What Premium Property can we buy in Budapest in 2021
The price per square meter of luxury properties in Budapest has long exceeded the HUF 1 million, today the price of HUF 2 million is only average. However, the top segment of the luxury category has already passed the HUF three million mark per square meter.
Of course, for this the limited supply was also required a, since there is no oversupply of top-class apartments in Budapest.
The demand has also changed a lot in recent times, the unpredictable epidemic situation and the increasingly widespread home office have resulted in wealthy buyers not only buying luxury properties for investment purposes, but also looking for homes where they themselves would like to live even for a longer period of time.
What properties are considered luxury in Budapest?
Location of luxury properties
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Location is still one of the most important aspects in the market of luxury apartments and houses, the rich definitely want to buy property in an area that they like.
In Budapest, the 2nd and 12th districts are still considered the most popular due to the panorama of the mountain side, but in addition to the Buda mountains, some streets in the city center also hold their own in the competition for luxury.
Floor area
Among the villas in Buda, mainly those properties built at the beginning of the century with a landscaped garden, which have at least 4-5 bedrooms, 3-4 bathrooms and a living room of at least 100 square meters, while in the city center the meticulously renovated, around 150 square meters, bright apartments with large terraces are the most sought after.
Design and equipment of luxury apartments
There is no limit to the customer’s needs, the better it competes with Western European and overseas standards, the more likely the property will find a buyer.
Although real estate offered at a price of around HUF 400,000 per square meter is often described as luxury here, by Western standards they can be called at most average, not luxury in any way.
Today, it is simply impossible to get the highest quality out of all this, and of course the discerning eye notices this immediately.
At the same time, a really well-renovated or converted villa can easily fetch up to one billion.
Completely unique design and interior design are a basic requirement both in Buda and in the city center, but the most modern heating and security systems, as well as smart home solutions, are also becoming more and more popular.
In the case of luxury villas, you can expect a heated sidewalk and driveway, a sauna, a gym, a fireplace, a central vacuum system, a large pool, and even a cinema room over 100 square meters.
It is also preferable if the garage can fit at least 5-6 cars and the garden also has a summer kitchen and an area suitable for receptions.
Premium-level mechanization must definitely be part of the luxury equipment, but there is an increasing demand for the use of well-recognized individual brands in the field of coverings, lighting and other accessories as well.
The extent to which the house or apartment can be converted still plays a big role in the selection, but even now the overall picture and the first impression are decisive.
Why does the price of luxury apartments increase more efficiently?
While the 2nd and 12th districts were clearly the most expensive neighborhoods ten years ago, the upswing in the housing market in recent years has somewhat redrawn the field.
The historic city center also caught up with the mountains in terms of price level, but if we look at the properties with roof gardens overlooking the Danube, it also surpassed the aforementioned competitors in Buda.
There are more and more luxury investments in the 6th and 7th arrondissements, which foreign investors like to buy, considering the long-term rental yield and price increase.
The prices are mostly driven by the still scarce supply, but the loss of good plots of land and, of course, the continuous increase in construction costs also play a huge role.
Last but not least, the fees of contractors working with the most expensive materials and technologies are also rising, which also results in a noticeable price increase every quarter.
Who buys luxury real estate?
According to experts, most of the buyers of premium-category real estate in Budapest are not foreign investors, but Hungarians who have settled abroad.
On the one hand, real estate investment always has promising returns, and on the other hand, interest rates on mortgage loans are constantly falling.
Many of them are buying for housing purposes, but building a rental housing portfolio is also an important goal for them.
Among foreigners, mainly Russian buyers dominate, but if the supply increases and we catch up with the standards of developed countries, Budapest will surely become an important destination for Western investors as well.
It seems to be a universal statement that luxury apartments and villas are always a good investment. If you think so too, feel free to contact the Kenway Real Estate colleagues to help you find the perfect one.