Rents continued to rise in July: both nationally and in the capital, they increased by 1.9% in one month. Supply rents rose in all regions of the country except Pest County. In Budapest, the highest increase was recorded in the transitional districts of Pest (3.0%). The rate of nominal rent growth continued to exceed the monthly rate of inflation in July, with real rents rising by 1.6% nationally and 1.7% in the capital compared to the previous month.

Rents continued to rise in July

After a slowdown at the end of 2022, the first half of 2023 saw a faster pace of rent growth in the rental market. Rents continued to rise in July 2023, with supply rents up by 1.9% both nationally and in Budapest compared to the previous month. Compared to the same period of the previous year, July rents rose by 13% in the country and by 14% in the capital, and by 92% and 84%, respectively, compared to the same period in 2015.

Nominal rents have been rising above the peak of January 2020 for about a year and a half, exceeding it by 32% nationally and by 29% in Budapest in July 2023. At the same time, taking the consumer price index into account, real rents are 7.6% and 9.7% below their pre-pandemic levels. The monthly rate of inflation also lagged behind the rate of nominal wage growth in July, with real wages rising by 1.6% in Budapest and by 1.7% in Hungary.

In the capital, rents rose by 2.1% in the inner districts of the Pest side, by 3.0% in the transitional districts and by 1.7% in the outer districts in a month. Supply rents rose by 1.1% in the hilly districts of the Buda side and by 2.2% in the other districts. Over a year, the highest increases were recorded in the transitional districts of Pest (14.8%) and the lowest in the hilly districts of Buda (10.7%).

The supply of dwellings for rent remained below the level a year earlier

Between January and July 2023, 56% of the advertisements taken into account were for housing in the capital, 29% for housing in county towns and 13% for housing in non-county towns. The average floor area of the dwellings advertised for rent was 55 m² in Budapest and 58 m² in county towns. In the smaller settlements – in non-county towns and villages - the dwellings for rent tended to be larger, with an average floor area of 67 m². The apartments for rent with the largest floor area (78 m² on average) continued to be advertised in Pest County.

Nationally, the vast majority (92%) of the advertisements observed were for dwellings in multi-family buildings, with the remaining 8% or so for detached houses. In the first seven months of 2023, 42% of the advertisements in the capital and 43% nationally were from private individuals.

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