The Hungarian capital is experiencing a new real estate boom with numerous office projects, hotels and luxury housing. More than 2 million m2 are currently under construction or are being renovated in the city.
That’s what the “Frankfurter Allgemeine Zeitung” (FAZ) says. According to the German newspaper, the Hungarian construction sector is the most dynamic in the EU, after Ireland and the Netherlands. The climate of confidence and economic barometers in Hungary are now the best in the European Union. More than 2 million m2 are currently under construction or are being renovated in the city.
“In the last five years, we see rapid growth in all real estate sectors. 2019 should also be an excellent year“, explained Ferenc Furulyas, Managing Director of Hungary at Jones Lang LaSalle, the US consulting firm specialising in corporate real estate. With nearly 20% of investments compared
The main driver of this growth is the hotel industry, which has become very profitable thanks to the explosion in tourism. Room prices are now higher than in Prague or Warsaw. Housing construction is also up sharply, with sales prices that have doubled since 2014 to an average of €2500/m2, according to numbers from the Hungarian National Bank (MNB).
The shortage of labour, due, among others, to a very restrictive migration policy, nevertheless poses a problem for construction companies. Moreover, the law passed a few years ago to stop the projects of sales areas of more than 300m2 prevents the construction of shopping centres. Finally, the laws protecting old buildings in the centre of Budapest are holding back investors in the renovation sector.