees vary between 1-1.5 %.

If you decide on hiring a Buyer's Agent expect to pay a fee between 3-4 % success fee upon completion of the contract.

If you want to buy more than one real eastate in Budapest the best is if you form a company.

Property Acquisition Duty (stamp duty): incaseof properties for residential purposes (apartments, flats): up to 4 000 000 HUF 4% up and 6 % of the remaining amount.

Find out more about certain legal issues related to property investment in Budapest-Hungary.