Property prices in Budapest are expected to rise this Summer
In the first half of this year market can be dominated by tenants, however, starting from Summer rental prices can rise again which can be further boosted by the growing use of coronavirus vaccines and the reappearance of tourism – writes Rentingo.com in their 2021 forecast on rental prices in the capital.
Meanwhile, standard demand prices are still extremely low; the market has shown positive changes in December. The fact that in the case of newly promoted apartments owners are again asking for two months of deposit instead of just one is also a sign of a healthier functioning of the market and an ongoing increase in the future – writes vilaggazdasag.hu.Â
In 2021 the rental housing market in Budapest will still be influenced by the economic impacts of Covid.
Rentingo.com, in their forecast on the market’s tendencies, says that the recovery process from the pandemic will bring drastic changes similar to those caused by the outbreak of the virus since the complex economic impacts related to the coronavirus influence both supply and demand equally. This will all lead to a change on the market towards the beginning of Summer, prices can go up and the situation can slowly turn back around towards a level experienced before the virus.
Based on the forecast of the public sublease website, the number of newly delivered properties will constantly increase, which will not cause the decrease in rental prices. This is since the increase of properties will happen in a market segment where rental prices are typically higher than the average.
Nevertheless, starting from Summer, a positive correction can be expected where reborn tourism thanks to vaccination can act as a catalyst.
If subletting on a short term will not be blocked or simply made harder by rules, thousands of properties can come back to being operated as Airbnb apartments. Thus it will increase prices of properties for rent on a long term in the capital. Conditions on the demand side are expected to improve with the lifting of restrictions and the increasing number of those who will be protected against the virus, which can also contribute to this increase in prices.
Consequently, this will lead to the extension of job opportunities in those sectors of the economy that has been in a sleep-mode, where with the rise in salaries, the buying power will be stronger. Life at universities is expected to get back on track next Autumn, which will further support the increase in prices as students from inside and outside of the country will boost demand.
90% of tenants asked for a deposit on two months of rent already back in December, which happened, for the last time, back at the beginning of 2020 with the appearance of the virus. This can be the first sign of the expected turn in prices.
Based on the website’s data on December, price level is still at an extreme low. However, tenants are not decreasing rental prices any further.
Most of them are trying to adapt to the current market situation by providing the possibility to pay the second month’s deposit in instalments, apart from being open to negotiation by renting their property below the promoted price, which is more or less a 10% difference between the advertised and the actual price.
Source: vilaggazdasag.hu