Why invest in Budapest?

Investing in Budapest, with its stable political system, stable economy, well established legal system and property prices significantly below other major EU capitals offers a far greater potential return.

Why should the Budapest market appreciate?

• EU membership and future EURO entry.
• Average salaries are rising.
• Limited growth in supply of real estate in central districts.
• Low prices compared to other major EU capitals including Central European capitals.

Over the last 20 years the Hungarian state has created the legal and economic environment to meet the requirements of foreign investors. EU accession in 2004 further removed barriers to competition and has given foreign investors the same legal and financial conditions they are accustomed to in many of their own countries.

Budapest possesses the largest concentration of “aristocratic” architecture in Europe. Large numbers of foreign workers come to Budapest to work for multinational corporations. There are many embassies and transnational organisations located in the heart of our key investment area, District V, which means there is a large supply of discerning tenants living and working in the area.

There is a vibrant cultural scene with a splendid opera house, numerous theatres, concert halls and music and dance academies. New cafes, bars and restaurants are opening daily to restore Budapest’s reputation of being the Paris of the East.

Budapest, after decades of neglect is fast becoming one of the most beautiful cities in Europe again. There has been and continues to be extensive renovation of the older buildings; parks and public areas have been attractively re-landscaped; the selection of Five Star hotels is amongst the best in Europe; it has excellent road, rail and air communications with two new terminals at Ferihegy airport; it is adding new lines to an already first class underground rail system. In addition it has the Danube and its promenades.

New agencies continue to move into Budapest such as (the EU Science and Technology Institute & United Nations High Commission for Refugees) and BP is now locating it’s European service centre In Budapest. Many of the world’s films are now filmed on location in Budapest and at the Korda studios just outside the city which is the largest film studio outside Hollywood.

The value attaching to the properties in the portfolio is approximately €2,800 per square metre. This is very much less than other European capital cities and if we compare property prices in Budapest to similar Accession State capitals, there is considerable upside potential. For example the ratio of the price per square metre of property in Hungary to the GDP per capita is 20 per cent which appears inexpensive compared to the average for Accession States of 29 per cent. This suggests a possible upside of 44 per cent.

In the publication of their Global House Price Index for the first quarter 2009, Knight Frank show that year on year, house prices in Hungary rose by 2.5%, putting them in the top quartile of all countries surveyed.