Traveling around the countryside in Hungary you will often see “ELADO” signs which indicate a property if for sale. Usually you will see a run down property if you are really in a rural area outside a village.
The rural real estate market in Hungary is depressed. There has been little growth in unit movement for years. If you are looking for property in Hungary it might be tempting to think that the depressed real estate market is a fiscal windfall. But in reality, you may be wrong in that thinking.
Rural Hungary is poor. Making $500 a month take home salary is still considered a good income even now in 2014. One way that Hungarians make ends meet is they usually own their home or apartment which eliminates the expense of monthly rent or mortgage payments. And yet, for one reason or another, be it from inheritance from complex family structures or other reasons, Hungarians that do own property for sale often have more than one property.
What does this mean for the buyer?
For one thing, it means the seller is not always in too much a hurry to sell. One property on our street had an “Elado” sign up for a decade. The property was priced above market value. The owner died with that “Elado” sign up.
And for another, once a seller knows you are not a Hungarian, expect the price to go up at least 40% (and probably more). And they will quote a price that is pretty fixed and may refuse to budge despite being over market value. Negotiations are often futile. Even if you can negotiate a lower price, given the fact that foreigners are charged more to begin with, you will still probably over pay the market value in all cases. Being from “out of town” and thus overcharged is not a Hungarian novelty as Mr Blandings discovered (great to listen to it all, but skip to minute 10:15 for “standard top gouge price to city slickers”).
And even fairly intact houses will need some renovation in the not too distant future. Little money, it seems, is spent here in maintaining houses that are for sale. So a new “old home” owner should always assume there will be some unseen issues in the walls, or under those many layers of paint, that you will have to deal with in a few years or sooner.
And of course you are buying in Hungary, which has all the Hungaricums that come with living or owning a house here. Do not assume simply because Hungary is in the EU that it necessary plays by EU standards. Simply because Hungary shares a boarder with Austria, it would be fallacious to assume that it has Austrian or Western ways of thinking and ways of doing business. It is Hungary. It is different. It is a unique culture in Europe.