Frequently Asked Questions
Not only for first time buyers
Selling my flat
How long does it take to sell my apartment?
If your apartment is priced correctly, it can be sold within 1-2 months. If your apartment is on the market for sale for over 3 months, please ask for a second opinion on its real value and correct the price if necessary.
When is the best time to put my flat on the market?
It depends on many factors. There is no exact best time which works for every flat. Springtime is usually a busy season when many buyers are around and so the autumn. However it depends on the parameters of your apartment. If your flat becomes dark from the trees opposite your windows, then start to advertise it in the wintertime when the leaves have fallen off. In case your flat is in a noisy touristy area, put it on the market in a low season.
Can I sell my apartment with tenant?
Yes, you can. I do advise it only if your tenant keeps the apartment in a perfect condition and order, he/she is available most of the time to let us in the apartment for the visits of potential buyers, he/she tells only nice things about the property, the neighbours and the condition of the building and last but not least the rental fee is high enough to make it attractive for an investor.
Can I sell my flat fully furnished?
Yes, you can. Usually it is not a problem at all. In such cases the value of the furnishing is always included in the price of the apartment.
Do I need to renovate the flat before selling?
Usually it does not make sense to spend any penny on the flat once you decided to put it on the market. There are some exceptions when a fresh painting or a little repair work can help a lot to make a better impression and achieve a higher price. I always tell my clients my suggestions after the visit of the property.
Do I have to come to Budapest for the sale?
No, you do not have to come if you can not or do not want to. You can leave a Power of Attorney to your lawyer who will represent you during the complete sales procedure.
How much agency fee do you charge for the sale?
The agency fee is 4% of the sales value.
How do you advertise my property?
I do advertise your property online both for the local market and for the international market. Your apartment will be offered to several local real estate partner agencies to share it within their database. I work together also with property management companies, lawyers and accountants with a clientele of foreign investors. I place “for sale” boards into windows which can attract the attention of pedestrians, place ads on message boards of the certain building, share ads in my Facebook group etc.
Do I receive the sales price in HUF or EUR?
If you give your home EUR account for the receipt of the sales price, then you will receive the price in EUR.
Can I receive the sales price to my foreign bank account?
Yes, you can. No need of having a local bank account.
Do I need to pay tax after the sale of the property?
Yes, you have to pay Capital Gains Tax if you sell the apartment within 5 years from the purchase. After the 5th year, you can sell it taxfree.
What documents do you need for the sale of the apartment?
It is only your passport needed if you sign in person. If not, I will need also an official Power of Attorney. Regarding the apartment, the lot number and the BER certificate is needed. This later one I can arrange for you if you need.
Buying in general
Do I need any permission to buy an apartment in Hungary?
If you are an EU citizen, then you do not need. However if you are coming outside of the EU, then you need a permit to own an apartment in Budapest. The permit of the Government Office is arranged by your lawyer after having signed the purchase contract and paid the deposit. Its costs is around 300 EUR including related legal fees. The Government Office has 60 days to issue or reject the permission. While I have not heard yet any case when this permit was not granted, theoritically it is possible. The ownership of a non-EU citizen can be registered in the Land Registry Office upon the receipt of this permit.
Are you selling freehold apartments?
Yes, all the apartments I am offering are freehold.
The prices are fixed in HUF or EUR?
The prices can be fixed both in HUF and EUR. As the currency in Hungary is the Hungarian Forint, in general all Hungarian sellers wish to fix the HUF price. However the foreign sellers prefer to fix their prices in EUR, in these cases the HUF price depends on the actual exchange rate of currencies.
Do I need a bank account to buy a flat?
No, you do not need to have a Hungarian bank account to buy an apartment in Budapest. You can transfer the purchase price directly to the seller’s account or through a lawyer’s escrow account.
How long does it take to complete the sale?
In case you are an EU citizen – no need of permit – cash buyer and the apartment is vacant, you receive the keys right after the payment of the purchase price. If the apartment is tenanted or you buy with a bank loan, the usual agreement to complete with the purchase is 2-3 months.
Do I have to come to Budapest to purchase a property?
No. If you can not be present at the date of the contract signing, you can give a Power of Attorney to your lawyer to act on your behalf. You can leave a PoA in person while you are in Budapest or you can sign it in the Hungarian Embassy in your country or in front of a public notary. In case of signing at a public notary, the PoA needs to get an apostille to be acceptable by the Hungarian authorities.
How much deposit do I need to pay?
At least 10% deposit has to be paid at the contract signing. We call it also downpayment which means that the buyer looses this deposit if he does not complete with the purchase of the property and the seller has to pay back its double if he breaches the contract.
Can you assist with local bank financing?
