Housing

In the first half of 2021, 9,795 new dwellings were built, 13% more than a year earlier. The number of dwellings to be built on the basis of construction permits and simple declarations was 15,274, 22% more than in the same period of 2020.

Rents continued to rise in June 2021, increasing by 1.6% nationally and by 1.8% in Budapest compared to the previous month. Supply prices were also slightly higher than in the same period last year, something not seen for more than a year. Of all the district groups in Budapest, prices stagnated only in the outer districts of Pest, the largest price increase (2.8%) on the previous month being recorded in the transitional districts of Pest.

It is particularly important to present, in addition to our regular and detailed publications, the current situation of the areas most affected by the pandemic with flash estimates using a limited information base. Our WEEKLY MONITOR presents the economic and social impacts of the pandemic through daily, weekly and monthly updated preliminary data as a collection of interactive diagrams.

Authorities issued building permits for nearly a third less floor space in May 2021 than a year earlier. A different and strong base effect prevailed for both building types. Permitted floor area fell to less than half of the very high base in May last year for non-residential buildings, while the low base for residential buildings increased by one and a half times, also helped by an increase in the floor area of single and multi-family residential buildings.

In Hungary, dwellings were built at an average net price of 302 000 HUF per sqm in 2020. In the last two years, growth in the unit cost of housing construction has accelerated significantly, with the annual rate of increase exceeding 10%: the cost per sqm of single-family houses has risen slightly more than new dwellings in multi-storey, multi-dwelling buildings. The estimated price per sqm of construction was highest in the capital and in Hajdú-Bihar county, both at HUF 320 000.

The housing loan stock of over HUF 4000 billion as of 31 December 2020 was 10% higher than in 2019 and accounted for 8.4% of GDP. Both the number of approvals and disbursements decreased, while their amounts increased. With the dominance of loans for the purchase of second-hand dwellings, the weight of lending for new dwellings has decreased. The number of CSOK grants increased by 18% and their amount by 29%. The moratorium on repayments introduced to mitigate the effects of the epidemic was used for 43% of housing loans.

Mainly the second-hand housing market was affected by the first two waves of the epidemic. Housing market turnover recovered after 2014, peaked in 2019 and fell 13% year-on-year in 2020, mainly due to a drop in second-hand home sales in Q2. The rapid rise in house prices that had been continuing until 2019 also slowed down, with the price indices for new and second-hand dwellings splitting as the former continued to rise at the same pace as in previous years.

On 1 January 2021, Hungary's housing stock consisted of 4 million 501 thousand dwellings, which increased by almost 27 thousand in 2020 as the balance of dwellings built and ceased. Budapest, Pest and Győr-Moson-Sopron, which have a significant share of the real estate market, continued to contribute the most to the accelerating growth since 2016. Housing density was further reduced by the growing housing stock and the declining population, especially in Budapest.

The yearbook is a data compilation on construction permits and simple declarations, dwelling constructions and cessations, housing stock, housing market and the management of municipalities. Data on average construction costs and the main figures of housing loans as well as data of dwellings purchased by the National Asset Management Company are also available here.