Hungary

Several prominent individuals and organizations in Hungary have publicly committed to addressing the housing crisis and promoting affordable, sustainable housing in Budapest and nationally. The Mayor of Budapest, Gergely Karácsony, leads urban efforts with programs like “Home, for Everyone,” built on new municipal housing agencies and the conversion of vacant properties. Key NGOs include the Utcáról Lakásba Egyesület (“From Street to Home”), the Hungarian Charity Service of the Order of Malta, Periféria Policy and Research Center, and Habitat for Humanity Hungary, all championing innovative rental models, financing for vulnerable groups, and reusing vacant spaces. The AHA Budapest consortium unites public utilities, district municipalities, NGOs, and real estate firms for pilot projects in inclusive, energy-efficient social housing.

Potential collaboration partners span sectors. In academia, the Metropolitan Research Institute and Periféria Policy and Research Center produce leading research and pilot studies. Real estate sector actors such as MR Közösségi Lakásalap (MR Community Housing Fund) and public/private housing agencies are key. The startup world is represented by incubators like Startup Hungary, which foster real estate tech and urban innovation. The NGO sector boasts active players such as Habitat for Humanity Hungary, Utcáról Lakásba Egyesület, and charitable foundations that drive social rental and integration schemes. Joining forces with these groups—on research, policy, finance, development, and advocacy—will be vital for scaling affordable and sustainable housing solutions.

Hungary is experiencing a pronounced housing crisis in 2025, characterized by rapid price increases, stagnant supply, and persistent affordability challenges. Since 2015, housing prices across the country have nearly tripled, with Budapest alone seeing annual price growth of 15–19% in early 2025. Homeownership remains high, but only a small share of the population rents at market rates; affordable rental options are notably scarce in Budapest and practically absent elsewhere. Despite a surplus of housing units—with about 572,000 vacant homes nationwide—most vacant dwellings are in poor condition or located in less desirable regions, failing to meet current demand.

New residential construction lags behind need, with annual renewal rates at their lowest level in Europe, and building permit issuance continuing to decrease. Rents have also climbed by nearly 10% year-on-year, intensifying access challenges for new entrants and low-income groups. Investor activity in Budapest is substantial, often outcompeting local residents seeking homes.

The crisis hits specific groups hardest: young adults, first-time buyers, low-income families, and urban residents—especially in the capital—face growing exclusion from affordable homeownership and rentals. Homelessness affects between 30,000 and 60,000 people, while up to 300,000 households live in insecure conditions and tens of thousands risk eviction due to debt. Housing insecurity is particularly acute among those living below the poverty line, with high rates of rent and utility arrears worsening their vulnerability.

Hungary’s housing market in 2025 is marked by rapid price growth, high homeownership, and a limited rental sector. Around 91.6% of people own their homes, while just 4.2% rent at market rates nationwide; Budapest’s rental share is higher, around 17.5%, yet still below European averages. The median price to buy an apartment nationally is about €3,000 per sqm, with central Budapest reaching €3,700 per sqm. Median rents are typically €12–15 per sqm monthly across Hungary, but city center rates in Budapest can exceed €18 per sqm.

Publicly owned housing is marginal, accounting for only about 2.4% of total homes. Local municipalities manage most public housing, yet these units are dwindling and financially constrained; regulations and lack of investment hamper expansion. Public housing refers to municipally managed flats, while social housing targets vulnerable or low-income groups—often overlapping but not identical. In practice, Budapest’s “public” rentals essentially serve social groups, but eligibility and rent controls vary. Overall, social housing’s share remains very limited compared to need, and there is growing interest in renovating vacant municipal buildings for affordable housing.

Thus, Hungary’s housing is overwhelmingly owner-occupied, with soaring prices and rents, and a lagging, underfunded public/social housing sector playing only a minor role.

Hungary’s national government is tackling affordable and sustainable housing with a mix of subsidies, targeted loan programs, and administrative reforms. Recently, a major initiative is the Otthon Start (“Home Start”) program: from September 2025, those aged 18–40 who have not owned property can access up to €127,000 in home loans at a fixed 3% interest rate, with generous price and size caps, and without requiring marriage or children. This runs alongside targeted subsidies such as €3,000 per year for public servants and a broader mortgage scheme capped at 5% APR for younger first-time buyers.

Administratively, new rules now fast-track building permit approvals for large developments aiming to create thousands of affordable homes, overseen by the dedicated Home Start Programme Office. In December 2024, Hungary launched a €511 million Housing Capital Program using the state development bank to massively expand new construction and revitalization through real estate funds.

Another major effort targets sustainability: Hungary’s digital strategy funds smart home technologies and gigabit connectivity, boosting green and energy-efficient housing. Authorities are also restricting new short-term rentals in Budapest to increase long-term rental supply. While converting vacant spaces into affordable housing is seen as promising, systemic scaling is hindered by local regulation and finances—NGOs are advocating for new financial tools and public-private schemes.

No formal quota or binding sector targets have been published; recent measures are time-limited and primarily serve young and middle-income buyers, rather than the most vulnerable.

In Hungary, housing cooperatives are mainly organized as “lakásszövetkezetek” and function as legal entities responsible for managing, maintaining, and sometimes building residential properties for their members. While they provide a democratic framework for resident decision-making and collective action over shared housing assets, their primary role today is the management and upkeep of existing buildings, not the creation of new cooperative housing. The legal basis is set by the 2004 Law on Housing Cooperatives, which defines their functions and rules.

The sector remains marginal in terms of new construction and expansion, with most cooperative housing stock built during socialist times; since the 1990s, development has largely stagnated and there is no notable growth in share or new projects. Recent data do not indicate any meaningful increase in cooperative housing’s proportion of overall housing; there are no recent official figures, but estimates place cooperative units well below 2% of Hungary’s total housing stock. Their influence is dwarfed by the predominance of private homeownership and the market rental sector.

Policy activities mainly focus on modernization, energy efficiency improvements, and maintenance support instead of expanding cooperative ownership. Programs like OTP Bank’s annual grant competition provide financial support for cooperative buildings’ upgrades, favoring sustainability and safety. The national government has not introduced specific strategies or binding quotas to significantly grow cooperative housing, instead prioritizing homeownership incentives and public housing investment over the cooperative model.