About Hungary

It is predominately a flat country with some mountainous regions in the in the north and west. Southwest of Budapest is an important landmark, Lake Balaton, Europe’s largest lake which attracts millions of tourists every summer from all over Europe. The Danube slices the country in half, entering Hungary from Slovakia before winding it’s way to Serbia & Montenegro in the southeast.

The population of the country is just over 10,000,000 with approximately 20% of them living in the capital, Budapest. Hungary’s primary industry was historically agricultural, however most of the young population now chooses university education and the service industry is the most dominant. The education system is very strong and produces many solicitors, doctors, dentists and engineers. Hungarian graduates are in great demand in Western Europe.

The official language is Hungarian. Whilst it uses the Latin alphabet it is a very unique language and is notoriously difficult to learn. The good news is that most Hungarians speak fluent English, especially in the service industries.

The Currency is Hungarian Forint. Exchange rate: £1 = 360 Ft

The weather: Unpredictable. Officially called Central European climate with four (distinguishable) seasons. Winters could be snowy and very cold, whilst summers are hot and dry.

A brief history

After a hundred years of annoying most surrounding settlers, the time came to grow up and join the rest of Europe. Hungary was established as a state in 1000AD and took up Christianity. To this day the leading religion is Catholicism but Hungarian people have always been tolerant and welcome towards other religions.

Until 1500AD Hungary was a powerful, stable kingdom. Later, mainly because of its geographic position being in the centre of Europe, Hungary became the battleground of many major powers (Austria, Turkey, Germany, Russia) positioning themselves in Europe. It was under Turkish reign for 150 years, the memories of which are still present in the form of Mosques and hundreds of Turkish baths.

After many unsuccessful and wars and uprisings, Hungary became part of the Astro–Hungarian Monarchy that was present until the end of the First World War. It was during that time that Hungary stretched its borders furthest and occupied today’s Croatia, Slovenia and Slovakia.

After the Second World War, during which Hungary was very badly damaged, it fell under communist regime. There was yet another tragic attempt to seek freedom in 1956 but the country had to wait till the late 1980s for that to happen.

Hungary had always been one of the most liberal and open countries during the communism; private ownership and travelling were amongst the few luxuries that other countries did not benefit from.

After 50 years the first free elections were held in 1990.The country went through a huge learning curve in the next 10 years. With the help of the rest of Europe, in the form of foreign investment, it strengthened its economy and improved its infrastructure. Hungary joined NATO in 1996 and the European Union in 2004.

Economic factors

• GDP growth average 2.9% compared with EU 0.7%
• Inflation has gone down from 18% in 1997 to 4.7% in 2004
• Unemployment: 6%
• Productivity 13% rise every year
• Foreign investment since 1989 has been £15 billion
• 30,000 firms are operating in Hungary with foreign capital
• Wages are 1/3 of UK’s but growing every year on average 5.7% every year
• Growing foreign investment: mainly commercial,
• GE Capital’s Indian, African and Middle Eastern headquarters are located Budapest. Audi, Samsung, Electrolux, LG, Ericsson, Vodafone, Schindler, Phillips, Samsung, Nokia, Vauxhall all have offices in Hungary.

The tourism industry is growing especially following the rapid growth of budget airlines flying to Budapest:

• easyJet, Wizz Air, Jet2, Sky Europe, Air Berlin – 30% increase on the number of visitors since 2003
• Spa tourism will be the new big hit, there are already 7 main spa regions in the country
• City weekend breaks: street parties, themed restaurants, and bohemian pubs.
• Four Seasons Hotel opened in 2003
• Sunday Times voted Budapest in the top 20 hip cities to visit
• Good infrastructure – motorways linking to Austria and Croatia
• One of the best public transports in Europe
• World’s largest film studio being built outside the capital

Cost of living:

• The Mercer Cost of Living Survey rates Hungary as 84.5/100
• Bottle of Water: £0.30
• A meal for two including wine: £25.00
• Average two bed flat is: £55,000
• Average three-bed house: £82,500

What does the future hold?

European accession means that Hungary will benefit from significant EU investment in the coming years. One key measure for continued investment is that Hungarian average salaries reach 75% of the EU average. It is predicted that this will not happen for 11 years. Good news for property investors. Now is the time to invest in Budapest!

For more information on where and how to invest in Hungary contact us .

