Duna House : Publication of the Duna House Barometer

DUNA HOUSE

BAROMETER

The latest property market info from Duna House network

Issue 139

January 2023

www.dh.hu

PRIVACY POLICY

Statistical information and estimates published in the Duna House Barometer are the intellectual property of Duna House Franchise Ltd. Statistical information and estimates presented in the Duna House Barometer are for infor-mation purposes only, for the complexity and accuracy of which Duna House Holding does not take responsibility.

Statistical information and estimates published in the Duna House Barometer can be used for individual purposes and responsibility by any person with reference to the following conditions:

•  Statistical information and estimates published in the Duna House Barometer must remain unchanged when presented.

•  Statistical information and estimates presented in the Duna House Barometer must be published only with exact source indication: words "Source: Duna House Barometer" must be indicated right prior or following the text. If in context, it must directly refer to Duna House Barometer as source.

Any use other than the above will imply legal juridical measures. Duna House is entitled to claim the termination of misuse and refund of the entire damage caused. In case of breaching regulations of link posting Duna House is enti-tled to instantly remove the link pointing to the webpage and claim the refund of its damages.

FORTHCOMING ISSUES

DATE OF ISSUE	CONTENT
12.06.2023	May 2023 data
12.07.2023	Q2 2023 data (including price indices and housing loan data)
14.08.2023	July 2023 data

Duna House Barometer is available from the 12th day of each month (forthcoming weekday if weekend) on the webpage: www.dh.hu/barometer

If you wish to receive Duna House Real Estate Barometer or download previous issues visit our webpage: www.dh.hu

GENERAL INFORMATION CONSERNING THE CONTENT OF THE PRESENT PUBLICATION

Attention! The present publication must not serve as grounds for estimating, or making conclusions in relation of Duna House business profitability.

All data, information, estimates and professional statements presented in the publication are developed based on data gained from the activities of Duna House Holding members, or in some cases are based on subjective experience. Application of those for the entire Hungarian property market may require additional corrections.

Data sources - unless indicated differently at the given section - derive from the database operated by Duna House Holding, the content of which is compiled by members of the network upon their individual judgement and information gained from clients. The operator does not take responsibility for the comprehensiveness of the data. Data presented in the present publication is mainly based on parameters of property transactions in major Hungarian cities given by Duna House branch offices and agents.

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JANUARY 2022 | DUNA HOUSE BAROMETER

CONTENT:

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10.

11.

12.

Privacy Policy, Forthcoming issues

Executive Summary

Transaction data

Transaction parameters in Budapest Transaction parameters in the country Sales data, prices, bargaining

Demand Index, Demand for individual districts Quality preferences, Turnover speed

Client profile: buyers

Client profile: sellers

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EXECUTIVE SUMMARY

HOUSING MARKET TOOK A SPRING BREAK IN APRIL

April brought a temporary slowdown in the domestic real estate market, with 1000 fewer transactions in the segment compared to the previous month. Based on Duna House's proprietary data, the estimate of 6787 sales nationwide is still down 37% year-on-year and 13% weaker than March, this year's strongest month so far. However, activity in the mortgage market continued to pick up, with domestic data from Credipass, the group's international financial brand for the month of April showing an estimated volume of HUF 42 billion, up 6% on the previous month's estimate, but down a significant 71% on the April 2022 figure published by MNB, the National Bank of Hungary. In the real estate market, the holiday and spring slowdown is expected to be temporary and not unusual based on the analysis of longer-term housing market trends, so our real estate experts expect a renewed upward trend in May, while financial analysts also forecast increased activity for the second quarter.

Although the real estate market closed the month with a lower number of transactions than in March, the segment did not perform worse in terms of potential buyers, with April's demand index stood at 69 points, one point higher than in the previous month. However, there is still a significant lag compared to previous years, but even so, this April still saw better performance than the extraordinary drop seen in the year of the pandemic.

Compared to previous months, there has been a significant shift in interest for the capital's districts, as shown by a survey of Duna House clients. District 13 tops the list, while the popular inner-city districts of Terézváros (District

1. and Erzsébetváros (District 7) were squeezed from the podium. Újbuda (District 11) was the second most sought-after district among potential buyers, followed by District 2.

April was also a turbulent month as far as changes in the price per sq. m. were concerned, as the price decrease now affected the brick and mortar properties on the Buda side and in downtown Pest, too, with the average price per sq. m. falling below HUF 1 million in these areas based on last month's sales data. The change in the asking price was 4% for this property type in the whole of the capital, with owners also willing to lower the selling price by 5% during the bargaining process. In the country, the bargaining margin was 6%.

