Budapest is more popular for real estate investment than Vienna or Prague

Lower cost and better ROI from rent

While Budapest property prices are significantly higher than prices in other parts of Hungary, they are still significantly lower than in Vienna or in Prague. As a result, with the same investment, you can buy bigger property that is at a better location. The lower initial capital need increases potential return on investment.

Rental market in Budapest also offers better opportunities than Vienna or Prague. Rental market in Vienna is very stable, but it typically has lower profits. Prague prices have recently increased on a steep curve, which reduced profits somewhat. At the same time, according to analysts, rental yield in Budapest remains competitive in the region.

While the majority of Hungarians own their houses or apartments, there is still a high demand for rentals in Budapest, especially among these groups:

• Students – both Hungarian and international
• Employees of international companies
• Digital nomads and other foreign professionals
• Tourists (where local regulations allow short-term rentals)

Development and future opportunities in Budapest

Urban development is continuous in Budapest. New office buildings and housing complexes are being built at various locations, while projects realised on the bank of the Danube are especially attractive – such as Budapart, the newest quarter being built in District 11. At the same time, local infrastructure (roads, public transport) is also in constant development to make life more convenient for the more than 3 million people living and working in and around Budapest.

While Vienna prices have been close to Western European levels for some time, Prague prices have increased rapidly over the last few years. Budapest prices are still below those levels, which means there is ample potential for growth, especially for the right kind of real estate investment. In the long run, regional differences might equalize, at least partially.

In this sense, the main risks to consider are the following:

• Changes to real estate loans
• Changes to regulations
• Stricter regulation of short-term rentals
• The impact of the economy in general on the real estate landscape
• Currency risk for foreign investors – which can be reduced if rental fees are determined in EUR instead of HUF (the local currency)

Choose Budapest if you are looking for good ROI

To sum up the most popular cities for real estate investment in the region:

• Vienna offers a stable rental market with a lower return on investment
• Prague is getting pricey quickly, which reduces ROI
• Budapest prices are lower compared to the region, with a strong potential for appreciation

As such, Budapest is ideal for investors who are planning their first real estate investment, or who find Vienna prices too high. Additionally, it is an excellent choice for both investors who are interested in good return on their investment, and who are patient enough to wait for long-term value growth.

Real estate investment with Helpers

Helpers has 20+ years of experience supporting foreigners living, working, and doing business in Hungary. This includes help with property purchase too, whether you are looking for an attractive investment opportunity or for a second home for yourself and your family.

Depending on the investment construction you choose, you might even become eligible for Hungarian residency, which grants you visa-free access to the EU and the Schengen zone, making travel more convenient.

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