Local bank financing is available only for foreign individuals who live and work in Hungary. Banks provide loans only for those who have a local address card, Hungarian tax card and an existing employment contract. If all these documents are available, then I can help with the arrangement of bank financing.
Which districts do you recommend to buy in?
It depends on your property purchase plans. The central Pest (V, VI, VII, VIII, IX, XIII) and Buda (I, II, XI) districts are all very much sought after areas for rental properties.
Can I use my lawyer for the purchase?
You decide of course which lawyer you appoint for the purchase contract, but it has to be a Hungarian lawyer who is member of the Chamber of Lawyers.
Apartment prices include furnishing?
In general the advertised prices include only the built-in furniture like kitchen cupboards with appliances or bathroom fittings, but they do not include any other items. An apartment can be advertised also fully furnished – quite typical by investors – but in this case the ad says clearly that the price includes the complete furnishing.
Can you recommend me an English speaking lawyer?
My husband is a lawyer and works for most of my clients. He is specialized in real estate, inheritance, company law. I am pleased to give you his contact details in any case you need legal help.
Can I use my own lawyer?
Yes, of course. If you have already a lawyer in Hungary, you can use his services for the sale or the purchase of an apartment. Please note that you can not use your lawyer based abroad, the sale and purchase contracts can be prepared only by lawyers registered in the Hungarian Chamber of Lawyers.
Is the purchase and sale agreement in English?
If the lawyer preparing the sale and purchase agreement speaks English, then you can request a bilingual contract. It is quite typical that contracts are in both languages. It is always the Hungarian text though which is legally binding according to the law.
How much are the legal fees?
Legal fees for the sale and purchase contract in general are 1% (+VAT) of the purchase price.
Do I pay the purchase price through an escrow account?
Despite of some countries, in Hungary the payment of the purchase price does not have to go through a lawyer’s escrow account. The buyer can pay directly to the bank account of the seller. The ownership registration of the buyer is filed in to the Land Registry office by the lawyer only upon the receipt of the seller’s confirmation that the full price has been received.
When do I receive the title deed?
The buyer receives the title of the property upon the payment of the complete purchase price and its confirmation of the seller to the lawyer. The registration of the ownership takes up to 60 days in the Land Registry Office. Following that the title deed of the property can be requested any time at the relevant Land Registry Office or can be downloaded online by any lawyer. The Land Registry Office records every ownerships and titles can be proved any time upon request.
Is my ownership registration safe?
Yes, it is absolutely safe. The owernships are registered in the Land Registry Offices and a copy of the title deed can be requested at any time.
Do I need to set up a Hungarian company?
No, you do not need to set up a company to purchase a property in Budapest. You can buy an apartment as a private individual. If your are an EU citizen then without any permit, if you are non-EU citizen, then you need apply for the permit and your ownership will be registered following its receipt.
How can I give a Power of Attorney?
You can give a PoA either in person while you are in Budapest or at the Hungarian Embassy of your country. You can also sign a PoA in front of a public notary abroad but in this case the PoA has to be apostilled to make it acceptable for Hungarian authorities.
Can we have a joint ownership with my wife?
Yes, of course you can have a joint ownership in 50-50% or in any other proportion you wish.
Can I change my ownership to my child’s name?
Yes, you can. According to current laws, you can do it taxfree.
What says the inheritance law in Hungary regarding properties?
Properties will be heritated by your children and your spouse. If you have a spouse and 2 children then each of them will heritate 1/3 proportion of the property.
Taxes and accounting
How much is the purchase tax when I buy a flat?
Purchase tax is 4% of the purchase price after the purchase of apartments, garages, storages and retails units as well.
How much is the capital gains tax when I sell my flat?
CGT is 15% if you sell your apartment the same year or the year after you bought it. If you sell it later, then you get a tax allowance every year. If you sell it in 2nd year after the purchase, then you get 10% discount, in the 3rd year 30%, in the 4th year 60% discount. If you sell it 5 years after the purchase, then you can sell it taxfree.
How much is the annual property tax?
There is not any general property tax in Hungary. However if you own an apartment where you do not live in permanently, then most districts have an annual building tax which you need to pay every year. Its exact amount varies from district to district, but in general you need to think of a cost of 500 EUR/sqm/year. Please enquire and declare your tax obligation at the relevant municipality.
How much is the income tax on the rent?
Income tax is 15%.
Can you offer accounting services?
I can put you in contact with English speaking accountants who have relevant experience of accounting properties of buy-to-let investors.
Where do I have to pay my taxes after my property?
Income tax after your rent has to be paid to the National Tax and Custom Office. Building tax has to be paid to the relevant Municipality. CGT tax is to be paid again to the National Tax and Custom Office. Having a local accountant is highly recommended to have everything being paid on time.
Is taxation different for private and corporate property owners?
