Property 29 August 2024, 10:50am

Demand cannot keep up with surge in flats for rent in Hungary

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The supply and demand sides of the Hungarian rental market have moved in completely different directions this season, according to the latest analysis by property portal ingatlan.com, which looked at the current situation of the rental market in the wake of the announcement of the results of the second round of college admission exams at the end of August.

Supply has increased significantly in the last four weeks on the Hungarian rental market, with more than 16,000 properties currently available for rent. Based on the current supply, there are 17% more apartments for rent on the market compared to a year ago, and 13% more compared to a month ago, said László Balogh, chief economist at ingatlan.com. According to the expert, the expansion is due to three things:

Firstly, landlords try to post their flats for rent on real estate advertising portals during the season, as this is the quickest and most efficient way to find tenants.
Secondly, this is the anniversary of many leases, when tenants look around to see if there are nicer, better or cheaper apartments for rent on offer. And where they move out, those apartments are put back into supply.
What is new this season is that the increase in supply has not been matched by a growth in demand, partly due to high rents. Indeed, many students played the waiting game in August, as they could save hundreds of thousands of forints by waiting a month. In the first four weeks of August, the portal recorded 130,000 telephone enquiries for apartments for rent, which is 30% more than in June, but 20% less than in the same period last year. Demand has therefore been unable to absorb the increased supply from the market.

The KSH-ingatlan.com July rent index showed a 10.2% year-on-year increase in the market, which benefited landlords but not tenants.

"However, the significant increase in supply in recent weeks has already benefited tenants. Not only because they have more apartments to choose from, but also because the competitive situation on the landlord side has meant that the surge in prices seen in the middle of the rental season has been absent this year," the expert said.

This is the average rent, demand may be on the rise

At the end of August, there were nearly 10,000 apartments for rent on the market in Budapest, with an average rent of HUF 250,000. Among the districts with the highest supply, tenants in the 11th and 13th districts can expect an average rent of HUF 250,000 each. Among the cheapest districts are the 15th, 20th, 21st, and 23rd, where the average rent is below HUF 200,000, between HUF 170,000 and HUF 185,000.

Debrecen is still the most expensive university town, with an average rent of HUF 230,000. In Győr, the corresponding figure is HUF 190,000 per month. In Szeged and Pécs, the average is HUF 150,000. In Veszprém it is 160,000 and in Kecskemét HUF 145,000. In Miskolc, owners offer apartments for rent for HUF 110,000 on average.

According to László Balogh, the announcement of the results of the second round of college/university admissions on 29 August, and students entering the market who have been putting off their decision to rent will lead to a stronger demand for apartments for rent in the next two weeks.