Hungary’s Real Estate Agency Market Holds Strong
October 20th, 2016
As the real estate market is reviving, so is the agency sector linked to it. By investing the equivalent of the price of an apartment, up to two to three such offices can be opened.
In 2015, 135,000 properties were sold and bought in Hungary, a 20 percent increase compared to the previous year, and this year property market promises to be even busier. Dr Márta Szabó, head of business and network development at OTP Ingatlanpont was asked about her opinion on what is obvious about the lucrative nature of the profession, and how easy it can be to get started: “Entrepreneurship, some financial reserves and a wide personal network should encourage anyone to open a real estate agency of their own,” she notes. “It is a misconception that setting up such a business is more costly than a short-term property investment. By investing the equivalent of the price of an apartment, you can open up to two to three offices.” Experience shows that such a firm can be up and running from scratch in just one or two months.
Several actors drawn back to real estate industry
According to data from the Central Statistical Office (KSH), this is a typical SME-sector. Some 95% of the about 30,000 active companies in the sector fall into the small- and middle-sized category and 60,000 people are employed by those firms. As the expert explains after the recession hit, a process of consolidation took place, which resulted in the strengthening of those networks with stable backgrounds providing integrated real estate agency and financing services. “The price explosion of the past one-to-two years, the revival of the property market and the apartment building boom drew many back to the industry” - she explains. Numerous people are capitalizing on the steep upward trends, from real estate developers, contractors to attorneys, and, of course, real estate agents themselves.
Real estate agency can be a competitive solution for investments purposes. Although, it requires active day-to-day work for profit, contrary to the classical investment forms – especially now with current yields – greater profit can be achieved. In certain regions, for instance, property transaction is drastically increasing in the inner districts of the capital, Budapest, and in the surroundings of the Lake Balaton – here when opening an real estate agency – success is by all means guaranteed.
Competition is fierce, though. According to KSH (Central Statistics Office) figures, six out of ten newly established real estate offices fail within two years of their foundation; therefore, it makes a huge difference to be part of a professional network. Clients and employees clearly show more trust toward a stable market player.