When it comes to real estate, location is important; a Hungarian property is no different. Prices and property types vary across the country. The trend is, however; that most Hungarian expatriates and international investors gravitate towards the resort areas of Balaton or the city of Budapest.
The first thing to note is the reason for purchasing the property. If you desire a home in the country, a lakefront property, or a city dwelling as a primary residence or investment property; then the right real estate options can then be explored to match your request. The next considerations would then be price, property type, and square footage.
Country cottages are prevalent in eastern Hungary and in small towns and villages across the country. The prices in these areas are also much more affordable. Some eastern towns include:
The Balaton region accounts for most lakefront properties in Hungary. Typically, real estate prices are less on the south side of the lake and more expensive on the north side. There are many communities that surround the lake and some, like the resort towns; are more costly to live than others. A few of the lakeside towns are:
Budapest, the capital city; offers all the trappings of a modern metropolis. Condominiums as well as houses can be found throughout the city’s landscape. There are several districts that are a part of the city’s makeup that cater to luxury as well as modest living. Districts in Pest with consistent and increasing real estate activity include:
- 7th District
- 8th District
- 9th District
Budapest consists of a total of twenty-three (23) districts. There are six districts in Buda, one on Csepel Island (located in-between Buda and Pest); and sixteen (16) in Pest.
When purchasing a Hungarian property; it is very important that special attention is paid to the fees on the purchase and sale agreement. Whether or not you follow through with the agreement; the fees still need to be paid. Buyers are responsible for the lawyer’s fees while sellers are responsible for the real estate agent’s fees.
Contracts are issued in twos; one in English and the other in Hungarian. It is important to note that property and estate laws are different in Hungary compared to other countries. Therefore, it would be in your best interest as a foreign investor with Hungarian property ownership; that you have a Hungarian Will drafted for a stress-free way of disbursing your assets upon your demise.
As of January 1, 2005; any properties purchased that are valued at less than 15 million forints (USD$66 248), will be exempt from property transfer tax. The property transfer tax is about 6%. The tax on rental income for personal is 25% and for a business it is 16% of the net income. The personal tax rate does not allow for deductions of outgoing costs.