thousand HUF/sqm (1300 EUR), and
- Apartments in less preferred neighborhoods: around 220 thousand HUF/sqm (880
EUR).
It is possible to buy run-down apartments in need of total reconstruction for 175
thousand HUF/sqm (700 EUR). Make sure the neighborhood is clean and safe!
Average purchase price/square meter of new apartments in a middle class
neighborhood of Budapest is approximately EUR 1500-1800.
Check current property-selling prices by district, based upon the largest Hungarian
database of real estate ads. Don't buy higher than that! Don't expect to be able to sell
higher than prices per square meter on this page at the given time! For further
information, run a search for similar properties in the same location and compare
prices. If you are visual, view the property value map of Budapest.
Refurbishing costs. Complete refurbishing under average circumstances can be
expected to cost approximately HUF 50,000 (EUR 200) / sq.m.
Expenses when buying
Typical costs when acquiring property in Hungary include:
a) a minimum of 1 % plus 20% VAT, = a total of 1, 2 % solicitor's fee, paid by the buyer
upon signing the purchase contract. Required.
b) a minimum of 2.5 % plus 20% VAT = a total of 3,6 % buyer agent's commission, paid
upon signing the purchase contract. Optional.
c) Purchase duty as follows:
- When buying as a company, the company will pay 2% tax and declare that she intends
to sell the flat or dwelling within 2 years.
- When buying as a private person, one will pay 2% for the first 4,000,000 of the
purchase price of the flat or home, and 6% for the rest of the purchase price.
Expenses when renting out
a) Agency fee: 10-12 % of the first year's rent plus 20% VAT, paid upon signing the
tenancy contract.
b) Management fees: 10 to 12 % plus 20% VAT of the annual rental income.
c) Annual personal taxes on rental income as follows:
For non-resident individuals owning and renting out Hungarian property, there are two
possible routes of taxation:
Expenses when selling
Capital gains tax on property sold by an individual of 25 per cent.
From January 2008, rules on personal income tax and value added tax have changed
with respect to real estate sales. New income tax and VAT rules! >>>
Real estate agent: 3-5 % plus 20% VAT = a total of 3,6 % (or more) commission, paid
upon signing the purchase contract wit the buyer. Optional.
- Apartments in less preferred neighborhoods: around 220 thousand HUF/sqm (880
EUR).
It is possible to buy run-down apartments in need of total reconstruction for 175
thousand HUF/sqm (700 EUR). Make sure the neighborhood is clean and safe!
Average purchase price/square meter of new apartments in a middle class
neighborhood of Budapest is approximately EUR 1500-1800.
Check current property-selling prices by district, based upon the largest Hungarian
database of real estate ads. Don't buy higher than that! Don't expect to be able to sell
higher than prices per square meter on this page at the given time! For further
information, run a search for similar properties in the same location and compare
prices. If you are visual, view the property value map of Budapest.
Refurbishing costs. Complete refurbishing under average circumstances can be
expected to cost approximately HUF 50,000 (EUR 200) / sq.m.
Expenses when buying
Typical costs when acquiring property in Hungary include:
a) a minimum of 1 % plus 20% VAT, = a total of 1, 2 % solicitor's fee, paid by the buyer
upon signing the purchase contract. Required.
b) a minimum of 2.5 % plus 20% VAT = a total of 3,6 % buyer agent's commission, paid
upon signing the purchase contract. Optional.
c) Purchase duty as follows:
- When buying as a company, the company will pay 2% tax and declare that she intends
to sell the flat or dwelling within 2 years.
- When buying as a private person, one will pay 2% for the first 4,000,000 of the
purchase price of the flat or home, and 6% for the rest of the purchase price.
Expenses when renting out
a) Agency fee: 10-12 % of the first year's rent plus 20% VAT, paid upon signing the
tenancy contract.
b) Management fees: 10 to 12 % plus 20% VAT of the annual rental income.
c) Annual personal taxes on rental income as follows:
For non-resident individuals owning and renting out Hungarian property, there are two
possible routes of taxation:
- Private Route #1:
- Rental income is taxed separately from other income. The 25% tax rate is levied
on the gross rental income, without any cost deduction.
- Private Route #2:
- The taxable income is computed by
- deducting expenses that actually incurred and documented in the renting
process, such as lighting, maintenance, administrative costs, etc., or by
- deducting a 10% notional deduction from the gross income (10% expense
ratio). - source: Global Propertyguide
Expenses when selling
Capital gains tax on property sold by an individual of 25 per cent.
From January 2008, rules on personal income tax and value added tax have changed
with respect to real estate sales. New income tax and VAT rules! >>>
Real estate agent: 3-5 % plus 20% VAT = a total of 3,6 % (or more) commission, paid
upon signing the purchase contract wit the buyer. Optional.
 | |  | |  | |  | |  | |  | |  | |  |
The Right Price
Calculating Figures
Perfect Price...
Before making a buying or selling decision, you will need to know how much the
property is worth. When you are the seller, it is crucial to establish the "Perfect Price".
The Perfect Price is the price that will sell your home fastest, and for the most money
possible. When you are the buyer, you will have to check comparable market prices in
the neighborhood to make sure you are not paying too much.
RENTAL YIELDS IN BUDAPEST are currently around 5-7%, but good location is a must!
6% and above is considered good. A guaranteed rental return simply does not exist!
CAPITAL APPRECIATION IN BUDAPEST The Budapest real estate market is at a low
point currently which means that
Calculating Figures
Perfect Price...
Before making a buying or selling decision, you will need to know how much the
property is worth. When you are the seller, it is crucial to establish the "Perfect Price".
The Perfect Price is the price that will sell your home fastest, and for the most money
possible. When you are the buyer, you will have to check comparable market prices in
the neighborhood to make sure you are not paying too much.