The Housing Market

• During communism the housing construction was dominated by concrete building. The beautiful classical style buildings from the 19th Century were neglected due to luck of finance.
• The government introduced a new housing policy in 2001, developer activity has been very active since than.
• 6300 dwellings were put in use by 2003 and building permissions have been issued for another 11,800 in the capital Budapest.
• Property prices are rising firmly by 10-15% every year. On new developments you can achieve even better return and there is also profit in renovating old properties.
• Rental yields are 5-8%. The strongest rental market is in the capital Budapest.
• The tenants: 100,000 expatriates, young professionals, thousands of students from all over Europe.
• The interest rates on mortgages are between 5 and 8% depending mainly on the currency you use.
• Hungary is due to join the EURO zone after 2010 when interest rates are likely to drop by half.
• Following EU entry in May 2004, Hungary and especially the capital Budapest is undergoing huge development in terms of building construction, renovation and infrastructure. That is due to the large amount of foreign investment.
• Compared to Vienna, the capital of Austria, which is only 2½ hours drive away; prices are three to four times lower. Not for long though!
• The wages of the local population are slowly but steadily rising, which again will lead to increase in property prices over the next years.

These converging economic factors have not escaped the predominately Irish, German and US foreign investors who were responsible for buying over 1000 properties in Budapest in 2003. contact us on for additional information on property investments in Hungary.

The Capital: Budapest

• The capital of Hungary, Budapest is formed of two parts Buda the hilly and Pest the flat side separated by the Danube. It is divided into 23 districts.
• They were united in 1836 with the construction of the Chain Bridge. Built by William Clarke (English) and Adam Clarke (Scottish) who constructed the Thames Bridge in London. There are now 8 bridges connecting the two districts today.
• Budapest is said to be the “Paris of the East” and in some parts you really have the feeling that the Notre Dam is just around the corner. No surprise though as the city was actually constructed on the basis of Paris.
• Buda is the upmarket area of the city. It has always been a historical centre; this is where the Castle, the Matthias Church and the Fisherman’s Bastion stand. It is a world heritage site and is visited by millions of tourists every year.
• It probably does not come as a surprise that this is where the Hungarian aristocracy has settled and that is reflected in property prices.
• Pest is where all the hard work is done, with most of the government buildings, the Parliament, the Basilica, and the Universities are on that side of the river. However, as they say “work hard, play hard”– most of the restaurants, bars, cafes, nightclubs, and theatres are on this side of the Danube as well.
• Budapest has the oldest underground line in mainland Europe.

Now let’s get down to business:

• Budapest is where 60% of the country’s commercial activity happens.
• 20% of Hungary’s population lives here.
• Budapest is one of the biggest capitals of those that joined the EU in May 2004 and therefore has a role of a regional capital in terms of tourism, education and trade.
• Flying to Budapest takes as long as flying to Rome from the UK. Approximately 2 hours.
• Budapest is where most of the foreign investment concentrates with companies such as: GE, Vodafone and Ericsson
• The property market is performing very strongly, with property prices rising 15–20% each year. Central Budapest property prices start from as low as £40,000
• The rental market is busy and stable making the city ideal for a mid to long–term investment with returns of 6 to 8%.
• 25% of the beautiful classic style, 19th century buildings need renovation
• The best districts to invest are :I, II, III, V, VI, VII, IX and XIII

Why don’t you contact us to find out why?

The Fun bit: shops, entertainment and culture.

• Budapest is a multicultural city being influenced throughout the history by Roman, Turkish, German and Mediterranean culture.
• There are seven main spa regions in the country
• Luckily there are also plenty of wine regions. You might have heard of the world famous Tokaji desert wines.
• Budapest is a vibrant city to live in. You’ll find the following there:

1. 223 museums
2. 90 cinemas
3. 400 Turkish Baths
4. 237 museums
5. 35 theatres
6. Cool nightclubs for the restless some of them opened till 8am
7. Themed restaurants
8. The second biggest Synagogh in the World

• There are music festivals throughout the spring and summer
• Plenty of nice hotels to stay in such as the Four Seasons, Kempinski and Le Meridien
• Good restaurants and bars with a large choice on the menu. Fishlovers beware this is a landlocked country. Cocktail drinkers, welcome to heaven!
• And let us not forget about a very important part of life: SHOPPING
• If you want to feel at home you can shop in M&S or Tesco
• And if you really want to splash out Dior, Prada and Gucci are just a few corners away!!

There is so much more we could tell you if you want to contact us .