Price Growth vs. Yield: When Is It Worth Investing in Budapest?

The real estate market has always been considered one of the safest investment options, especially in times of economic uncertainty. Over the past decade, Budapest’s property market has experienced a significant increase in prices, attracting the attention of many investors. At the same time, however, rental yields have shown a downward trend. So the question arises: when does it truly make sense to invest in the Hungarian capital?

1. Development of Property Prices in Budapest

Over the last ten years, property prices in Budapest have nearly doubled. By the end of 2024, the average price per square meter in the inner districts had reached around 1.2–1.3 million HUF, while in the outer districts prices ranged between 700,000 and 900,000 HUF. Although still more affordable compared to many Western European capitals, these prices represent a significant challenge relative to Hungarian incomes.

2. Rental Yields and Trends

Due to the regulation of short-term rentals and economic uncertainty, rental yields have decreased. While a few years ago gross yields of 7–8% were not uncommon, today most central apartments provide yields of around 4–5%. Nevertheless, long-term demand remains strong, as Budapest is a university city and attracts many foreign students and professionals, creating a stable tenant base.

3. Investment Horizon and Strategy

Whether investing in Budapest is worthwhile largely depends on the planned time horizon.
In the short term, opportunities for rapid value appreciation are limited, as prices are already close to their peak.
In the long term, however, Budapest remains highly attractive, as the city’s economic, cultural, and tourism importance continues to grow, ensuring stable demand.

4. When and Where to Buy?

In the city center (Districts V, VI, VII), investment is recommended due to value stability and premium locations, although yields tend to be lower.
In outer districts (e.g., XIV, XV, XVIII) or emerging neighborhoods, higher yields are achievable, and upcoming infrastructure projects may further increase property values.

Conclusion

In Budapest today, the key question is not whether you can find cheap property, but whether you can strike the right balance between price and yield. In the short run, extraordinary profits are less realistic, but in the long term, the Hungarian capital provides a solid foundation for investors seeking value preservation and continuous demand.

In short: Investing in Budapest makes the most sense when you think long term and carefully choose both the location and the strategy.