A beautiful city, a central European location and excellent value for money are factors making Budapest a city of choice when it comes to property investment.
Dubbed the Paris of Eastern Europe, over 23 million tourists flocked to Hungary in 2019, and it’s not hard to see why. Budapest is a culturally rich city, with exciting architecture, a flourishing arts scene and an abundance of spas and thermal baths.
For investors, the city offers the opportunity to invest in one of the most affordable capitals in Europe that offers excellent scope for both capital growth and excellent rental yields.
Budapest is home to around 17.9% of the country’s population and accounts for approximately 39% of Hungary’s national income.
Hungary has experienced strong economic growth over the last decade with gross GDP being driven by rising disposable income and increasing disbursement of EU funds.
Budapest enjoys a diverse range of industries, and Hungary as a whole has a strong agricultural, industrial, automotive, electronics and services sectors, making its economy incredibly robust. Across Hungary, the service sector contributes 55.3% of GDP and employs almost 63% of the labour force.
The city itself has seen increased foreign investment and citywide renovation, which is driving growth.
Despite the challenges of the Covid 19 crisis, economic performance has remained steady in Hungary.
Budapest is a popular destination for tourists from across the globe. Visitors numbers in Budapest have grown steadily since 2009 and peaked at around 4.6million visitors in 2018, almost four million of whom were international tourists.
The city enjoys year-round appeal – summer months provide a perfect backdrop for exploring, and in July 2019 overnight stays in the city passed the million mark. Winter visitors come to enjoy the Christmas markets, outdoor ice rinks and stunning lights.
Thanks to its central location in the heart of Europe, Budapest attracts visitors from all corners of the world, with visitors coming not just from Europe, but from many further afield travellers looking for a perfect base from which to explore neighbouring countries. A vast increase from travellers from Russia has been seen, thanks to the easy and affordable direct flights available.
Property Investment Budapest
One of the most attractive propositions about Budapest for investors is the opportunity to purchase accommodation in a capital city at a price that is so favourable when compared to other European capitals.
Real estate prices have increased by over 30% over the past years signifying an exciting opportunity to see real capital returns on any investment and demand for rental is strong from both the young professional inhabitants of the city, but also from the tourist market. There is also a growing student population in the city, attracted by the leading universities that are situated there.
Additionally, Hungary is a property investor-friendly country – legislation is favourable to landlords, and taxes are low – the absence of property and housing tax and the single tax scale of 15% of net rents excluding charges make it possible to benefit from very advantageous taxation.