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Even some of ruling Fidesz’s mayors have grown critical with the draft bill that would enable virtually all the current tenants of council properties to buy them at a fraction of their real value, without needing approval from the municipalities. Despite the criticism, the legislation, however, is moving ahead.

We reported last week that Fidesz MP László Böröcz tabled a bill that would let tenants of council properties buy the apartment they are renting, for not more than 30% of the market price (something that could easily go further down to even 10-15% with additional discounts). The plan drew criticism not only politically but from the social sector too. Critics say the bill would deepen the housing and social crises, while some fear the appearance of the housing mafia and property speculations. Many also criticize the governing parties for wanting to favor those loyal to them with the bill. According to rough calculations, the council-owned rental properties’ total worth amounts to some HUF 1,000 billion (EUR 2.85 billion), a large part of which would be now privatized, leaving municipalities without these assets.

Fidesz's New Bill on Sale of Council-Owned Properties Draws Criticism
Fidesz's New Bill on Sale of Council-Owned Properties Draws Criticism

The law would further deepen the housing crisis, and dissolve the local council's renting system, critics say.Continue reading

The bill apparently generated criticism in the ruling party’s circles as well. One notable example being the 16th district’s Fidesz mayor who labeled the draft as “idiotic” and “immeasurably unjust.” Péter Kovács, however, was not the only one from Fidesz circles to express some opposition.

“It is the basis of our legal certainty that only owners- the local governments in this case – have the right to make decisions about the property they own. It is, therefore, not right of the National Assembly to decide by using the law against the owners, about the disproportionate alienation of municipal properties,” according to Székesfehérvár’s Fidesz mayor. András Cser-Palkovics argues that the part of the proposal that concerns apartments rented out for an indefinite period should be considered. However, in the case of “fixed-term rentals, the submitted draft in its current form is not acceptable,” he concluded

A number of other pro-government city leaders also made it clear to expect modifications of the bill, according to left-leaning daily Népszava’s report.

One of them was the Fidesz mayor of Győr (the Western city’s council owns the second most such properties after Budapest’s 13th district). Csaba András Dézsi expects and is confident that the proposal would eventually narrow the range of subject properties. According to him, it is a legitimate suggestion that in some cases individuals would be more prudent owners than the councils. “But if we give these properties to those young people who start their careers living in municipal rental housing on a fixed-term, five-year contract, than the next generation won’t have this opportunity.”

Balassagyarmat’s Fidesz mayor pointed out that this type of housing for low-income young couples, social workers, and other professionals are very important for the municipalities and more would be needed. Gábor Csach stressed that the ideal number might be a matter of debate, as “zero is definitely a bad position.” In their case, the lost assets would amount to some HUF 1 billion (EUR 2.9 million), he claimed.

Meanwhile, Fidesz MP Böröcz says they are ready for the debates and will try to convince other party members. But he says the proposal is goodwith a discounted price and a 25-year installment payment option, so that many of the low-income families could own property, while it also settles the issue of the Castle District monument apartments.” In regard to constitutional concerns, he says if the Constitutional Court decides on the bill, “we will respect the decision.” Earlier, he explained that he sees nothing to confirm that the draft would cause a housing crisis or favor the housing mafia.

Despite the debate, the government apparently will move forward with the plan. On Monday, the ruling forces majority in the National Assembly’s Committee on Economics hadn’t put any obstacle in the legislation’s path. This means it would up to the plenary to further discuss the bill. László Böröcz, however, earlier claimed that Parliament could vote on the bill as early as in June.

featured image: László Böröcz in the Parliament; via Szilárd Koszticsák/MTI