Yes, absolutely. Taxfree sale of an apartment after holding it 5 years is available only for private owners.
Do I need an accountant in Hungary?
Can I deduct renovation costs from my tax?
Yes, you can deduct provided you have proper invoices, not only bills about the renovation. A proper invoice has to include your name and address and so the name and address of the service provider.
Can I deduct travel expenses, agent fees from my tax?
Yes, you can deduct all fees related to your apartment if you have proper invoices of these costs. The invoice has to include your name and address and the same of the company or person who issued it.
Leasing an apartment
Can you rent my apartment?
I can connect you with a reliable property management and letting agency who will find you a tenant and take care of your apartment.
How long it takes to rent a flat?
It depends on the season you would like to find a tenant. In August and early September apartments are let within days, this is the peak of the rental market. January can be also busy. In any other time you need to calculate with 4-6 weeks provided your apartment is correctly priced.
How much is the finder’s fee?
In case your apartment is let for a minimum period of 1 year, the finder’s fee is equal to the amount of 1 month rent. If the contract is only for a half year or a semester, the fee is 10% of the total rent. For daily tourist rentals the usual fee is 20-25% of the total rent.
Do I need to furnish my flat?
It depends on your rental market. Students and young professionals seek usually fully furnished apartments and many expats require the same. In case of larger properties it is advisable to leave a room empty or not to furnish the apartment completely to leave the possibility that the tenant will bring some of his own furnishing (usually beds or a sofa and not wardrobes, cupboards or dining table). Naturally you can try to rent your apartment unfurnished but the number of potential tenants here is much lower. Such tenants are usually local couples and families.
Can I have access to my flat if it is rented?
Yes. Most rental agreements include that the owner or his representative has the right to access the apartment once every month at a date and time agreed prior to the visit.
How much is the security deposit?
Security deposit is equal to the amount of 2 months rental fee. It has to be paid at the signing of the rental agreement and it is due to be paid back at the end of the rental term when the tenant is moving out. Cost of repair of any damages caused by the tenant in the property or in the furnishing can be deducted by the landlord from this deposit.
Is the tenant responsible for damages?
Yes, the tenant is responsible for all kind of damages made in the apartment.
Who pays the building charges?
The building charges, called also as common charges are paid always by the tenant. If the apartment is vacant, these charges have to be covered by the owner.
Who pays the insurance?
The apartment has to be insured by its owner and it is the owner who covers the annual insurance fee. The common parts of the building is insured by the Condominium and its fee is included in the monthly common charge which is paid by the tenant if the flat is rented and by the owner if the flat is vacant.
Can I rent my apartment for an office?
Yes, you can rent your apartment also for an office if there are no restrictions in the rules and regulations of the certain building. Usually they are none, but it is better if you check.
Can I rent my flat for tourists?
You can rent your apartment for tourists if you have the agreement of the building residents and you paid for the permission for tourist accomodation to the municipality. To arrange for that you need to contact the building representative and ask him to call together the meeting of residents and ask for their agreement. In many buildings tourist rentals are completely banned. The cost of the permission of the municipalities vary from district to district.
How much do I pay for a property management company?
In general the property management cost is 10% of the monthly rent for long-term rentals. It is 20-25% of the rent in case of tourist rentals.
Can I ask for a weekly cleaning in my apartment?
Yes, of course. It is highly recommended when a tenant is not taking care properly of the apartment. In such cases the tenant can be called upon to pay the cleaning to keep the quality of the apartment.
How much do you think a complete renovation would cost?
A general renovation costs around 500 EUR/sqm including the change of heating, water pipes and electricity wiring, new bathrooms, kitchen, flooring and painting. This figure can go even higher if you need to replace wooden windows or doors with new ones or move walls. You can easily achieve 800 EUR/sqm if you aim to have an exclusive property.
Are property management companies available 24h?
Property management companies are usually available working hours, 9 am to 5 pm on working days.
What happens if the fridge stops working properly?
If the fridge is owned by the landlord and it breaks down by usual wear and tear, then it is the responsibility of th owner to fix it immediately or change it to a new one.
How often is my apartment inspected?
Property management companies intend to inspect their aparments every month.
How can I receive the monthly rental income?
You can ask the rental income transferred to your Hungarian or foreign bank account or you can collect your rental income in cash during your stay in Hungary.
How can I change property management company?
If you wish to change your management company, the current property manager has to hand over to the new manager not only the keys of the apartment, but also the zero papers of utility providers and the same from the building manager proving that all fees and costs have been paid up to date. The existing rental agreement, BER certificate, previous bills, utility contracts, all documents related to the flat have to be passed on.
What is included in the general fee of the property management company?
Inspection of the apartment, collection of rents and post, availability for tenants, payments of landlords, contact with building management and accountant.