Hungary Real Estate Report 2016
BMI View: A positive economic outlook will support the real estate sector in Hungary over the medium term. Demand for high quality space should remain high, particularly in the office and industrial sectors.
New construction activity remains limited, with the majority of space under construction already pre-let.
Consequently, we expect rental growth at the prime end of the market in these two sectors. Retail rents, on the other hand, are likely to remain stable due to the newly introduced legislative changes, which could constrain retailer demand despite rising consumer confidence and spending.
Hungary's economic growth is expected to remain steady over the medium term. GDP growth is forecast to be 2.8% this year and to average at 2.4% per annum over the period 2016-19. Higher exports, falling unemployment, rising incomes and strong consumer spending support this positive outlook. All three markets in the real estate sector are likely to benefit from this improving economic picture and to witness stronger levels of activity in the medium term. Positive market sentiment witnessed this year is expected to be sustained, underpinning occupational and investment activity in the medium term.
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