Affordable rentals, 3 June
Rental prices have also been reduced by the coronavirus – they eased the most here
Although it is too early to quantify the effects of the coronavirus epidemic on the economy, it is already clear that it will have a drastic impact on tourism and hospitality. The Budapest apartment market reacted almost immediately, in the two weeks since the epidemic appeared in Hungary – the first infection was registered – the number of apartments for rent in the capital has risen by more than 4 percent to over 10,000, which affects prices.
Former players in the apartment market are former apartment hotels
Evaluating the data, László Balogh, the leading economic expert of ingatlan.com, said:
“The offer mainly includes apartments that previously operated as apartment hotels, ie for short-term rent (typically to foreign tourists)”.
Due to the pandemic situation, fewer people are expected to come from abroad. The flats, which are the engine of supply expansion, are mainly located in the inner districts of Budapest ”. The expert added: “There are still more than 10,000 apartments in the capital in typically good condition in the capital on the market of short-term rental hotels.” Some of these can be sold or offered for rent in the longer term by their owners.
Expanding offer, falling prices due to the pressure caused by the coronavirus
The sudden expansion of offers also left its mark on prices, with the V, VI., VII. and VIII. district, average prices fell by 1 to 4 percent in two weeks.
In district V, the rent decreased to HUF 220,000, in District VII. and 150 thousand forints in the district. At the same time, rents in the capital as a whole have not changed: the monthly average is still HUF 165,000.
“Even though the declines in the districts in question are a decrease in rents, that is significant. The effect of the epidemic on prices is shown even more spectacularly by the significant increase in the number of flats rentable in the capital for less than HUF 100,000 per month, ”László Balogh emphasized a significant new market change.In other big cities, such as the university city market, no outstanding changes similar to those in Budapest can be seen.
The offer has expanded by barely 1 per cent and there has been no significant shift in prices over the past two weeks. This can also be explained mainly by the fact that the number of apartment hotels in large cities was much lower than in the capital.
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