RENTAL YIELDS IN BUDAPEST are currently around 5-7%, but good location is a must!
6% and above is considered good. A guaranteed rental return simply does not exist!
CAPITAL APPRECIATION IN BUDAPEST The Budapest real estate market is at a low
point currently which means that
- this is a good time to purchase now, and you should be able to find good deals
in the long run - this is not a good time to sell, so if you own property here, try to hang on to it if
you can - Budapest is a long term investment location. You should be able to keep you
property for at least 6 years to sell with a good profit.
| Hungary joined the European Union in May 1, 2004, and is expected to change its currency to Euro in 2011. Politics and Economy FACTS >>> Q & A What type of investment is recommended? €75,000 - €150,000 is currently best invested in a downtown Budapest apartment. € 2-300,000 is well invested in a home in the Diosd area (Erdliget - Diosd - Budafok), Torokbalint, or Budaors area (Budaors - Sasad). These are the up and coming Budapest suburbs. As always, select carefully what you buy. Your purchase should 'mach' the immediate neighborhood for a good resale. If you purchase to let, buy near international schools and keep it spacious but not fancy, families are price- sensitive! Floor-plans should please western tenants; Americans in particular if you're considering the above- mentioned up and coming suburbs. Contact us for assistance. What's the rental yield? Should be net 5-7%, but depends on the investment. Be extra careful, if a company claims to guarantee a certain per cent of capital appreciation or rental return! What capital appreciation can I expect? 10 -15% yearly in the case of a quality property bought at the right price. 10 per cent is more realistic, but it can be much higher if you make a smart purchase, have the nerve to keep your property when skies are gloomy, and sell in the right time. You can even loose money, however, if you buy an overpriced property in a non sought for location. I find investor discussion very interesting on the Overseas Property Investment forum of askaboutmoney.com |
EXPENSES
Purchase price. Prices, even in the
most desirable districts, are
considerably lower than in the other
cities of Europe. Budapest property is
currently trading at 25 - 50 per cent
discount on other European capital
cities.
Average purchase price/square meter of
resale apartments in good condition
- Landmark properties: 400-600
thousand HUF/sqm (1600-2400 EUR),
- Apartments in good areas: 325
Purchase price. Prices, even in the
most desirable districts, are
considerably lower than in the other
cities of Europe. Budapest property is
currently trading at 25 - 50 per cent
discount on other European capital
cities.
Average purchase price/square meter of
resale apartments in good condition
- Landmark properties: 400-600
thousand HUF/sqm (1600-2400 EUR),
- Apartments in good areas: 325
| What is the cost of maintaining an average apartment in Budapest? Building maintenance fee is € 30-40/month, paid by tenant if apartment is rented. Basic utility fees with no consumption: € 10/month. Insurance: € 200/year. Property management: € 20-30/month if apartment is not rented. How much do lawyers charge? 1% -2 % of the purchase price (+ 20 % Value Added Tax) for preparing the Purchase Agreement and obtaining the title from the Land Registry. How can I identify and avoid scams?
How long does it take to complete a purchase? Under normal circumstances and following a thorough search, securing the right property takes 1- 3 weeks. If you are in a hurry and / or your only purpose is investment, it is possible to get to the point of signing the contract in a couple of days. (It is generally not a good idea, however, to hurry, when you are buying or selling real estate.) The property must be chosen, agreement with the seller, the Land Registry must be consulted, lawyer to draft the contract, 10% down-payment deposited, contract signed. It is also possible to sign the documents and deposit contract and down-payment with lawyer until conditions are fulfilled. Finally let me remind you again: If professionals are taking care of property inspection and legal issues, 'paperwork' for you, be sure they don't work for the seller! |
| Disclaimer: the article serves merely information purposes. Due to its extent, it is neither an all round information nor shall it be qualified as legal advice. |
| Budapest is a stable place economically, legally and politically; one of the safest locations for long term property investment in CEE. Your investment, however, can turn out to be a costly adventure in any country, if you rely entirely on companies that specialize in 'serving' (or taking advantage of) foreign investors. Do your own research, get to know the area - yes, get on the plane! Property presentations brought to your own city can be very misleading. You can wake up to reality too late if everything (property search, legal work - including establishing a company and then managing your company -, property furnishing, finding a tenant, property management) is brought to you on one silver plate by the same company. Have your own independent solicitor, or hire your own unbiased buyer's agent - work with local professionals who are paid to represent your interest, not the seller's. If a service is said to be 'free' for you, be careful - it can end up costly. Their loyalty is not yours. Don't give up control. Property investment companies will make profit on you, and not you through them, if they do all the work for you. They will not help you to an easy automated income, or to a get-rich-quick lucky deal. If you want to make good money for yourself and not for others in property investment, do your own homework and become informed before you enter into any deal! Take your time! Get out if they rush you! The door of opportunity is not about to close yet. |
| View the comparative property value map of Budapest |
| Currency Converter >>> Convert Hungarian Forint (HUF) prices to your own currency! |
| FiloLog.com | currency converter | route planner | relocation to Hungary | Budapest | Hungarian culture | translation services |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| |
 |
| - - - - - - - - - - - - - - - - - - - - - - - - - - Buying or Renting a Home in Hungary - - - - - - - - - - - - - - - - - - - - - - - - - - |
| property prices, expenses, yield, investment, interest, yield, price, expense, gain, tax, rental income, property management, capital gains tax, acquisition of property, investing in real estate, international real estate investment |
| © 2008 Budapest-Propertyfinder.com | About us | Contact us |
| For Sale Asking price statistics in Budapest on ingatlan.com Asking prices in suburbs on this site: Budafok (distr. 22) Budaörs Diósd & Érd Sasad (district 11) Törökbálint |