Compared to the same period last year, there was a slight increase in the average price per sq. m. of flats in the country and in Buda, but prices in the concrete block housing estates of Pest decreased. In the capital, owners of concrete block units in Buda and Pest reduced their prices by an average of 5% and 4% in the advertising phase, respectively. The overall bargaining margin in the capital and in the country was 3-5% and 8%, respectively.

In terms of buyer motivation, investment purchases were the most common in the country, similarly to the capital, but first-time buyers also had a sizeable share of 22-27% nationwide. Real estate investors spent an average of HUF 55.6 million in the capital and HUF 34.2 million in the country, while young people in the country spent HUF 30.9 million on their first home, compared to HUF 39 million in Budapest.

According to the data on property sales in April, homes in a good condition were the most sought-after both in the capital and in the country, but in the Eastern part of the country, a majority of buyers (32%) opted for properties in a very good condition. Overall, the propensity to renovate ranged from 6-12%.

Further information:	Duna House Holding Nyrt.
Benedikt Károly • Head of PR and analysis	1016 Budapest Gellérthegy str. 17.
[phone]	[phone]
[e-mail]	www.dh.hu

THREE INTERESTING FACTS:

• In Buda and in Downtown Budapest the average sq. m. price of brick and mortar properties sunk below HUF 1million.
• In April, the property market closed the month with exactly 1000 fewer transactions than in March.
• Újbuda and District 2 replaced the downtown districts in first place of the popularity ranking.

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JANUARY 2022 | DUNA HOUSE BAROMETER

TRANSACTION DATA

DUNA HOUSE TRANSACTION NUMBER ESTIMATE (DH-TE)

Duna House presents its monthly Transaction Number Estimate (DH-TE) and Mortgage Forecast below, showing that 6787 residential property transactions were concluded in April 2023 and residential mortgage contracts worth HUF 42 billion were signed in the whole of Hungary.

	Duna House transaction number estimate
	(DH-TE)
180 000	17 500
160 000
140 000	15 000
120 000
	12 500

1. 000

1. 000

				10 000
60 000
			5853
40 000				7 500
20 000				6 787
0				5 000
*Duna House transaction number estimate	HCSO annual data	2023	2022	2021

In April 2023, the Easter and spring holiday seasons caused a temporary slowdown in the domestic real estate market, resulting in 1000 fewer transactions in the month compared to March. Based on Duna House's own data, the estimate is 6787 purchase transactions nationwide, still down 37% year-on-year and 13% weaker than March, this year's strongest month so far. This holiday/spring decline is expected to be temporary and is not unusual when looking at longer-term housing market trends, so our experts expect May to bring a return to growth.

The mortgage market is also showing further signs of recovery, with an estimated volume of HUF 42 billion in the month of April, based on domestic data from Credipass, the financial brand of the Duna House Group, which translates into a 6% increase compared to the previous month's estimate, but still a significant, 71% decrease from April last year, based on factual data published by MNB, the National Bank of Hungary. Similarly to the housing market, experts forecast increased Q2 activity for the mortgage market, too.

THE TABLE BELOW SHOWS MONTHLY TRANSACTION VOLUME ESTIMATES OF DUNA HOUSE.

	JANUARY	FEBRUARY	MARCH	APRIL	MAY	JUNE	JULY	AUGUST	SEPTEMBER	OCTOBER	NOVEMBER	DECEMBER
2020	9917	13,117	11,100	5971	8400	11,186	13,125	11,923	12,708	12,200	11,369	10,354
2021	11,185	14,569	15,630	13,511	14,198	13,615	11,185	11,304	11,807	11,526	11,022	11,422
2022	10,815	13,793	14,548	11,911	12,519	10,859	8,978	9,748	9,200	8,326	8,000	6474
2023	5853	6253	7787	6787

Methodology behind DH-TE: Regardless of the time of year, the most important indicator of the real estate market is the annual number of sale transactions. The DH-TE figure is an estimate published by Duna House and it reflects interim approximate data. The estimate is based on the number of monthly property transactions brokered by Duna House and the estimated market share of Duna House. The estimate of the current monthly market share of Duna House is based on the following indicators: 1. Data published by the Hungarian Central Statistical Office on transactions among private individuals. Since the Statistical Office publishes data with several months' delay, market share can be adjusted retroactively which also results in a more accurate estimate as well. Please note: After 2016 and as a consequence of the boom in newly-built apartments, pre-contracted purchase transactions appear in the statistics of the Statistical Office with a delay of several months or even one or two years, after the capital transfer tax has been levied, which results in anomalies in the statistics. 2. The number of Energy Certificates issued; 3. Subjective assessment based on other management information from Duna House Holding.

Please also note that DH-TE data cannot be used for defining the volume of transactions brokered by Duna House, or for estimating the business profit of Duna House Holding or for the drawing of any related conclusions.

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