Considering the changes in rents, the stagnating-decreasing trend of the previous months started to increase again in January: rents rose by 1.7% nationally any by 2.1% in Budapest in one month. Within Budapest, an increase was recorded in each district group. The growth rate of nominal rents already fell below the inflation in a yearly comparison, too, while in real terms rents decreased from August of the previous year.

The increase in rents falls below the inflation in January, too

The unbroken growth of rents beginning in early 2021 turned into a basically stagnating-decreasing trend in the period from September to December 2022. In January 2023, however, supply rents rose again noticeably: by 1.7% nationally and by 2.1% in Budapest, compared to the previous month.

Compared to the same period of the previous year, January rents went up by 20% in Hungary, by 22% in Budapest, and were 75% and 69% higher than in the 2015 base period, respectively.

The nominal rents exceeded the pre-pandemic peak of January 2020 by 21% nationally and 18% in Budapest; in real terms, however, rents kept showing a decreasing trend. Taking the consumer price index into account, real rents in January were 13% lower nationally and 15% lower in Budapest than three years earlier.

In Budapest, rents rose in district groups in one month; the most, by 3.5% in the hilly districts of Buda, but by 2.3% in the inner and outer districts of Pest, and by 1-2% in the other districts of Buda and the transitional districts of Pest.

The corresponding period of the previous year was still exceeded to the largest extent by the rent level of the inner districts of Pest (by 25%), while rents were 20-21% higher in the hilly districts of Buda and the transitional districts of Pest, and 18-19% higher in the outer districts of Pest and the other districts of Buda, compared to a year earlier.

Budapest rent supply remains considerably lower in January than a year earlier

Considering the advertisements taken into account for the first ten months of 2022, 58% were dwellings in the capital city, 27% in towns with county status and 13% in towns without county status. The number of advertisements significantly fell, by 19% compared to the first ten months of 2020 and by 22% compared to the same period of 2021.

In the first month of 2023, 58% of the advertisements observed referred to dwellings in the capital city, 27% to dwellings in towns with county status, and 15% to dwellings in towns without county status. The average floor area of dwellings advertised for rent was 55 m² in Budapest and 58 m² in towns with county status. In the smaller municipalities – non-county towns and villages – the dwellings for rent were generally larger, with an average floor area of 66 m². The rentals with the largest floor area were still advertised in Pest county, with an average of 78 m².

Nationally, the vast majority (91%) of the advertisements observed were for flats in multi-dwelling buildings, with the remaining 7% for detached houses in January 2023. In Budapest, however, only 3.9% of dwellings for rent were detached houses. 44% of advertisements in Budapest and 46% at the national level were from private individuals.

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