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Budapest Property Market Index falls further - extended

  The Budapest Property Market Index, a measure of supply and demand on the market as well as market players’ plans and expectations, dropped eight points from January to -29 in April, László Akar, head of market research company GKI, which prepares the index, said on Tuesday.

The home market index dropped 2 points from January to -46 in April. The survey, of 1,194 companies, including 114 property companies, shows Hungary’s property market has probably bottomed out, but any pick-up in activity is not likely to be felt until 2011, Akar said. The biggest change on the market this year is the drop in plot prices, he added.

GKI expects 27,000-29,000 homes to be built in 2009, but the number of homes put on the market will fall from quarter to quarter. The number of building permits is seen falling at a slower pace because companies planning home constructions in 2011 must apply for permits already this year.

Home prices for homes in condominiums in the capital will remain flat, though prices for homes in communist-era condominiums will fall slightly. Family houses will rise in price.

In eastern Hungary, home prices will drop drastically. Prices will also fall in western Hungary, though at a smaller rate. (MTI-Econews)