Analyst: CSOK will increase home sales, prices

Sustainability

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The number of homes sold in Hungary this year is expected to reach 150,000-155,000, as compared to the previous year’s approximately 135,000, due to the home subsidy purchase program (CSOK) the government is planning to introduce this year, Gábor Soóki-Tóth, head of research at Otthon Centrum, said today.

Soóki-Tóth told a press conference today that, because real estate supply will be unable to keep up with the increasing demand for new and used homes in the short term, prices could increase by 5%-25%. He told the Budapest Business Journal that this demand pressure would probably be a short-term phenomenon, and that home prices should normalize by 2017.

The governmentʼs CSOK program, which is being promoted as a policy to help Hungarian families, provides grants and loans to families who have children, or are planning to have children, so they can buy new homes.

Otthon Centrum said it expects the activities of real estate developers to increase, along with the number of construction projects, due to CSOK and the reduction, to 5%, VAT on construction projects. Furthermore, Otthon Centrum expects that projects that were suspended or halted earlier could be revived.

Soóki-Tóth said that homes purchased with the CSOK subsidy will most likely be found in Budapest and surrounding areas were the cost of homes is lower, as well as country-side settlements, especially in the area of industrialized cities.

According to the analyst, people are expected to be careful when applying for the HUF 10 million subsidy, especially when applying for the additional HUF 10 mln loan. “As experience of the crisis is still close, those who went through losing their homes or saw close acquaintances go through such hardships will be careful,” Soóki-Tóth told the BBJ.

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