Development of real estate prices in Budapest 2008 – 2025
Real estate prices in Budapest have developed exceptionally strongly over the last ten years. Between 2014 and 2023, property prices in Hungary increased by, according to the Global Property Guide over 230%, which represents an average annual increase of around 13–14 % corresponds.
Deflated by the Consumer Price Index (CPI), this results in a real average annual increase in value of around 7–9% for Budapest – depending on the source and reference period.
2008–2013: Decline due to the financial crisis
Between 2008 and 2013, Hungary – as in many other countries – saw a significant drop in prices on the real estate market. The global financial crisis hit Budapest particularly hard: buyer confidence fell, credit became less available, and many planned construction projects were put on hold. The decline was particularly strong for existing properties in poorer locations or in need of renovation. Depending on the location, prices fell by 20-30% and in many cases recovered only years later.
From 2014: Dynamic recovery and appreciation in Budapest
From around 2014, a sustained recovery began, supported by economic stabilization, growing domestic consumption, improved credit availability and growing international demand. From 2016 onwards, Budapest – especially the inner-city districts – recorded particularly strong price growth. Driven by investors, students, expats and waves of modernization, many period apartments were renovated and rented or sold at higher prices. During this phase, real estate prices in Budapest rose by 10-15% per year, and between 2014 and 2023 the cumulative price increase in Hungary was over 230%.
2020–2025: Stabilization at a high level with moderate growth
Despite global challenges such as the corona pandemic, supply chain problems and the war in Ukraine, the real estate market in Hungary remained surprisingly stable. Although a short-term decline in transactions was noticeable in 2020, prices largely held up - and continued to rise from 2021, albeit at a somewhat more moderate pace. In particular, renovated period apartments in good inner-city locations – for example in Budapest – have proven to be crisis-resistant. In 2024, the market again recorded a noticeable upswing with a price increase of around 5% compared to the previous year. The long-term trend remains positive, even if short-term fluctuations depending on the economic situation cannot be ruled out.
2025: Special support for first-time buyers drives the market
In 2025, the Hungarian government launched the program “OtthonStart”, which offers first-time buyers low-interest financing with a fixed interest rate of just 3 % possible for up to 25 years. Official information According to this, loans of up to HUF50 million (≈125,000€) can be applied for.
The allowable upper limit for the purchase price According to government guidelines, it is up to HUF100 million (~250,000€) for apartments and HUF150 million (~€375,000) for houses.
This funding instrument has already boosted demand in the short term: An analysis showsthat just a few weeks after the announcement, demand increased by around 20%.
Market observers, however, warnthat this program is part of a pre-election stimulus package and continued continuation cannot be guaranteed.
For investors, this means: An additional surge in demand could drive up prices in sought-after locations in the short term - at the same time, there is a risk that the funding will be ended, changed or restricted, which is why realistic return planning is recommended.
Our conclusion
The prices in the Hungarian capital remain low compared to other European cities (metropolises/capitals), which means that there is considerable potential in central and near-centre locations.
The price development in the capital due to the support program (19% in the current year) is a clear exaggeration, which could be followed by a correction if the program is discontinued. However, we do not believe in a massive correction, rather the sellers will have to adjust their sometimes unrealistic price expectations slightly downwards or wait patiently.
We also assume that the price dynamics will flatten the higher the prices rise - and we are using a scenario of for our return calculations for the next 5-10 years in the core area of the city of Budapest an average of 4.5% – after deducting inflation.
When calculating the return on rents, we assume an increase of 3% p.a., which is above the inflation target of the Hungarian central bank and well below the increase in rental prices in Budapest that has been observed so far.
Sources
The figures are supported by multiple independent data sources including:
- MNB (Hungarian National Bank)
- BIS (Bank for International Settlements) / FRED Database
- Global Property Guide
- FHB Housing Index
- Otthon Centrum (Budapest market report)
