Hungarian Property Stops Selling – Savills Close Budapest Office

Up-market estate agency Savills has closed its office in Budapest, Hungary, because the property market in Hungary has come to a complete standstill.

The office was only opened in 2006 to take advantage of German and Irish property investors buying property in the region. However, sales levels have plummeted this year.

Statistics compiled by Hungary’s National Statistics Office reveal that just 500 homes in Hungary were sold to foreigners between January and November of this year, compared to around 5,000 residential units for the whole of 2007. Hungary, like many other emerging markets, was solely reliant on outside investors, and with the financial crisis biting, the UK and much of western Europe already in recession, prices are plummeting and many investors during the boom years are taking what ever prices they can get. Many properties are back on the sluggish market at as much as 60% reductions from 2007 prices.

Lack of domestic demand is exacrebating the problem, and Hungary’s property market will continue to slide for the foreseeable future.