Investing in Real Estate: Why is it Worth Investing Now? – Arguments for Real Estate Investment, with a Special Focus on Rental Opportunities

Real estate investment and leasing have always been a popular and secure means of wealth accumulation in the long term. Today, especially in Hungary, the favorable trends in the real estate market encourage many investors to invest in properties. Below, we present why now is the right time to invest in real estate and what opportunities leasing offers, with a special focus on the Hungarian market.

1. Stable and Long-term Returns

One of the main advantages of investing in real estate is its stability and value growth. In recent years, property prices in Budapest have been steadily rising, and this trend is expected to continue in the coming years. Therefore, purchasing a home offers a secure return in the long term, particularly in the capital and other large cities.

The continuous growth of tourism further increases the demand for short-term rentals, allowing investors to achieve higher returns through platforms like Airbnb and other short-term rental services. This is especially true for centrally located, easily accessible properties.

2. Passive Income Through Leasing

Leasing out real estate provides passive income, which can be a stable revenue source over the long term. The steady rise in rental prices in Budapest benefits investors, especially in short-term rentals, where the increasing number of tourists drives up demand.

For those who wish to lease their properties long-term, leasing can be a reliable cash flow source, helping to cover the maintenance costs of the property and even the mortgage payments.

Younger generations increasingly prefer to live in rental apartments, further strengthening demand in the rental market. The proximity of universities and workplaces is particularly attractive to renters, making well-located apartments highly sought after.

3. Favorable Tax Environment and Subsidies

The tax benefits and subsidies provided by the Hungarian government also contribute to the attractiveness of real estate investment. The Family Housing Subsidy (CSOK) and VAT reductions create favorable conditions for those investing in new-build properties.

The maintenance costs of properties are partly deductible from the tax base, which results in additional savings for investors who plan to lease their properties.

The combination of subsidies and tax benefits makes real estate investment in Hungary particularly appealing, as they can significantly reduce initial costs and increase long-term returns.

4. Real Estate as a Value-preserving Investment

Real estate has always been considered a stable, value-preserving investment, especially in times of financial market fluctuations. The real estate market reacts more slowly to economic changes than the stock market, offering long-term security and predictability for investors. It is also an ideal choice from a financial diversification perspective.

During periods of economic uncertainty, real estate is a less risky form of investment, while still offering continuous value growth. The stability of the real estate market and the growing demand for housing, particularly in Budapest and other major cities, ensure long-term value appreciation for investors.

5. Market Outlook in Hungary

The future outlook for the Hungarian real estate market is favorable, especially with the development projects taking place in major cities. New development areas in Budapest, such as the Marina-part, along with properties in central districts, further increase investment opportunities.

The continuous growth in demand, developments, and the interest of foreign investors all contribute to the Hungarian real estate market remaining stable and profitable in the long term.

Demand in the rental market is particularly strong, ensuring high returns for both short-term and long-term leasing. Apartments in major cities with central locations and good transport connections are especially sought after, driving rental prices even higher.

6. Flexibility and Diverse Investment Opportunities

One of the advantages of real estate investment is its flexibility, as investors can choose from a variety of options. Some prefer residential properties, while others invest in commercial or industrial properties, where they can also achieve excellent returns. The diversity of the real estate market ensures that every investor can find the most suitable opportunity for them.

Conclusion

Real estate investment in Hungary currently offers outstanding opportunities in terms of long-term value growth and passive income through leasing. Economic stability, government subsidies, and the continuous growth of the rental market create an excellent investment environment. Real estate offers reliable value preservation in the long term and is ideal for those seeking stable returns and passive income.

Now is the ideal time for investors to take advantage of these opportunities and invest in real estate, especially in urban areas where demand continues to rise and the rental market is flourishing. Kenway’s team is here to help you with this.