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Housing Market: 3-7% Price Increase Expected in 2022

Hungary Today 2022.01.12.

The housing market is showing signs of recovery, which is expected to continue in the near future, as both the national and capital city housing market indexes have reached two-and-a-half-year highs, HVG reports. According to a joint survey conducted last December by economic research firm GKI and Masterplast, a building materials company, used home prices are expected to rise 3 to 6 percent over the next 12 months, while new home prices are expected to increase by 7 percent.

This article was originally published on our sister-site, Ungarn Heute.

GKI conducts a quarterly survey to determine the outlook for real estate companies. The current survey, which involved 108 companies, also drew on the results of a representative public opinion poll that surveyed 1,000 people. According to the survey, the market for used real estate has recovered in 2021 after a decline in 2020.

Demand is also bolstered by further increases in household incomes in the near future and price discounts for families with children. According to the survey, real estate companies’ expectations for the next 12 months have hardly changed compared to the previous quarter. In Budapest, the outlook improved for prefabricated houses and worsened slightly for single-family houses.

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In eastern Hungary, the outlook for condominiums is unchanged and slightly worse for detached houses. In western Hungary, prospects for apartments in prefabricated houses have become significantly more positive.

The housing market index hit its bottom in the second quarter of 2020 and has improved since then. The current survey’s results are in line with this upward trend. GKI-Masterplast’s capital and national Housing Market Index (which compresses the expectations of real estate companies and the public into a single number) reached a two-and-a-half-year high in December 2021.

The majority of respondents expect prices of used apartments to stagnate in Budapest and increase in rural areas. Prices are expected to rise 3 percent in Budapest and 4-6 percent in rural areas, with the largest price increase (6.3 percent) in the western Hungarian region, according to the survey.

In the new housing market, two-thirds of respondents believe prices will rise by 7-8% next year. And as for the rental market: most people expect prices to rise in the capital and stagnate in rural areas, with an increase of 2-3% next year, according to GKI and Masterplast.

Featured photo illustration via Pixabay