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Govʼt support could boost home construction market 20%

The governmentʼs new home creation and renovation support measures could boost the home construction market by up to 20% and home renovation projects in the coming two years by 50%, according to joint research by economic research company GKI and construction parts manufacturer Masterplast, reports.

The reintroduction of the preferential 5% VAT rate on new home construction from January 2021 is expected to give new momentum to home building companies and ease the projected decline in housing construction.

Having upgraded its earlier forecast, GKI now expects 15,000-17,000 homes to be completed next year and 18,000-20,000 in 2022 compared to 12,000-14,000 in 2021 and 15,000-17,000 in 2022 as earlier forecast.

The new home renovation program is also expected to have a significant impact as the combined amount of the subsidy and the contribution of the household can reach HUF 6 million.

Families are expected to take out a loan for the latter in half-to-two-thirds of the cases, according to banking sources. GKI expects up to 120,000-150,000 families to avail themselves of this subsidy in 2021 and in 2022.